Cannabis cultivators are looking to technology to help automate, cut cost, and grow their cannabis business. Despite the legal barriers in the US the cannabis industry is growing at extraordinary rates, and are expected to continue to see growth in the future. With the industry growing, and customer demands raising, companies are looking to automation to be able to scale their business. Harry Brelsford of The CannaTech Group sits down with Jack Naito of Luna Technologies to discuss automation in the cannabis industry and what he is developing to help businesses grow and scale to meet demands.
Video Transcription
Harry Brelsford
Hey, we’re back with another CannaTech podcast. And we’re with Jack Nato from Luna technologies out of Portland, Oregon. How you doing? Jack?
Jack Naito
I’m great. Yeah. Thanks so much for having me on.
Harry Brelsford
All right. Well, you know, I want to thank you, first of all for helping expand my definition of technology when you and I talked the first time. My My challenge is I come from infrastructure and now you know, cybersecurity and that world of, you know, former Microsoft vendor and I need to think a little bit bigger in the cannabis supply chain about technology. Right? It’s it’s not just servers and passwords.
Jack Naito
Yeah, yeah. The industrial equipment side of it is pretty big piece too.
Harry Brelsford
Yeah. Yeah. And so let’s just what is Luna technologies? Let’s go A to Z. What’s your store?
Jack Naito
Yeah. So I found a luna technologies in 2016, with an old friend of mine. And we manufacture and sell cannabis oil extraction equipment. Got so kind of started out of a need my business partner Kyler, he was already in an extractor. He was working under a medical license at the time back in 2015. And all the equipment on the market at that time it was, it was pretty bad. Just put in nicely. It all came from other industries. None of it was built or designed for cannabis extraction. There was a lot of safety issues. There were a ton of issues trying to scale your business with the equipment. Just everything you might expect when you try to use equipment that wasn’t designed for the purpose you’re using it for. Yeah. So originally, I came on to work for Kyler to help him one just improve his process and then to automated. And back then what we were doing at the time is BHO extraction, butane hash oil, we thought everyone was going to be automating DHL. Then after about six months, we realized no one else was doing it. And so we started this company, Luna technologies to design and manufacture the
Harry Brelsford
equipment, ma’am. And what is the what’s the workflow, right? Because my audience are primarily geeks. And so we can kind of double click down into the workflow. Again, if we were talking workflow in my past life, we would you know, it, quite frankly, be the traditional seed to sale, ERP technology conversations. So help me understand your workflow in the different machinery and that kind of stuff.
Jack Naito
Sure, yeah. So starting from harvest, right now, most cannabis is harvested by hand. And that’s just because of the scale of farms. Most farms are pretty small. So you’ll harvest it by hand, maybe with equipment, then you’ll process it, you’ll have a plant with seeds and stems and buds. And well, probably not seeds, but you’ll have to process that into something that can be extracted. And typically, that just means taking off everything that doesn’t have THC on it. So whatever method you use for that, maybe a tan trimming, maybe it’s putting it through a machine, you get down to what we call just biomass, which is our feedstock for extraction. And that’s it looks just kind of like the weed that you see, you know, just in a bulk bed. Right, then from there, it’s often stored in a freezer. If you’re processing fresh frozen material, which is highest quality, as soon as it’s harvested, it goes into a freezer, then from the freezer, it’ll go to extraction, which is where Luna technology sits, and that’s where we dissolve the cannabis in a solvent, we extract out all of the valuable components which are all the cannabinoids and the terpenes, which are flavors and aromas of the plant. I mean,
Harry Brelsford
no, there we go, Hey, we’re keeping it right. Now like, go on.
Jack Naito
Alright, so. So yeah, after you extract all the cannabinoids and terpenes, then it goes into some sort of post processing process. And that’s either for BHO extraction, often it’s just a solvent purge, where we take out all the residual solvent, so there’s none of it left that the end user consumes. Or if you’re making other products that aren’t BHO specific, you might go through a number of refining steps where you’re going to separate out basically all the impurities that you accidentally extracted that you didn’t mean to so in the end, once you get to your final product, then you package it either into a vape pen, or maybe a tincture or some sort of distillate that can go into an edible
Harry Brelsford
and man just fascinating. Yeah. By analogy is this similar to maybe the the way spirits are processed? And I’m just saying by analogy, I understand you’re in a different line of work, but I you know, I do enjoy So I’m just trying to get my arms around.
Jack Naito
Yeah, yeah, yeah. So with vodka distillation, you start with, you start with some crude product that no one wants to drink, right. And then you do a series of distillation, which is just another way to say separations. And you separate out everything that you don’t want to drink from everything that you do want to drink. And usually it takes a number of steps to get to the final product that you want to drink, especially with the high quality vodka. And so we do a similar process. There’s a couple we do separation, we do both cold separation and hot separation. Okay, hot separation is distillation. Cold separation is just where we separate things by changing their or by their difference in freezing points. Whereas with distillation, you separate things by their difference in boiling points. But at the end of the day, we’re refining consumer product and just making it something more attractive for the consumer.
Harry Brelsford
Yeah. And what what’s your background? You know, do you one of these PhDs and bioscience or you know, what’s, what’s your background even know this stuff? Yeah, I
Jack Naito
came from, I have a master’s degree in mechanical engineering. And when Tyler poached me and offered me this opportunity, I was working in the aerospace industry working on automation.
Harry Brelsford
Okay, okay, cool. Um, yeah, cuz I have a real good friend down here in Austin, Texas. Pretty go getter young man, you know, and compared to my age, you know, it’s all relative. But he, he’s the CEO of a brewery in Austin. And before that, he was the CEO. So he was on the operation side with in these warehouses with tanks that look like what you have on your, your web page, right? Yeah. So if he gave me a tour, and he walked me through, and you do this, you know, he really knew his stuff. And he wondered about what would the possibility be at a future date? If he leaves Texas number one. And number two, if he wants to go to the cannabis industry, but what do you see out there? You know, so this, this guy has an MBA, I mean, he said, he’s a smart guy. And he knows manufacturing, for breweries and fairly good sized breweries. Do you see that in your industry? Where Pete in Portland in particular with the craft breweries Do you see people coming over from the other industry and getting retrained this added natural act?
Jack Naito
I think it’s natural. There’s a lot of overlaps between the two industries, and especially on where new technology sits our equipment. vho is really designed for craft products. And so there’s a ton of overlap where with beer, you’re talking about hops and different qualities of hops and all the flavors and aromas. That’s the same thing with BHO extracts where you’re trying to get, basically, you’re trying to take everything that the plant had to offer and put it into the consumer product. And then on the same side, you deal with the same problems with manufacturing from a natural product, you know, you have inconsistencies in what you start with, but you’re trying to get to a consistent end product. And so it’s a lot of the same issues where automation really comes into play and helps standardize and boost your efficiency and quality.
Harry Brelsford
Well let’s talk about that the the inconsistency in edibles is well known. So why do you think you might have a indica peanut butter cup and it meets your needs? You watched a little cable news you go to bed sleep like a baby. Another evening, you may not help us, the 30 Evening you might wake up stone I think there’s there’s
Jack Naito
a couple basic problems in cannabis one, it’s just kind of the because we’re a new industry. Quality control is tough, especially with edibles. You have to make sure we’re using it we’re putting a tiny amount of cannabis in a lot of food, right? And so you have to get a homogenous mixture to make sure that every edible actually has the same dose. And most places are doing it some places. It’s it’s just hard to get right. And then the other side of it is that we’re just missing the science on how the body reacts to different edibles. And that’s, you know, we’re just many years away from getting there.
Harry Brelsford
Yeah, yeah, because I recently did travel well not far went to South by Southwest to downtown Austin, but I had it takes about an hour to drive in and park so it felt like travel. Of course, you know, they have some evening receptions and I have a Tito’s vodka cran. And here’s my point with Tito’s I can be in Austin, Texas, Denver, Miami, and I kind of know the experience I’m going to have right I’m gonna have a drink. And i i My expectations are managed. What I’m hearing you say is we’re not really there with cannabis. Right.
Jack Naito
I think some businesses are there Some businesses aren’t. We’re getting pretty close. And it’s really all just about testing on the inside making sure that your consumer product has exactly what you say it has.
Harry Brelsford
Yeah, yeah, exactly. Well, I’ll tell you what we’re gonna keep an eye on. Yeah. I appreciate you’re raising your hand and educating us on what do you call it? industrial equipment, technology, a different category?
Jack Naito
Yeah, yeah. All right. Good to be here and happy to talk with you.
Harry Brelsford
Yeah, continued success. Thanks, Jack. Thanks.
