Cannabis-infused topicals, strips, and pre-rolls
"Escape Artists is the leading topicals brand in the state of Colorado," touts Di Spaltro. "Out of all the brands in a category-agnostic sense, we are the third most-distributed brand in the state. We're in nearly every dispensary in the state of Colorado."
She adds, "We've been the leading topicals brand since 2019 in the state and our growth has been pretty significant the last two years. Our year-over-year growth last year was about 52 percent."
However, the cannabis industry faces hurdles that most other industries don't. "Basically, one of the huge challenges with the cannabis businesses is that you essentially have to start over in every new state," Di Spaltro explains. "You can't ship anything with active ingredients across state lines. So businesses either have to set up their own manufacturing group in each state and set up a new space and a new license, or they work with partners and license their brands."
It's exactly the type of opportunity Di Spaltro relishes. "My background is in scaling operations for tech companies in the Bay Area," she says. "I'm kind of a problem solver at heart -- that's what I love to do. I got involved with this company at the beginning of 2019 on the operations level and I just fell in love with all of the challenges that there are to tackle in this industry. I think the difficulty is unlike any other industry that I've experienced."
To enter new states with THC-based topicals like its Relief Cream, Escape Artists is planning on taking what Di Spaltro calls an "asset-light approach" by partnering with existing manufacturers with excess capacity. "Obviously we're going to be very careful about the selection of those partners to be able to uphold the quality of the product."
The company can leverage its supply chain in Colorado for everything but THC. "The manufacturing partner is only responsible for the infusion of the THC at the end and packaging the product," says Di Spaltro.
"For us, it's really important to have consistency in our products," she adds. "That's why we will be making as much of the product as we can before shipping it out. And then we will have really thorough SOPs and an extended period of supervision of that manufacturing partner, where we can be assured that they are following our processes so we can deliver the same experience to customers in different jurisdictions."
Those types of partnership makes sense for the company; after all, Escape Artists partnered with a company to launch its first products. It found a partner manufacturer in Alchemy Food Co. in Denver that had a kitchen and license for distribution of cannabinoid products.
With regard to the THC components of the products, she notes, "For our topicals products, it's not as much of a strain issue so much as just the distillation process and the quality of where it came from rather than the specific strain."
Challenges: "One of the hardest things when you're in a period where you're trying to grow and expand quickly is maintaining focus and moving efficiently when you're getting pulled in lots of directions," Di Spaltro says.
Opportunities: "One of the things we're seeing is the Colorado market, overall, is slowing down. Luckily that hasn't yet impacted our business, but I do think at some point we will find a ceiling in the state," says Di Spaltro. "Continuing that kind of high level growth will require expansion to new markets."
She's cagey about exactly which markets the company plans to expand into first, but she says, "The two coasts are very interesting, just due to the market size. California, and I think New York is incredibly interesting as it comes on the market. . . . I think one of the states that has been really interesting is Michigan. They grew over 50 percent this year."
Another potential growth path for Escape Artists is in its CBD products that it can sell wholesale and directly through its website. Di Spaltro sees the line as a vehicle for boosting brand recognition. "I think that our Relief Cream with CBD can also be an entry product for people to try. Then they might discover our brand and be interested in trying our products that are available in dispensaries."
The company has plans to introduce new products in Colorado as well. "One in the edibles space and then a few new kinds of different form factors and types of products in the topicals category are coming out later this year, which ultimately may make it to other states as well," Di Spaltro says.
Needs: "Our needs are going to come around hiring and growing the right team and also we are currently needing to expand in Colorado from a space perspective," says Di Spaltro. "So that's something they're looking at for this year. We'll be working with our existing partners to expand."