Projecting $100 Million, Hemp Startup MOOD Confounds Expectation

It may sound like a business fairy tale, but the runaway success of hemp startup MOOD is, to borrow from Shakespeare, “the stuff dreams are made of.” Launched last August by millennial entrepreneur David Charles and co-founder Jake Antifaev, the ecommerce dispensary is already projecting $100 million in revenue by the end of 2023. To anyone else, that rosy estimate might seem like a fanciful concoction, a delusion born of youthful hubris, but to the 32-year-old Charles, it’s just another notch in his belt of accomplishments.

Before he and Antifaev ventured into cannabis, Charles cut a swath across the marketing landscape. Having started his career as a media buyer at MuteSix, Charles soon embarked on a series of entrepreneurial ecommerce ventures in various categories, including a human pheromones business and nutraceuticals. Following this period, he entered telehealth, serving in an executive role at men’s weight loss firm Fella Health and as an advisor to AI healthtech startup mEMR.

Currently, CEO and chief operating officer of MOOD, Charles said he and Antifaev are running their company like a tech startup as opposed to a cannabis startup. For one thing, about 50 of MOOD’s 90-person staff work at the Oklahoma headquarters while the rest work remotely. Charles, who used to live in Austin, is presently traveling and working remotely from Tel Aviv.

Recently, Charles took a break from his schedule to answer questions via email.

This Q&A was edited for conciseness and clarity.

Iris Dorbian: What made you want to launch a hemp company? How did that evolve?

David Charles: The idea came from my co-founder, Jake Antifaev. He had experience in the cannabis industry in Canada and noticed a lack of tech-savvy, customer-focused companies in the legal THC ecommerce space in the U.S. Initially, I was skeptical because I thought the market was saturated. However, upon closer examination of the competition, we realized there was a significant opportunity to create the kind of legal THC ecommerce platform customers truly desired. We knew we had the skills and expertise to make it happen, so we became determined to build a customer-centric hemp company.

Dorbian: How were you able to bootstrap your business and then generate seven figures in one month after the launch?

Charles: Bootstrapping our business involved extensive research to understand what customers truly wanted. We spent many 100 plus hour weeks in pre-work, obsessing over the details. When we launched on August 1, 2022, it was a challenging day as we initially had zero sales despite investing a significant amount of money in ads. However, after about 12 days, we started hitting our stride. I personally phoned countless people who had abandoned their carts, trying to understand their reasons for not buying and identifying quick and cost-effective solutions to improve our conversion rates. It was a constant process of fine-tuning our performance marketing efforts.

Dorbian: What have been your biggest challenges to date?

Charles: Finding the balance between growth and infrastructure development. As we mature, it becomes increasingly complex to scale our operations while maintaining quality and upholding our core values. To tackle this challenge, we have focused on rapidly expanding our team without compromising hiring standards. I have implemented a standardized hiring process that ensures efficiency and objectivity, resulting in some of the best hires I have made in my career.

Another significant challenge has been developing and effectively communicating our brand identity to our target audience. We have approached this challenge by thoroughly understanding the problems we solve and the specific audience we cater to. From there, we have crafted a brand story that aligns with our company values. Assembling the right team of internal stakeholders and collaborating with a trusted branding partner has been crucial in this process.

Dorbian: Has inflation and the recent supply chain issues affected MOOD?

Charles: Yes, inflation has had an impact on our business. Our gross margins have been affected since our initial launch. However, we believe in spending money on things that truly matter. We prioritize supporting American farmers, sourcing high-quality ingredients for our edibles, and providing competitive wages and excellent health insurance for our team. Despite the increased costs, we maintain sustainable unit economics and remain committed to our values.

Dorbian: What are your ultimate goals with MOOD?

Charles: [We want] to become the leading provider of high-quality legal THC ecommerce worldwide. We are well on our way to becoming the top THC ecommerce company in the U.S. and as more European countries legalize cannabis, we plan to expand into EU markets. When the time is right, we envision selling the company, and I plan to use my share of the proceeds to start a hunger charity and live on a yacht with 10 Labradoodles!