INSIDER: Aquila Black joins green rush with budding business venture to create THC-infused drinks

In the past 200 years, California has seen the Gold Rush, the Golden Age of Hollywood and the rivers of gold flow through Silicon Valley. Now the Golden State is in the midst of the Green Rush — a stampede to cash-in on the budding legal cannabis market worth billions. The world’s fifth largest economy rung up an estimated $US5.2 billion in legal recreational and medicinal marijuana sales in 2023, according to mull business news outlet MJBizDaily. That makes the Californian pot business about the size of Fiji’s entire GDP. Having overtaken grapes and almonds as a leading agricultural product in a State renowned for wine and producer of 80 per cent of the world’s almonds, legal pot continues to flourish alongside burgeoning markets in Canada (estimated at $US3.4 billion) and Michigan (the second biggest US State, valued at $US3.1 billion). New York, the fourth most populous US State behind California, Texas and Florida (the latter two are unlikely to budge on the bud any time soon), is loosening its laws, making North America an incredibly attractive, if nascent, market to sell recreational cannabis products, such as edibles (or gummies), containing tetrahydrocannabinol — or THC, the principal psychoactive component of cannabis. Joining the entrepreneurs, the giant food and beverage companies and celebrity investors ranging from the expected (Snoop Dogg, Willie Nelson and Seth Rogen) to the less obvious (Martha Stewart, Gwyneth Paltrow and Disney Channel star Bella Thorne) in the great Californian Green Rush, is a plucky Perth-based enterprise called Aquila Black. The company makes gin and vodkas under the Banks and Bloom brand, enjoying rapid growth and gold medals for its innovative Ice Vodka and other products. Meaning “eagle” in Latin, Aquila is borrowed from founder and head distiller Elaine Darby’s previous life as owner and winemaker at Aquila Estate, the boutique wine label she launched as a 22-year-old science graduate in 1993. Darby studied molecular biology and microbiology at the University of WA and Murdoch, pursuing an interest in plant genetics and developing theories she put into practice at her winery. Darby’s father Mal Washer, a GP and socially progressive Liberal politician who entered Federal Parliament in 1998 as the Member for Moore, helped finance Aquila Estate. During his 15 years in Canberra, Washer campaigned for drug law reform. In particular, he called for the legalisation of medicinal marijuana, something he strongly advocated after witnessing firsthand the pain relief the drug offered his patients. After stints as a lawyer at Clayton Utz and speechwriter for her father, Darby served as managing director of AusCann, an Australian Stock Exchange-listed medical cannabis company. Before joining AusCann, Darby thought medicinal marijuana was simply an excuse for people to get stoned. “That was my perception,” she explains during an interview at Aquila Black’s secret headquarters in a northern suburb of Perth. “When Dad first mentioned it to me, I was like ‘seriously? Yeah, right’.” Darby discovered her father and fellow doctors “had a lot of patients who were sourcing this stuff illegally at the time to either treat their own symptoms, or their kids’”. She travelled to Canada, where medicinal marijuana had been adopted by the health system based on an “impressive” amount of research. “My opinion changed very rapidly,” Darby adds. “From a scientific point of view, it made sense.” She soon became intrigued in the exponential rise of recreational cannabis in North America. In particular, Darby took a keen interest in Canada’s Canopy Growth Corporation, the world’s largest cannabis company which became the first unicorn in the sector when it hit the billion-dollar mark. The first cannabis producer listed on the New York Stock Exchange, Canopy Growth advised AusCann via a presence on its board of directors in return for stocks the group had reportedly “dumped” by 2019. Darby says the Aussie pharmaceutical company lost direction, got into bed with the wrong partners and soon derailed. She’d jumped ship in 2018, starting Aquila Black the following year to explore the business potential of recreational cannabis. Darby also had her first personal experience with pot during one of her fact-finding visits to Canada. “It was in an edible format,” she explains. “I used it for sleep, it was fantastic. “I was one of those rare people that goes through university and didn’t actually have a cannabis plant. I feel a bit sad about that now. I hadn’t tried it at all, but going to Canada where it is legal, I had to see what it was all about.” Darby’s personal 180-degree turn complete, she decided to join the green rush and formed Aquila Black. “We’d been involved in the medical side of things and we saw this new — probably a lot more fun, to be honest — area that was emerging,” she says. “Where are the opportunities and where can we lend some of our skills, some of our know-how we’d pulled from the medicinal world? When you look at the size of the recreational cannabis market in California, it’s huge. But I think beverages are making up only 10 per cent of that market, or less.” Specifically, Darby and co wondered whether Aquila Black could do what many other companies struggled to achieve — make a THC-infused beverage with a predictable onset of psychoactive effects and desirable taste. That’s a long way from blending semillon and sauvignon blanc at Aquila Estate for someone who has never smoked a joint. Darby jokes that she added Black to the company name because she’s gone over to the dark side. “You think you’re on a path and you never end up where you thought you would,” she laughs. Sitting next to her in the secure facility, Aquila Black chief operating officer Trent Carroll nods in agreement. Also a winemaker in a previous life (and AFL footballer with 78 matches for the Dockers and Eagles between 1997 and 2004), Carroll and his wife Amanda launched Margaret River-based beverage company rok Kombucha in 2015. The former professional sportsman says it’s part of his personal mission to “bio-hack how to get over a hangover”. “I was watching the boom in non-alcoholic drinks and couldn’t get my head around people paying exorbitant prices for cordial,” Carroll begins. “I was trying to read the market and thought ‘why can’t we offer non-alc but with some sort of social lubricant’. The first thing that came to my mind was recreational cannabis.” He adds that he thought Kombucha drinkers would be a similar market to those keen to try a THC-infused beverage. Like Darby, Carroll says he had never dabbled with pot before joining this Aussie company on a global mission. “(Cannabidiol) would have been a wonder drug back when I was playing football, just for inflammation and pain,” he says. “The only options back then were non-steroidals, everyone ends up with stomach ulcers, and we were being injected with cortisones all the time.” Carroll describes Aquila Black as a “R&D company” owned by mostly WA and east coast shareholders, including Darby, with the unofficial motto: “We science the s… out of it.” That applies whether isolating a tiny part of a native botanical to create a sweetener for a Banks and Bloom ready-to-drink beverage or working out how to make a THC-infused drink a realistic and marketable alternative to alcohol. The vagaries of using THC in a beverage is part of the reason why cannabis-infused drinks remain a small portion of legal recreational pot. “The cannabinoid of interest is THC,” Darby begins. “That’s the one that has the psychoactive effects, it’s relaxing, it gives you the buzz. That’s something we could see could work quite well instead of alcohol. You don’t get a hangover and it doesn’t affect your liver.” And the fact the product is imbibed and not smoked is another benefit. She adds, however, that THC has three problems. “Firstly, it’s a very unstable compound,” Darby explains. “You expose it to heat, light or air and it starts to break up. It’s a difficult thing to work with.” The second is that THC doesn’t like water. “They’re only soluble in oil. You can see the problem there — no one wants to drink salad dressing,” she laughs. “The third one is that if you take these things orally, you may not feel the effect for an hour or so. That can be a huge problem.” Carroll adds that the products first to market discovered the THC would “stick” to the lining of the can or lid, meaning each can had a seemingly random dosage. The beverages were acting like edibles, he continues, where different parts of a chocolate bar, for example, may contain different amounts of the 10mg dosage. “It’s not conducive to a social setting if we’re going to have a different experience at a different time,” he states. The fifth of these three problems is taste. Some THC-used beverages on the North American market were described as tasting like “wet socks” or “dirty bong water”. Some products have tried emulsification to get the THC to work in a beverage, making for a milky, oily and visually unattractive drink. “I think the market is still at a very young stage for cannabis beverages,” Darby says. Using their internationally patented process developed over a surprisingly quick 18 months, Aquila Black has worked out how to produce a THC-infused powder. Contract packaging firms will manufacture the powder in the US State in which the final beverage will be sold — the drug can’t cross international or State borders for obvious legal reasons. Appearing as anything other than bong-smoking Cheech and Chong stereotypes, Darby and Carroll claim their product is stable, looks clear in a solution and the effects “kick in” in a predictable nine minutes. The precious powder also includes CBD, or cannabidiol, a compound found in marijuana that does not produce a “high” in users but mitigates some of the potential negative side effects of THC. “It’s good on the body, good on the head the next day,” Carroll offers. “It’s still a social lubricant.” The only question and the biggest problem, Darby says, was how do you make this thing taste good? Aquila Black’s first two THC-infused products were a sparkling white and sparkling shiraz-style beverage. “It certainly changed Christmas day,” Carroll laughs. Given Aquila Black’s range will be far from first to market, Darby says they needed to really stand out from the pack. “We’ve got a real point of difference here in Australia,” she adds, referring to the native botanicals they plan to export to use in ready-to-drink beverages released on the North American market. Aquila Black was poised to begin the long process of taking its magic THC powder to market when COVID hit. While forced to hit pause on the alcohol alternative, they decided to launch their spirits brand, Banks and Bloom. “We’ve been playing with all these Aussie natives, so what are we going to do,” Darby asks. “Well, let’s make some booze. At least we can show how well we can deal with flavours in an alcoholic setting. “We’ve gone back to the dark side,” she laughs. “First stop was gin. We all love gin. I suppose it was ‘let’s make a damn good gin’. That was the mandate and that’s where Banks and Bloom began.” Both Darby and Carroll found themselves working as distillers — and, to repeat their mantra, science-ing the s… out of it. “No one in this country is treating fruits and botanicals for a mass market beverage the way we are,” Carroll says. “The way that we extract colours and flavours is very different,” Darby adds. “Sometimes that makes life a lot more difficult but we believe the products speak for themselves. And the awards.” Carroll says Banks and Bloom enjoyed “rapid growth” over the second half of 2023 and expect to deliver six-times the revenue of the previous financial year thanks largely to sales of ready-to drinks and the Flux Vodka range. While they hope the cannabis-infused products can one day sit side by side with the spirits, there’s no thoughts of making a product combining THC and alcohol. “I don’t think any country would let you do that and, even if they did, we wouldn’t do that,” Darby states. “We’d be reluctant to combine those two drugs.” She says that distilling the Banks and Bloom range has helped their team better understand Australian botanicals and ready them for the North American market. “We wanted to get that side of the business financially sound, washing its face and then launch over there without overextending ourselves,” Darby explains. With Banks and Bloom already “washing its face” after only 18 months on the market and Aquila Black’s chair Matt Callahan based in Philadelphia, the Australian-made and branded THC-infused beverages are poised to make a big splash in 2025. Carroll and Darby joke that the only thing to do now is recruit a high-profile Aussie export to be their celebrity spruiker. Margot Robbie already has her own gin brand. Robert Irwin is too young. Hugh Jackman? Nah. “A Hemsworth,” Darby says. “Authentically Australian, a bit of science — well, science fiction, anyway — and a sense of humour.”

INSIDER: Aquila Black joins green rush with budding business venture to create THC-infused drinks

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