In this 20th episode of Hitting The Mark, Fabian talks with the first founder of a 'new green economy' brand to make it on this show, Clement Kwan of bespoke lifestyle cannabis brand Beboe. Clement comes from the world of high-end fashion. He helped reposition the Diesel brand for America, moved to Milan to take the license back for D&G (Dolce & Gabbana), and later became the president of Net-a-Porter, the biggest online luxury retailer on a global basis. This episode shows what can happen when you follow your heart and how a brand is being built by adding one authentic layer of story, emotion, and design on top of another.
If you look at a cannabis product by Beboe you would not think of weed, rather of art, design and fashion. This was derived through great brand thinking and design.
Clement Kwan has reached great heights of success yet decided to follow his heart and, together with Co-Founder Scott Campbell, launched a luxury brand in a segment that has not seen much sophistication before. Today, the Beboe brand has its own store within Barney's in Beverly Hills and has also carved out its own clientele.
Listening to Clement's fascinating story from growing weed in college to make tuition, to becoming an M&A investment banker in Silicon Valley, to holding the president of Net-a-Porter position and learning how he yet turned to where his heart told him to go is inspiring on many levels.
But it is also an episode about the sheer power of great design, honest storytelling and how having a deep understanding of a particular audience can make any product succeed, even in a market that did not know it was ready for it.
F Geyrhalter: Welcome to Hitting The Mark, episode number 20 of Hitting The Mark to be exact. What an inspirational journey it's been for me, and I hope the same holds true for you. I know for a fact that it has been an inspiration for the latest supporters of the podcast, Nathan Cain from Little Rock, Arkansas and Lav all the way from Serbia. Both are monthly supporters on the Brandster level, which means they will partake in my next monthly group call in September, which I'm greatly looking forward to. So thank you Nathan and Lav for your support. And I'd love for you too to turn into a Patreon by clicking the support button on hittingthemarkpodcast.com, so we can try to keep this show advertising-free and community-supported. For this special 20th episode, I'm thrilled to welcome our first guest from the new green economy. Indeed, we are talking THC and CBD, a space that has been on a fast rise and one that has been a fertile playground for entrepreneurs with a keen sense for branding. On the forefront of this movement is the bespoke brand Beboe and Co-founder Clement Kwan. Beboe is a lifestyle cannabis brand founded in 2016 which the New York Times has called the Hermes of Marijuana. Beboe includes cannabis vaporizers and edible pastilles and caters to discerning consumers. Beboe merged with Green Thumb Industries in late February of this year, 2019. Kwan started his professional career in tech mergers and acquisitions and transitioned into business development and executive roles across the fashion industry working for companies such as Theory, Diesel, and Dolce & Gabbana. In 2012, Clement joined the YOOX group as President of U.S. Operations. Kwan graduated from UC Berkeley. Welcome to the show, Clement.
C Kwan: Thank you very much, Fabian.
F Geyrhalter: Let me start off by saying what a great pleasure it is to have an entrepreneur like you on the show who clearly understands and strategically utilizes the power of brand in everything he touches. So without going any further, let's start off with the question of all questions, what does branding mean to someone like you?
C Kwan: Having worked in the fashion and luxury world for so many years and having built Beboe with Scott Campbell, branding really is emotion, and it's a incitement of emotion, which is really, I think, fascinating to see. Not to go off into a tangent, when I was at YOOX and running the U.S. operations, I decided to chat with and communicate with our 10 largest consumers. These are people who spend at least $250,000 per year online. And I decided to call and/or have tea with them. And what I realized was one lady in particular, who spent exactly $274,000 per year, told me that she doesn't drink. She doesn't do drugs. What she does is shop online as it makes her happy. So from that moment on, I really realized that a brand incites emotion, and any good brand incites emotion either through aesthetics, story, or just some X factor that you can't really describe. So not to get really hippy-dippy or too Venice on us, but there's just juju involved, and we can attest it to emotion.
F Geyrhalter: Totally, no, and I love that story. And sorry for jinxing the YOOX name. I read the story behind the name YOOX, so I figured maybe it's just the letters, but it's not Y-O-O-X, it's YOOX. This was a great way of describing branding. It really comes down to emotion. And it's interesting how you say it's something that you really can't touch. It's something that you feel, and it's really hard to talk about how it's being derived. And that is one of the reasons why I love doing this podcast, to kind of talk to different people that have done it successfully and to get a little bit more out of them of how they actually did derive it with their companies. So let's back up a little bit. I read in Forbes that you grew pot to get through college, so that's on the air now, but it's also been in Forbes, so it's okay. That was back in Berkeley when you were a student. And then you pivoted into a fashion career at Diesel and Dolce Gabbana. It seems like Beboe is the direct result of equal parts fashion, design, branding, and cannabis. How did Beboe start?
C Kwan: So when I was at Berkeley, I was actually studying corporate finance and decided to grow weed just because I really didn't have any money for tuition. So I met a really nice hippie who decided to teach me how to grow marijuana. I already loved gardening and have a green thumb, and this really presented itself as a wonderful opportunity to not only fulfill a passion but also to make money, which I needed. So I did that for about three and a half years, and then I actually became a tech M&A investment banker in the Silicon Valley from 2000 to 2001, which basically made me stop growing marijuana. But I have always had a passion for it, and I vowed to myself in 2000 when I stopped, that I would get back into it in one way, shape, or form. So after the tech market exploded, I decided to move to New York in late 2001, beginning of 2002, to get into the fashion world because I was raised by a single mother. My single mother took me shopping very, very frequently and asked me really insane questions like, "Does this color look good on me? What looks good on me? Does this fit well," et cetera, et cetera. So I sort of fell in love with fashion just because I was bonding with my mother. So tech market exploded, moved to New York and then first job was at Theory. Then went to Diesel. I helped do a repositioning of the brand for America. Then moved to Milan for seven years and took the license back for D&G or Dolce & Gabbana. And then I became the president of YOOX NET-A-PORTER, the biggest online luxury retailer on a global basis. So long story short, I had children in 2014, and I basically had to look myself in the mirror. Having done what I've done in both banking and fashion, I knew that my passion was marijuana. So after having a child, I was thinking to myself, "If my son asked me, 'What should I do when I grow up'," the wonderful romantic answer is, follow your passion. And I looked at myself in the mirror, and I'm like, "Wow, that's a wonderful thing to say, but if you don't do it, it's very disingenuous to say." So at that point, this is late 2014, I decided to really embrace that passion, not be ashamed of it. And sort of, the universe opened itself up. And I met Scott Campbell through Tom Kartsotis who founded Shinola and Fossil. We bonded over our love for marijuana, and then we decided to embark on a journey called Beboe. We didn't quite know what it was, but we did know that we wanted to build something that was aspirational, something more aesthetically pleasing, something lower dose. And we wanted to have two, I guess, different form factors, which is inhalable and ingestible, and we just incubated the idea. And that's literally the genesis of Beboe. It wasn't to say, "Let's build a luxury brand. Let's target women." We just have a genuine love for the plant and just so happened to have great experience building luxury brands and businesses. Scott Campbell has done a lot of work with Marc Jacobs, Mr. Arnault, Hennessy, all the brands in the LVMH stable. So we both come from that sort of pedigree and wanted to build something that was considerate, beautiful, and really for ourselves. So that's a very long answer to your question.
F Geyrhalter: No, that's beautiful. And Scott, who's also a tattoo artist, right, and a tattoo artist of a certain pedigree. I think he tattooed everyone from Jennifer Aniston to Robert Downey, Jr. so very, very high end tattoo artist. But he created the intricate patterns that became such an important part of the brand language of Beboe. But I assume that at some point in that journey, you must've engaged a packaging design and branding firm, right? Can you walk us through that process a little bit? When did you start to actively invest in branding with the startup?
C Kwan: We did everything in-house.
F Geyrhalter: That's amazing.
C Kwan: Scott has always assembled a wonderful internal team of packaging people, and he's also very hands on. So everything that is Beboe was done in-house.
F Geyrhalter: Because you started with a team, right?
C Kwan: We started with consultants and just friends. So yeah, we didn't have any focus groups. We didn't have any agencies. We didn't have anything really. We did everything internally.
F Geyrhalter: And that's why it is authentic. And because of your combined background, again, the parts of design, fashion, brand, right, and cannabis, it feels like it is a brand that can happen intrinsically, not so with a lot of other founders who don't have any of that brand or design kind of background. Where did the brand name come from?
C Kwan: Beboe is actually Scott's grandmother's name. So when we were in the course of thinking of a name for our company, we had so many different ideas and suggestions. And ultimately, what we were trying to do with Beboe is inject a little bit of fun, sexiness, and levity into the industry that was male dominated, very juvenile, very traditional, stereotypical stoner. So Scott told me a story about his grandmother, Be Boe, and how his mother, when he was from the ages of seven to 14, she battled cancer. And every week, the grandmother would come, Be Boe, and bring brownies, one, sort of, set for Scott and his sister and the other set for his mother. And during this entire time, he had no idea his mother was battling cancer because Be Boe injected levity into a very shitty situation because she was making marijuana brownies for his mother and normal brownies for Scott and his sister. So that story unto itself was both inspirational because she literally injected levity, fun, everything into really a bad situation. And we were like, "Wow, we should do the same with Beboe." Not that grave, but let's have Beboe inject a bit of sexiness, fun, and levity into the marijuana industry. And that's where Beboe came from.
F Geyrhalter: And change the idea of what the industry stands for and who is actually the user of today's cannabis products, right? With that one simple story, which is so emotional, talking about emotions, right, you captured a lot of the spirit of the brand. I really, really like it. I love that you actually talk about this on your website as well.
C Kwan: Fabian, sorry to interrupt, going back to the first question about what a brand is, this is what a brand is. So we have a genuine passion for marijuana, growing it, selling it, I mean, pretty much everything, right? There's Be Boe, and that's very emotional story of a grandmother, a person really just making a bad situation wonderful or very, very, tolerable, and then our experience. So I think it's this emotion and this sort of genuine passion that is injected into Beboe, and I think that's what makes a brand a brand. It's our personality. It's us. We couldn't even script it, right? We can't do a focus group. It's truly an extension of us.And he's covered in tattoos. I'm covered in tattoos, but yet Beboe is loved by women and really aspirational, fancy women. And we're like, "Wow, how did that happen?" But it comes back to, I was raised by a single mother. Scott had a very good relationship with his mother and grandmother. So there's a strong female presence and impression on us.
F Geyrhalter: It's one layer after another, right? You keep adding these layers to the brand that are all authentic, that are all part of what you're trying to create. And then at some point, all of these layers together, this beautiful cake, right, and everyone can't resist, right? So it's kind of this idea of just adding one little piece at a time. Like you said, you can't script it. Even when I work with entrepreneurs who don't have this intrinsic idea of what the brand needs to be, they really know what they want their product to be, but they don't know what their brand needs to be. And I really, all I do is I just derive it out of them too. It's like, I can't create a story for them. I can just help tell their story in a better way and try to create authenticity that is already inside of them but just kind of get it out of them. It's really therapy. I mean, that's pretty much what it is. You mentioned you were also president of NET-A-PORTER, which you just don't even include in your bio because of everything you accomplished in your life. So congratulations, that's a pretty, pretty big deal, and it feels only natural to talk about another high end fashion powerhouse. So let's talk Barneys for a minute here. I used to be a Barneys fanatic, then I married a smart woman, and now I'm more of a Barneys three times a year kind of guy. But what a fabulous and inspiring institution Barney has always been to me and to most designers around the world. And before we talk about your current Beboe collaboration with Barneys, so totally between you and me and whoever's listening, what do you make of the Barneys bankruptcy? I mean, right after Dean & DeLuca, you mentioned you lived in New York for awhile, what is going on in the world of high end shopping?
C Kwan: I don't even think it's just Barneys. It's pretty much the industry as a whole. Going back 10 years, there's a lot of money in the industry and not from a consumer perspective. It's from the institutional investors where private equity pours a lot of money into the industry, an industry that at certain echelons is very non-democratic. So all your luxury brands are now getting private equity money. Before the money came in, every distribution was very selective. It's about scarcity. It's about the consumer experience physically in the store. And post-money, obviously private equity has a horizon, right, three years, three, four years, and then exit. So a lot of pressure has been put in on the industry to get sales, make profits. But this is sort of the price of scarcity and distribution. So if you walk into any store, if you go onto any website, just look at the assortment of products on the sites or on the floor. It's the same thing. So it's because every brand is now selling to every store. Before it was, "Okay, I'm going to sell to Colette, Corso Como. I'm going to sell to a one department store in the U.K., one department store in America," and now, everything is everywhere, and it's accessible 24 hours a day, seven days a week on social media channels. And I think that the day of reckoning is sort of coming where I think there's too much accessibility, and I think there's going to be a pull back. And I think for whatever reason, Barney is going through another transformation or evolution, and then you're going to start seeing many others doing the same thing. So Barneys being a leader, taking the bandaid off and doing what they need to do. And a lot of it is predicated on rent hikes, especially on Madison Avenue. But I think it's a good idea for every retailer to look at what works, what doesn't, and really look for that point of view again, both online and offline. So why are people shopping on one site or store versus the other? Before Zara, Colette had a very distinctive point of view. Sozzani has a very distinctive point of view in Corso Como. And then you have, your Bergdorf Goodman has a very distinctive point of view. But I think there needs to be a refinement again, an evolution in the industry.
F Geyrhalter: I love how you were able to spin this into something that can be seen as something pretty negative, but it's fertile ground, right? Something can happen, and something needs to happen. And I got my first first idea of that when I worked with Ron Herman of the Fred Segal empire, and then I saw how unique this was, what he was actually creating. And then obviously, it got sold, and now, it's at the airport, and now, it's everywhere, right? And so I think there's something that is happening currently with that accessibility that I totally agree with you. It ruins the pleasure of finding a certain curated shop and having an experience and finding something that you can find anywhere else. There used to be the time where you brought back something from your travels and it's kind of, it doesn't make sense anymore, right? What you get in a museum store in New York, you get in a museum store in Paris but interesting, interesting observation. And your brand has an actual store named The High End, which is a brilliant name by the way, within the physical Barneys Beverly Hills store. I think it's on the fifth floor. And within High End, the store within a store, you can pick up a $60 box of seven pre-rolled joints amongst many other gorgeous products of your brand. How did that amazing collaboration come about, and what did you learn about your first Barneys customers, who I assume would be very different from your customers before? But that's only assumption. And I also wonder, was that the time that you started to pivot the brand to cater mostly towards women? Or like you said before, it was kind of intrinsically that it was catering more towards women, but was that the time where you actually realized, "Oh, my God. Wealthy women love our aesthetic. They love our product."
C Kwan: Ever since we launched, just due to the nature of the branding, the aesthetics, the form factor... I mean, it's a rose gold vaporizer. It's more expensive given our experience and background. I mean, if you look at it, Scott and I have sold dresses, purses, to women for a good 12 to 13 years. I think subconsciously, we only know how to market to women, but we just never articulated it other than building something like a Beboe. So we've always captured the very aspirational female consumer, not by design, but just by nature. I don't know. It just organically happened. The tagline for our brand is probably, my wife or my girlfriend loves Beboe. So yeah, we've always had that aspiration of consumer from 25 to 65, and it was predominantly female, and it just happened by chance. So when Barneys came around, it was just a natural fit, not only because they've known us for so long as Scott and Clement in our different iterations, but Scott also has a very dear relationship with Matthew Mazzucca , the creative director of Barneys. And from there, they wanted to do something in cannabis. We had a great idea on how to do it, and then we just had a great meeting of the minds. And eight months later, The High End was born. But it's not very difficult. It wasn't a stretch by any means because that customer that shopped at Barneys was already buying Beboe and/or had a friend that was using Beboe so very natural relationship.
F Geyrhalter: On your website, on the Beboe website, at the very, very end, hidden within the about section, you are also offering brand consulting. What does that entail, and who do you work with, and how did it become part of the part of the Beboe brand?
C Kwan: It's not something we really focus on too much, but it's there for humanitarian reasons, humanitarian in the sense-
F Geyrhalter: Tell me more.
C Kwan: Humanitarian for the industry. So we are extremely open people. What we've created wasn't done in a lab. The IP is us. And what we have realized was when we created Beboe four years ago, we created a product that was counter to what was happening in the market. What we realized was, being a grower myself and dabbling in, let's call it the gray market, there's a lot of people in this industry that have paid their dues, that have been in it for 20 years, that have paved the way, that have gone to prison. They're like the OGs of the industry. So what we did was, and I'll make this short, took this product, and I went to these OGs, and I said, "Guys, listen. In order for our industry to move forward, I respect everything that you do because I've done it. But in order for to really grow and evolve, give this product, which is bourgeois, more expensive, lower potency, and you've never seen anything like this, please help us support it and/or just don't hate on it. Because once this new consumer comes into the industry, they're not going to stop at just Beboe. They're going to try other brands, and then they're going to start asking local politicians and the industry as a whole for more information. And this is what's going to drive change." So having said that, we are where we are because they supported us. Now, there's a whole other generation of people and entrepreneurs trying to do what we've done, and instead of not helping, we want to make sure that the people with the right ideas and the right ethos and obviously, good people, are able to succeed because rising tides floats literally all boats. So let's just have consulting out there so that we can help people flesh through ideas, share with them the pain points that we've gone through, and just, let's help evolve this industry in the right way and be a thought leader and a leader as a whole. And that's what consulting is about.
F Geyrhalter: As we come slowly to the end here, one of the questions I always love to ask founders is if you can describe your brand in one word, so I call it the brand DNA. So it's one or two words that are all encompassing of the Beboe brand. For instance, for my brand consultancy FINIEN, our brand DNA is clarity. And for Everlane, it would have to be transparency. What is Beboe's brand DNA?
C Kwan: Empowered. It's empowered because I think every person who uses it feels empowered. Every woman that works for us is truly empowered. I mean, our entire team is built up of women, and they are the heart and soul of our brand, and it's not by design. So we cater to a female consumer, and we only have females working for us, which is, it's a beautiful thing. So the thing that we always preach is that, do not let an industry drive you. You drive an industry. Whatever problem you have, you have the authority and the initiative to get it done, fix the problem. You are empowered and financially empowered, everything empowered. And I think we just don't say it. It just happens. So yeah, I think even people who use our product feel empowered when they use it. They're able to discreetly use Beboe, and they feel great because they've empowered themselves to get high. It's mommy's little helper, so they're empowered to be better parents. I don't know. People feel empowered when they have our products in their hands, where they work with us, when they interact with us. Yeah, I think that's what we're really the most proud of.
F Geyrhalter: It feels very, very right. And also when you look at the packaging, and you read some of these life lessons and wisdoms that are hidden within the packaging, it is about empowerment. Even though you say you don't mention it, you don't spell it out, it is subliminally spelled out throughout your entire brand. Do you have any other brand advice? And you have already given a lot for founders in any space, as a final takeaway, maybe a lesson you may have learned the hard way, something that can just empower, to use the word, fellow entrepreneurs that are not quite at your stage yet.
C Kwan: Ultimately, and I think if I had a startup in the fashion world or something that was little bit more traditional, I would have a big fuck up or something like that to share. But I think we have been fortunate enough to build something in the wild, wild West where we charted our own course. I think the biggest lesson I've learned is that kindness goes a long way. And I hope that every entrepreneur that starts something is kind, not only to the people and the partners and the world as a whole, but kind to themselves, kind that there is no right answer to what you're doing. There are sometimes parameters, but you're going to mess up. You're going to definitely mess up. But it's just being kind to yourself and your mental health, your physical body, because ultimately, that's very, very important.
F Geyrhalter: And talking about kindness, when I reached out to you, Clement, I read a Forbes, I think it was a two, three page article about Beboe, and I reached out to you completely blindly. I think it was via LinkedIn or maybe I found your email somewhere on the website. And very often I just pretend the emails go out, and I don't hear back. And the more high profile of a publication I read about someone that I invite on the show, the likelihood is slimmer that they actually get back to me. You got back to me saying, "Hey, Fabian. How are you? Sure," period. I think it was something like that. And I'm like, "That is kindness," right? The idea of the first thing you say is how are you, and there's this spirit that comes from you that is, obviously, shows across your entire brand. So really, really appreciate it. Listeners who live in a state where they can legally obtain cannabis, how can they get a taste of Beboe?
C Kwan: You can find it in California, in Colorado, at your favorite dispensaries, and/or go to Barneys, and you can find it there. And then soon with a wonderful partner like GTI, we will be expanding into 10 to 11 other states in the course of the next 12 to 18 months.
F Geyrhalter: That's amazing. That's fantastic. And thank you, Clement, for your time today. It was such a pleasure, and it was really fascinating to have you on Hitting The Mark. I really appreciate it.
C Kwan: Thank you very much, Fabian.
F Geyrhalter: And thanks to everyone for listening, and if you enjoy this sponsor-free podcast, please help keep it that way and become a sustaining member by hitting the support button on hittingthemarkpodcast.com or by going to patreon.com/hittingthemark. Our theme music was written and produced by Happiness Won. I will see you next time when we once again will be hitting the mark.