Founder’s Corner - Benjamin Kennedy - Fable Libations

Can you share the journey that led you to start Fable Libations? What was the initial inspiration behind creating non-alcoholic THC botanical cocktails?

Benjamin: From our Denver home, my wife Kristin and I had a front row seat when Colorado legalized Marijuana back in 2016. We witnessed first-hand the social tension between cannabis consumers (typically smokers back then), and alcohol drinkers in a social setting. We set out to resolve this tension by giving alcohol drinkers a way to enjoy cannabis without having to smoke. Our goal was always to build a product we believed could disrupt the alcohol industry, not the Marijuana industry. We were 6 years too early.

If we are going to realize the largest opportunity and disrupt alcohol, we need to get somebody to put down a great alcoholic product in favor of a THC infused beverage. We won’t do this in the long run by putting average products on the shelf as the replacement. We must match that alcoholic consumption experience in taste and overall experience. If we fail to do this, we’ll build a sub sector of hemp drinks. Sure, there will be winners, but we will have failed in our quest to disrupt the larger market.

What were some of the biggest challenges you faced when entering the THC-infused beverage market, and how did you overcome them?

Benjamin: In retrospect, we were so early when we started Fable. There was one infused beverage in the country, that we knew of, and it wasn’t tested. The largest challenges we faced, you could organize under 3 categories.

Building the supply chain… When we started developing Fable, there was no manufacturing infrastructure, anywhere. The very concept of a cannabis infused beverage was foreign. Navigating the industry and finding the folks that could really help was a challenge. You’d meet a lot of characters.

Science…. Fable was a complicated formulation. We had ingredients that nobody had ever put together with a Cannabis emulsion before. In 2017 we worked with Vertosa on combability for over 2 years, learning how a THC emulsion would react with heat (Fable was formulated to be pasteurized), higher PH levels (real fruit contains higher levels of acid), can liners, homogeneity with new spices and even the impact of sunlight. You couldn’t afford to fail postproduction testing so in our case, there was no “short cut” outside of turning Fable another flavored seltzer, which we refused to do. From 2017 – 2021 a cross disciplined team worked through all these scientific issues, dealing with a manufacturing facility in Tinley that moved the goal posts on SOP’s every month, before ultimately disappearing. We reformulated Fable 6 different ways in 2 years based on manufacturer capability, or their lack of.

Consumer adoption & Distribution We got Fable on shelves in January 2023, entering the CA regulated market. Despite feeling confident we’d developed solid drinks we had genuine concerns about the marketplace. We targeted just 50 stores, ending up in 100 statewide, with a focus on geographies that we felt indexed well against our target consumer. Our thesis turned out to be accurate about CA MJ, with buyers prioritizing cost per milligram over quality, and not caring what was in beverages, so long as the THC content was high and cheap. The shelves were packed with syrupy concoctions containing Red Dye 3, Titanium Dioxide, High Fructose Corn Syrup and 100mg of THC, and they outsold Fable 20-1. The drinks that were sold were given away, only for retailers to mark them up 300-400%. This, in an environment that was overwhelmingly positioned for flower meant that you just couldn’t scale a beverage in CA.

How do you incorporate your personal values into Fable's branding and storytelling, especially in terms of sustainability and quality?

Benjamin: As far as the brand goes, everything about Fable is intentional and fun. Fable is a subtle brand in many regards, whether that be using our “fable” character illustrations hidden within our packaging, the British Racing Green (nod to home) or the welcome note on the inside tab of our secondary packaging, we try and surprise and delight where we can. Cannabis consumption should be fun, and for many, will be a first experience, so we want Fable to conjure emotions of trust, quality and control before, after and during consumption.

Kristin and I look at ingredient labels during our day-to-day life. We care what we put into our bodies, so we’ve always held Fable to that standard, even when there was a much faster cheaper path. Our fruit comes blended, in 5-gallon pails. We don’t use syrups or synthetic flavors. We use ingredients like Sichuan Pepper, Cardamom and Capsicum. All real and natural. That’s the standard we set for our family. We have two kids under 6 so sustainability and the world they will inherit is extremely important for us as both founders and parents. We use “non-bleached” secondary packaging that, despite being more expensive, is more environmentally friendly and we recently removed a resealable plastic XO lid due to environmental concerns. Beyond that we work with ingredient suppliers that practice fair business ethics and sustainable farming efforts.

Fable Libations has a unique approach to its products. Can you discuss your product development process and how you ensure the use of high-quality, real ingredients?

Benjamin: The product development side of Fable has been a rollercoaster. We initially set out to develop an infused spirit, but it just wasn’t possible to match anything even half as compelling as the alcoholic spirit version.

We have always intentionally stayed away from trying to imitate existing alcoholic drinks. It’s why Fable is a Fable, and not an infused Margarita, Mule or Old Fashioned. I’m never going to make a better Old Fashioned by removing the alcohol and adding cannabis.

We worked with a product development company, versus a flavor house. The team studied international tasting trends, interviewed bartenders, mixologists, chefs. We studied ingredients and their ability to deliver natural sensations such as burn, bite etc.

From day 1 we’ve worked with real fruit, real spices such as cinnamon and cardamom. They come blended in 5-gallon buckets from best in class ingredient suppliers. I always welcome people to come witness how Fable is made, the entire brewery smells like Christmas. You get this because the team steep real spices in giant tanks. Everyone gets excited.

With recent changes in regulations around THC, how has Fable adapted its business strategy to stay compliant and continue delivering quality products?

Benjamin: Like most businesses in the beverage space, we’ve made the leap from MJ THC to Hemp D9 THC. With no change to taste or effect, it really becomes a no-brainer on the business side of things. You’ve covered it well previously, so I’ll keep this brief, but with no way to centralize manufacturing, an unscalable retail environment and a salesforce built primarily for flower, the regulated market is challenging.

We are witnessing the fragmentation now of the hemp D9 Market, so we will operate in line with state law. We’ll navigate this challenge through version control, in line with our strategic roadmap. Laws are changing all the time so in our case, mitigating risk and picking states that are more defined, legally and structurally is very intentional. CA is a good example of a state that I don’t feel like we need to rush into today, based on uncertainty. We will make a 4mg beverage for Iowa if that law is solidified because it’s a risk-off market. Larger companies can afford to take more bets.

Luckily, version control doesn’t impact the quality of our drinks. We are a low-dose beverage to start with and we self-regulate on product quality. *note, this is being challenged today and going through the judicial review process

As a leader, what piece of advice would you give to someone looking to start their own THC-infused beverage?

Benjamin: I’d say don’t rush. When people rush, you increase the risk of making bad decisions, you can give equity to the wrong person, you can pick the wrong distribution partner, you can sign the wrong investment terms. Put in the foundational work, build the model and steadily build belief. LinkedIn can be a good way to meet peers but it can be the worst driver of FOMO.

Besides Fable, what other brands do you enjoy and why?

Benjamin: In the broader cannabis industry I always felt that binske did a good job building an identifiable, fun brand. I walked into a lounge in Palm Springs and saw their Pink Flamingo glowing across the bar. Awesome.

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