DrazCanna, Inc. (OTCBB:DZCA) discloses the human challenges faced by the Cannabis Bio-Pharmaceutical Research and Development Venture.
DEARBORN HEIGHTS, MI / ACCESSWIRE / December 8, 2022 / DrazCanna, Inc. release is part one of a two-part disclosure of the challenges presented to the organization's development team starting in 2015 and the evolution of the company's Cannabis ESG Social Equity endeavor, "Cannabis Helping Cops".
"It is an incredible story of DrazCanna, Inc.'s now seven-year cannabis bio-pharmaceutical supply chain research and development history. One about overcoming the challenges to achieve extraordinary results." stated Hussein Anani, President of Texas based DrazCanna, Inc. (OTCBB: DZCA), "It is also a heart wrenching story of a couple encountering trials and tribulations that no one should have to experience in life let alone their embracing of a very unique sacrifice in order for their entrepreneurial vision to be realized."
"My relationship with Ty goes back almost a couple of decades when our paths first crossed on a startup development project. I have enjoyed watching his entrepreneurial vision and career seeing both extraordinary success as well as helped him process through failure." stated Ali Anani, President of Michigan based privately held DrazCanna, Inc., "Our conversations cover everything from religion to public policy over the years but one discussion about innovation and investment opportunities within the cannabis bio-pharmaceutical supply chain brought us back together."
The Realization of the Entrepreneurial Vision Begins - A Desire for Change
During December 2008, Michigan's Medical Marijuana Program began allowing medical use of marijuana with home grows and the caregiver system to connect registered growers to produce marijuana products for up to five designated patients. Although Michigan's "Green Rush" began, almost ten years would pass before the first commercial cannabis business licenses were issued in the state.
In 2014, a Michigan entrepreneurial couple were working together on their "budding" business, i2B Consulting, Inc. The business of connecting independent continuous improvement consultants to project opportunities of some of the world's leading auto OEMs to aid on overcoming "crisis supply chain interruptions." The crisis could be the result of fires, explosions, floods, breakdowns in equipment, etc. at the supplier's factory, but in each case the challenge to overcome was the same, tens of millions of dollars in lost gross profit per day for the Automobile OEM. These crisis projects are known to be one of the most demanding and challenging work for automobile industry professionals.
"The crisis project management is long hours spent on the factory floor for the project consultants that on occasion stretched into days. It requires long hours each day of problem solving the supply chain constraints." added Gina Szpak, President of i2BConsultants, Inc., "The work itself is a mental and physical challenge for the consultant and spending months of time away from home working seven days a week creates additional work/life imbalances to overcome. The burn out rate is incredibly high."
A goal was established to diversify i2BConsultants, Inc. from auto industry projects led to project expansion into aiding financially troubled corporations in returning their operations to profitability.
Entrepreneurial Vision Realized - It All Starts in the Garage with Growing by Plant Empowerment
"As we looked for diversification opportunities from the consulting industry, Michigan's emerging bio-pharmaceutical cannabis industry came into view." declared Ty Putrich, "What we saw was a path with the time to fully develop the processes, procedures, and policies to achieve the goal in the years ahead of becoming one of the best cannabis bio-pharmaceutical industry investments."
So, it began in 2015 with the couple performing some minor renovations to the garage in preparation of planting the first cannabis crop. The first crop was started after months of researching and refining of goals and mission for their "budding" cannabis operation. For them both, it did not come without the appreciation of the time required for the new entrepreneurial venture while balancing a personal relationship with a necessary 9 to 5 job, family, and all that life brings to the team in creating (and capitalizing) a successful new business endeavor. The opportunity for Ty was a break from the grueling demands of his specialized crisis consulting work for some of the largest automobile OEMs and embrace learning something new.
Growing by Plant Empowerment for Indoor and Hybrid Greenhouse Hydroponic Cultivation
So, the 10,000+ hour entrepreneurial "deep learning dive" began with its journey of innovating the processes and procedures to achieve the goal, "Best of the Best" in the cannabis cultivation and extraction industry. The couple researched the data driven processes developed in 2005 by Dutch scientists in the Netherlands for indoor and hybrid greenhouse horticulture application dubbed "Growing by Plant Empowerment" (fka "Next Generation Cultivation"). As a grower, optimization of cultivation results is crucial if the desire is to achieve Best of the Best in the cannabis industry.
Ironically, the data driven process of GPE also met the couple's mission of achieving innovative sustainable cannabis cultivation processes for environmental leadership. The solution for sustainable cultivation and optimal results is provided by nature itself by the plant which are primarily regulated by its three balances; water, energy and assimilates. Growing by Plant Empowerment supports the plant in keeping its three balances in equilibrium enabling plants to become strong, healthy, resilient, and efficient regarding water, nutrients, CO2 and energy with resulting high yield and quality.
Indoor cannabis cultivation provides a better environment than that of outdoors for plant safety and quality control required for the cannabis bio-pharmaceutical supply chain, but the electrical energy required for traditional cannabis indoor grow operations presents an industry challenge to sustainability.
"It is about knowing better and doing better. We believe that hybrid greenhouses, hydroponic systems, Michigan's favorable summer temperatures, and Plant Empowerment processes are the path to success in minimizing the environmental impact of cannabis cultivation.", said Ty, "We do agree with the consensus of experts within the horticulture industry of the need for further development, refinement, and adaption to changing local conditions. We challenge ourselves daily to innovate further and to continue."
Nutrient Optimizing Algorithm for Indoor and Hybrid Greenhouse Hydroponic Cultivation
"For Ty, there was an ultimate challenge of further developing the GPE data driven processes for cannabis cultivation, an algorithm to correlate nutrient concentration relative to changing environmental variables." stated Gina, "After watching his nephew and partner develop an algorithm to achieve the pinnacle of success within Daily Fantasy Sports ("DFS"), he wanted to collect the data to see if a GPE and nutrient concentration for the optimization of the cannabis cultivation approach could be found, an algorithm. It was the start of ‘Michigan's Green Rush‘, while everyone else was trying to figure out how to grow cannabis, Ty wanted to figure out what it took to kill it."
For Gina and Ty's vision, the start of their journey into Michigan Medical Marijuana Program of caregivers began in the garage as the couple sought to realize their innovative vision into a commercial business reality and a great investment in the emerging cannabis industry.
The approach was unique; however, the intent was to define the optimization points of each environmental variable relative to plant nutrient and water uptake. Plant nutrient water uptake was an important variable to measure in order to mitigate the effects of heat and nutrient stress in a cultivation environment with set point temperature control found in traditional indoor grow operations employing environmentally damaging and expensive air conditioning. The challenges of discrete measurements to collect water and nutrient uptake rates challenged the couple to innovate a solution not available in the commercial hydroponic systems.
"The importance of the plant nutrient and water uptake measurements were critical to maintaining plant vitality in elevated ambient temperature." Stated Ty Putrich, "We looked at commercially available Deep Water Culture systems with their superior yield and quality attributes but saw challenges to get the data with accurate discrete measurements. Ebb and Flow hydroponic systems provided the data desired every six hours however the yields and quality were lower than DWC. We had to problem solve over a couple of years before arriving at our ‘hybrid DWC and Ebb and Flow' hydroponic system."
The couple efforts were focused upon overcoming the constraints to acquiring the data desired, however unbeknownst to them at the time the hydroponic system they designed was truly unique.
Defining the Processes, Procedures, Policies, and Work Instructions
As time went on the DrazCanna development team grew and the need for additional cultivation space became larger than the garage. By 2017, the cannabis bio-pharmaceutical research and development operation moved to a larger building in south central Michigan to house the growing enterprise. Fortunately, the DrazCanna team had documented the processes, policies, procedures, and work instructions in preparing for the growth that comes as commercial licensed cannabis cultivation company.
"As our team grew, we saw the need to document work instructions to assist in training new members of our team." said Gina Szpak, "So then our tasks became about creating quality processes and manual, forms, daily processes, the general ledger account structure, personnel manual, and everything we could think of to make growth easier on our team."
It also afforded the DrazCanna developmental team the opportunity to define the culture of the coming company. It was agreed by all that servant leadership principles should guide the organization to focus upon creating win-wins for employees, shareholders, and our customers could thrive. The sharing of the wealth through employee ownership that is built into the share structure within the entrepreneurial equity capitalization process.
DrazCanna's leadership focus was and still is upon achieving excellence in all aspects of Cannabis ESG. The team spent years defining processes from corporate governance with the legal and reporting requirements of a public company to innovating social equity initiatives and designing the basis for the "ideal corporation" to environmental excellence in energy and water consumption.
Entrepreneurial Equity Capitalization Process and the Cannabis Industry Conundrum
Looking past the cannabis industry emerging growth opportunity, financing challenges are at the top of the list of growth constraints cannabis leaders must overcome. The federal illegality of marijuana makes it difficult for cannabis-related businesses to access traditional banking and financial services, including raising capital from debt or equity. Lending rates for cannabis companies are up to four times higher than in other industries and current financing options generally include provisions for shareholder diluting convertible debt.
DrazCanna's approach as a public cannabis company opens additional doors to capital markets, the constraints to capital are much the same with similar debt-financing challenges regarding interest rates, loan terms and structure of capital that private companies face. Market changes abounded, however institutional investors into the industry are still largely on the sidelines and limited to family offices and hedge funds. Section 280E of the federal tax code, which taxes cannabis companies at the gross profit level by eliminating most deductions that are "normal tax deductions" in other industries reduces the ability for cannabis companies to fund working capital to finance future growth.
"The importance of equity capitalization to fund profitable growth was not missed by our group on the road of differentiating the company as one of the best cannabis bio-pharmaceutical industry investments. We saw the flexibility of a public OTC shell "pre-planned" reverse merger in opening doors for debt and equity combinations that would appeal to the institutional investors." added Ty Putrich, "The effect of high demand and limited supply created such high effective cost of capital that we had to innovate capital sources in order to fund construction of DrazCanna's planned expansion into a state-of-the-art hybrid greenhouse in Michigan."
As an Entrepreneurial Journey Comes to Realization…
By the fall of 2018, great things were happening in Michigan's cannabis industry with the first medical marijuana license issued by the state. For the DrazCanna team which numbered over 30 by now, the excitement of the evolution to the next step also meant the closing down of the research and development project in order to transition from Michigan caregivers' law to a 1,500-plant commercial medical marijuana cultivation operation as the next step in the evolution of the company.
As the year 2018 came to a close for Gina and Ty, the future couldn't have looked brighter in their eyes on both personal and professional lives. Marriage and a "budding" cannabis cultivation endeavor was in their plans for the coming new year. Holiday activities were supplemented by a search for a building to house the next step, a larger building and a license application for a medical marijuana cultivation and extraction operation. Everything seemed "right" for the couple. "May we live our lives well and to the fullest, so future generations will continue to have a history of which to be proud."
Then it happened on December 21, 2018, a 105-year Putrich family legacy reared its ugly head once again in the state of Michigan. The Seeberville Murders, a dark day in Michigan's history and a family legacy that had to be overcame. A cold Michigan winter afternoon, an unexpected event unfolds for the couple defining the departure from the entrepreneurial path they were on...to the inescapable path for the couple paved with despair, destruction, and death.
Source: Michigan Technological University Archives and Putrich Family. This is a view of the Putrich boarding house in Seeberville, Michigan, the scene of a shooting resulting in police related death and injuries during a labor strike in 1913.
Hussein Anani, President
P.O. Box 600
Dearborn Heights, MI 48127
For more information about "Cannabis Helping Cops" contact [email protected].
About DrazCanna, Inc.
DrazCanna, Inc. (OTC:DZCA) was operating in the educational sector until 2016 and was dormant until 2021 when the corporation filed its reports to achieve current status. For more information, visit www.drazcanna.com.
This press release contains forward-looking statements that involve risks and uncertainties concerning the plans and expectations of DrazCanna, Inc. These statements are only predictions and actual events, or results may differ materially from those described in this press release due to a number of risks and uncertainties, some of which are out of the company's control. The potential risks and uncertainties include, among others, that the company's expectations of future growth may not be realized. These forward-looking statements are made only as of the date hereof. The company undertakes no obligation to update or revise the forward-looking statements, whether as a result of new information, future events or otherwise. All forward-looking statements are expressly qualified in their entirety by the "Risk Factors" and other cautionary statements included in the company's annual, quarterly and current reports and other filings, including but not limited for the quarter ended September 30, 2022, and filings with the OTC Markets.
SOURCE: DrazCanna, Inc.