Today we had a fascinating talk with Nidhi Lucky Handa, who is the founder and CEO of the cannabis brand Leune, based in California. She started her company in 2018, quickly securing seed capital from celebrity investors including John Wall, Rich Paul, and Carmelo and LaLa Anthony.
We began by talking about why Handa founded Leune, which proved an immediate success.
A Gap in a Divided Market
Handa noticed that cannabis marketing was typically targeted in two opposing directions. Either it had a misogynistic “girls in bikinis” slant aimed at male “stoners”, or it was sold as a holistic wellness product, with the emphasis on getting high much reduced. There didn’t seem to be many products aimed at the “cannabis curious”. Handa identified these two established strategies as being niche verticals with a huge gap in the middle — and so it proved.
She set up Leune as a connoisseur product for recreational users who didn’t fit either stoner or spiritual personas.
Research and Product-Market Fit
Handa saw that the huge range of successful brands marketed quite clumsily as proving that consumers currently didn’t really care what the packaging was like. However, she could tell that this situation wouldn’t persist. The legal cannabis industry was very young in 2018; the attitude of any packaging beating the clear plastic bag of street products would soon pass.
Handa set about creating a brand with a unique name (Leune is a made-up word), high end visual branding and new product descriptors which didn’t follow the typical terminology. This made her product stand out in a crowded marketplace.
Unique Challenges of a Vice-Based Product
There were immediate hurdles to overcome. Cannabis cannot legally be transported over state lines, so Handa had to build entirely new supply chains for each state she launched in. There were a lot of legal hurdles to overcome for Leune to be perceived as a legitimate, trustworthy brand.
In addition, there was an established terminology, based on bad science, which consumers were used to encountering. Handa wanted to take a much more CPG-approach, treating her product lines as unique flavors, rather than bud varietals with dubious claims attached to them.
Unlike something like kale, cannabis already had a large user base from its days as an illegal drug. No cunning marketing strategy was required to bring consumers on board. Instead, Handa’s approach became about how to make consumers associate Leune with standardized, quality products which were freely and legally available. Clear, transparent marketing was vital. It would be entirely brand-led since there were no official bodies regulating quality.
Branding and Stigma
Since she couldn’t patent or own a varietal, and different varieties would be available in different states in any case, Handa build consistency by creating her own unique flavor palette — Cloudberry, Soulberry, etc. She raised $2 million seed funding and used much of it to finalize product and supply lines.
Getting renowned celebrities and sportspeople as investors wasn’t as helpful as it might have been in other industries. The stigma attached to the product and the existence of vice clauses in NBA players’ contracts limited the exposure these celebrities involvement could receive. However, these famous investors did shine in meetings, as well as helping attract further investment via word-of-mouth.
Leadership in a Challenging Industry
Handa offers some very useful pointers on leadership and how to succeed in a market where misogyny and “pirates” are all too common. Unusually, Handa recommends trusting your gut instinct, particularly when it comes to dealing with personalities who might be over-inflating their own value or influence. She credits this tendency to her father, who she says often trusted his instinct more than a more logic-based approach to decision-making.
She also talks about the importance of learning how to pitch effectively. Two things are vital here — firstly, you must be full of self-belief and conviction. You won’t be able to convey enthusiasm and trustworthiness to an investor until you’re 100% evangelistic about your own product.
Secondly, pitches should be bite-sized, clear, and visually appealing. Although investors do want to invest in you as a person, they don’t need 50 slides detailing every aspect of your personal journey, Handa explains.
Don’t Follow the Herd
Another piece of vital advice Handa gives is to use real, proven research to spot trends, rather than following the herd. Informed that women don’t buy weed, Handa realized that this might be a hold-over from the days when female smokers would send their boyfriends to buy from dealers. These days, since women make up to 80% of household purchasing decisions, there’s no reason to suspect cannabis need be any different.
This insight went against the grain, but Leune’s sales data proved Handa correct. She notes that, against expectations, traditional young male “stoners” aren’t her biggest market. She sells a lot of her products to baby boomers and Gen-Z consumers who have started drinking less but using cannabis more.
Handa took many of her branding notes from related industries — Pantone color predictions from household products and taste profiles from related CGP fields.
Staying True to your Vision and Creating a Positive Culture
Handa says “you have to be able to simultaneously hold vision and meet circumstances.” In other words, pivot just enough to deal with the unforeseen whilst holding fast to what’s vital to your brand. She had the unique problem of having too many potential investors, so it became a matter of trusting her instincts and saying no to anyone who would distort her company’s vision.
In the context of corporate culture, Handa found it was vital to hire very thoughtfully, and release staff whose attitude did not suit her vision for Leune. While this approach was challenging, it was also very necessary.
Handa believes you should surround yourself with positively reinforcing friends and colleagues when you found your own business. They will support you through the tough times and help you combat your natural fear of the unknown.
However, she also says, “don’t quit your day job until you’re ready to lose everything.” You do need some concrete confirmation that your business idea has validity before you commit. Handa, of course, received more than enough evidence of potential success and has seized every opportunity with vigor and determination.
Handa is a great role model for women of color in business. She’s had to negotiate racism, misogyny, and accusations of tokenism to succeed. That she’s battled through so successfully, while forging ahead in a difficult sector, is a source of inspiration to us all.
Previously published on joyadass.com
