Cultivating Change: Hemp’s Sustainable Impact on Farming and Paper Production with Kim Kovacs from Element 6 Dynamics

Join us for an enlightening conversation with Kim Kovacs, a trailblazer in sustainable farming and hemp innovation.

In this episode, we explore the profound impact of climate change on farming practices in Southern California and unravel the transformative potential of hemp as a rotational crop.

Kim Kovacs shares her firsthand experiences working with farmers, emphasizing the importance of regenerative farming and the need for capital to fuel sustainable infrastructure projects. As we navigate through the challenges and opportunities in the hemp industry, get ready for a deep dive into the world of agriculture, environmental consciousness, and the pivotal role of hemp in shaping a greener future.

Additionally, discover how hemp is revolutionizing the paper industry, providing eco-friendly alternatives, and contributing to a more sustainable approach in everyday products.

This podcast is your gateway to understanding the multifaceted journey of hemp, from farm to paper, and its crucial role in cultivating positive change.

00:03 Isaac:

Hey, Kim Kovacs, how are you? It’s great to have you on.

00:06 Eric:

Great. Thanks Isaac. Pleasure to be here.

00:09 Isaac:

No, it’s, uh, it’s been way too long since we’ve had to catch up. Um, but yeah, we appreciate you taking the time to jump on the Route to Risk podcast with us and, and would love to start with learning a little bit more about your background and, uh, some background on Element six and what, what you all are building.

00:27 Eric:

All right. Well, how much time do we have? Uh, <laugh>,

00:29 Isaac:

Just as much as you need <laugh>.

00:32 Eric:

Um, yeah, so just, uh, so I’m in industrial hemp, so Element six, we’re focused on really looking at, uh, using hemp in a sustainable and scalable way. Our first production, in fact, I can say that now, um, is replacing tree based pulp with hemp derived material. And so, um, I’ll get into that a little bit more about that in a second. But from my self personally, this is, uh, an interesting sort of twists and turns to get here. Um, I’ve been an entrepreneur for the last 25 years.

01:05 Eric:

I’ve had six different startups both in and out of sort of technical space and clean tech. That was kind of my background. And then I had my foray into cannabis for a bit, which is really where we first met and had a company there that I sold. And then I was the, um, c e O of Arcview. And so Isaac, you and I had had a chance to really get to know each other, um, including golf games. Yes. At, uh, at Arcview and through some of the other groups. There

01:33 Isaac:

An impressive golf game on my end. But, uh, at that, at that time, drew at least helped our, our scramble team a little bit. <laugh>. Yeah,

01:40 Eric:

He certainly did. So, um, so anyway, I appreciate you and everything you’re doing here in Alpha Root Two really, um, help support that industry because it’s needed. And, um, I’ll say while I was at Arcview, one of the things that I found was fascinating was not just sort of the marijuana side of the business, but also the hemp side of the business that we were, you know, helping to fund and develop and so forth through a view. And we did this thing called, uh, hemp Day. So a global hemp day actually turned into two days <laugh>, and I learned so much about the hemp plant, the potential, the industry, the history.

02:19 Eric:

And ever since then I was hooked. And so when Steven Gluck Stern, you know, approached me at the time it was called Santa Fe Farms, you know, to come in and join him and really help build out the industrial hemp industry, I couldn’t say no, even though leaving rfu was really hard for me. And so, um, and so here I am, and you know, it’s been two years now that I’ve been here. Um, I have to say though, Steven passed away about a year ago. And so I’ve been c e o for about a year and a half and just, you know, really taking, you know, all those 50,000 things you can do at the hemp plant and really focusing it on one thing and doing it right.

02:57 Eric:

And so that’s kind of where we are today.

03:00 Isaac:

No, I love it. And I think, um, you know, obviously we’ve been in a lot of contact over the last few years, um, through Arcview and now through, you know, Santa Fe Farms and Element Six. Um, but of all the things that you all, you know, kind of started the scope, what really kind of drove the decision to, you know, narrow the focus on what you all are focused on now? Because I know, I know initially, um, you know, the scope was pretty wide with what you were looking to do with that plant because of so many applications that has. So I’m curious, so what the decisions were made and what kind of led you to where you’re now?

03:32 Eric:

Yeah, so when we started in 2018, actually really more towards the end of, uh, I’d say 2017, early 2018, uh, Stephen Gluck Stern ha was living in Santa Fe, New Mexico and was approached by a couple of, um, his friends who wanted to really get into the hemp space and grow hemp for C B D. And so, like every good entrepreneur or Frontiersman, I used to call him, you know, he saw this huge opportunity to get into a newly legal market, you know, with the 2018 Farm Bill and to, you know, buy land.

04:05 Eric:

So, you know, Santa Fe Farms in its early days, we were all about the hemp industry with regard to C B D, right? So he had, you know, a thousand acres of farmland in New Mexico. Uh, we also bought or acquired six different companies in the hemp space, and it really stretched across, you know, C B D seeds and genetics to farm and farm practices.

04:29 Eric:

We had a testing facility, so we had a lot of businesses in the hemp space, um, very specifically designed towards C B D. But I think as Steven got started, what he realized is that, you know, C B D was, was fantastic. I mean, health and wellness and all of that, but if you really looked at all these other applications, and so when I came into years ago, there were really three things on our roadmap. We said, okay, can we get into the plastic space? Can we start to replace, you know, plastic either as a filler at the time, and it’s still really just a filler, um, or a true replacement for plastic in, in the, um, development of that animal feed was another one.

05:09 Eric:

So protein, so animal feed, meaning the seed of the plant can be used for that and or paper. And so we really kind of looked at those three different types of markets and said, where do we think we can land on one of them and do it right?

05:25 Eric:

Um, well, with regard to plastic, we didn’t really have a good partner there to start with. And there seemed to be a lot of different applications and the jury was still out. Whether or not you can really recycle it the same way, um, you know, as a plastic filler or a replacement filler, it’s not necessarily the same type of material as the true plastic itself. And so there’s some like what ifs about that protein animal feed great opportunity, but still regulatorily, um, prohibited, right? U S D A has not approved, approved for animal feed across the country.

05:59 Eric:

Now, certain states have taken a lead and said, we want it for chicken feed, or we want it for cattle, or we want it for certain types of animals. And so like Texas, um, and Kentucky and Pennsylvania, and we actually helped those states get there. But until it becomes federally legal, it gets a little challenging.

06:18 Eric:

So that brings us to paper and pulp. And fortunately, and this is where the stars align or you know, um, serendipity or however you wanna say this, Stephen met John Ingram and John Ingram of the Ingram family is truly a pioneer. And I would actually say really an intrapreneur as well. His family businesses have been around for generations, and he started what’s called print on demand in the country and in the world.

06:50 Eric:

He took the opportunity to print books one at a time as opposed to filling up a warehouse of books and hoping they sell. And he was very, um, early in his time there in that vision, but his, uh, his goal was to not overproduce, right? That’s wasteful. Printing 10,000 books and sticking in a warehouse and hope they sell instead, print on demand was really the way to go. Fast forward, you know, 10, 15 years, he now has a, a, a mission and a vision to start removing trees from that equation.

07:25 Eric:

He’s like, you know, our first round of sustainability was not overproduction. He said, our second goal is to remove tree based pulp as much as we can. And so when he and Steven met, it was just kismet, you know, they were like, Hey, we’re on the same, we’re on the same path it off the same thing. Yeah. And so really with John Ingram’s support, both financially as a visionary with his company and looking at how do we back solve into his need with a hemp solution is exactly where we focused.

07:58 Eric:

And thank goodness, because in the last year, we have literally planted hemp, harvested hemp, processed it, pulped it, made paper, and then printed a book on it all within seven months in the United States. That’s incredible. First time ever. And so, you know, it’s just, it’s such an amazing thing to think about and you know, I like showing it ’cause it’s just the coolest thing, but you literally pick up this book, and I know people listening to this podcast can’t hear it, but, um, we can certainly send you a reel, uh, little sizzle reel of how it was made.

08:41 Eric:

But you look at this and it, you can’t tell Isaac, you can’t tell that this is hemp. That’s the whole point, right? There’s beautiful hemp stationary, there’s beautiful hemp business cards, but they look like they’re made outta hemp. They have the fleck in them, they have the, you know, you can see the fibers, but when you’re talking about, you know, toilet paper or boxes or printing paper, you don’t want that. And you need it to fit into the supply chain. That was the other thing that we had to really demonstrate is that we could make this at scale, scale.

09:15 Eric:

I mean, Ingram prints 500 feet a minute. It’s a fast moving machine. You can’t have paper that doesn’t match the requirement going through there. And so that’s what we did. That’s what we’re doing.

09:31 Eric:

That’s, that’s awesome, Kim <laugh>,

09:35 Eric:

It’s pretty cool. And like I said, this is our first product. I mean, pulp is used for a lot of things. And if, and we did this right, because we were starting to really focus in on this marketplace, but you know, we cut down 68 million trees just in the US or for the US consumption alone. And half of that is used for toilet paper and tissue paper and things that we literally throw away. So if you think about just sort of a macro sense of, you know, we’re deforesting to literally flush it down the toilet doesn’t make a lot of sense to people when you break it down that way.

10:13 Eric:

And so our goal here is that we’ve proven it works in this application, but that pulp is applicable across a lot of things, including toilet paper, tissue paper, um, cardboard packaging, you know, all sorts of things.

10:28 Isaac:

Oh, definitely. I mean, of, of all those different items that the pulp can be, you know, placed into, is there, is there one in particular you all are focusing on next, or is it just kind of, you know, continue with the paper side of things and, and see where that goes?

10:42 Eric:

Well, our biggest next challenge now that we’ve shown that actually can be done at scale is really now scaling. And for us, what that means is that we regionalize the production of the material. So our goal is to, and which we’re doing now. So we’ve grown hemp in seven different states already, and we’ve identified the right genetic material. So hemp is not all the same, right? Some hemp is grown for c b D market. And so those seeds are actually bred specifically for that market.

11:15 Eric:

We’ve now bred seeds specifically for making pulp, and now we have that genetic line. It’s a OSCA certified, so it’s non-detect t h c. And you know, we’ve proven that the seed will perform, as we say it does, and we contract with farmers across the country to grow for us for that purpose. And so our next stage here is really commercializing.

11:39 Eric:

So going into these different states, um, Wisconsin’s been a great state for us, but we’re also looking at like New York, Washington State, um, Alabama, Tennessee, Texas. We’ve got a lot of really cool states coming online this year where we grow. And then the plan is to grow enough material within about a 50 to a hundred mile radius of a pulp mill that we will own or work with an owner to produce this hemp pulp specifically.

12:10 Eric:

So the idea here is to grow enough of the material regionally having a pulping facility regionally, and then taking that material and sending it to a paper mill partner who then turns it into these final products. And if we can do this all within these regions, and there’s a lot of pulp and paper mills around, but a lot of ’em are also struggling. You know, we’ve shored a lot of these jobs and this technology, I put that in air quotes because, you know, pulping technology and paper making technology has been around for a long time over a hundred years.

12:46 Eric:

And so, you know, we’ve moved a lot of that to, you know, overseas. And so we wanna bring it back and we wanna bring it back regionally, and we wanna support these regional markets where I think one of the, um, we’re, I’m going to Wisconsin in a couple of weeks, and one of the towns we’re visiting has about 2000 people, and the mill that closed had 900 employees.

13:08 Isaac:

Wow. So yeah, 50% of the population lost their jobs.

13:12 Kim Kovacs:

<laugh>. Yeah.

13:12 Eric:

Yeah. That’s significant. You know, and we’ve been doing this over and over, I mean, over the last 10 years, we’ve closed 130 pulp and paper mills in the United States. And demand hasn’t changed. Demand has shifted. You know, we used to use a lot of, you know, pulp for, let’s say retail packaging, right? When big box retailers were all the rage, you know, 10, 20 years ago, a lot of the packaging requirement was getting, you know, products to those retailers. Well, we’ve just shifted the demand. Instead of it going to the retailer, it comes to my front door.

13:45 Eric:

I have some grown kids that still deliver stuff like almost every day to my house. You know, so we’ve just shifted the demand. It hasn’t changed. In fact, some say it’s growing because now we can use pulp, especially sustainable pulp instead of plastic for like packaging and other things. And so that’s really our next phase here, Isaac, is to start to grow in these regions, start to support regional farming, regional processing, and bringing those jobs back and onshoring our requirements as we move toward emissions and scope three requirements for these large packaging companies or these large C P G brands, you know, that need a solution.

14:28 Kim Kovacs:

No, and, and I think it’s, I it’s always interesting to get, because a lot of the, you know, the focus of, and people that we have on the podcast is, is cannabis, whether it be investors. So it’s always great to have the other side that’s much less talked about, but has a, a tremendous application, um, on the industrial hemp side. And, and one thing that I always wondered, and Kim, you kind of outlined a ton of the benefits that hemp has, right? You know, especially in your specific niche. What do you think are some of the barriers with like, wider proliferation?

15:04 Kim Kovacs:

Is it, is it just time? Because now we’re just starting to really hone in on our supply chain? Is it, you know, existing infrastructure? I guess, like, you know, what, what’s the barrier for everything being, you know, turned over to hemp, right? Given what’s demonstrated as a much cleaner alternative to a plastic or, you know, harvesting trees?

15:27 Eric:

Great question, Eric. Oh gosh. You know, and, and not insurmountable, but it’s a number of things that sort of have to happen at the same time. So hemps only been legal since the end of 2018. I mean, really, the firm act, or the firm bill was amended in 2018 and took effect in early 2019. So we’re less than five years old as an industry legally in the United States. Yep. Now, China, Europe, they never had it illegal for industrial hemp. And so they’ve constantly or continuously have used those, that product for things like rope and textiles and different things, but not really caring about the T H C number, right?

16:08 Eric:

So hemp still in the United States, even with the, the Farm act and the, and the amendments to it is still a regulated crop, and it’s regulated by each state. And so each state can decide what rules they’re gonna kind of impose.

16:22 Eric:

But minimally hemp farmers have to go get licensed, they have to be fingerprinted, they have to apply for a license, and then their te their, their fields have to get tested, which is a cost to the farmer. And so we’re supporting, um, sort of a, a revision to this regulation. It’s called the Industrial Hemp Act of 2023. And this is a bill by tester. And what Senator Tester said is, you know, let’s just treat this like any other crop. So if we can get that done, and we can say, okay, so now this opens it up as any other crop, it doesn’t have the risks associated with growing hemp and all of the other things they have to do.

17:04 Eric:

It opens up insurance, it opens up funding, it opens up all these other doors. And so if we can just crack that open just a little bit, to me, that will help bring it into the mainstream. The other thing, Eric, is education still to this day, I have people come to me and say, well, I smoked that in college. And I’m like, well, probably not <laugh>, because, and if you did, you’re right, DISA

17:30 Kim:

Disappointed, probably did it. Yeah. So someone got that. Yeah.

17:32 Eric:

Because we don’t have any TC in it. And so, but it looks like marijuana. I mean, it still has the same leaf structure in a lot of ways. And so, you know, I’d say between, you know, let’s put a le level playing field for the farmers. Let’s not penalize them because they have to now go through these extra hoops for something that doesn’t exist. ’cause T h C doesn’t exist in our products. And so, and we’re using it for, for paper and packaging and different things like that. It’s like, you know, it, it’s not even on the market or a shelf to buy like that.

18:04 Eric:

Um, so let’s do that. And then that’ll open up farming, that’ll open up financing, that’ll open up all these other things that’ll really make it happen. Um, I also think, you know, brands, especially big companies, are really worried about scope remission.

18:20 Eric:

You know, they’ve done what they can to say, okay, no more copy paper in our offices and, you know, we’re gonna, you know, not use, um, you know, we’re gonna have only recycled, you know, containers in our, in our space, and we’re gonna go to, you know, this kind of water filtration instead of bottled water. I mean, they’ve done all the things they can do right on their own. Their problem is, is they can’t control their supply chain the same way. And so this is a solution for these big brands to come back to their supply chain and say, we wanna use your packaging, or we want to use your paper source, but you have to be sustainable and you have to show that you’re reducing emissions.

18:57 Eric:

And how can you do that? We can do that with us. And so we fit into that solution really nicely. So again, I’d say open up the regulations, make it a level playing field and education. Those are really the two big barriers for us.

19:13 Isaac:

No, and that one makes sense. I guess, oh, sorry, go ahead, Eric.

19:17 Kim Kovacs:

No, I, I was just gonna say too, what what’s really cool about it is like the, the timing of it, because I think we’re entering, um, a period of time where people are much more conscious about that, especially just like, you know, gen Z and, and younger generations about their carbon footprint. Um, you know, something, not something that, you know, older generations really thought about as much. And, and also just in, there’s, there’s a shift in business, right? Um, with, you know, c s G initiatives and, and not only driving revenue for shareholders, but doing it the right way.

19:52 Kim Kovacs:

Um, and so I think it’s, you know, as these things continue to develop, obviously as you mentioned, it’s been five years, right? And so we’re still very early on in the game, but I think, um, just given where, you know, I wouldn’t say humanity, but like mm-hmm <affirmative> much more like social awareness around these sorts of initiatives. And I think that’ll be really helpful for the proliferation of, of uh, industrial help.

20:20 Eric:

Absolutely. I agree with that a hundred percent. And I think it’s also kind of moving up a little, I mean, I’m not Gen Z <laugh> or you know, Don,

20:31 Eric:

But you know, but look at this and say, you know, I, in southern California, and this was the first winter that we’ve had some significant weather and we’ve had the hottest summers as well. I mean, I live in sort of the coastal region and what’s amazing is that, you know, we’ve never had it, this hot homes in my area don’t have air conditioning. They never needed it. And now it’s like you can’t live without it in August, September, or October, sometimes even into November. And so global warming et it’s climate change.

21:04 Eric:

And we’ve all kind of are seeing this in different ways in different parts of our world. And, you know, whether or not we’re causing it or this, that or other thing. But if we could just kind of save some of that boreal forest and not cut it down to put it in our toilet, I think that’s probably a good idea.

21:21 Eric:

You know, I don’t need to necessarily be a full environmentalist or believe in climate impact or anything else to really just say that just makes a lot of sense to me. Totally. And if I can bring a job to a farmer and I can have this plant grow in 70 to 90 days instead of 20 years, that also seems to make a little bit of sense to me. You know? And if hemp is gonna regenerate soil, this is the other part that’s super cool. The hemp plant is pretty amazing. I mean, it regenerates the soil. And so what we propose to farmers, our farm partners, is that take it as a rotational crop.

21:56 Eric:

Put it in every third year or every other year, depending on what other crop you’re doing, because it’s been shown to bring nutrient value back into the soil because of the deep tap roots that it has.

22:07 Eric:

And so, you know, a wheat farmer, for example, has to cycle out every third year anyway. ’cause they’re not gonna get a crop if they keep going. Monocropping doesn’t work for the lands. We’ve proven that. And so we find that we’re kind of a story of, and not, or like we can grow for our consumer needs and we get to regenerate the soil and we get to provide jobs here in the United States that are now overseas. And so I think we kind of all woke up a little bit, maybe during covid things started happening.

22:42 Eric:

You know, supply chains got disrupted just generally. I mean, there was a run on toilet paper at my grocery store,

22:50 Isaac:

<laugh>, you know, I think. Yeah, yeah.

22:53 Eric:

You know, and people got a little worried that we don’t have that here anymore to make those products. And, you know, not to mention the chips and all the other things that, you know, from a technical standpoint, but even a non-technical standpoint.

23:08 Isaac:

Right. Well, and that’s, you know, kind of the, the thesis here is one of the things I wanted to ask you about is how has the adoption and education side on the farmers been going? I mean, ’cause I feel like for them, you know, it’s a unique plant, obviously, to your point earlier, um, some of them might be a little hesitant due to the requirements for them. Um, but how has that process been going? And are farmers more receptive because of that end aspect of hemp that it’s not gonna replace what they had been growing for generations in some cases?

23:38 Eric:

Yeah, I’d say that, you know, I, regionally it’s a little different. I mean, some areas of the country are a little bit more open to growing it. Um, but we work with farmers where they are. I mean, we’re not saying go all organic, right? I mean, there’s a lot of conventional farming happening in the United States, and there will always be conventional farming that is not organic farming because we need things in bulk. I mean, we grow 90 million acres of corn in the United States that’s not all organic. And, and should it be, I mean, if you think about where that product’s going, you know, we’re making corn starch that’s now being used in a lot of new applications.

24:18 Eric:

We’re doing ethanol production, you know, so there’s things that are being done with that crop that aren’t being ingested into our bodies as humans. Now that being said, we would love to have all of our farmers be regenerative farming and making sure that they’re doing the best practices and reducing water and pesticide and, you know, fertilizing in various things.

24:38 Eric:

And so we provide the seed and the, I would say hemp expertise. What our farm partners provide is they know their land, right? And some of them are third generation or more farmers. And a lot of those are kind of what you said before, they’re Gen Z and they want something different. You know, their, their granddaddy was a potato farmer, you know, <laugh>, and that’s a great living for them. But now could they rotate something else in there and have a really interesting connection to what they’re doing and who’s buying?

25:14 Eric:

So here’s a really interesting thing that happened. We grew in Wisconsin for this production run for Ingram. So I know exactly the farmer, I know the seed, I know the land. I know how much water was used. I know everything about it. And Alex Mootz is our farmer for that particular product. That product went and got pulped and it got turned into a book book.

25:36 Eric:

And so when we were making the paper in Michigan, I said to those guys, I said, you know, this product came from Wisconsin, this hemp. And they’re like, oh my gosh. ’cause one guy had like a Green Bay hat on <laugh>, you know, and all this stuff. And I, they were so excited. It was the first time, I think, ever in a paper mill where somebody had a connection to the raw material that was coming in, where they go that, and he even said, he goes, that might’ve been my dad’s farm or my grandfather’s farm that they came off of.

26:09 Eric:

That’s really cool. How cool is that? You know? Yeah. And so I see all of these things sort of as an opportunity for us to, to do something right at the beginning. So I think actually hemp being, um, sort of outlawed is a little bit of a blessing, to be honest. ’cause we can do things differently that unfortunately trees can’t do. Right.

26:32 Isaac:

No, I mean, I think, um, you know, you, you’ve gone over a lot of what the future holds, but what do you think the next kind of proper steps are for the industry in general? And I know guys are supporting the, uh, amendments or the new version of the bill. Um, but what else can, you know, people in general be doing? Or where where can the industry go from here in, in the coming years and months?

26:54 Eric:

And I’ll probably sound like a broken record with everybody else you have on here, <laugh> and asking a similar question. And it’s the same in the cannabis space, which is access to capital. Right? And I think for us, it isn’t, um, necessarily about hemp. Well, it is, but that’s one layer. But we also have, you know, challenges of, you know, funding infrastructure projects in the United States. You know, we want alternative materials. We wanna have sustainable production. But, you know, the, the venture capital world hasn’t necessarily embraced infrastructure.

27:28 Eric:

They haven’t, you know, we’ve, we’ve, like I said, shored a lot of stuff. We’ve divested not invested in infrastructure in this country. And so I think capital markets are starting to, to get it, you know, that if they don’t put a 10 year or a 20 year plan in place, that none of this is gonna change.

27:47 Eric:

And so we’re fortunate enough to have a couple of really great capital providers. Uh, one is willing to step in for a $300 million opportunity debt. That’s awesome facility, you know, to build these facilities. And I’m like, bless you, <laugh>, thank you. Because without those kinds of folks coming to the table, none of this is gonna get done. So we have interested customers, we have farmers who are ready and willing to go, we have the right genetic, we need a little bit of change on the regulatory side, and we need capital to open up.

28:22 Eric:

And so those are the things, and let’s roll back to like 2000 7, 8 9, when Tesla was just getting started, right? You know, without government support and the billions of dollars that they received in both federal and state monies, we wouldn’t have that industry today. And look what’s, how that has propelled us forward as a, as a country, as a world in recognizing the need for electric vehicles and electric transportation, electric opportunities versus gas, right?

28:57 Eric:

Oil and gas. And so we wanna be kind of using that as a little bit of a roadmap and say it’s a public private partnership here, right? We need capital to open up, not just in the private space, but also in the public space and getting government behind it.

29:15 Isaac:

No, it’s, um, it’s interesting that capital crunch is a universal issue across everyone we speak to, and it seems to just extend outside of the industries that we focus on as well.

29:29 Eric:

Yes. Now we said AI or something, you know, or chat G P T I mean, maybe then we’d have a lot of money coming our way, but, um, you know, we’re a traditional business.

29:42 Isaac:

Yeah. It is funny. Um, you know how certain things become super hot really quickly and then, um mm-hmm. <affirmative>, we’ll, we’ll see what happens on the AI front given some of the, the recent news about, you know, the AI technology learning languages they weren’t programmed to, and things of that nature, which are giant red flags. Meanwhile, they could be giving companies like you capital to help rebuild our farming system and, uh, infrastructure internally.

30:05 Eric:

Yeah, indeed.

30:07 Isaac:

Um, but this has been awesome, Kim. We, we really appreciate your time. And before you go, we’re gonna do a little switch up and have, uh, Eric ask you a few, uh, fun questions that are outside of, uh, outside of the, the working, uh, questions.

30:21 Kim Kovacs:

That’s funny because you threw me a curveball, because normally Isaac’s the one that does that. I

30:25 Isaac:

Know

30:26 Kim Kovacs:

One of the questions. No, I’m just kidding. <laugh>. Um, no, so, so we always just like to like, you know, one thing that we’re doing too is, is building, uh, a playlist on the Roots to Risk podcast. And what we’ve been asking people is, you know, when you’re either getting fired up for the day or, you know, just wanna put on a song and relax. Like, what’s your, what’s your go-to song to get you excited and, and in a good mood? Oh, or artist, one of the, the

30:54 Eric:

Stronger artist. You know, what I’ve been digging lately, this is, this is gonna age me too. I think I’ve already disclosed, I’m not Gen Z, but, uh, the Gypsy Kings, I love those guys. And you know what, one of the things that I really appreciate is they take sort of these older songs and then they redo them in their style. And so I just, I love it. It’s just, I’ve been addicted to them for now, probably the past year. I’ve just been, it’s just been fun. So that, and a little bit of bluegrass too. I’ve been kind of getting into some, some new genre, um, okay.

31:26 Eric:

Getting out of my like, you know, I like the eighties bubble sort of thing, <laugh>. Um, so yeah, those, I would say those two things are really kinda floating my boat today.

31:35 Kim Kovacs:

There we go. Awesome. Um, uh, another another thing is just what would be, you know, one book that, you know, you’ve turned back to or something that you’d recommend, aside from the, the newly published, you know, Ingram book, <laugh>, um, but you know, one that you’ve had a, a lot of lessons from that you think would be just valuable for, for other people to, uh, to wrap their head around.

32:01 Eric:

So there’s two that I’m kind of toggling between right now. And, uh, this one, actually, I still have it here ’cause I bring it around with me all over the time. And it’s hard to, because it’s a little reverse here, but it says, uh, it’s talking to strangers by Malcolm Gladwell. And what I love about this book is that, um, I don’t wanna get too political or too, like, you know, but we have a lot of problem, I think communicating right now with people. Everybody is very sensitive, you know, it’s sort of like, well, you can’t say this and you can’t say that.

32:32 Eric:

And, you know, that’s changing rapidly. And I would say somebody for, from like my age, I mean, mean I’ve been pretty conscious socially about a lot of things. Um, but even myself, I’ve gotta kind of step back and go, well, how am I addressing people today?

32:47 Eric:

You know, how am I talking with people? Do I understand where they’re coming from and, you know, what is the context in which they’re saying something? And I love this book because it, it really addresses that in a historical data kind of way as opposed to just an opinionated one. And, you know, it’s, um, there’s some meaningful conversations that we need to have without getting upset with each other, and it’s a really good basis for that. And so I really like it. Um, and it’s, and he, the subtitle for him is what we should know about the people we don’t know, right?

33:21 Eric:

And, um, and I would just encourage people to take a look at that. And then the other one I’m reading is about, um, about homo sapiens and our development as a human culture and human um, humanity and going back, you know, literally hundreds of thousands of years and just some things that are kind of like in our D n A versus some of the things we’ve learned and what have been the bigger influences in our, in our development as a human species. So those are the two that I kind of go back and forth on.

33:50 Kim Kovacs:

Very cool. No, that’s awesome. Um, and, uh, and, and definitely interesting, like, you know, a lot of the ones that we get are like, you know, specific to bus, like very business focused. So I I like the Yeah. Little, little outside the box there. Love that. And then finally, I could either be your favorite meal or favorite restaurant.

34:15 Eric:

Oh goodness. Oh, my favorite meal or favorite. Oh, your

34:19 Kim Kovacs:

Favorite are your favorite restaurant? <laugh>.

34:21 Eric:

Okay. Let’s see.

34:22 Kim Kovacs:

Super specific. I like it

34:24 Eric:

Super specific. Um, you know, there’s, uh, it’s actually a little hole in the wall place here in Laguna Beach called The Seahorse. And I actually love it. It reminds me it’s a half bar, half restaurant kind of place, but it’s like a cheers place, you know, it’s the neighborhood everybody knows exactly. And it’s really funky. They have like, um, you know, some live music on certain nights. They have like these old couches, they’ve got like artwork and then they got a turntable and, you know, but it’s just such a comfortable place to be and you don’t have to put on airs, you know, it’s just, you just come as you are.

35:02 Eric:

I mean, people come in off the beach, they come in, you know, getting ready for prom night. I mean, it doesn’t matter, right? It’s like this incredible eclectic group of people, and you sit on a couch with strangers and it’s fun. It’s just so much fun. So that, and I’m half Swedish, so I love anything that has to do with the smorgasbord or fish or, you know, really interesting things like that. So I’m a very, um, pescatarian, if you will.

35:30 Kim Kovacs:

Awesome. No, that’s, uh, that’s very unique. And there’s nothing better than when you go to a, a restaurant or a place enough times and they memorize your order or your name. Yeah. And you feel like you made it, you know, you’re just like, wow. But also you’re like, wow.

35:46 Eric:

And you don’t literally go, and I’ll probably go tonight, like literally I’ll probably go tonight because it’s just that place, right? Yeah. And you don’t have to spend a lot of time or a lot of money or whatever. You just pop in and, and it’s, it’s great. Yeah.

35:58 Kim Kovacs:

Very

35:59 Isaac:

Cool. Awesome. Um, well, Kim Kovacs, this has been, yeah, thank you so much for, for taking the time and, uh, you know, we’ve appreciated your partnership over the last, you know, four years starting with our view and getting to work with you all and hope, support the, the small way we do on the insurance side with, uh, element thick. So, um, it’s been great to catch up and we appreciate it.

36:20 Eric:

Oh, thank you so much, Isaac. And like I said, I’ve really enjoyed working with you, and you guys are amazing. I mean, you travel in lanes that most people won’t, but we need it, so I appreciate that. Thank you.

36:32 Isaac:

Absolutely. Thank you, Kim. Thanks, Kim.

36:44 Kim Kovacs:

Sorry, my network is like really struggling. Okay. Now it just like snapped back. Apologies. It like, wasn’t registering. I was like waiting for three. What’s up Isaac? How we doing? It’s good to see you back. You’re, you’re right above me. It’s good to see you back there. I know, I know you’ve been like in your apartment, but it, it gives me comfort knowing you’re right above me. Great to see you

37:09 Isaac:

<laugh>. Yeah, it’s, uh, it’s good to be back in the office, you know, uh, the, the network seems to be better up here than down in the actual office space for one. So that’s a quick change of pace. So maybe I’m not gonna be the one causing the technical issues this time around.

37:23 Kim Kovacs:

There’s no doubt. Um, but no, we got a great one on deck with, uh, with someone that we’ve known for quite some time. Um, and I know Isaac, you’ve, you’ve obviously worked with Kim Kovacs Rivers, um, you know, pretty thoroughly. And

37:35 Isaac:

Yo gotta stop, it’s Kim Kova.

37:38 Kim Kovacs:

Oh, Kim Rivers

37:41 Isaac:

<laugh>.

37:42 Kim Kovacs:

What’s going on? Iby, how are we feeling today?

37:45 Isaac:

I’m doing good. How are you doing?

37:47 Kim Kovacs:

I’m good. I think we gotta get it a, a little different of an intro. I, I feel like we, we have a similar one. It is a good one. I like it. Um,

37:55 Isaac:

Well, you gotta check. I mean, it’s, it’s a little pulse check before we get going, you know, there’s nothing wrong with that. Keep it consistent.

38:01 Kim Kovacs:

I like it. I’m with you actually. Alright, let’s dive into it. We got an awesome one on deck. Kim Kovacs Kovac, chief Executive Officer of Element Six Dynamics. I know Isaac, you’ve worked with Kim Kovacs for quite some time, you know, over the past four years. I think we met her at our first Trailblazer event.

38:19 Isaac:

We did, yeah. She was, uh, you didn’t join us, but back when, uh, Mr. Taylor was a part of the AR team, he and I were in the same, uh, golf scramble group as Kim Kovacs and some of the other at that time, Santa Fe Farms folks. Um, so yeah, it’s been fun. Yeah,

38:36 Kim Kovacs:

No, and, and, uh, they’re doing amazing things in the, uh, industrial hemp space, which is, you know, honestly one that, that we don’t have on enough. Um, a lot of our stuff is focused on the, you know, cannabis specific, but it’s, it’s great to have, um, this different, different nuance to the, the industry as a whole. Right. Um, and, and so just a little bit more background on Kim Kovacs. Um, prior to joining Santa Fe Farm, she was chairman and c e o of the Arcview Group, a financial services company offering a range of equity funding from early stage to m and a pre i p o and consulting across the cannabis and hemp industries.

39:16 Kim Kovacs:

Kim is also managing director of Arroyo Ventures, uh, which is a strategic advisory and investment firm that provides a place for high net worth female investors and exceptional entrepreneurs to connect and empower women to invest and seek investment. Kim has had a long career as an entrepreneur, investor, and mentor, having founded six companies raising more than $120 million in equity capital for these ventures and negotiating several hundred million dollars exits.

39:46 Kim:

Um, she knows how to get things done.

39:51 Isaac:

Six, definitely.

39:54 Kim Kovacs:

That’s, that’s, uh,

39:56 Isaac:

Could you imagine doing what we’re doing five more times?

39:59 Kim Kovacs:

I dunno. I dunno. We’ll, we’ll, we’ll, we’ll see, we’ll see. But, um, excited to have her on and get her perspective on the hemp space and, and learn a little bit more about what they’re building and, and what’s really in the, the foreseeable future.

40:13 Isaac:

No, definitely. And I think, uh, like you mentioned, definitely one that we haven’t had on previously. Um, and I think a part of the overall kind of canvasing hemp industry that, um, in a lot of circles goes a little, uh, under underappreciated, just given how much, you know, long-term effects and positive change it can lead to.

40:34 Kim Kovacs:

Absolutely. Let’s bring her in

40:39 Isaac:

Another great one in the book. Yeah, definitely another good one in the book.

40:44 Kim Kovacs:

I like the little switcheroo at the end. You caught me off guard, but you know, I was, I was paying attention and, um, <crosstalk>,

40:51 Isaac:

I just wanted to make sure I, I have to get your, uh, I have to get your, uh, your reflexes or ready to go for, for San Diego in a month. So I wanted to see how the mental, the mental reflexes were,

41:02 Kim Kovacs:

Uh, physical. Physical reflexes are a little slower than the mental ones. I’ll say get a little older, but,

41:09 Isaac:

Um, I think you’re hung the mental one a little bit more now. But yeah, I mean, it’s really cool stuff that Element six is building and um, you know, I, you know, we get to work with them on a day-to-day basis, um, as our client, but getting to hear it firsthand and from a story perspective, not saying it on paper is always great.

41:27 Kim Kovacs:

Yeah. And I, I just love their passion, right? She, you know, it’s, uh, super genuine, authentic and you know, what they’re building and really, you know, their key initiatives I, I think is, is very interesting how it culminated too in the partnership with Ingram. Um, it’s, uh, it’s really amazing to see and I think that there’s, I think that the sky is really the limit, you know, not to be corny for, for the industry. Um, and there’s so many different applications I think that we’ll just continue to see more and more, uh, product development, um, out of this space on the industrial side

42:06 Isaac:

A hundred percent. And I think her analogy to like the electric vehicle movement was a pretty APTT one. Um, and I hadn’t really thought about it that way previously. So, um,

42:22 Kim Kovacs:

Absolutely.