This Thanksgiving weekend, MSNBC will premiere “Pot Barons of Colorado.” The six-part documentary series will air Sundays at 10pm ET/PT beginning November 30th, with a special Sneak Peek airing Friday, November 28th. The show takes a look at the ambition of Colorado-based dispensary owners to cash in on the new “green rush” to become “the Costco of marijuana,” to franchise across multiple states and to be the lasting names that come out of the end of marijuana Prohibition. Another branch of the industry looked at in the series is edibles.
On New Year’s Day, Colorado became the first state to allow the legal retail sale of recreational marijuana as long as the customer is age 21 or older and the store is licensed, taxed, and regulated by the state. Recreational marijuana is now also legal to cultivate, sell, and consume in Washington, Oregon, and the District of Columbia. Medical marijuana is legal in 23 states and DC, with roughly a dozen other states having limited medical marijuana laws.
In the six-part series, audiences will meet a handful of the state’s leading Pot Barons, including Jamie Perino, owner of Euflora, a high tech pot parlor which she calls “the Apple Store of Weed,” and Tripp Keber, the President and CEO of Dixie Brands, who hopes to build an empire out of his marijuana soda that comes in fancy brushed-aluminum bottles. The documentary explores how each pot baron broke into the industry, the risks they are taking, and the setbacks they must overcome.
The U.S. market for medical and recreational use is expected to grow more than 70% from roughly $1.5 billion in 2013 to approximately $2.6 billion in 2014. Legal marijuana is projected to become an $8 billion to $10 billion industry by 2018.
There are several ways that entrepreneurs can profit from legal marijuana. Interested business owners can apply for a dispensary license or become a grower or sell cannabis-infused products, which include edibles, tinctures (extracts), salves (topical applications), and beverages. There’s also testing labs, security firms, and the high-end paraphernalia market, like the glass blowing community.
At the Federal level, marijuana remains illegal under Schedule 1 of the Controlled Substances Act, which means it has no medicinal use and is a drug on par with heroin, acid (LSD), and ecstasy. So, banks are shunning cannabis business, creating a cash-only world and a climate of armed guards, locked vaults, and constant concerns about security. Additionally, federal law enforcement agents continue to raid legal cannabis growers and retailers.
It can cost anywhere from $1 million to $4 million to finance an upstart dispensary or growth facility. And annual revenues for dispensary owners range from less than $100,000 to more than $1 million, according to the Marijuana Business Factbook, published by MMJ Business Daily.
Corey Barnett heads up Washington, DC-based District Growers, an owner/operator of cultivation centers and dispensaries that also provides advisory services to companies in the industry. D.C. laws are tough. Before getting hired by a cultivator, you need approval from the Health Department and a background check. You can’t have drug related felony charges or misdemeanor federal charges. This forces a number of African Americans to either grow marijuana for personal consumption or sell on the unregulated market.
Drug use and sales happen consistently at around the same rate across racial lines. Yet, even though African Americans make up 13% of the country’s population, they comprise 31% of those arrested and more than 40% of those incarcerated for drug offenses, according to Colorado’s Drug Policy Alliance.
According to Barnett, who previously ran two dispensaries in San Diego, about 5% of people cultivating marijuana in Southern California are African American. Further east, the number of cultivated black growers is slim to none. His advice to eligible newbies interested in a dispensary is to start out as a patient specialist, also knows as a bud tender, before branching out on their own. This will give them insight into the day-to-day functions of inventory control, diversion prevention, supply chain management, and other back-office functions, while learning on someone else’s dime.
For cultivation center employment or to become a grower, the first thing to look for is an established commercial cultivated grower. Successfully completing a cultivator’s training courses and taking a grower test elevates you grower or cultivator status. You can then work your way up to senior grower, which means being seasoned enough to handle large portions of a garden. Promotion to garden manager means you can be trusted to run an entire facility. It takes about six months to go from trainee to cultivator and another year or two to become a senior grower.