Canopy Growth to Acquire Top Edibles Brand When U.S. Legalizes Cannabis

10/15/2021

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Canadian cannabis company Canopy Growth has entered into an agreement to acquire Wana — the number one edibles brand in North America — once cannabis is legalized federally in the U.S., Forbes reports. Canopy is reportedly paying $297.5 million for the option to acquire 100% of each Wana entity, including Mountain High Products, Wana Wellness, and the Cima Group, the report says.

Once Canopy decides to move ahead with the acquisition, it will pay 15% of the fair market value of the entities being acquired; however, until the purchase is complete, Canopy Growth will have no interest in Wana, which will continue to operate independently, according to Forbes.

David Klein, CEO of Canopy Growth, told Forbes that the deal provides the company with exposure to the edibles market in the U.S. and Canada — which is the fastest-growing market segment — and would automatically make Canopy a leader in the edibles category.

“Through the agreement with Wana, Canopy is adding another industry leading brand to power our rapid growth across the U.S. Wana has built a successful business using an asset-light licensing model, allowing them to scale across North America.” — Klein to Forbes

Wana currently manufactures and sells gummy products in Colorado while licensing its intellectual property in 11 other states.

Nancy Whiteman, CEO and co-founder of Wana Brands, described the deal as “an ideal relationship in the cannabis industry.”

“Wana is a bit of a unicorn as a woman-owned, boot-strapped, and profitable business,” she said in an interview with Forbes. “We are generating significant growth and have become the leading edibles brand in North America without taking on investors or debt.”

She added that the company has “known all along” that there would be a time that they “could no longer do it alone.”

“The breakneck pace of growth, the competitive environment, and the potential to take advantage of strategic opportunities require a degree of both outside-of-the-industry experience, as well as access to capital that we simply didn’t have,” she said in the interview. “Canopy of course fulfills those needs and more.”

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Flowhub Closes $19M in Funding, Including Personal Investment from Jay-Z

10/15/2021

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Flowhub, a retail point-of-sale platform for cannabis dispensaries, announced on Tuesday the closing of $19 million in strategic funding, which brings the total amount of capital raised by the firm to nearly $50 million and a valuation of over $200 million. The financing was led by venture firms Headline and Poseidon, including a personal investment from Shawn “Jay-Z” Carter.

In a press release, Kyle Sherman, founder and CEO of Flowhub, praised Headline, Poseidon, and Carter.

“I couldn’t think of a better group to be working with as we take this company to the next stage. This funding not only underscores the significant value that Flowhub provides to our customers, but also the maturation of the cannabis industry at large. We remain committed to developing innovative products that help our retail customers run better businesses.”—Sherman in a statement

Flowhub processes more than $3 billion in cannabis sales annually and is used by more than 1,000 dispensaries. The company said the additional funding will help accelerate its expansion into emerging markets, further develop its product line and grow its social equity program.

Flowhub’s social equity program, which was launched in June, invests in cannabis business owners who have been adversely impacted by the War on Drugs. The program offers eligible social equity business owners Flowhub’s POS software discounted at $4.20 for up to three years, the mobile Stash and Greet apps, the View app, and free implementation, the company said in the release. To date, Flowhub has awarded more than $1 million worth of software products to eligible cannabis entrepreneurs via the social equity program.

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Dutchie Raises $350M, Doubling Valuation to $3.75B

10/15/2021

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Oregon-based cannabis technology company Dutchie has raised $350 million in a Series D funding round, doubling the firm’s valuation to $3.75 billion, GeekWire reports. The cash raise comes seven months after Dutchie successfully raised $200 million.

Founded in 2017 by brothers Ross and Zach Lipson, Dutchie has raised $603 million to date and more than doubled in size over the past six months to more than 500 employees throughout North America.

“Cannabis presents opportunities for job creation, critical reforms, and opens up new revenues to support state and local economies and communities. By powering cannabis commerce and streamlining operations, we are accelerating the positive changes that cannabis is bringing to the world while normalizing the industry.” — Ross Lipson via GeekWire

The company’s latest funding round was led by D1 Capital Partners, with participation from Tiger Global, Dragoneer, DFJ Growth, Thrive Capital, Gron Ventures, and Casa Verde Capital — all of which had previously invested in the firm. Willoughby Capital, Glynn Capital, and Park West Asset Management also joined the funding round as new investors for Dutchie.

The company’s technology includes e-commerce, point of sale, and seamless payment technology used to conduct annual sales of more than $14 billion at 5,000 cannabis dispensaries across the U.S. and Canada.

Dutchie said the funds will be used to add employees, expand into new markets, including outside of North America, and create new products.

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USDA to Survey Hemp Farmers

10/15/2021

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The U.S. Department of Agriculture’s (USDA) National Agricultural Statistics Service (NASS) plans to send 20,500 hemp producers across the country their first Hemp Acreage and Production Survey, beginning October 18. NASS expects the survey to act as a snapshot of the total planted and harvested area, yield, and value of hemp in the U.S.

Recipients are asked to complete the survey at the USDA website using a provided ID number or return the survey in a prepaid envelope by October 25.

“This inaugural hemp survey will establish a necessary benchmark and provide critically-needed data for the hemp industry. The information collected can help inform producers’ decisions about growing, harvesting, and selling hemp as well as the type of hemp they decide to produce.” — Kevin Barnes in a press release  

NASS will release its findings on Feb. 17, 2022, on their website and in the searchable NASS database.

“The resulting data will also foster greater understanding of the hemp production landscape across regulatory agencies, producers, state and Tribal governments, processors, and other key industry entities,” Barnes said.

Under the 2018 Farm Bill, hemp is defined as a cannabis plant and its other derivatives like seeds, extracts, and flowers with a delta-9 THC concentration of less than 0.3% on a dry weight basis.

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The People’s Ecosystem: Community Empowerment Through Cannabis

10/14/2021

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An equitable cannabis industry should include legacy operators — this is the cornerstone principle at The People’s Ecosystem. The People’s brand started as a legacy dispensary founded by two women of color; it is now growing into a vertically integrated multi-state operator. They have also built an accelerator that exists solely to help other entrepreneurs and business owners move forward in the space.

“That’s always been our thing: how do we work together to create larger wealth for everybody and not one person?” said Co-Founder and CEO Christine De La Rosa.

In the history of their 13-year friendship, Christine De La Rosa and Charleen Caabay have owned two restaurants together as well as a retail shop, an art gallery, and event production companies (they used to produce one of San Francisco’s favorite Pride parties). Now, they’re building a multi-faceted and equity-focused cannabis brand.

Their first step into the cannabis space was as a legacy dispensary operating in the closet of a local Oakland non-cannabis retail store. Charleen, who is also a Bay-area chef, had developed an effective edible for her personal use that they found helped Christine function through Lupus flare-ups. Christine had a positive response to cannabis medicine compared to her prescribed opioid regimen. Because of that success, the duo started providing their community with access to the plant. They offered three in-house strains and Charleen’s heavy-hitting edible. Eventually, they expanded to the 300-square-foot loft upstairs.

When California Proposition 64 went into effect, the business partners decided to apply for retail licenses as The People’s Dispensary. The process has been brutal. Some legislation has been built in a way that looks as if social equity applicants are prioritized but in actuality, the system does not create equity at all. “We have done a lot of businesses together that were very successful, but none of them prepared me for the crippling sadness that cannabis is when trying to move from legacy to legal. It’s already hard if you’re a woman, it’s definitely hard if you’re a woman of color in just the regular marketplace,” said Christine.

Seasoned entrepreneurs Charleen and Christine wanted to continue building brand momentum as they waited for news on their retail licenses, so they have focused on the wider scope of The People’s Ecosystem, which includes a lifestyle brand, CBD wellness products, the aforementioned dispensaries, a soon-to-be-developed THC product line, and an outdoor cultivation site.

The lifestyle brand features ‘Legacy to Legends’ merch — as an act of solidarity with legacy entrepreneurs (who risked prison time for doing cannabis business), 10% of the profits from this line will go to communities targeted by the drug war. The founders encourage every cannabis business to take the same action to help repair the damage done to these neighborhoods. This prong of the Ecosystem works as a way of giving back.

The Wellness line also gives back by serving prohibition states with CBD products while they fight for legalization. This product line includes tinctures, gummies, capsules, and topicals made with Colorado-grown hemp. A seasoned formulator crafts base recipes before The People’s brand customizes them with additional plant extractions to influence effect and add aromas.

Now that the CBD line is live, their focus has shifted to launching a line of THC-infused edibles as good as those from their legacy flagship dispensary. Charleen is developing recipes that honor her heritage by infusing traditional Filipino treats with premium cannabis infusions. The chef has traveled to farms throughout California to source flower and farm partners for this endeavor. As she searches for the right farm, she takes careful note of how the plant is treated and the love that goes into the cultivation process.

“I really want the best products on our shelves,” Charleen said. “It’s just been so awesome to see companies that are really pushing to be as clean and efficient as possible…I’m all about the clean and efficient, and the intention behind it.”

The lifestyle brand, wellness line, and edibles products were all developed in the wake of the discouraging lack of progress with retail licensing. Additionally, some beginner mistakes hindered their early growth. Keeping that memory close, and looking at an industry landscape that was very male and very white, Christine and Charleen decided to build The People’s Accelerator.

They are using the knowledge they’ve acquired through painful setbacks to help other entrepreneurs of color avoid them. “We made some mistakes at the beginning that — had we had the knowledge that other people had access to that we did not have access to — we wouldn’t have,” Christine said.

There are five Accelerator companies in four states currently supported under The People’s Ecosystem umbrella. That support includes all of the assets The Ecosystem currently has access to like wholesale discounts, experiential knowledge, and a $50 million fund used to invest directly in Accelerator companies. Company leaders are supported by weekly advisor meetings where they can talk about financials, SOPs, data rooms, and branding.

The Ecosystem has also purchased land with water rights in New Mexico to serve the community there. The People’s Farm will be home to The Ecosystem’s production site and will also have 1-acre plots split off for small farmers who want to enter the cannabis space through the state’s microbusiness licenses. Each plot will have access to water and resources so they can focus on growing dank flower and establishing themselves in the developing industry. They were able to build this before New Mexico’s adult-use market was solidified by staying involved in policy building.

While California’s regulations were being established, Charleen and Christine focused on applying for a license and getting their dispensary in place, but now they wish they hadn’t trusted the system to acknowledge legacy and equity applicants.

“When we were coming out of California, I remember this very clearly, we did not participate in the regulation, the comments, nothing. From our perspective, they were gonna put the regulation together and they’re gonna tell us what we need to do to get our license. Not understanding at the time, which is the case for many of these states, that they were regulating us out of the market because we didn’t have a say, we didn’t comment at the time.” — Christine De La Rosa

After that experience, The Ecosystem has worked to empower local organizers in their regions to be more involved in building the cannabis regulatory framework in their states. Frederika Easley, The People’s Director of Strategic Initiatives, is involved in multiple levels of government on behalf of the Ecosystem. She represents The People’s interests of diversity and equity at a federal level and supports grassroots efforts working towards similar goals at the state level.

“Cannabis is the first industry where there is a possibility for people of color to actually participate in the building of the industry,” said Christine. “There is no other industry ever in the history of the US — look at railroads, look at the interstate, look at steel, look at cars. People of color have an opportunity to create generational wealth for their communities and their families.”

What started as a small project under the stairs has grown into an entire Ecosystem built around a community-driven mission of equity, and it doesn’t look like the Ecosystem’s evolution will stop any time soon. Expect the release of Charleen’s edible line in the coming months. Over the next year, there should be growth at The People’s Farm and new licenses for The People’s Dispensary.

As they grow, The People’s Ecosystem will hopefully serve as an example for other multi-state operators. Regulated cannabis businesses should redistribute a portion of their profits to community organizations harmed by the drug war. Also, successful operators should share their industry insights and mentor the next phase of entrepreneurs in the space. These are cornerstones of The Ecosystem, and the way that they are developing shows a commitment to claiming a stake in the industry for people of color.

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Ohio Republican Proposes Adult-Use Legalization

10/14/2021

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A conservative Ohio lawmaker is currently seeking sponsors for a bill to legalize cannabis for adults in the state, the Associated Press reports. The bill being circulated by Republican Rep. Jamie Callender would allow sales and possession for adults 21-and-older and levy a 10% tax on retail sales.

Callender described the legislation as “the responsible approach for adult use.” Under the proposal, a quarter of the cannabis-derived tax revenues would fund police department purchases of equipment used to detect impaired drivers, and another quarter would be used for addiction and recovery programs. The remaining half would not be earmarked, allowing the funds to be used by Ohio during a precarious economic time, Callender told the AP.

“Having that extra funding going into the general revenue fund would give the Legislature more financial stability without having to look at tax increases.”—Callender to the AP

Ohio lawmakers legalized medical cannabis in 2016 and it was implemented three years later.

In August the state Attorney General’s Office approved the summary language of a petition to legalize adult-use cannabis in the state, two weeks after determining that previous language wasn’t “fair and truthful.”

Campaign organizers next must collect signatures from registered voters equal to at least 3% of the vote cast in the last gubernatorial election. Additionally, those signatures must come from voters in at least 44 of Ohio’s 88 counties and, for each of those counties, the number must equal at least 1.5% of the vote cast in the last gubernatorial election, the AG’s Office said.

A spokesperson for the group behind the initiative, the Coalition to Regulate Marijuana Like Alcohol, told the AP that it supported Callender’s bill and would welcome the chance to work with lawmakers on the reforms.

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Marin County, California Drops or Reduces 604 Cannabis Charges

10/14/2021

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The Marin County, California District Attorney’s Office on Tuesday dropped or reduced 604 cannabis charges in the county prior to 2017 as allowed under the state’s cannabis legalization law. The District Attorney’s Office worked with Code for America on identifying eligible cases.

Marin County DA Lori Frugoli said that her office “and community partners want to ensure that those who have an eligible conviction are aware that their case may have been reduced or dismissed.”

“The effect of a conviction on a person’s record can have a multitude of negative effects, including lost job and housing opportunities.” — Frugoli in a press release

The county’s process began in April 2019 when Frugoli’s office requested conviction data from the California State Department of Justice and a month later began discussions with Code for America. The conviction data was received from the state a month later, and Marin County DA staff separately reviewed its own data to ensure no cases were overlooked. It was determined that some people had more than one case, and some cases had multiple cannabis charges, the DA’s office said in the release. Ultimately, it was determined that 604 people involved in 514 cases were eligible for reduction or dismissal based on Prop 64.

Code for America has previously worked to identify cannabis charges eligible for reduction or dismissal in California, including in San Francisco, and Los Angeles, and San Diego counties.

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Cannabis Legalization Legislation Introduced in Nepal

10/14/2021

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Activists are pushing legislation in the Nepalese Parliament to legalize cannabis, according to the Associated Press. Once a hippy hideaway for cannabis before it was made illegal in the late 1970s, Nepal is looking to join other countries that have loosened cannabis laws in recent years. Cross-party disagreements concerning parliamentary power, however, have caused some delays, the report says.

“We are demanding the legalization of marijuana in Nepal firstly for medicinal purposes for patients who are dying.” — Campaign leader Rajiv Kafle, via the AP

Kafle is also looking to the economic impact legal cannabis would have on Nepal, telling the AP, “With our low cost of production and the competitive edge we have in the global market for cannabis, we surely are going to win and this is going to change the country.”

Health Minister Birod Khatiwada, a powerful member of the governing coalition in favor of the change, has signed up to testify in favor of the bill. He says there are currently 9,000 Nepalese in jail for cannabis, but he too is looking to the economic benefit legal cannabis would have on the once-popular hippy destination.

“I am trying to make it a campaign and issue in Parliament because many countries including the most powerful and developed countries have allowed the use of marijuana,” Khatiwada said. “The new law would ensure that the benefit is not going to go to one industrialist or small group of businesspeople but rather it will benefit the poor farmers who would use their small plots of land to grow it.”

Although cannabis is widely available in Nepal and is often allowed to grow on a small scale throughout the country due to religious and cultural tolerance, Kafle, a medical cannabis patient himself who uses the drug to manage his HIV, was arrested last month by police at his “Hippy Hills” retreat outside Kathmandu on narcotics distribution charges. He faces up to ten years in prison if convicted, according to the report.

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Alabama Accepting New Hemp Industry Applications

10/14/2021

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The Alabama Department of Agriculture and Industries (ADAI) is now accepting hemp production, processing, and university research applications, according to the Alabama Political Reporter. This is the fourth year the agency has administered the program. Applications must be submitted through the Kelly Registration System found at the ADAI website and must be completed by November 29 at 5:00 PM, the report says.

“This is the department’s fourth year to administer the hemp program. It has always been our goal to manage the program in a fair and timely manner to benefit Alabama farmers and hemp producers and develop industrial hemp as an alternative crop.” — Agriculture and Industries Commissioner Rick Pate via the Political Reporter

After the legislature passed the Alabama Industrial Hemp Research Program Act in 2016, which required the ADAI to set up a hemp licensing program, and the Agriculture Improvement Act of 2018, which declassified hemp by officially defining hemp as parts of the cannabis plant with less than 0.3% THC, the state had its first hemp production and processing cohort in 2019.

The program saw 152 licensed producers, 59 processors, and five universities in 2019. In 2020, officials licensed 422 producers but by the end of the year, that number had fallen to 300, according to the report. Additionally, processors are permitted to create CBD-rich products, grain, and fiber.

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Mimi Lam: Creating a Boutique Cannabis Shopping Experience

10/13/2021

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As more cannabis retailers open their doors across Canada and the rest of North America, Superette is a refreshing break from the default cannabis shopping experience with colorful shops drawing inspiration from a variety of other classic shopping experiences. Some of Superette’s locations include a cafeteria-style shop, a cannabis convenience store (which focuses on immediately consumable products like beverages, edibles, and pre-rolls), and, most recently, a colorful cannabis supermarket.

In this Q&A, we ask co-founder Mimi Lam about the founding and rapid growth of Superette, where she finds the inspiration for her shops, and how the company works to integrate their dispensaries with their local communities. Mimi also shares some of her biggest obstacles and successes, offers advice for upcoming cannabis entrepreneurs, and more!

Read the full interview below:

Ganjapreneur: When did you decide to found Superette and what was your starting vision for the company?

Mimi Lam: Back in 2018 in the months leading up to federal legalization of cannabis in Canada, I got the itch to start my own weed business. By the fall of that year, Superette was born! While at our previous positions, Drum and I were inspired to take a different approach to the buying experience in cannabis and saw it as a large opportunity. Rather than sticking to accepted norms of what dispensaries could be, we wanted to create spaces that infused familiar retail elements in a cannabis setting, and to build community around our brand.

The starting vision for Superette, and what we have stayed true to, is to make buying cannabis fun! In such a highly regulated space, it seemed like companies interpreted rules as necessity to be sterile – we are the antithesis of that.

What was your career background before founding Superette?

My career began in venture capital, working on a small team focused on seed stage investments in the tech sector. This experience gave me a glimpse into entrepreneurship and the excitement of building something from the ground up. I then jumped into investment banking, where I had the opportunity to be involved in many M&A transactions for large publicly traded clients. Learned lots, but safe to say I quickly found out that the banking life wasn’t for me and I was using cannabis more than ever before for my emotional and mental wellbeing. Despite having smoked my fair share of weed in school, this was the first time I actually took the time to learn more about the plant from a medicinal point of view. It was eye opening and it was that moment that I knew I had to be a part of the industry.

I dove into the cannabis industry in early 2017, which was a big surprise to those around me who were confused why I would leave my fancy Bay Street job. I joined a startup to be in a space I am passionate about, and finally, I got to be on the operational side of things across various parts of the business, from product to retail to marketing. I saw this as an opportunity to do as many things as possible in areas of the company I previously knew very little about.

I feel like I was building my toolkit, ranging from strategy and capital markets to operations, and all of these experiences prepared me for Superette.

You recently launched Superette’s first Sip’n’Smoke express shop in Toronto — could you explain the reasoning and inspiration behind this project?

Fun fact: Sip ‘N’ Smoke is the first express store for Superette! To us, express didn’t just mean smaller, but it meant an opportunity to rethink the service model and product offering. The inspiration of this space is directly connected to the experience, which capitalizes on the joy of convenience. The exterior is reminiscent of a German trinkhalle and the interior has the feeling of a cafeteria. With this store bordering Toronto’s most iconic park, we took advantage of the surroundings to primarily carry ready to enjoy items such as pre-rolls and infused beverages (we also have a secret menu shhhhh). The shop has limited categories, which gives us the luxury of offering an abundance in each. It is important to us to integrate ourselves in every community we open a shop, so at Sip ‘N’ Smoke we have a munchies phone that dials directly to our local sandwich shop and neighbour, Lambo’s .

As we build out our retail portfolio, we are taking the opportunity to lean into different elements of our brand universe and to draw inspiration from traditional retail environments found in local neighbourhoods all around the world. Sip ‘N’ Smoke is only the first of more concepts to come that are adjacent to our Superette shop formats.

What other steps have you taken to integrate your shops with their local communities?

The munchies phone is actually something relatively new to our retail experience, and you can also find them at our Summerhill, Spadina and Glebe locations (dial these for burgers, pizza and poutine, respectively!). These locations all opened during the pandemic, and what started as – how can we help drive traffic to business that might have been hurt by lockdowns – has become a fun and unique element that our stores are known for. I mean, food and weed, name a better duo.

In all seriousness, community is a core value of ours as a company. From showing off our neighbours (eg. Glebe Guide, Bellwoods Guide) to dedicating time for regular garbage cleanups around our stores, finding ways to be a good neighbour has always been a priority for us. We are also passionate about diminishing food insecurities in the communities we are in and focus on ways we can make a positive impact. In Ottawa, we have been growing our partnership with the Ottawa Food Bank since 2019, volunteering year round on the farm and in their warehouse as well as hosting in-store food drives. In Toronto, we work with Daily Bread, Parkdale Community Foodbank, and most recently, Community Fridges Toronto where our teams clean and stock fridges with fresh produce, masks, hand sanitizers, and more.

What has been your biggest obstacle so far in growing the Superette retail brand?

It’s hard not to be cliché when identifying obstacles to being a growing company in the cannabis space. Aside from normal startup challenges, we all also face unpredictable changes to the regulatory framework out of our control, as well as the inability to communicate our brand story like companies in any other industry. These have a significant impact on our ability to grow and survive as a brand.

Something that might be a unique challenge to us is growing as a lifestyle brand with a cohesive product pipeline, outside of expanding our retail footprint. This means that on top of dedicating resources to our stores, we are also building out a supply chain with values-aligned partners to create products to service both our domestic and global audiences. This has been a tremendous amount of work and effort, but it is what we believe in!

How has the retail market for cannabis shifted in the years since your company’s launch?

It’s weird looking back to how different the market is today from only almost three years ago, it’s like night and day. Operating in Ontario (the largest province in Canada), we launched when it was a limited license environment with 25 stores for all of ~15 million people. Fast forward to today, the regulations had opened up to unlimited licenses and the market now has over 1,000 stores. What is even more challenging about this dynamic is the fact that most of these new stores came online during the 12 months Ontario experienced the world’s longest stay-at-home lockdown order due to the pandemic. With this drastic shift in the market, we have never been more confident in our thesis and are doubling down on how we create the best experience and emotional connection with our customers and community.

Could you share any great success stories or a favorite memory from your experience at Superette?

There have been so many success stories and so many moments to be proud of. Here’s a top 3:

  • Opening the doors of our first store, with only 6 weeks runway, this was the moment the world officially knew who we were
  • Surpassing 100 people on our team, with each individual having a big influence on who we are as a company.
  • Seeing e-commerce sales of our branded goods go all around the globe within our first year of launching products

For me, I live for all the little things like overhearing a customer having a great interaction with a budtender and seeing someone on the street with a Superette hoodie. It’s moments like these that make it all worth it.

As the global industry grows and Superette expands its footprint, is there a specific region or marketplace that you are particularly interested in or excited about?

I’m really excited about bringing the Superette experience to places outside of Canada! More to come on our US expansion soon 🙂

Do you have any advice for people who are about to open their own cannabis retailer?

Identify your why and always go back to that. Remember that what you bring to the industry and the community has to be uniquely and authentically you. Don’t just open a door, sell weed (or anything) without thought or the aim to sell to some corporation down the road. Customers today sniff out inauthenticity, so if you are serious about opening a store, have a unique value proposition and a long-term perspective so you can be patient with what you are building.

Thanks again, Mimi, for answering all of our questions and sharing your expertise. To learn more about Mimi Lam or Superette, visit SuperetteShop.com.

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California Allows Hemp-Derived Cannabinoids in Everyday Products

10/13/2021

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California Gov. Gavin Newsom (D) last week signed a bill allowing hemp and some cannabinoids to be included in food and beverages, dietary supplements, cosmetics, and pet food, as long as the compounds are below 0.3% THC, the National Law Review reports. The law does prohibit the products from making any health claims about the cannabinoids included in the products.

Under the legislation, products containing cannabinoids must include a label, scannable barcode, website, or QR code linking to certificates of analysis, providing the THC content of the tested batches; product expiration dates, if applicable; a statement indicating that children or those who are pregnant or breastfeeding should avoid using the product before consulting health professionals; a statement that cannabinoids should be kept out of reach of children, and the statement, “THE FDA HAS NOT EVALUATED THIS PRODUCT FOR SAFETY OR EFFICACY,” referring to the federal Food and Drug Administration.

The law does not include guidance on maximum serving sizes or cannabinoid concentrations, or serving sizes, but the measure does provide the state Health Department the authority to issue regulations on those details.

In a summary statement on the bill, the U.S Hemp Roundtable said there are still “a number of issues left open by the statute that may be resolved through the standard regulatory process.” The trade group noted that “once the [FDA] acts to regulate hemp-derived CBD products, the state agency is then required to adopt new regulations to comply with the federal standards.”

The Hemp Roundtable also clarified that “there are no new regulatory burdens placed on hemp growers under this legislation.”

“Contrary to inaccurate reports, hemp farming is not addressed by this legislation, and growers continue to be regulated under previously existing statute,” the group said. “Furthermore, neither hemp growers, nor processors, nor manufacturers are subject to the oversight of the state Department of Cannabis Control.”

Legislation is expected in the state next year focused on smokable hemp products.

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Singaporean Man Sentenced to Death Over Kilogram of Cannabis

10/13/2021

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A Singaporean man is set to be hanged for importing 1 kilogram of cannabis from Malaysia into Singapore in 2018, Channel News Asia reports. Omar Yacob Bamadhaj, 41, was sentenced to death in February after being convicted on one count of importing cannabis into Singapore — on Tuesday, the death sentence for the conviction was upheld by Singapore’s Apex Court.

The prosecution claims that Omar pre-ordered the cannabis and collected them a day later near a mosque in Malaysia. Omar’s defense during trial was that he did not know the nature of the packages when he picked them up and that acquaintances placed the bundles in his bag without his knowledge or consent.

During a police interview on the day of his arrest, Omar said he was offered S$500 per bundle to travel with the packages and that he only accepted the deal because he was “desperate for money.” He later denied knowledge of what he was carrying, alleging that Central Narcotics Bureau officers had “coerced” his initial confession, the report says.

The Apex Court rejected Omar’s coercion claims, with Chief Justice Sundaresh Menon saying it was “difficult” to see how Omar’s two earlier statements were “involuntary.” Menon pointed out that, notwithstanding the allegation that the first officer had threatened Omar, the second statement was taken by a different officer and Omar divulged more details of how and why he imported the cannabis.

Singapore has a zero-tolerance drugs policy.

Chiara Sangiorgio, death penalty advisor for Amnesty International, decried the appeal, telling Vice that by dismissing the appeal, “the Singapore authorities have violated international safeguards and sentenced yet another person convicted of drug trafficking to death by hanging.”

“Singapore’s heavy reliance on draconian laws and policies have not only failed to tackle the use and availability of drugs,” Sangiorgio said, “they also give zero effective protection from drug-related harm and instead facilitate a raft of human rights violations.”

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Steven Van Zandt Launches Cannabis Pre-Roll Line

10/13/2021

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Actor and musician Steven Van Zandt—or Little Steven—is launching a line of pre-rolls in partnership with Canna Provisions called Underground Apothecary, Asbury Park Press reports. Van Zandt is a Rock and Roll Hall of Fame inductee, a member of Bruce Springsteen’s E Street Band, and was featured in “The Sopranos.”

“The United States may be the only country in the world that considers health care, both physical and mental, as an afterthought. Little Steven’s Underground Apothecary was created to help combat that issue by focusing on natural, holistic remedies. Some will help relax you, some will help energize you, all will help you take charge of your own wellness.”—Van Zandt in a statement via the Park Press

Ten percent of the proceeds from the line will be donated to the National Organization for the Reform of Marijuana Laws (NORML).

“We need to help spread cannabis education, destigmatization, and stop unjust criminalization for a plant that not only does a lot of good but has proven during COVID to be almost as essential as art to people’s well-being and quality of life,” Van Zandt said in a statement

The products will be exclusively available at Canna Provisions store in Massachusetts.

Canna Provisions and its CEO Meg Sanders has previously partnered with musician Willie Nelson’s estate on his line of cannabis products, Willie’s Reserve.

“Little Steven wanted to be sure to have an approachable, low-THC and high-CBD cannabis that is less about the recreational high, and more for people seeking the benefits of cannabis and cannabinoids like high-CBD cannabis on the body and mind,” Sanders said in a statement.

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German Police Unions Oppose Cannabis Legalization

10/13/2021

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German police unions on Tuesday came out against plans to legalize cannabis in the nation, Politico reports. The remarks come following the electoral victories of the Social Democrats—which won last month’s elections—the Greens and the Free Democrats, all of which support the reforms.

In its election program, the Free Democrats estimated that were cannabis taxed similarly to cigarettes, Germany could raise up to €1 billion annually. The Greens said that a cannabis control law would “drain the black market for cannabis and reduce organized crime,” while the Social Democrats have called for cannabis to be distributed to adults in so-called “field projects” to assess the impact of legalization for adults, the report says.

Rainer Wendt, head of the German Police Union, opposed the reforms, saying that allowing legalized cannabis “would be the beginning of a stoned future instead of the launch of a modern Germany.”

Oliver Malchow, the head of Germany’s police union GdP, told Neue Osnabrücker Zeitung that he wouldn’t back the reforms as “legal but dangerous” alcohol is “already causing enough trouble.” He added that it doesn’t make sense to “open the door to another dangerous and often trivialized drug.”

“There must finally be an end to trivializing the joint.” — Malchow to Neue Osnabrücker Zeitung via Politico

The reforms are also opposed by the conservative Christian Social Union. CSU member Daniela Ludwig, who has served as the government’s drugs minister since 2019, has said that “legalization doesn’t solve any problems, it creates new ones,” and has called for possession limits up to 6 grams, calling the 15-gram limit in Berlin “clearly too high.”

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Keith Stephenson: Legacy and Longevity in the Volatile Cannabis Industry

10/12/2021

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Keith Stephenson is the owner and founder of Purple Heart, the first Black-owned cannabis business to be licensed in the U.S. and the longest-running cannabis dispensary in Oakland, California. During the sweeping social justice protests last year, Purple Heart was hit by a series of burglaries that ultimately crippled the company — Keith is still working to build back his business.

In this podcast interview, our host TG Branfalt asks Keith about entering the cannabis space in the 1990s and launching one of the country’s very first licensed cannabis businesses. This interview also covers Oakland’s groundbreaking social equity provisions (which were largely based on Keith’s suggestions), the early days of cannabis testing, how to achieve longevity in the frequently volatile cannabis space, and more!

Listen to the full podcast below or keep scrolling down to read a full transcript of the interview.

Listen to the podcast:

Read the transcript:

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Cara Wietstock: Hi, I’m Cara Wietstock, Culture Editor at Ganjapreneur, and host our YouTube show Fresh Cut. The best way to understand cannabis business, is to speak directly to those who work within it, and Fresh Cut was created to shed recognition on the people who fill these roles. In this interview series, we focus on those with their hands in the dirt, both literally and figuratively. From cultivators to bud tenders, educators to advocates, activists to lobbyists, we aim to illuminate the workers who keep this industry thriving. Enjoy one-on-one conversations with me and guests, by watching along on the Ganjapreneur YouTube channel, and follow our social channels to keep up with the latest episodes. Have a great day.

TG Branfalt: Hey, there, I’m your host TG Branfalt, and thank you for listening to the Ganjapreneur.com podcast, where we try to bring you actionable information and normalize cannabis, through the stories of ganjapreneurs, activists, and industry stakeholders. Today, I am joined by Keith Stephenson. He is the founder and owner of Oakland, California-based, Purple Heart. The nation’s first Black-owned cannabis business, and Oakland’s longest-running cannabis retailer, which has served the Bay Area for 15 years, but unfortunately was among the cannabis shops targeted by thieves during last year’s unrest in the city. Purple Heart and Stephenson were featured in Ganjapreneur’s March report, Oakland’s Longest Running Dispensary Still Recovering From Last Year’s Crime Spree. I am really, really delighted to have Keith on the show. We got to talk a little bit for that interview, and there was a lot more that didn’t really make it to print that I think that Keith’s story needs to include, so here he is. How are you doing Keith?

Keith Stephenson: Absolutely phenomenal, Tim, and equally as important as how I’m doing, is how are you doing?

TG Branfalt: I’m doing great. It’s a really delight to have you on the show. I really enjoyed interviewing you for our article back in March. But people got to know a little bit, just got to scratch the surface of your story. So why don’t you fill in the gaps, and tell me about your background, and how you ended up in the cannabis space?

Keith Stephenson: Yeah. Well my background is professionally, I was an aviation maintenance technician for 17 years, for one of the top two airlines in the industry. And with that being said, I also had a preexisting juvenile form of arthritis, which was intimately involved in my life growing up. So that’s how I became intimately involved with cannabis.

TG Branfalt: And we talked a bit for the article, about your first jobs in the space. Tell me about your early experience in California’s medical cannabis industry.

Keith Stephenson: Yeah. My first experience professionally being involved, was working with the Oakland Cannabis Buyers Co-op, which was a retailer and a provider of medical cards in the City of Oakland. And from there I also worked at some of the grassroots organizations, like operating the phone banks, and just early adaptor work in the space, which allowed me to learn more about the industry, and realize that this is something that I wanted to be involved in early on. And when I say early on, we’re speaking like 1996, ’97, ’96, somewhere around there.

TG Branfalt: You said you started at phone banks, and you started at the club. What did you learn from those early days, that eventually led to you being able to start your own successful dispensary?

Keith Stephenson: What I learned, is that working in the industry was something that I truly loved. I really felt fulfilled, and it didn’t appear to be a job to me. It was a labor of love. And from that, just being around the plant, and having spent some time in gardening and trying to hone my craft, and just seeing that this was an industry that I liked. So it was something innate, it touched me and it allowed me to interface with other individuals who had some ailment that they were treating with the use of cannabis. So that’s one of the things that really brought me in.

TG Branfalt: You are the first Black-owned cannabis business in the United States. Can you talk to me a little bit about your early days, or even your experience now in what is a still white-dominated industry?

Keith Stephenson: Yeah. Early on, I say that wow, other operators had jumped into the space and I wanted to jump in, however, this was at a time when this Justice Department was really very intensified towards the medical cannabis industry. So I just didn’t have the ability to hop into this space, as an unlicensed operator like some of my other white peers were. And the difference now and then, is that right now you have a larger group of individuals who’ve never really interfaced with medical cannabis patients. So right now we have a market that, in California at least, is more “recreationally” involved. So when I initially started, there were many patients that we would provide cannabis for that succumb to their injuries. And that’s one of the bigger differences that I see, and also the large or well-financed companies that are coming into this space. So we’re really at a point where the industry is emerging, and this is the advent of commercial cannabis sales that we’re seeing.

TG Branfalt: And one of the things that I was really surprised to learn about when we spoke for that article, was that you played a really pivotal role in Oakland’s social equity licensing process. The city was the first in the state to roll those out. Tell me about that process, and what your role was in developing what has become really, a standard for every cannabis program that comes online.

Keith Stephenson: Yeah. So initially I was involved in the industry, and there just weren’t many people of color in space, in terms of being authoritatively and financially binded to companies. The positions you’d see people of color in, we’re typically positions of security to mitigate the threat. And I knew me, myself, I was capable of doing this. And what we have is, we’re talking about retail sales, and while some folks wanted to make it seem more than what it was, it was really business, kids who operate a business, and there are many people of color that operate successful businesses. However, the way I viewed the local regulations at the time at the city level, that some of these individuals that would be qualified to enter into the space, just would not be able to based off of how the regulations were written, because of growing up in an area that was targeted by the war on drugs.

And I just felt like as a collective group, we would never get to the place of opportunity. So I communicated with two Council members back in about 2008, or 2009, about working to change this. And I was just saying, “Hey. You know what, the way it’s written, these individuals that would have a record, they may have been arrested for cannabis, drug sales, or whatever, that they would not be allowed to operate into this space.” So it was something that early on they were like, “Yeah. We can see it.” And it took a decade, it took 10 years for this to come to fruition. So my position was early on, I was a thought leader. And then right before the city rolled out the program, I was really intricately involved in the language to make sure, that these individuals that grew up in these areas, that were heavily targeted by law enforcement for drug sales would have an opportunity.

And it’s one of the things that I shared with others in the industry. And I’ve always communicated like, “Listen, if you really think growing up in the inner city is always easy, I would surely exchange your Hampton experience, or whatever lifestyle that you dealt with in exchange for growing up in urban America.” Me, myself, I grew up in South Central Los Angeles, however, I’ve traveled enough to know that this was a systemic issue. It’s not just regulated to the area that I grew up in. That’s really what it was about. It was about giving opportunity to other individuals that lived in these environments that were targeted for the war on drugs.

TG Branfalt: And you make a good point when you call yourself a thought leader. And I think that, that’s almost an underrated characterization. You have operated and lived through, basically the entire life of California’s, go from the gray market to the medical market, licensed medical market to the retail market. Can you tell me about the challenges, the transition into each of those markets you faced as an operator?

Keith Stephenson: Yeah, absolutely. So the gray market is what I would experience, I would call it prior to the 215 Market. And that was just like, “Hey, California cannabis is really good,” and back then it was really good. And by me having a pre-existing condition, that was really about having continuous and daily pain. I don’t think anyone knows what it’s like to have pain all the time. And I think that’s how the opioid abuse has come into play, because as humans, we deal with pain, and then we want to find a source of comfort. And for many that source of comfort was opioids that were prescription-based. However for me, I realized cannabis made me feel good a long time ago. However, I operated in a safety sensitive position, and even to this day, workers that operate in safety sensitive positions cannot consume cannabis, or CBD.

So for me, it was like, “Hey what do you really want?” And for me, it was like, “I want a quality of life.” So now we matriculate into the 215 era, and my physician recommends cannabis, because a physician cannot prescribe cannabis, but he recommends cannabis. And I’m like, “Okay, this is great. Now I can go to the Oakland Cannabis Buyers Co-op,” and I’m like, “Okay, you know what, they’re hiring. So I’m going to take a part-time job here.” However, the stress of going to work at a facility, and this was a part-time job, and going to a facility that’s on the list of the Justice Department, or DEA is not an easy thing to do. And then you realize, “You know what, I have to work in this industry, because I’m not the only one who feels like this.”

And while there were others that were more pro recreational cannabis, I didn’t have the ability to really think in that frame of mind, because I’m dealing with a preexisting condition, and by the time I’m 26 years old, I’ve had both hips replaced. And I have range of motion issues, and my posture is changing, and I go from being six feet tall to 5’10, and my spine is compressing. So I’m consuming cannabis, and cannabis is alleviating the constant pain, and it’s allowed me to go into more of a recreational mode. So with that it worked out, and I started cultivating around that time. However, it became better being able to cultivate and having some protections from the local Police Department in the City of Oakland, being a cannabis patient.

So from there just going to the hydroponic store, and seeing it become more and more crowded, and then realizing, “Okay, I’ve got to pivot.” So pivoting into the recreational space, it was natural. However, it didn’t happen easy, this opportunity occurred because in my spiritual sense, how I’m communicating, is that the universe wanted me to play a part in this industry. And I spent a lot of time going to Oakland City Council meetings, communicating to staff afterwards like, “Hey. We need more cannabis dispensaries,” because the initial first four dispensaries that were licensed, I wanted to have one of those. However, during that process I had to have emergency surgery. I had diverticulitis and I’m like, “Wow. This is what I want to do.”

So I had to back out of it. And then I get in the industry, I become a retailer. Things don’t happen overnight. My burn rate was very high. It was 132,000 for the first three months. And this is at a time where I was cultivating at home, so I had saved a pretty large amount, like 75 pounds of cannabis to start the dispensary, and had I not done that, I don’t know what would’ve happened. So everything that I’ve learned previously from the time of my inception of dealing with licensed cannabis, and moving towards the timeframe of 2017, that’s when I first interfaced with the new regulators that were a put together by Governor Jerry Brown, to open or to start the Bureau of Cannabis Control.

And some of the individuals were from the Alcohol Beverage Control Department, in the State of California. So they had experience of dealing with a regulated inebriation product, however, they knew nothing about cannabis. So through the years, I think it was 14 years of my experience, I communicated with them the things that I had worked on, processes that the Purple Heart team had developed. And we just poured into them, because we wanted this framework to mirror what was right by the licensed industry standards. And just to go back, when I talk about the first Black-owned cannabis business, and we’re the number four licensed cannabis business in America, it’s about being licensed. I didn’t have the authority. Well, I had the authority, but I didn’t have the protection of going into this without being legally licensed.

So there are other operators that were operating, and then they became licensed. But what I wish to say, is that I am the first licensed Black-owned cannabis business in America, and the number four licensed in the country, period. So my experience in what I’ve given to the industry, is one of love. So as we move into this newly regulated market, me being able to interface with the officials Lori Ajax, and Dean Grafilo, and some of them have gone on to be lobbyists, some have gone on to work for other corporations, it allowed me to communicate what we found to be our best practices. And some of the things were adopted into the state regulation. Such as, at one time I was working on a hydroponic line of products before my mom took ill, that allowed me to go into the efficacy of finding out what’s in the hydroponic nutrients.

And we were moving towards a zero to low, heavy metal analysis. So these are the things that were brought into California regulations. And you have things, like when you use a sulfur burner, when you’re cultivating, sulfur burner is used to mitigate pottery mildew on vegetables and plants. However, it was never meant to be used on plants that would later be combustible. Meaning that we were lighting them, and that lighting the residue from the sulfur burner turned into a carcinogen once lit. So there was just a lot of things that myself, and operators in the City of Oakland learned about testing cannabis, and mold spores, and all these things. And initially I was not someone that welcomed testing. I used to refer to it as the easy bake oven theory, and I just thought it was something that the city wanted, that someone was in their ear to make us spend more money on this service. And I found that there were so many things that were on this cannabis. It was the-

TG Branfalt: Excuse me for a second. Are these the things that you discuss in your role on the Cannabis Advisory Committee as well?

Keith Stephenson: … These are things that I discussed prior to, and this is how I received the opportunity to be appointed to the advisory commission. So these were things that we were doing locally, and I wasn’t the first operator to do it, however, we developed a standard that was so high, that the City of Berkeley adopted our standards for their medical cannabis dispensaries. So it was just something that I wasn’t actually accepting of, because in business you’re looking at top line revenue, overhead, and how do we become not only successful, but profitable. And no one wants to run a business where your finances are tight. However, it allowed us to set this standard, but because me being a Black business owner in a cannabis space, I couldn’t promote what we were doing publicly, because I had to take a seat and just be quiet about it.

However, when you have a Richard Lee, from Oaksterdam University, one of the well known individuals that was really pushing the industry towards adult recreational cannabis, and you have a Steve DeAngelo from Harborside, it makes it easy for you to fall, I won’t say fall, but those are big figures. So it allowed me to maintain my anonymity. However, when you’re a first mover in this space, seems like the reward you get are 280E audits.

TG Branfalt: We can certainly talk about some of these, I guess, administrative, that’s not giving them enough credit, problems. But I want to ask you really quickly, what do you attribute your longevity in this industry? Having covered this space since 2014, I see businesses and people come and go, even some of the people who are riding high for five or six years, then they blow up spectacularly. How do you last this long?

Keith Stephenson: Well, for one, I think that there are three things that you have to have in the modern cannabis space. You have to have knowledge of the industry. You have to have financial, or fiscal responsibility, and you have to love what you’re doing. No one really has anything that’s different, product wise. So you have to be able to deliver exceptional customer care and service, and to be able to know the nuances of the industry. The buying patterns, the sales. Sales tend to go up at certain parts of the year, and they tend to go down at certain parts of the year. So your financial forecasting has to be on point, and you always have to have the ability to mitigate your exposure.

It’s a very costly business. A lot of times you see MSOs, multi-state operators, come into this space, they raise a lot of money, and then they go bust. And part of it is, believing that once you’re going to get in this space, that everything happens just to your favor, and that’s not the case. It goes back to what I was telling you about, me starting in this business, there being very limited competition, and I’m still losing, my negative burn is 132,000 a month for the first three or four months. And it’s like, “How do you mitigate that?” And I think that my history, is that I’ve encountered many turbulent periods of this emerging industry, and not being afraid, not folding, but really sticking to the script.

That I feel, and I believe that I know this industry better than anyone. Now, whether I know it better than anyone or not, it’s what I believe. I believe on my intimate knowledge, my preparation for the space, and how do I prepare myself in 2016 to be here in 2026, and understanding that all the things that I’ve been through, how do I not allow them to impact me? And when I say me, me is synonymous with the business, so there are a lot of things. I didn’t come into this space with billions of dollars. I do believe that the opportunity to be financially successful, is equally as important as being philanthropically successful. A lot of operators in the industry may really feel that, who makes the most money is the biggest winner.

However, how positively impactful have you been in this space? And there are so many things that we could chart our growth by, but ultimately, for me, it’s about how many people, or have you assist in getting into the space? How many brands have you helped break into the space? And when it comes to policy involvement, where have you been? I’ve been involved in the City of Oakland’s policy early on, where I sat on the Measure Z council, which is now the Oakland Cannabis Commission, which is a precursor to what I do at the State level for California. And it’s really me being someone from the industry, and me offering my greatest advice as to how this industry can move forward and grow, not in a manner that’s beneficial for me before the entire industry.

TG Branfalt: Well, and so you discussed your challenges and in our piece that we published in March, we discussed the ransacking of your shop at length with the riots that were happening, under the guise of the protests that were occurring. These are separate incidents, obviously. You had described it as organized crime, it was planned on Twitter. But what we don’t really go into in that story, is the depth into some of the other fallout, such as the insurance problems that you faced, and the issues with METRC that you experienced in the days and the weeks of following the event. Can you talk about those issues, and whether or not they’ve been fully resolved?

Keith Stephenson: Sure. Yeah, we did sustain two burglaries after temporarily closing to become COVID compliant. When I say COVID compliant, I mean building sneeze guards, acquiring the right disinfectants that we can use that are not only safe for our facility, but allows us to counter COVID, and any other sickness or issues that are happening there. So working with the insurance company, this has probably been my first foray into being upset with an insurer. And you realize you’ve paid years of insurance to protect the business, and you’ve never filed a claim, and then when you file a claim, they make it more arduous than what it has to be. And you realize that after talking with your legal counsel, I was told the only way to insurer makes money is by paying you less money than what they owe you.

And then you start to realize, “Well, this is why so much of our citizenry doesn’t like insurance companies, because you have a need to be covered financially, and you have a need to have whatever other harm that happened to be taken care of. But the underlying connectivity is the finances. And I feel that, based on my experiences, I want all the operators in the industry to know. There’s no reward in over insuring your business for more than what you can receive, and what I mean by that, if the business is only going to keep $200,000 in merchandise at the facility, there’s no need to pay for a policy that allows you $500,000 in coverage when you’re not going to have it. And then you start realizing how the adjuster, the insurance company all work together.

So now you’re attempting to find a solution, and then you realize that this is just capitalism. Where capitalism is about making money, but my thing has always been capitalism with a consciousness and giving back to the community. However, when you’re dealing with level business at this point, and the numbers are large what they have to pay you, what I’ve been told is that the insurers, they’ll just put you in a position to say, “Can you afford to litigate this case?” And if you can, they’ll try to get the case kicked out of court, and if they can’t get it kicked out of court, as you start progressing towards trial, then that’s when the insurers start to communicate with you in a manner that they want to resolve this, they want to settle this. But it’s an arduous turn, and I wish for the best for me and my industry peers.

TG Branfalt: Do you think that the response from your incident specifically, has to do with the fact that you are a cannabis business, and there may be a little bit of bias there?

Keith Stephenson: That’s difficult for me to say. I just think that regardless, I can say that may be an inference. It could be inferred that, that may be it. However, I also feel that insurers just they don’t want to pay you. If they have the ability to remove themselves out of any policy covers, they will.

TG Branfalt: So you had mentioned that you have this capitalism with a conscience, and you’ve donated to many community organizations, including Urban Services, YMCA, Oakland School of the Arts, the Oakland Police Officers Association, and the Covenant House of California, among others. What role by and large, do you think that cannabis businesses should have in community building?

Keith Stephenson: I think that as stakeholders in the community, we have to be in compliance with the community, and a community should be in compliance with us. And what I mean by that is, if a cannabis business is operating in a residential community, then you have to be accepting, and accountable to conversations to hear the community’s position. And I also think that if a community moves into a commercial district that has become habited by cannabis businesses, then that community should also put themselves in a position to have to acquiesce. Because I presented two situations that are similar, but different. And some communities are residentially oriented, and others are commercially oriented. And if you move into either districts, you should realize that me being a stakeholder means that I’m accountable to my neighbors, regardless of what they do. Just a couple weeks ago, I went to a facility, and this place, there was an intense cannabis smell emanating from the facility in a residential area. And how does one mitigate that? I can tell you, I like cannabis, however, the strong smell of cannabis in its final weeks of ripening and being trimmed can be rancid to some.

TG Branfalt: Yeah. New York, we obviously just moved into it. Anytime I read about what people describe cannabis as, when I lived in Florida, I remember the smell of the burning orange peels at the Tropicana plant, and that’s what I think about. I’m not somebody who really likes to smell citrus. So to your point, what do you think operators could do better in that regard?

Keith Stephenson: Well, I think that the operators are doing exactly what they planned on doing. However, I think that, that’s a more of a municipal issue and municipalities have to have an understanding of what they are permitting. Now, for the residents of that community, I don’t think they could be upset at the operators that are cultivating, processing cannabis, or anything like that. I think that as a citizen of that community, they have to voice their issue, if they even have an issue. I just found it very loud to be two blocks away and approaching this facility, and just like, “Wow. This is pretty loud.” Now, could I live in that environment? It may be difficult. I’ve cultivated cannabis at home, and it was fine with me because it was my cannabis.

TG Branfalt: Again, just like our conversation for the print article we again, just barely get to scratch the service with you, Keith. Okay. In the final minutes here, could you tell me, 30 years in this industry, it’s literally a lifetime for lesser men and lesser businesses. What advice do you have for entrepreneurs, who seek to be in this space for 30 years?

Keith Stephenson: One, make sure that you love what you’re doing. And so many operators come into the industry, because they look at it as a gravy train with meatball wheels. And I understand, if you want to do something for a financial gain to allow you the affordability, of a quality of life that you might not have right now. However, what makes you happy? So if cannabis makes you happy, you have ideas of doing things your way, try it. Make sure that you are able to be involved, and learn as much as you can about the industry, and make sure that the folks that you’re interfacing with are who they say they are, and that they have the experience that they’re stating to you. Because at this point, I know cannabis is such a young industry as we move into the legality of it, and there are many individuals who, everyone’s a subject matter expert.

However, this is the only industry where the disbarred attorney, or the mortgage broker who created fraudulent loans, can come into this space and say that they are subject matter experts. So do your due your diligence, find out what part of the industry you want to be in, and find out if you’re in a state where the opportunity tends to be not as easy, that you consider going to a state that it’s a lot easier. I spoke to an individual yesterday in the city of Oakland who wants to do it here, but they feel like the California regulation and taxes are a barrier to entry, so they want to go to Oklahoma. And I’m fine with that. And just really have an infrastructure, have sound legal advice, and have some involvement in the industry, where you can reach out to communicate with those in the space that have been doing some things. And if you have to pay for a professional advice, then be willing to do so.

TG Branfalt: I really enjoy being able to have these conversations with you back-to-back. I really feel like I’ve got to know you a little bit between interviewing you for the print article, and I really appreciate you taking the time both then and now, to tell your story, and offer your decades of experience to our listeners. Where can people find out more about Keith Stephenson and Purple Heart?

Keith Stephenson: Right now I would say, just Google Keith Stephenson. Definitely Google Keith Stephenson, and support my GoFundMe campaign that I’ve launched. And as we’re in a process of rebuilding and opening, you can go to purpleheartpc.com, and we’ll start providing more information on there. You could follow me on Clubhouse at purpleheart_keith, and just Google me and continue to listen to you, Tim. It’s awesome for you to share your time and your platform with me, and I greatly appreciate it.

TG Branfalt: Just so our listeners are aware, the GoFundMe, it’s in response to the ransacking, the burglary, robbery of your dispensary last Summer, your retail establishment. Could you tell people how they can find that GoFundMe?

Keith Stephenson: Yeah. It’s at GoFundMe. It says, Help Keith Stephenson Rebuild His Life. And the reason that I chose to put, ‘help me rebuild my life’, is because the cannabis space is one of those unique spaces, where right now no one wants to shake your hand professionally when it comes to financial institutions. And they’ll kick you out of a bank, and they’ll shut down your platform. So I’ve had to personalize this crowdfunding opportunity, by saying, “Help Keith Stephenson.” Because if I say anything about Purple Heart, it’s going to be shut down.

TG Branfalt: It’s unbelievable, it’s unbelievable. Keith Stephenson, he is the founder and owner of Oakland California based, Purple Heart. The nation’s first Black-owned cannabis business, and Oakland’s longest-running cannabis retailer. Keith, thank you so, so much for being on the show. I really wish you the best of luck as you reopen and get back on your feet, and I hope that the next time we talk, it’s about reopening the doors to Purple Heart. Thank you so much.

Keith Stephenson: Absolutely. Appreciate you, Tim. Thank you.

TG Branfalt: You can find more episodes of the ganjapreneur.com podcast, in the podcast section of ganjapreneur.com, on Spotify, and in the Apple iTune store. On the ganjapreneur.com website, you will find the latest cannabis news in cannabis jobs updated daily, along with transcripts of this podcast. You can also download the ganjapreneur.com app in iTunes, and Google play. This episode was engineered by Trim Media House. I’ve been your host, TG Branfalt.

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Farechild Events: Bringing the Cannabis Industry Together

10/12/2021

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Farechild Events is focused on making connections within the cannabis industry. They launched at the beginning of 2020 but their event calendar went on hiatus amid state lockdowns. In the meantime, they built a cannabis-friendly event ticketing platform. Later this month, they return to hosting with The Zodiac Party in Las Vegas.

Founders James Zachodni and Dave Tran planned their first cannabis event in Seattle before Washington legalized adult use. The partners hosted that first party as DOPE Magazine and it was unlike any other cannabis gathering at the time. With that success, they went on to throw coveted events all over the US. Planning networking parties and celebrations was their favorite part of owning the media company so when DOPE was sold to High Times, the entrepreneurs started their next chapter in the events sector. At Farechild, the mission is simple: Dave and James want to foster community while throwing kickass parties.

“There was excitement about building a new project. There was excitement about building solutions for problems in the industry because the industry still is very young, and there are a lot of opportunities to build solutions to help the industry grow,” said Co-Founder Dave Tran. “As we started looking into things we were really passionate about, events seemed to serve that purpose.”

Before James and Dave established DOPE Magazine, they worked together in the Seattle nightlife industry, an experience that served them well as they moved into cannabis events in 2012. Throwing an above-board weed party was unheard of at the time — most cannabis gatherings were underground secret seshes and exclusive cannabis cups to avoid attention from the law. DOPE events stood out then, and the experiences that the pair picked up from their nightclub days to the years of DOPE parties have been essential in launching Farechild.

“For us, the event side of it just made sense, and we took our skill set that we naturally had and built over years and years and applied it to the cannabis industry. And I think that’s where you find the success stories is when you hear of people doing those types of things and bringing a great professionalism and experience to our industry which is still very new so there’s still a lot of room for people to find their niche.” — James Zachodni

Farechild throws signature events and also plans gatherings for businesses and organizations. They love throwing parties, but most of all, the event pioneers want to serve the cannabis community. After they canceled all of their events in 2020, James and Dave spent the time considering what problems in the industry needed solving. Cannabis event planners will often run into issues with ticketing platforms shutting down their listings for their industry involvement. In response, Farechild decided to build their own ticketing platform so event planners could avoid these issues altogether. Now, the Farechild event platform is operating in Beta for any event interested in being included on their calendar.

To effectively solve the problem, they had to understand the root of the issue. Cannabis events being booted from ticketing platforms is just one thread in the complex knot of cannabis banking. Mainstream event ticketing platforms use Stripe or other payment processors with federally enforced rules of service. So, their first step was to find a banking partner that they could work with transparently in the cannabis space. To do this, James worked with a consultant to find the right bank. They took several meetings before finding a partner willing to offer low enough rates to keep the platform affordable. The Farechild platform consists of cannabis events for now, but soon-to-be legalized psychedelic retreats and other hosts that have challenges with ticketing their parties are encouraged to join the community as well.

 

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The first Farechild soiree since the initial COVID lockdown is The Zodiac Party coming up on October 21 during MJBizCon. They are so excited to plan an event but they understand how crucial it is to reduce risk as much as possible. The Zodiac Event will take place in an outdoor event space and is partially sponsored by Mooselabs, the silicone personal mouthpiece company that will be providing a unit to every guest attending. Of course, they will also provide hand sanitizing stations and follow other routine public health procedures.

James and Dave love their plans for this celestial event and hope their guests will, too. To show what went into creating The Zodiac Party, Social Club TV filmed a docuseries covering from the original idea up to the final steps of execution. The video series shows Farechild taking a 360-degree view of the event in hopes of transporting guests to a new galaxy. Those who know about astrology, numerology, and the elements will have fun finding the easter eggs hidden throughout the party. Everyone including novice astrologers can enjoy live music, get an astrological reading with a professional mystic, and, best of all, network with industry peers. This year’s party will feature 16 VIP outdoor cabanas perfect for team bonding and treating clients — nearly all of the cabanas are already booked.

James and Dave are excited to step back into the event space after a long stretch of time spent building the ticketing platform. Every DOPE event had an air of magic to it, and after speaking with the founders, it seems the Farechild events will keep the magic alive.

“We love to produce events. We love to continue to give the industry opportunities to network and to find each other. Because, really, we’re still connecting cannabis to the world and the world to cannabis. How do we do that and be an integral part of that connection? That’s what I’m excited for,” said Dave.

Oh, and in case you were wondering, James is a Taurus sun and Dave’s sun is in Leo. Learn more about The Zodiac Party and Farechild events at farechild.com.

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South Carolina Says Delta-8 Not Legal Under State Hemp Law

10/12/2021

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In a letter to South Carolina’s Law Enforcement Division chief, state Assistant Attorney General David S. Jones said that delta-8 THC—or any other forms of THC derived from hemp—is not legal under the state’s hemp law.

“We believe a court would not hold that the Hemp Farming Act does not provide an exception for, and does not legalize, delta-8 THC or any other isomer of THC in itself… [The Hemp Farming Act] categorizes all isomers of THC as Schedule I controlled substances ‘unless specifically excepted.’ The only exceptions found in the Hemp Farming Act involve ‘a delta-9 THC concentration of not more than 0.3[%] on a dry weight basis.’”—Wilson in the October 8, 2021 letter

The letter was in response to an inquiry from the Law Enforcement Division, in which it had determined that the “unambiguous language” of the hemp law would “clearly criminalize the possession, possession with intent to distribute, or distribution of any and all amounts of delta-8 THC, or any other variant of THC, found in South Carolina.”

“If the General Assembly intended to undertake legalization of THC on the scale that the industry posits, they would have done so expressly and unambiguously,” Jones opined. “Instead, the legislative scheme of the Hemp Farming Act is much narrower: to create a legal framework for the licensed, regulated production of industrial hemp as defined. It cannot fairly be read to accomplish sweeping THC legalization or a similar sea change from previous policy.”

In June, the Hemp Industries Association (HIA) and its attorneys, Kight Law, had released its own legal opinion arguing that the 2014 and 2018 Farm Bills—which legalized hemp federally—allow for delta-8 THC products as they do not contain more than the 0.3% delta-9 THC threshold allowed under federal law.

The attorneys and HIA did note that while delta-8 THC “appears to be safe” some of the products which may contain “adulterants, contaminants, or other toxins” may be unsafe.

“The HIA believes that the hemp industry should take a strong stance against unsafe delta-8 THC production methods and products,” the attorneys wrote.

In June, a Leafreport study found 53% of delta-8 products contained delta-9 THC over federal legal limits while 68% of the products contained less delta-8 than advertised.

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California Tribe Plans Outdoor Cannabis Grow in Lieu of Casino

10/12/2021

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The Dry Creek Rancheria Band of Pomo Indians has filed an application with Sonoma County, California officials to grow nearly 1,000 cannabis plants outdoors on land in Petaluma that it had previously considered for a casino, the North Bay Business Journal reports. The grow site is proposed to use 29 acres of the tribe’s 277 acres in the region.

The tribe owns the land; however, it has not been officially taken into trust as tribal, sovereign land, the report says, which means the same laws apply to the tribe’s property south of Petaluma as any other parcel in unincorporated Sonoma County.

Petaluma City Councilmember Mike Healy said the plan “would allow the tribe to get some economic return on its property without a casino.” The city council and area leaders have long sought to limit casino activity in Sonoma County.

The tribe’s application to cultivate cannabis on the land came three months after leaders agreed to extend an agreement with the county that no casino would be constructed on the property before Dec. 31, 2032. In exchange, the tribe, which closed its River Rock Casino for more than two months at the start of the coronavirus pandemic, was able to waive its $750,000 annual payments to the county last year and this year.

According to the application outlined by the Business Journal, the site plants include landscape screening and fencing, no storage of chemicals, a 100-foot setback from property lines, pine trees to mask the smell, and on-site security.

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Missouri Tosses Residency Requirements for Medical Cannabis Companies

10/12/2021

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A Missouri judge last week ordered a permanent injunction against the requirement in the state’s medical cannabis law which required cannabis businesses in the state to be at least 51% owned by residents, the Springfield News-Leader reports. Missouri Western District Judge Nanette Laughrey had issued a preliminary injunction against enforcing the residency requirement in June.

The case against the Missouri Department of Health and Senior Services case had been brought by cannabis investment firm Toigo.

Jack Cardetti, a spokesperson for the state’s largest cannabis industry trade group, MoCannTrade, said the organization has not taken a position on the ruling.

Kim Andrews, part-owner of OzaRX Botanicals, a dispensary that’s 100-percent Missourian-owned, told the News-Leader that she was frustrated by the order, describing the now-defunct residency requirement as “one of those few things that [owners] had to keep everybody on even ground.”

“All the big guys have already been kind of standing at the back of the door. Now there’s nothing to keep them from just rolling in and buying everybody up. Their pockets are deep, their marketing budgets are more than I could ever dream of. They can take a hit opening up stores in a way that we can’t. … They can afford to lose a little money in one market where they know they’re going to make it up somewhere else. It really throws competition for a loop.”—Andrews to the News-Leader

It’s unclear whether state officials plan to appeal the ruling. Chris Nuelle, a spokesperson for the state Attorney General’s Office, which is defending the state health department in the lawsuit, declined to comment to the News-Leader, saying the agency doesn’t “typically don’t get into legal strategy.”

In August, a federal judge ruled that Maine officials could not prohibit out-of-state firms from operating medical cannabis dispensaries in the state, effectively tossing that state’s residency requirements.

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Protests in Mississippi Call for Medical Cannabis Legalization

10/12/2021

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Protestors gathered across Mississippi on Saturday to demand Gov. Tate Reeves (R) call a special session to pass the Mississippi Medical Cannabis Act (MMCA), KAIT 8 reports. The bipartisan MMCA was drafted in response to the state Supreme Court throwing out Initiative-65, the voter-approved initiative that sought to legalize medical cannabis in the deep South state during the 2020 election.

“We are tired of waiting,” said Amy Smoot while outside the Desoto County Courthouse with a group called We Are The 74 — named after the 74% of Mississippians who voted in favor of the state’s medical cannabis initiative. “We have sick people that are waiting for this. We need this now.”

Only the governor has the power to call a special session. State senator Kevin Blackwell (R) told KAIT that the final draft of the bill was sent to the governor last Thursday. Reeves has indicated he would call the special session if legislators came to an agreement to regulate the cultivation, processing, and distribution of medical cannabis.

“This is medical cannabis; it’s medical cannabis only. You’re not going to see people running around and smoking everywhere. There are rules and laws.” – Smoot to KAIT

We Are The 74 plans to rally again this weekend in front of the governor’s mansion. In an appeal to Reeves’ compassion, Smoot said at the protest that “there are hurting and sick people all over the state.”

“They don’t have medicine for their children, for their families, and it’s heartbreaking,” she said. “It’s truly heartbreaking.”

During the 2020 election, 74% of Mississippians voted in favor of legalizing medical cannabis. However, Initiative 65 was ruled unconstitutional by the Mississippi Supreme Court due to a congressional redistricting technicality. Anticipating the ruling, some legislators started working on the MMCA in early 2021 and now have a prepared proposal.

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U.S. Senators Ask Justice Department to Decriminalize Cannabis

10/11/2021

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U.S. Senators Cory Booker (D-NJ) and Elizabeth Warren (D-Mass) have sent a letter to Attorney General Merrick Garland urging the Department of Justice (DOJ) to decriminalize cannabis by removing it from the federal controlled substances list.

“Under the Controlled Substances Act of 1970 (CSA), the Attorney General can remove a substance from the CSA’s list, in consultation with the Secretary of Health and Human Services (HHS). Decriminalizing cannabis at the federal level via this descheduling process would allow states to regulate cannabis as they see fit, begin to remedy the harm caused by decades of racial disparities in enforcement of cannabis laws, and facilitate valuable medical research. While Congress works to pass comprehensive cannabis reform, you can act now to decriminalize cannabis.” — Booker and Warren in the Oct. 6, 2021 letter

In the letter, the senators called out President Joe Biden (D) for so far failing to uphold his campaign promise to decriminalize cannabis and expunge all prior federal cannabis use convictions.

“Decriminalizing cannabis is also a critical first step in addressing the racial inequities in cannabis law enforcement,” the senators wrote in the letter to Garland. “Federal cannabis policy has disproportionately affected the ability of people of color in the United States to vote, to pursue education, and to build intergenerational wealth. You can begin to repair the harm that the criminalization of cannabis has wrought on communities of color by using your statutory and regulatory authority to deschedule this drug.”

The letter notes that the National Institute on Drug Abuse — a part of the federal National Institutes of Health — has acknowledged that THC “has proven medical benefits in particular formulations” and that the Food and Drug Administration has approved THC synthetics as medications for patients with AIDS and patients undergoing chemotherapy and has also approved a CBD medication for pediatric patients suffering from epilepsy.

In the letter, the senators request that the attorney general responds as to whether they will consider ordering an HHS review — the first step in the process — by October 20.

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Pennsylvania Republican Readying Cannabis Legalization Bill

10/11/2021

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A Republican Pennsylvania state senator is circulating a memorandum seeking to add co-sponsors to a cannabis legalization bill, the Times Observer reports. Sen. Mike Regan, who helped write the state’s 2016 medical cannabis law said in a Broad and Liberty op-ed last week that cannabis legalization in the state “is inevitable.”

“As chairman of the Senate Law and Justice Committee and a former member of law enforcement, rather than sit idly by and allow others to shape the legislation, I am stepping up to be a leader on the issue, as I did on medical marijuana. And I am doing so using a common-sense, bipartisan, bicameral approach that will provide Pennsylvanians access to a safe product, create thousands of jobs, level the playing field with neighboring states, support law enforcement and our communities, and more importantly, defund the deadly drug cartels who have wreaked so much havoc on the commonwealth and our country for so many years.”—Regan, “Legalization of adult-use marijuana is inevitable,” Broad and Liberty, Oct. 5, 2021

Under Regan’s plan, cannabis-derived revenues would be used partially to benefit the Pennsylvania State Police and for infrastructure investment. The bill has not yet been formally introduced in the Senate.

Earlier this year state Sen. Dan Laughlin (R) and Democratic state Sen. Sharif Street, announced a joint plan to legalize cannabis for adults which would create a state-run system for cultivation and sales and expunge records for nonviolent cannabis-related offenses. That announcement made Laughlin one of the first Republicans in the state Legislature to support the reforms.

Democratic Gov. Tom Wolf and Lt. Gov. John Fetterman—who is running for U.S. Senate—both strongly back cannabis legalization in the state.

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Arizona Releases List of Zip Codes for Social Equity Licenses

10/11/2021

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The Arizona Department of Health and Human Services (DHHS) has identified 87 zip codes where applicants for the state’s cannabis social equity licensed must have lived in recent years. The localities include parts of Phoenix and Tucson and some in the smaller border communities of Nogales, Douglas, and San Luis, and is heavily focused on areas on or near Native American reservations Fox 10 reports.

In all, the state has set aside 26 social equity licenses for 169 total retail cannabis licenses.

DHHS Spokesman Tom Herrmann told Fox 10 that the process for selecting the zip codes “included a thorough review and analysis of a variety of data sources, including research and analyses of criminal justice and socioeconomic data.”

Licensees must have lived in one of the identified zip codes for at least three of the last five years to be eligible for a social equity license in the state. Other criteria include household income and past cannabis convictions for either the applicant or a family member, the report says. Those awarded the licenses must also show how their business “will provide a benefit to one or more communities disproportionately affected by the enforcement of Arizona’s previous marijuana laws,” according to the official program description.

Will Humble, a former DHHS director who now serves as the executive director of the Arizona Public Health Association, said that the agency likely didn’t release information about how it chose the zip codes because regulators are likely anticipating being sued; however, he noted that releasing the list was the first time he was “aware of the state of Arizona has basically admitted there are some communities that have been unfairly targeted by law enforcement and prosecutors.”

“They had to be forced by voters to admit it,” he said to Fox 10.

Adult-use cannabis business licensing in Arizona, including social equity applicants, is expected early next year.

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Cannabis Confiscations Rising on U.S.-Canada Border

10/11/2021

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Custom and border officials have seized nearly 15,000 pounds of cannabis at the Canada-U.S. Michigan border this year, MLive reports. The incidents are reportedly up seven times from 2018 when just 2,189 pounds were confiscated.

“It’s fascinating that you can sit there and you look into parts of rural Ontario from Michigan, you can look across the water, whether it’s Lake St. Clair or the Detroit River, you can see in the middle of the night the glow of these greenhouses that are basically just mass producing this stuff on a daily basis.” — Homeland Security Investigations Assistant Special Agent in Charge Matthew Stentz, via MLive

Like on the southern border, cannabis smuggled across the northern border is not destined for the nearby area. Although cannabis is legal in Michigan, most of the cannabis crossing the border is headed south where cannabis is still illegal in places like the Carolinas and Georgia, according to the report.

“With Michigan being a recreationally legal state, anyone bringing drugs from Canada will probably be best served to those drugs in a state where they can maximize their profit,” DEA Detroit Field Division spokesperson Brian McNeal said. “Logic would suggest that not all if any of those drugs are destined for the state of Michigan.”

Authorities say smugglers are using large trucks, individuals’ cars, and even mini-submarines to bring Canadian cannabis into the U.S., but it’s not just a Michigan issue according to the report. Another hot spot on the Canada-U.S. border is Buffalo, New York where authorities seized 41,000 pounds of cannabis this year, up from 1,071 in 2016.

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