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After starting as just a local retail play in Charleston, SC, a THC brand now called High Rise has been on expansion spree, now playing in 20 states via nearly 70 DSD partners with lineup that's grown to include single-serve seltzers at 5 mg and 10 mg dosages and recently released spirit-like High Rise Infusion packed in 750-ml glass bottle. New to bevs, founders Matt Skinner and his wife Libiss have recruited former CanArchy Brands/Oskar Blues exec Chris Russell as prexy, a coupla years after he departed CanArchy acquirer Monster Beverage, as team plots more intensified push into Midwest from beachhead in Chicago. It's "in conversations with a really big distributor right now, the biggest one to get in the game as of yet," which if successful "will make a big Midwest footprint for us as well." (He didn't ID house but could it be wine & spirits house Breakthru?) Brand's making headway in NJ and is moving into Oregon, a year and a half after abrupt banning of Delta-9 bevs in Calif aborted High Rise launch of just a few weeks earlier. Like his rivals, Skinner is carving out healthy amount of time to work with orgs like Cannabis Beverage Assn to head off federal ban due in Nov. Venture was launched 5 yrs ago by Skinner, who comes out of restaurant biz, and his wife initially as a retail operation called Charleston Hemp Collective that would craft its own products. They partnered with copacker in Boone, NC, and grew concept into 5 storefronts, building a distribution model out of that and recruiting more copackers as restaurants dealing with visitors' moderation surge started requesting line. That was "a movement we didn't even know was going on," Skinner said frankly. They didn't envision big CPG push until one of their copackers pointed to the traction that Cann THC brand was getting out west. Seeing chance to build out more than a regional play, name was changed to High Rise, tho brand continues to push Charleston-style coastal vibe in its positioning.They've similarly let themselves be guided by market feedback in designing product lineup. Their preference was for sociability-enhancing 5 mg dosage but, as they moved beyond SC, they were finding that go-to dosage was 10 mg. So they responded to that, with line segmented into squat cans for the 5's and sleek cans for the 10's, with Original flavor just augmented by Raspberry and Orange flavors. And as their bar and restaurant biz blossomed, they found more spirits-like entry in demand, prompting addition of High Rise Infusion packed in 750-ml glass bottle good for 15 servings. Each 50-ml serving contains 10 mg THC and 2.5 mg apiece of CBD and CBG. Core credo of co is to use natural ingredients, including fruit puree base, and to avoid sweeteners like stevia in favor of smidgen of cane sugar, for about 20 calories per single-serve. In update video call and virtual tasting held yesterday afternoon, Skinner readily acknowledged that the use of puree necessarily creates consistency issues and makes it harder to find copackers among universe of operations willing to consider THC in the first place. Intent is to provide elevated option that can serve as creative palette for mixologists while not turning off core demo that's turned out to be affluent women age 35-45 who're seeking an alternative to a glass of wine. While brand currently uses a preservative, anticipated move to tunnel pasteurization will eliminate that need "as we move to the Sprouts of the world," Matt said.After deliberate start, brand built up big head of steam last year working over 1,800 in-person events while adding the 10 mg cans, variety packs, new flavors and the Infusion, 8 additions all told. Activations included athletic events like Bridge Run in Charleston and Running Man in Rome, Ga, as well as culinary tastings like Charleston Food & Wine Fest and Highlands Food & Wine Fest in NC.In discussion yesterday, Skinner was first to admit that he's been continually surprised at what he's encountered in market. Notion of alternating alc and NA bevs that's called zebra striping was a surprise, tho maybe it shouldn't have. After all, "we're known to drink alcohol in Charleston, South Carolina. In fact, I think every joke about Charleston, South Carolina's got alcohol in it." Ditto the preference for 10 mg dosages outside SC, to extent that in less than a year that dosage now exceeds 50% of sales.Then there was spirit entry, similarly not in the cards a coupla years ago. But "we realized we've got to commit completely to this category" with comprehensive portfolio spanning seltzer RTDs and spirits-like infusions. Development effort took a year, starting with 10 mg dosage in synch with what retailers like Total Wine prefer, tho on-premise accts demanded 5 mg too. Citrus entry was first 3 months ago, with Blood Orange and Raspberry just dropping now. High Rise team took pains to prevent any hint of weedy, "hippy" flavor in entries so that they'd work even just on the rocks. Co's mixologist Jenna Rusnak works to devise unique drink menus for key accounts.On distribution front, footprint doubled from 10 states to 20 last year. About 70% of partners are Anheuser-Busch houses, 20% Molson Coors and 10% indies, per Skinner's estimate. High Rise has proved a meaningful addition to some. In home state, brand is among top 5 at Southern Crown, along with Bud Light, Mich Ultra, Wicked Weed and Sam Adams, and reps 40% of house's THC sales in SC, where "they've got every brand in the book." State's Lowes Food grocers and Circle K c-stores have embraced category. On national basis, he said SPINS data shows High Rise to be #2 in grocery/c-store chains.By Skinner's account, Southern Crown proved to be handy ally to have as state regulators got their hands around advent of D9 bevs. It quickly became clear that state's Dept of Health wanted to shut High Rise down but co retained legal eagle, Curtis Harrington, who helped it formulate legally bulletproof items. Regulators' response, Matt recalled, was to mandate that dosage couldn't be flagged on package. So High Rise let it be known that it would pull out of SC, despite that state representing 80% of its biz at the time. "I think that was when Southern Crown initially took a look at us and said, 'Listen, these guys are going to do it the right way.'" The threat was headed off. Lately, Skinner noted, a reform bill that's passed SC Senate and is moving to house is "referencing High Rise and the High Rise procedures as the 'gold standard' of what to expect from a cannabis beverage company," he noted pointedly. That's path co intends to take in every jurisdiction, he made clear.

STRATEGY: Now in 20 States, SC-Based High Rise THC Brand Prioritizes Midwest Buildout While Expanding into Spirit-Like Infusion Line; Ex-Oskar Blues' Russell Helming DSD Buildout

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