Today’s interview is with Darby Cox, CEO and co-founder of Smoke Cartel, one of the most popular headshops on the internet. Founded in 2013 by Darby and her entrepreneurial-minded college friend Sean Geng, Smoke Cartel has grown from a side hustle operating out of their living room to a publicly traded company taking over a 26,000 square-foot warehouse in Savannah, GA. Read on to find out what sets Smoke Cartel apart from its competition and what Darby has learned as the country’s first female CEO of a publicly traded cannabis company.
(This post contains some affiliate links.)
Tell me a bit about Smoke Cartel and what sets it apart from other online head shops.
We’ve always focused on our technology and data at Smoke Cartel, from trying to provide the most useful information and products to our customers to building out the most robust systems for our own e-commerce use. Our selection is highly curated for our end-user, and we’ve spent a great deal of time in designing our user experience.
What inspired you to start a company in the cannabis space?
My partner Sean initially came up with the idea – I was very hesitant about it at first. I didn’t like working at SmokeCartel until I went to my first trade show and saw the scope of the industry, the people who were also working at legitimizing our space. I’ve met folks who have foundationally shaped my life and perspective on not only the cannabis industry, but how to handle business and life in a way I previously wasn’t exposed to.
Was cannabis legal at all in your state when you first started the company and how did that affect your decision to start the company?
Colorado had recently legalized when we made the decision to start Smoke Cartel. Georgia still is not legal, although we worked with our friends at Reform Georgia to remove the penalties associated with cannabis under an ounce in Savannah, Georgia last year. We’ve always felt that we had a duty to change the public perception of cannabis, especially in the South. There’s a lot of hidden, shamed usage around us, or at least there used to be [it’s getting noticeably better].
What was the tipping point that made you say, “OK we need a bigger space than the living room?”
We had about four employees at the point where we rented our first space that wasn’t attached to our apartment. We were fortunate to be living in a “live-work” apartment, so our first floor of our space functioned as our “office” for over the first year of our operations. I remember moving into 2,000 square feet and thinking we’d probably never fill it all. Then 4,000 sq feet came & went, now we’re in a 26,000 sq ft facility. Each move felt like such a critical expansion point of the company, I’ve always personally loved “moving”, and it has been a fun internal metric of our growth.
How has your “average workday” changed since moving to a warehouse with employees?
We’ve always been or had fulfillment capabilities, even in our smallest space. Since our most recent move into our fulfillment center, we’ve completed our internal inventory management software that’s reduced my warehousing operational work to a fraction of what it used to be. The biggest change to my average workday was taking our company public a little over a year ago, which drastically changed how we function and the speed at which we have been able to work on new ventures, like our latest project led by our brand developer, Angelica Sorauf, Midnight Toke.
What do you think is the biggest misconception people have about head shops or the cannabis industry in general?
That it’s a massive gold rush. Yes, it’s a great time in the industry right now, and the innovation and acceptance is at a never before seen rate, but there are still many challenges to success and running an operational business at scale.
What’s the biggest lesson you learned “the hard way” since launching Smoke Cartel?
Don’t overestimate your own importance. Yes, having a great team of excellent people is critical. Yes, your team needs to feel important and be treated as such. But don’t become obsessed with the function of a single individual – including yourself. There will always be waves when you remove your fist from a bucket of water, but eventually, those waves will stop. If you’ve done your job, and your team is doing their job, the success of an individual is never the focus. Your company is your team’s success as a collective whole. Everyone contributes, and [even when it feels like it] you are never the “only person” working, or trying, or the only one that cares. Business is a team sport.
Smoke Cartel has a successful affiliate marketing program that people can use to promote your products and earn a commission in return. Have you found this to be helpful in the face of cannabis advertising restrictions?
We’ve been really lucky to have such loyal affiliates and fans. We’ve found this and social media marketing to be incredibly helpful, especially with such strict marketing restrictions. My business partner & I both studied advertising in college [albeit him longer than I] and I cannot wait for the day in which we can use Facebook, Instagram & Google Ads, mainstream retargeting platforms, television commercials, there’s a huge untapped potential there that we are unfortunately unable to creatively work on at this time. You just wait – I’ll get my super bowl commercial one day.
What kind of advice would you give someone hoping to start an online cannabis business in a non-legal state?
It’s not for the faint of heart. It’s been getting better, but still be prepared to face more challenges than you expect. You may have issues with renting space from unsupportive landlords. You’ll have 3rd party apps and companies [from HR compliance software, reviews, and insurance providers] refuse to work with you because of your chosen industry – this happened to us as recently as last week. Insurance & credit card processing are two of the many things you can expect to pay more for in compliance costs.
Visit SmokeCartel.com to browse their selection of high-quality glass and smoking accessories.