Exclusive Interview with Old Pal Co-Founder Jason Osni and CFO Joe Franciskovich
Old Pal is a top-selling cannabis brand in the Nevada and California markets, and the company is continuing to grow through its licensing model. Jason Osni, one of the co-founders of the company, and CFO Joe Franciskovich spoke to New Cannabis Ventures about how this model has facilitated the rapid expansion of the lifestyle brand and the importance of maintaining company culture. The audio of the entire conversation is available at the end of this written summary.
The Team Behind Old Pal
Franciskovich started his career in the military–he spent five years on active duty, developing products for the Air Force. After that, business school led him to investment banking and then private equity. He spent a decade managing a portfolio for a large private equity firm. When working as Deputy CFO for Ticketmaster, he decided he was interested in a position that would offer more day-to-day operational responsibility. Franciskovich met Osni and fellow co-founder Rusty Wilenkin and made the move into the cannabis industry.
Prior to the cannabis business, Osni practiced as a lawyer in New York. On vacation in California, he observed a disconnect between the products on dispensary shelves and the consumers in those dispensaries–effective branding was missing. He moved to California shortly afterward and began his first company NATIV, which was sold approximately three years ago. He went on to do consulting for Caliva before he and Wilenkin started Old Pal.
Osni first met his co-founder while he was at NATIV and Wilenkin was at Kiva Confections. The pair decided they wanted to be the first to brand the value shelf in cannabis and launched Old Pal.
The leadership team has grown to include others like COO Charlie Cangialosi and CMO Allison Pankow. Cangialosi, another alumnus of Kiva, has been vital to building out Old Pal’s infrastructure. Pankow joined the company about a year ago, bringing experience from marketing and advertising company Anomaly and MedMen.
Nevada, California, and the Pacific Northwest
Old Pal top-selling flower products are in 25 to 30 stores in Nevada–the market has a total of 65 to 70 stores, according to Osni. Over the next couple of months, the company is aiming to increase its footprint to about 80 percent of the market. In Nevada, Old Pal has partnered with Flower One as its cannabis supplier.
The Old Pal team, like many other companies in the business, views California as a springboard for national success. The company has both flower and vape products in this market. With a focus on value products (not necessarily the lowest price yet still accessible to consumers), Franciskovich does not see many competitors, though that will change over time.
The company is also expanding into the Pacific Northwest via a new partnership with cannabis company Artizen in the state of Washington. Artizen is a strong fit for the kind of co-manufacturers Old Pal seeks to partner with, and the company is currently building its supply chain in the region. The Pacific Northwest will become an exciting market for Old Pal in Q2 and Q3 of next year, according to Osni.
Organic Expansion
Old Pal takes a conscious approach to expansion, looking at markets that are ready for a scalable CPG brand. At the moment, Michigan, Illinois, Massachusetts, and Florida are the most exciting possibilities for the company. While acquisitions that take the company into a new market or product segment may be of interest at some point, Old Pal is primarily focused on organic expansion today.
Company Culture and Vision
Beyond the goal of becoming a profitable company, Old Pal’s vision is focused on providing a shareable cannabis product to as many people as possible. That “why” is a big part of what drive’s the company’s culture, according to Franciskovich. Rather than trying to win in multiple parts of the supply chain, the company is hyper-focused on its flower and vape products and building the Old Pal brand.
As the company grows, its leadership team wants to ensure that its people don’t lose sight of that vision, a common downside of rapid expansion. The company is targeting quality, consistent products with a value price. The brand is intended to be within 10 percent of the best-priced products on the shelves, with the long-term goal of setting the price for value products, according to Franciskovich.
Old Pal Provisions
Strict regulations around cannabis marketing limit the ways companies can communicate their brand vision to consumers. So, Old Pal has taken a creative approach to building a relationship with their customers. The company launched Old Pal Provisions, a lifestyle brand focused on home goods and clothing. This brand can be marketed using traditional methods, in turn funneling consumers to the Old Pal cannabis brand.
Fundraising
Old Pal’s team comes with a strong investor network, which has largely funded the company up until this point. Over the summer, the company did an institutional round of fundraising with Gotham Green. Now, Old Pal is preparing for its Series A, expected to launch in Q1. The company has been successful in the private markets, and there is no interest in pursuing the public markets for the time being, according to Osni.
Brand Growth
Old Pal is managing approximately 3,000 pounds of cannabis per month across all of its private-label suppliers. The company has more than tripled its revenue year-over-year from 2018.
While Old Pal faces the same challenges related to the shifting regulatory structure as all cannabis companies, its low cash requirements allow it to remain nimble. Industry maturation will likely remove some of the challenges of today, such as banking, but Old Pal is remaining disciplined in an effort to successfully navigate the industry’s growing pains.
To learn more, visit the Old Pal website. Listen to the entire interview:
