Dixie Elixirs’ Tripp Keber is transforming the infused edibles industry, one product at a time

For Tripp Keber, the “future of cannabis” started small. When he
acquired Dixie Elixirs and Edibles in early 2010, it consisted of two employees
and a 400-square-foot shed. They had one product, cannabis-infused soda sold at
medical cannabis dispensaries.

Keber still sells the soda, and it’s still his best-seller. But these
days, it’s one of 150 products cranked out by his 50 employees at a brand new
47,000-square-foot facility in Denver’s Montbello neighborhood.

Success didn’t come easily or quickly. But when others thought green
buds would always be the mainstay, Keber suspected otherwise. When others
thought cannabis users would always want the maximum dose, he devised a low-THC
soda for beginners. And he was willing to risk and invest, spending a reported
$5 million on his new facility.

“We believe in the power of oil,” Tripp told CULTURE. “You just don’t see many people smoking that Marlboro. In Colorado,
we’re a very health-conscious, wellness-oriented state, so we know smoking
anything, whether it be tobacco, cigars or cannabis, is generally not healthy
for you.”

Dixie is now Colorado’s largest maker of THC-infused edibles. If the
rising tide of legalization continues, it may soon be the nation’s largest.

 (Tripp Keber, owner and Managing Director of Dixie Elixirs)

From alcohol to cannabis

The 46-year-old took a circuitous course to being a “ganjapreneur,” a
term often used for those who got into Colorado’s exploding medical cannabis
industry after 2009, when state restrictions limiting the number of patients at
a dispensary were drastically loosened.

A former techie in the nation’s capital, he left the East Coast in 2002
after losing nine friends in the September  11 terrorist attacks. He got in the nightclub
business, where he was struck by how many customers were leaving the club to
smoke cannabis. People outside weren’t buying drinks—that was bad for business.

That got him thinking about how most of the bad decisions in his life
had involved alcohol. Maybe there was a better way to make a living? So in
2009, he made a loan to Dixie’s original operators, according to The Denver Post, and bought the company
the following year.

It was the first of many risks that would propel him forward.

‘One foot in the grave and one
on a banana peel’

Today, Tripp has some amusing euphemisms for those first few years.
“Building this plane as we flew it.” Or “ready, fire, aim.” There was no
blueprint for an industry just emerging from eight decades in the shadows.

While most ganjapreneurs were opening dispensaries or grow operations
and edibles were a small sense of the market, Keber had a strong sense that
would soon change. Though change happened slowly.

“At any given time over the first two-and-a-half years, we had one foot
in the grave and one on a banana peel,” he said. If they could get a couple of
pounds of plant trimmings for their products, Keber felt lucky. Profit was
negligible.

Keber has attributed his success to setting a “higher bar” for the
industry, employing professional chefs and chemists, so customers not only get
a quality cannabis experience, but it tastes great too. He also focused on
marketing and quality packaging, to make Dixie more than a THC delivery method.
He made it a brand. Each year demand
for edibles among medical cannabis patients increased. So did the size of
Dixie’s operations. After Colorado voters legalized recreational cannabis in
2012, he knew something big would be needed. So, a month after the Obama
administration issued a memo saying it would not block implementation of
Amendment 64, Keber took his biggest risk yet: Paying $5 million for the new
facility. He cut the ribbon a year later. But nobody could have predicted just how
high the demand would be for THC-infused products.

Skyrocketing demand

Recreational cannabis stores opened the morning of January 1 of this
year, and in the subsequent nine days, Dixie sold more than the entire fourth
quarter of 2013. Even with a wide array of candies, foods and drinks, supply
couldn’t keep up and stores quickly sold out or began limiting customers’
purchases.

Most infused products are made from trimmings left over for
cultivation. But retailers assumed the demand would be for pre-rolled joints,
so that’s where the trim went. They were wrong.

Edibles account for 45 percent of cannabis sales. Along with the health
concerns of smoking, Keber attributes it to the fact out-of-staters often can’t
find a place to legally smoke. Keber expects that demand to eclipse 50 percent
in 2015. He is ready for it. Half of the facility is dedicated to cannabis
cultivation. There will be no more waiting for trimmings here.

The company is not publicly traded, and Keber declined to discuss sales
and profit figures. And make no mistake. He is in it for the profit. He has
made no secret of his desire to build up Dixie to one day sell it for a profit.

Ongoing threats to industry

When Colorado health officials recently proposed to ban all edibles
except oils and tinctures, it caused an outcry in an industry that employs
thousands of people.  Keber said he kept
his cool and was never worried about the state forcing his business into
failure. State officials backed down, but there remains a strong feeling among
regulators and critics of cannabis that the edibles and sodas are not only
falling into the hands of minors, but being marketed to them.

“We need to make sure we have packaging that is childproof and
tamper-resistant,” he said. “Cannabis, though it is a wellness plant, can also
be incredibly dangerous to a child, somebody whose mind is not fully formed.”

He also sees the need for stronger labels and testing. “If we say it’s
100mg it has to have 1000 mg,” he said. Customers need to trust the product.
Ironically, it’s a much lower dose that has become Dixie’s best-seller. Dixie
One, a soda with just 5mg of THC, is outpacing sales of the 75mg soda
two-to-one. That’s another secret of his success: Offer variety, not just in
type of edible but strength.

 “When I go out I don’t order a
bottle of Jack Daniels and sit it on the table and attempt to whack it in the
course of an evening,” he said. With the low-dose elixir, he said. “I’m not in
the bathroom vomiting. I’m not going home and creating domestic violence.”

Going national

Keber has his sights set higher than the Rocky Mountains.

“We have been very very vocal. Our intentions are to expand our brand
into Arizona, Oregon, Washington state. In Nevada, (medical cannabis) licenses
were just announced last week,” he said. Medical cannabis is on his radar in
Illinois, Massachusetts and Maine.

But it’s illegal to ship THC-infused products across state lines. It
doesn’t take much business acumen to know spending $5 million on a facility in
each state is impractical. So, again with a keen sense of the winds of change,
in 2012 he licensed his intellectual property and brand to Medical Marijuana
Inc., a California company. 

That business relationship has since ended, but Keber’s drive to make
the Dixie brand a national company has not. It’s just the latest risk in a
career full of them. And like the others, it will pay off.  “We’ve all slogged through this shit for these
four years, facing bankruptcy, facing banking issues, threats of federal raids,
threats from cartels, organized crime, and now we’re succeeding. We’re
prospering, in some cases profiting immensely,” he said.

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