This is an installment in a special series, Startup Year One, interviewing founders about the major lessons they’ve learned in the immediate aftermath of their businesses’ first year of operation.
Even in the spring of 2018 when the idea for Equilibria was born, the CBD space already had thousands of players. Of course, there were some high-quality brands, but in this unregulated industry, most were not seed-to-sale, medical-grade products optimized for therapeutic results. It is precisely this opaque and hype-driven landscape of CBD that inspired cofounders Coco Meers and Marcy Capron Vermillion to launch Equilibria.
As two serial tech entrepreneurs, the women recognized the hole in the market wasn’t around a different brand positioning or channel. First, it was about demystifying a new product category inextricably linked to cannabis, which is legal in only a few states. Second, studies are still inconclusive about the widespread benefits of CBD, which produces different results for different people, which is the underlying motive for Equilibria’s personalized dosage service. Every customer at Equilibria is paired with a personal dosage specialist, a trained cannabis educator who guides customers through how to tailor CBD to specific needs.
“Our mission at Equilibria has been and will always be to help women achieve balance,” Meers says. “In a sea of CBD brands, Equilibria provides not just medical-grade products from our partner farm (in which we have an ownership stake), but also individualized support for each and every member we serve.”
Fortune recently spoke with cofounders Meers and Vermillion to learn more about their first year in business, the lessons they’ve learned, the hurdles they’ve overcome, and their plans for the next year.
The following interview has been condensed and lightly edited for clarity.
CBD has never been bigger, and the space is getting more crowded every week. What inspired the launch of Equilibria? And how does it stand out from the bevy of other CBD businesses on the market right now?
Meers: Throughout my career, I’ve always been inspired to create beauty and wellness innovations that benefit women. I am an active angel investor in female-founded, consumer companies, and after brand management roles at L’Oréal in New York and Paris, got my entrepreneurial start as founder and CEO of PrettyQuick (acquired by Groupon in 2015), a beauty-booking marketplace offering seamless reservations at salons and spas nationwide. When Marcy inspired me to take a look at CBD’s balancing properties, I knew this was an extraordinary opportunity to take best-in-class science and wrap it in a services-first consumer experience that women could trust.
Vermillion: As an engineer, I’ve always been a problem solver first and foremost. When I sold my innovation consultancy in 2017, it was my own personal experience with CBD that led me down a path of learning everything possible about this powerful and complex plant, eventually to the point of leading workshops and one-on-one sessions on the medicinal and bioregulatory potential of cannabis for women. After a year of collecting women’s cannabis stories (fears, hesitations, triumphs) and organizing a wealth of product development data around what exists in the market (both good and bad), I met up with Coco to talk shop, and we discussed the gaping hole in the cannabis market when it comes to women.
Not only were there few truly quality-driven, over-the-counter options, but it was clear that women need an authentic, respectful hand to hold while they learn about what cannabis can do for them. Someone who could walk them through experimentation and finding the right product, dose, and frequency as they embarked on this journey, without any condescension or judgment. I heard stories of my fellow women aged 25 to 80 who felt like they were out of options, and scared, and I couldn’t stop thinking about it. On top of my own success story of using cannabis for spinal nerve pain and mental well-being, it was a no-brainer that we couldn’t not take our dedication to the women’s consumer space and answer this call. That one, impassioned, electric conversation served as the inspiration for Equilibria.
What were some of the biggest hurdles you faced in the past year? What surprised you the most?
Vermillion: As a startup, we’re constantly inspired by growth and all the challenges it brings. The company achieved 50% month-over-month growth all of 2019 and continues to sustain rapid growth even in the pandemic reality—north of 20% monthly. Balancing this momentum and scalability is a constant juggling act that keeps us on our toes daily. As a product company with dedicated technology and a human-to-human service, we are actively managing all three work streams at once. As an engineer, [I’m making sure] we’re applying automation and logic where possible, but managing this velocity is not without literal daily challenges.
Also, being in a highly unregulated industry presents its own maze. CBD oil is not a supplement, and it’s not a drug, so there is a lot of gray area in terms of FDA regulation. The industry is constantly evolving, and restrictions are changing daily, so we’re continually reviewing our systems to ensure we remain compliant and ahead of the curve. This also affects our ability to innovate within the space, as product development with evolving constraints is difficult. But we are determined to give our members what they need even if it is difficult. We started this business to change lives, and we knew it was an uphill battle.
But, of course, the elephant in the room is COVID-19. What we’ve learned from our members is that women are in need of CBD’s benefits now more than ever, so we’ve done what we can to keep it as accessible as possible in this time. And we donated $100,000 of CBD to women on the front lines as nominated by our members: Who deserves stress management more right now than those women? It’s the very least we could do, even as a startup.
Meers: I echo all Marcy’s thoughts on opportunities and challenges throughout year one. We are deeply humbled by this exciting growth and have assembled an incredible team of more than 30 women, who are similarly dedicated to this mission of balance through cannabinoid science. While managing scaling challenges and regulatory uncertainty keeps the day-to-day exciting, the most rewarding part has been knowing that we are really making a difference in the lives of our members.
What kind of feedback have you received from your customers, and have you (or will you) apply that feedback to how you sell your products in the future?
Meers: On the services side, more than 40% of our members choose to have a phone conversation with his or her personal dosage specialist to help unlock that perfect daily routine suited to his or her needs. Upwards of 60% of members are in touch with their dosage specialist through email. Our members rave about this personalized support. Life isn’t static, and neither are our bodies. In 2020, we’re doubling down on this personalized education with more ways to connect, like one-on-one chat and additional automation and recommendation engines.
Vermillion: On the products side, we hear heartwarming reviews on a daily basis about how our products improve quality of life for women. This feedback fuels everything we do.
For our Daily line, we’re working diligently on formulations that provide rapid onset and efficient bioavailability without the drawback of that signature cannabis taste (for those who don’t prefer the plant-forward oil). We have some exciting technologies launching throughout the year.
To round out our monthly subscription boxes, we’re also adding to our existing bath and body lines—our Relief Cream has a cult following for everything from period cramps to arthritis—in late May 2020. Combining cannabis with other proven botanicals for as-needed self-care in the form of a hot bath (Balancing Bath Bombs and Mindful Mineral Soak) or on-the-go “cannaromatherapy” (Dynamic Roller Duo) is another part of our mission. All of our product development is focused on rounding out how we help women tackle whatever’s thrown her way, from daily systemic CBD use to what’s needed in the moment when life calls for a little more.
Obviously, amid the coronavirus pandemic, consumers’ purchasing habits, and budgets, especially, are going to change. How does Equilibria plan to adjust to customer needs?
Meers: As Marcy mentioned, we have seen our members increase their daily dose and engage even more with our dosage specialist team throughout this unprecedented time.
On the financial front, we reacted very quickly in March with our “Here for You” campaign, in which we took 10% off every subscription renewal and new customer order. Going forward, we are evaluating new pricing structures which will allow us to offer our same high-quality CBD at lower monthly prices.
On the support front, we are growing our dosage specialist teams and expanding hours of coverage to be able to meet the needs of the community for more appointments. Our products and services were purpose-built to be extremely flexible, so whether members are bulking up or switching their routines around, we’re ready.
As noted, every Equilibria member is connected with a designated “dosage specialist” to help personalize his or her order. Has this changed during the shutdown period? How are customers connecting with specialists now?
Meers: We’ve always said that we’re a technology company first, so this is actually something that wasn’t heavily impacted. Our dosage team is able to maintain operations remotely and are accustomed to connecting with consumers via email, phone, et cetera.
During this time, I would say we’ve seen an increase in appointments by 20%, but also an uptick in customers emailing who are not able to do a phone call. We are adding chat functionality for this soon as well. Most members buy a starting dose kit and then talk with their dosage specialist once they’ve tried that for a week, and then their routine is adjusted from there.
At the same time, how does a shutdown of this nature affect the future of the business, from product development to raising capital?
Vermillion: While we haven’t yet seen any disruption to demand, we are building contingency into our supply chain at every level, from manufacturing partners to packaging vendors. Luckily our farm and lab has been unaffected, but we’re building as much redundancy into the system as we can to continue to offer uninterrupted service (and still launch innovative new products).
Meers: Having recently completed a $2 million raise, our balance sheet is healthy. We are continuing to invest in marketing and strategic hires and may choose to seek strategic capital later this year, but should the market require that we wait, we’re very fortunate to be able to be patient.
Looking beyond the post-pandemic era, which could be anywhere from a year to a few years from now, how do you plan to grow Equilibria, and what do you want the business to look like five years from now?
Vermillion: Looking out a few years, I want Equilibria to define how cannabis shapes the lives of all women everywhere. (Now: Over-the-counter hemp, but we haven’t ruled out a medical marijuana extension.) Usually as a product person, I say, “In trying to please everyone, you please no one.” But here we are with a market of approximately 25- to 80-year-old women. And that works in this industry because a woman needs Equilibria for different reasons in every decade of her life. Cannabis is an evergreen need. Not just for that daily roller coaster, but for new challenges in all stages of life.
Meers: Marcy and I are committed to advancing the mission of balance for women. Though Equilibria’s exponential growth to date has been thrilling, we’re not slowing down anytime soon! We believe that highest-quality cannabinoids have the power to improve life in myriad ways, for all women.
In five years, we hope to be a household name for premium cannabis products and services tailored specifically to women, whose biochemistry and complex lives warrant its balancing properties. We will always be a direct-to-consumer company at heart, but I suspect you’ll find us in select retailers and maybe with a few flagship locations nationwide. CBD is a journey, not a destination, and we’re prepared to accompany her all the way.