Episode 5: Jose Rivas
Rethinking Cannabis Extracts
From extraction to ingredients, this is a story about adapting under pressure. Jose Rivas, CEO of Premium Extracts, explains how terpenes unlocked global demand and why operators are rethinking the cannabis business.
About This Episode
Jose Rivas, CEO of Premium Extracts, explains how cannabis extracts are made and how his company evolved into an ingredients supplier focused on terpenes. He shares his journey from early startup failure to building a licensed extraction facility, and discusses industry trends including price compression, THC beverages, and regulatory challenges shaping the cannabis market.
Key Takeaways
- Premium Extracts nearly collapsed before pivoting into a global cannabis ingredients business
- Terpenes are the essential oils of the cannabis plant responsible for smell, flavor, and strain-specific characteristics
- Premium Extracts extracts terpene compounds without THC (tetrahydrocannabinol), allowing them to be sold globally in products like vapes, beverages, and CBD products
- Cannabis companies are producing more while making less due to industry-wide price compression
- THC beverages are emerging as an alternative to alcohol for younger consumers
- Commodity cannabis products are becoming less profitable, pushing companies toward higher-margin ingredients and proprietary technology
Resources & Links
Episode Chapters
Episode Transcript
Andrew Allison: Welcome to Wine Country Business. Today’s guest is Jose Rivas, CEO and founder of Premium Extracts and Coeo Bravo. Jose is a multiple patented inventor focused on cannabis extraction technologies and ingredients manufacturing.
Jose Rivas: My name’s Jose Rivas. I’m the CEO and founder of Premium Extracts and Coeo Bravo LLC. I’m a multiple patented inventor, all revolving around various extraction methodologies in the cannabis space. I founded the company in 2015, and we’ve been on an epic journey ever since.
Andrew Allison: For those that don’t know what extracts are, let’s start simple. What is a cannabis extract?
Jose Rivas: A cannabis extract is exactly what it sounds like. We take the cannabis plant and refine the molecules relevant to different product pipelines. At our core, we became an ingredients company for the cannabis industry.
Andrew Allison: How did you get started in cannabis?
Jose Rivas: It started in college. I was paying my way through school and didn’t enjoy working at Quiznos, so I started growing cannabis in my closet. My degree is in molecular and cellular biology, and I discovered I had a natural talent for cultivation. What started as a closet grow became a bedroom, then a house, then multiple houses.
Jose Rivas: After college, I stepped away from cannabis for a while and worked for a biotech company based in Belgium selling robotic systems for epigenetic research. Eventually I realized cannabis legalization was coming and that this was where I could compete at a world-class level.
Jose Rivas: I partnered with a few chemical engineers and launched Premium Extracts. We initially focused on supercritical CO2 extraction, raised about $120,000, bought equipment, and almost immediately went bankrupt because the equipment was terrible.
Andrew Allison: Like most startup stories, the plan changes quickly. How did you recover?
Jose Rivas: After California legalized cannabis, we raised around $3 million and built a licensed extraction facility in Woodlake, California. We transformed what used to be an olive orchard into a fully operational manufacturing facility within about a year.
Andrew Allison: Extraction facilities have a reputation for being dangerous if not done properly. What kind of safety standards are involved?
Jose Rivas: If extraction is done incorrectly, people can die. All of our equipment is ASME certified. We operate in Class 1 Division 1 environments with explosion-proof systems, gas detection, grounding, and emergency ventilation systems. Our preferred solvent is butane because it preserves cannabinoids and terpene compounds extremely well.
Jose Rivas: We’ve been growing around 40% year over year. I’ve always had almost delusional self-belief that we could make this work. One of the best lessons I learned is that what gets measured gets attention.
Andrew Allison: You also hold patents around terpene extraction. What exactly are terpenes?
Jose Rivas: Terpenes are essentially the essential oils of the cannabis plant. They’re responsible for smell, flavor, and the nuance of different cannabis strains. What makes our process unique is that we can isolate those compounds without THC or CBD.
Jose Rivas: Because the terpene products don’t contain cannabinoids, we can sell them globally. That allows us to export the California cannabis experience to markets that don’t yet allow THC.
Andrew Allison: What kinds of products are these terpenes used in?
Jose Rivas: Vape products are still a major category, but they’re also used in beverages and CBD hashish products in Europe. We have a customer in France using our terpene blends in CBD hash products to replicate California strain flavor profiles.
Andrew Allison: THC beverages seem to be growing rapidly right now. What are you seeing?
Jose Rivas: I think younger consumers are increasingly shifting away from alcohol toward cannabis-infused beverages. They still want an altered state of consciousness, but without the hangover associated with drinking.
Andrew Allison: What are some of the biggest challenges facing the cannabis industry today?
Jose Rivas: Regulation is incredibly fragmented. Every city, county, and state has different rules. California’s local control laws make operating complicated because one city may allow cannabis businesses while another nearby city completely bans them.
Jose Rivas: We’re also dealing with major price compression. Cannabis operators are producing more product while making less money. That’s one of the reasons we expanded into terpene ingredients and proprietary technology.
Andrew Allison: Banking access is still a challenge too, right?
Jose Rivas: Absolutely. Despite legalization spreading across the country, we still don’t have normal access to banking. We pay significant compliance fees just to maintain business banking relationships.
Andrew Allison: You also discussed THCA versus THC. Can you explain the difference?
Jose Rivas: THCA is the natural form of THC found on the cannabis plant. It becomes psychoactive THC only after heat and oxygen remove a CO2 group from the molecule.
Jose Rivas: What we’re really building is an ingredients company. We want to provide reliable, scalable cannabis ingredients so other brands can create products more efficiently.
Andrew Allison: Where can people follow your work online?
Jose Rivas: You can find me on Instagram at @premiumextractsjose. Our websites are premiumextracts.net and coeobravo.com.
Andrew Allison: Thanks for joining us today.
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