The Next Gold Rush Is the $22 Billion CBD Business--and This Florida Company Is Ready to Win

"Green Roads is cashing in on the demand for products with cannabidiol while preparing for changes in the law that could soon transform the industry."

That pretty much describes the status of an entire industry--the makers of products containing cannabidiol, or CBD. The compound, added to everything from skin cream to ice cream, can be derived from hemp or marijuana and has been touted as a treatment for ailments ranging from anxiety to cancer. The catch: "It's still in a legal gray area," says Bethany Gomez, director of research for Brightfield Group, which studies the cannabis and CBD industries.

Marijuana is subject to a patchwork of state regulations. But the 2018 farm bill would remove hemp from the list of controlled substances, opening the floodgates for hemp-derived products. "Everyone and their mother is starting a CBD line right now," says Gomez. "It's absolutely a gold rush."

With about 6 percent of the market, Davie, Florida-based Green Roads is the largest private company specializing in hemp-derived CBD, according to Brightfield. The company sells CBD-infused products such as tinctures and balms, online and in 6,000 stores and 2,000 doctors' offices. Green Roads now has about 100 employees, and co-founder Arby Barroso estimates 2018 revenue at $45 million. 

Barroso, 48, became interested in CBD after being introduced to it by a friend in Colorado. He had long taken painkillers for a crushing football injury he sustained when he was 23. When his real estate business collapsed during the financial crisis, he invested in a pain-management clinic. Barroso describes that decision as "the worst thing ever," as he soon became addicted to opiates. Then his friend suggested he try CBD gummies, which helped him stay clean.

The CBD in Barroso's gummies was derived from marijuana plants, so it contained another compound, THC, which is illegal in many states. ​Barosso needed something without THC--he'd been jailed for drug use, and testing positive for THC would violate his parole. In 2012, he approached a compounding pharmacist, Laura Fuentes, about making a hemp-derived CBD product that could alleviate his pain and help keep him off opiates. She came up with an oil. "I could have gotten cleaner quicker if I'd had CBD every day," he says.

Fuentes and Barosso soon became business partners and the co-founders of Green Roads. Barroso went door-to-door to smoke shops, leaving bottles of CBD oil on consignment. "In the beginning, no one would give us the time of day," Fuentes says. Then she started hearing that grandmothers were going into vape shops to find CBD. "I was like, we have to do something about this," she says. "Grandmas are not comfortable in vape stores!" 

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