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LifestyleCannabis

Pour yourself a glass of this cannabis-infused wine

By
Stephanie Cain
Stephanie Cain
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By
Stephanie Cain
Stephanie Cain
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April 20, 2020, 4:20 PM ET
All cannabis wine starts out with wine in the traditional sense, most of which are sourced from wineries in California.
All cannabis wine starts out with wine in the traditional sense, most of which are sourced from wineries in California.Courtesy of Rebel Coast

A handful of startups are hoping cannabis-infused beverages become a trend. But while other CBD purveyors have leaned more heavily toward fizzy drinks, these producers are reaching for the brass ring with the development of “cannabis wine.”

A wine-like product, these THC- and CBD-infused concotions are made with wine grapes sourced from reputed regions, including California’s Sonoma County and Napa Valley. But instead of getting a buzz from alcohol, the sensation stems from the addition of a water-soluble cannabis mixture added to dealcoholized wine. And like real wine, you’ll feel the effects in a matter of minutes.

But legal restrictions, skepticism regarding cannabis, and the newness of the infused beverage are keeping the product rather niche. It currently represents only 1% of the drinkable cannabis category—such a small percentage, that trend predictors at the Wine Analytics Report, which follows all sorts of beverages, doesn’t even track it. But that will increase in the future, producers say, as more cannabis fans discover new methods of consumption and the canna-curious gravitate toward a familiar product.

“Californians love cannabis, and they love wine, and we knew cannabis wine would be a hit,” says Josh Lizotte, cofounder and CEO of Rebel Coast, which, in 2018, became the first brand to launch a cannabis wine. “People are really curious about it. It drums up a lot of attention from consumers.”

Rebel Coast’s cannabis beverages—including the Sauvage (made from Sonoma-grown Sauvignon Blanc grapes)—are in more than 200 dispensaries in the state of California, a huge success for the brand in just a few years. When Rebel Coast first launched a cannabis wine, consumers had no idea what the product was exactly. (Many of them don’t today, either.) He and his team spend a lot of their time educating people about the beverage—starting with how it’s made.

Rebel Coast winemaker Muiris Griffin studied in Bordeaux and has worked for big Napa Valley names like Opus One and Ridge.
Courtesy of Rebel Coast

The first step, once the wine is in hand, is to remove the alcohol, as California law states that products cannot have both alcohol and cannabis. The process is tricky, though, as the dealcoholization can also extract important natural flavors and aromas from the wine. It’s a careful system to keep it all intact.

Next, producers mix carrier agents with cannabis oil, turning a non-water-soluble product into a water-soluble one that is tasteless and odorless. It’s then spun into nanometer-size droplets via a nana-emulsion technology, so that the cannabis integrates with the liquid and is more quickly absorbed when sipping. Activation can take anywhere from five to 15 minutes—comparable to how long it takes to feel the alcoholic effects of a glass of wine.

“None of this is easy, and especially not cheap, but we know we are setting the foundation for what we hope will become the gold standard in infused beverages,” says Tracey Mason, cofounder and chief executive officer of House of Saka, a line of cannabis-infused beverages that uses exclusively Napa Valley base wines.

It’s been a challenge, though, given restrictions around marketing and selling the product. For one, Lizotte says, cannabis wine brands are not allowed to use “wine,” “dealcoholized,” or any term associated with wine, such as “rosé,” on the labels or marketing. Then, of course, there are the massive 30% state and local taxes, which, he says, are “burdensome to consumers” and therefore the growth of these brands. Thirdly, consumers still don’t quite understand what the beverage is, meaning the onus is on the brands to educate consumers. And lastly, well, cannabis still remains illegal in many states, so brands like House of Saka and Rebel Coast are only sold in California.

“The revenue from the cannabis industry is expected to reach $5.5 billion by 2024, but only about 35% of that is from the legal sector,” Mason explains. “The illicit market is the industry’s worst-hidden secret. It’s relatively unpoliced and puts us at an extraordinary disadvantage when it comes to pricing and access to the consumer.”

House of Saka Pink is handcrafted from grapes grown in select vineyards within California’s Napa Valley.
Courtesy of House of Saka, Inc

All of that aside, the category appears to be growing. Mason’s House of Saka Pink and White branded beverages hit the market in October, driven to attract the female consumer who is a fan of luxury wines from Napa Valley. Mason explains she wanted to create a product that echoes the familiar social applications of a bottle of wine. In fact, the brand’s namesake is an ancient tribe of female warriors who actually used cannabis-infused wines as part of their pre-battle rituals.

Viv&Oak just launched its first-ever cannabis-infused red wine in February; it’s made from 100% Zinfandel grapes, also sourced in California. The Shimmering Scarlett, as it’s called, is available in three dosing levels as way for consumers to regulate their input based on the high they want: 50 milligrams of THC per bottle; 100 milligrams of CBD with four milligrams of THC per bottle; and 25 milligrams of THCV with 25 milligrams of THC and 25 milligrams of CBD per bottle.

“For me, it didn’t make sense to make one dose for everyone,” says Alana Burstein, Viv&Oak founder and president, noting other cannabis products are sold in different doses. “Every customer requires a different dosing style that suits them.”

Viv&Oak proposes its cannabis-infused beverage as a “healthier alternative,” with only four grams of sugar and 24 calories per glass.
Courtesy of Viv&Oak

But critics charge cannabis wine is an unfounded idea, stealing a chunk of the market away from wine and other alcoholic beverages. Instead, producers reply, the prime target audience for their cannabis beverages are cannabis fans who usually don’t drink alcohol anyway. “They are excited for a new, delicious way to consume,” Burstein says. And the canna-curious, she adds, are excited to try a cannabis product made more relatable in the form of wine. “We see the wine industry as partners not competitors,” Burstein says. “Wine connoisseurs love their wine just the way it is.”

Lizotte echoes that sentiment—he’s not trying to get a wine snob to switch to his product. Most big-time wine drinkers probably wouldn’t even like his beverages, he says: “If you pick up a bottle of cannabis-infused wine and assume it’s going to taste like a stellar Napa wine, you’ll probably be disappointed.” Lizotte thinks the pitting of cannabis against the wine industry is all media hype. “We’ve worked with quite a few vineyards and winemakers over the last couple of years, and they’re all really excited about what we’re doing,” he says. “They don’t think of us as detrimental to their craft.”

Cannabis wines may well open up a new consumer base for wine growers and a new sales channel for the wine industry as a whole, since, after all, these cannabis-infused beverages are made with wine. Add to that increasing consumer interest in the plant, and these producers are all banking that their beverages will be a hit—no pun intended.

“The fact is cannabis isn’t going away,” Mason says. “What’s different now is that we have room for innovation, for real conversation, and especially for more education about the plant, its extraordinary benefits, and responsible means for consumption. Probably the best place to start is with a glass.” And there’s another important detail to consider, says Burstein: “no hangovers.”                 

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—Listen to Leadership Next, a Fortune podcast examining the evolving role of CEOs
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About the Author
By Stephanie Cain
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