As a lifelong New Yorker, I haven’t seen the Green Rush sweep our state just yet. So this week’s MMJ Business Daily’s historical cannabis conference was Disneyland for me. It was pot heaven, without the buds. It was like a future life, set in a world where cannabis was more than quasi-legal. The smell of cannabis would occasionally hit you in wafts, but not from smoke or vapor, from the pockets of the attendees. Every few minutes the sweet smell of terpenes would wisp in and out as easily as it came and it was necessary for me to remember that I was a cannabis conference and not a trade show for a totally legal product. To see thousands of current and future entrepreneurs come together to get in on this green rush was inspiring, exciting, you could feel the energy in the air. A cast of characters that would make “Ripley’s Believe it or Not” were scattered throughout the conference, everything from hippies to yuppies were in full effect. My first impression of the conference was the sheer magnitude of the registration area, lines stretched far into the hall, some people reporting Disneyland-ride type wait times just to get their golden ticket, their conference badge.
The registration area featured a directory which reminded me of one you’d find in the Roosevelt Mall back home on Long Island New York. The speaker list was extensive, the exhibition hall was overwhelming. For those of us who recently attended the International Cannabis Association conference in New York City, marveled at the sheer mass magnitude of this particular event. It seemed 10 times the size of the ICA production, which it wasn’t, but I literally felt small in that room. The conference was boisterous and exploding with entrepreneurial spirit from its attendees. It seems like this new mega-conference model will continue to perpetuate as rumors of the ICA relocating its conference to the Jacob Javits Center spread throughout the room.
On November 1st, John Leland and Mosi Secret’s article “For Pot Inc., The Rush Begins” in the New York Times featured the cast of characters that were key players in the ICA event. Some of them included myself, a former rapper and cell phone store owner, Dan Humiston a tanning aslon owner and President of the ICA, and Ari Huffnung, a local entrepreneur seeking one of the cannabis coveted licenses, 5 total in New York State to be given. This conference had no shortage of its cast of characters. The parade of people ranged from all over the world onto the conference, my partner Marcel Maurer from Switzerland, but I also met people from Germany, Japan, China, South America, and a strong Canadian contingent. Their were people from all over the US from Nevada, California, Colorada, New York, Florida, Washington, Oregon, Wyoming, Oregon, Teexas, Arizona, Illinois, Hawaii, Maryland, and Ohio. Those were just what I saw. I’m sure many more territories were represented but we will get back to the individual stars of the show a little later…
MMJ Business Daily provided a wonderful program which is given out with your registration. I am quite confident it is the most comprehensive cannabis industry show guide in the history of the industry based on the fact they are a publishing company. The program guide had extensive full-color descriptions of all of the speakers for the event, laid out the conference tract in a simple to digest manner, had some interesting articles and advertisements as well. I was not surprised when I received an email Thursday morning to alert me the conference had sold out.
MMJ Business Daily had many sponsors and the lunch and deserts they served were excellent. The lunch was healthy, buffet style served right on the conference floor on both Thursday and Friday and I was happy to see that the cannabis community continues to provide a lot of vegan and vegetarian options to the show attendees.
It seemed from the moment I arrived it was all about the parties, as one would expect from a conference in Las Vegas! However like most things, the parties were very cliquey, but of course I’m sure space was limited. I went to the Women Grow event briefly, just in time to get what I came for. I wanted to hear Jane West and co-founder Jazmin Hupp speak to the industry. Women’s Grow announced an initiative to raise $250,000 and Eden Labs was the first to contribute. It would appear Women Grow is on a roll, they have chapters all over the United States and they have only been around since August. Green Rush much?! There are two sides of the women’s movement in the cannabis space I am seeing trending the first is raising awareness about women being treated appropriately in the marketplace, at work, and as a partner in a business. On one side women are still dealing with many of the same sexist male behaviors you would typically hear about in any office environment from inappropriate language around women, inappropriate comments, disparaging nicknames, to less subtle forms, such as women being used as pawns to become the “token female” in an organization based on gender and not merit. Men are making many faux paus saying things they may not even realize are offensive to women. Jane West, to her credit is more focused on women who are confident enough to push through those limiting behaviors and beliefs. I think the group’s name is appropo for West’s vision. Jane is really looking to inspire and create opportunity for women moreso than being the whistleblower and a fine job she appears to be doing.
As for the conferences, there were so many, but frankly I found the people and the vendors to be favorite part of the expo. The conferences may have been tremendous, but I only attended two, simply because I felt my knowledge of the industry was sufficient in the areas in which the conferences were being held. I came more for networking then for education. That said, I did attend two conferences, the first conference was called “Beyond THC” about CBD and hemp. This conference was exceptional and headed by two speakers Anndrea Herman of the Hemp Industrial Association and Chris Boucher of CannaVest Inc.
AnnDrea Herman spoke first and was exceptional; her ability to speak clearly and articulate her message about hemp, rattle of the data quickly and digestibly was incredible. After the conference I went up to her to ask her about growing hemp indoors. Why doesn’t anyone talk about it? She said, “Unless someone is looking to separate a male from female to produce extractions then there is no need for it. Most agricultural hemp need not grown inodoors, it is cost-prohibitive. AnnDrea went on to promote her initiative votehemp.com which is sounding like some sort of coalition to legalize hemp. They are seeking to remove any association of the word “marijuana” from hemp and also seeking to give the hemp industry control of the right to also cultivate the hemp flower, non-psychoactive cannabis as part of the legislation in all of the states. While this may seem harmless, this is a potential conflict of interest to the “marijuana people” or the psychoactive medicinal and recreational side constituents of the cannabis plant, specifically anything containing THC.
When Chris Boucher spoke, there was certain arrogance to his demeanor, he raised a bold analogy by showing the famous 1938 Popular Mechanics issue with Henry Ford and the claim that hemp would be a billion dollar industry way back then. Boucher remarked, “Imagine what hemp would be today if it were never made illegal.” It would seem that the small $500 plus million dollar industry is set to take off as Boucher claimed that he sees CBD oil as the new nutritional supplement, like vitamin C that will be infused into every nutritional wellness product. Boucher went on to expound on the benefits of farmers getting into the hemp industry, most notably emphasizing farmers rights to not only create the textiles, fibers, and process them, they would also have the rights to extractions of all the plant as well, leaving no waste for the farmer.
After the seminar a woman named Kiera from Black Rock Nutraceuticals in Las Vegas stood up and started asking some very serious questions regarding a conflict of interest between the initiatives spoken on the panel and the initiatives of the medical and recreational cannabis industries. I wondered for a long time before today why the cannabis industry was split between cannabis and hemp. One of the main reasons I founded the Cannabis and Hemp Association was to help merge these industries, but apparently the hemp people aren’t interested. Right now it appears there is a competition between the two industries in the area of medical use of hemp. Hemp laws are passing that give hemp growers the right to process non-psychoactive cannabis in concentrates requiring no special permitting while psycho-active cannabis must go through the expensive licensing process in order to set up extraction plants. What this means is essentially a hemp farmer can start their own cultivation facilities similar to medical marijuana cultivators without having to go through the medical marijuana process and some believe this could start an intra-industry war between THC and CBD. Kiera questioned Chris about this conflict of interest and was more or less given rhetoric as an answer. It appeared to me Mr. Boucher was deflecting the question. Despite these potentially damaging issues to the industry in the future, I found the hemp presentation to look like a phenomenal opportunity for farmers.
The only other conference I attended was the closing one, “The Future of The Industry in 5 years.” The panelists were Meg Sanders CEO of Mindful, Tripp Keber CEO of Dixie Brands, Rob Campia Executive Director of Marijuana Policy Project, and Andrew DeAngelo Vice President of Harborside Health Center. The industry outlook was very much similar to what I had anticipated. Dixie Elixirs CEO claims that infused products were just in 8% of all of the products in their dispensaries but now there are close to 50% infused products. The future is finished packaged goods according to Keber.
Two of the panelists had predictions that cannabis would legalize federally, Keber believes it will happen in 2016 with Campia believing we will have 5 more recreational markets online by 2016 and Federal legalization in 2019. Mr. Deangelo was less optimistic and would not make a prediction as he did not see Federal law changing for the foreseeable future. This bearish view by Mr. DeAngelo by the way, contrasts what his brother Steve Deangleo remarked in October’s “Blunt Talk” conference in New York in which he believed the 2019 election would be the federal lift on prohibition, and he said so definitively.
MPP had a rosy outlook for recreational cannabis, he went on to predict publicly the opening of new markets in California, Arizona, Maine, Massachusetts, and Nevada in 2016, while medical cannabis would be instituted by Pennsylvania and Florida by November 2016. MPP went on to state the best Presidential Candidate for the industry is Rand Paul, singling out Hillary Clinton as someone who may not be a friend to the industry.
Meg Sanders view of the industry in 5 years was wishful and hopeful; she spoke in an energized tone, perhaps by the sheer volume of people in the auditorium, a virtual wave of cannabis enthusiasts and investors. Sanders outlook was one of optimism, saying she looks forward to a day when we are all pitching our finished products at trade shows all over America. To accomplish Meg’s vision however, a great deal of regulation will need to be established as concerns over edibles continued to be a theme on the panel. When asked his greatest fear about the industry, Deangelo used an example of irresponsible edible use. He offered an anecdote of a bus driver who ate an edible and later in the day, after the edible kicks in, impairs his driving and leads to an accident and death of children on the bus. While the example is just a fabricated story and nothing like this has happened yet, it is a major concern as most of America has yet to have been exposed to the effects of eating cannabis concentrated infused products.
For those that are novice with edible products, the way the body metabolizes them is different than the inhalation process. When edibles are ingested, the cannabinoids metabolize through the liver, one of the main centers for CB2 endocannabinoid receptors. The psychoactive process is not instantly induced, but a slower metabolism, one that can take up to two hours to kick in. This can pose a problem in safety specific industries, where users of cannabis may not be able to time their high in a way that ensures the safety of those the user is tasked to protect. Some cannabis experts have even advocated to adult nubies trying cannabis for the first time to smoke it, due to the rapid induction of the high, allowing the end user to determine quickly if they can handle the dosage.
Tripp Keber from Dixie Elixirs went on to explain his concerns about the industry which involve overregulation. As is typical of most businessmen they are going to be concerned with regulation which costs them money to adhere to or regulation that makes them money as a result. His brand Dixie Elixirs are dependent on edibles to function and with many concerns being stated throughout Colorado and even proposed legislation to kill the edible business; Tripp has good reason to be concerned. We all have a reason to be concerned about overregulation. While in my hotel room I learned that the first online gaming company, Ultimate Gaming, in Las Vegas shut operations this month, citing an overregulated industry made it not worth the effort to operate their business.
“As has been the case in other jurisdictions, online poker revenues in Nevada have fallen far short of original projections,” Ultimate Gaming Chairman Tom Breitling said in the release. “Moreover, the state-by-state approach to online gaming has created an extremely cost-prohibitive and challenging operating environment. These factors have combined to make the path to profitability very difficult and uncertain. Consequently, we have decided to cease operations.”
With New York State proudly touting that the market will be the “most tightly regulated in the industry” according to New York Democrat Senator Diane Savino, the question is will it be prohibitive. Will New York be the state that pushes regulation too far or will the state-by-state regulations prove to be effective? We don’t know. The question is, how do we find the proper mix of regulation in the industry? The industry needs regulations loose enough to entice investors and entrepreneurs, so it must be profitable, but tight enough to ensure the state gets their tax revenue. Diversion (the act of moving legal cannabis into the black market) needs to be avoided and the patients n(and eventually consumers) must be able get their hands on a safe, affordable product in terms of production and quality.
Tripp stated another concern, the alcohol and tobacco industries fighting against cannabis in order to preserve their market share. “The inconvenient truth is that Big Tobacco is coming for you and, surprise, surprise, she plans on giving it to you good and hard,” Patrick Basham, director of the non-partisan public policy research organization based in Washington DC and London, said during a speech at the conference. Alcohol and tobacco have already begun to take steps to move against cannabis and the marketplace for America’s recreational drugs will end up in fierce competition. “You can’t have an industry that is tripling in size and taking revenue and profits away from manufacturers of alcohol and tobacco and not expect them to do something about it,” Keber told an audience on the last day of the conference. “You better be prepared.”
While alcohol and tobacco complement each other, cannabis is often used exclusively and this is reflected in statistics showing out of Colorado alcohol consumption is down as cannabis consumption increases. Personally, I believe those trends will continue in all recreational markets as cannabis and alcohol have opposite effects on the endocannabinoid system. Where alcohol greatly impairs the endocannabinoid system, cannabis supplements it, leaving the body in a state of disarray when both are used together in excess. I have a number of alcoholic friends and none of them smoke cannabis due to the effects it has on their body, it doesn’t sit well with them, and I believe that is due to the damage that gets done to the endocannabinoid system.
I did not have the opportunity to attend the keynote speech, an introduction from Ben Cohen of Ben and Jerry’s Ice Cream. I’m not sure what ice cream has to do with cannabis and to my knowledge Mr. Cohen has no interest in opening up a cannabis business, so I just don’t understand the choice in having him as a keynote speaker. I see the correlation between edible companies seeking to make an iconic brand in the marketplace, but as a keynote speaker I think having someone with a more broad view of the cannabis industry, such as Steve Deangelo or Ed Rosenthal or a notable author would have been better. This was one of my very few complaints about what was otherwise a stellar performance by MMJBusinessDaily.
As I walked the exhibition hall (8) rows of vendors awaited like a labyrinth of golden opportunity with Hempmeds booth being right up front. They are one of the “CBD-hemp oil hustlers” a subsidiary of the corporation Medical Marijuana, Inc. featured in a report from ProjectCBD. Hempmeds purchases hemp bulk product which consists of non-psychoactive cannabis which comes in a veritable vat of black, tar like substance, which then gets processed and refined (supposedly) into a digestable oil that is supposed to contain CBD. Companies like Hempmeds believe that hemp-oil will become the new Vitamin C, they believe it will be infused in various types of food and vitamin supplements all over.
The show was a mixed blend between some of the larger names in the industry such as Leafly, ArcView Group, Medbox, Hempmeds, GPharmaLabs, Abbatis Bioceuticals, Apeks Supercritical, Eden Labs, and Medmen were there, but by and large this huge conference space was filled with fledgling entrepreneurs. There was something American about company CEO’s and President’s being the trade show representatives. It felt very old fashioned, a throwback before multi-national corporations took over the world through globalization, all that was missing was a big fat piece of mom’s apple pie. Nearly every business card collected had the title of an executive, CEO, or company President of nearly all of them. Very few companies had a true staff member as the trade show representative, which tells me two things:
(1) Market leadership is readily available in a variety of the ancillary service businesses.
(2) This industry is a salespersons’ dream, a place you can go to meet just about every decision maker in the industry without any gatekeepers.
The trade show floor featured various infrastructural type companies, everything from credit card processing, to POS software, grow lights, etc. All the things one would need to open a dispensary. An impromptu book signing took place on the conference floor as longtime cannabis guru Ed Rosenthal quietly signed away copies of his book as those in-the-know onlookers came by to say hello. The conference floor had tables separate from the vending for those looking to conduct business. Throughout the weekend, many meetings were held and many people looked to be laying the foundation for future industry growth.
One woman, Margie from the island of Kauai in Hawaii is a former liquor store owner of close to 40 years in the business. She is looking to relocate to the city of Honolulu and pursue opening a dispensary. Another man, David from California, by way of New York, a porn industry investor and longtime gaming industry stalwart claimed to be the recipient of 11 dispensary licenses in Long Beach and was looking for partners to open top notch dispensaries. Another man from Ontario, Canada was a consultant processing 57 dispensary applications for Canada’s emerging medical program.
I ran into many people over 60, many investing their hard earned savings just to be in this industry and make one last epic business run. As I surveyed the crowd you could tell it was a total mash up of those people you would expect to find at a Grateful Dead concert to people you would expect to find in the boardroom of a Fortune 500 company. People from all walks of life were there but the diversity was interesting to me. I did meet many white women at the various booths and throughout the conference, some employees, and few had an equity position that I spoke with. I met very few black and Hispanic women and few black men. I wonder whether the price of the event was a factor that excluded more diversity but out of the 2500+ attendees I’d say it was 85% white male dominant, 15% everyone else. This is an observation not based on any statistic; however I made it a point to take note of the demographics in all of my conversations. The reason I track demographics in this industry is due to the opportunity that is presented, a unique one, giving women and minorities a real chance to not only participate but shape an industry and become a factor in cultivating the culture.
The entire show was very professional overall, despite a few minor glitches, but when you have a show of that magnitude for the first time, growing pains are expected. The pains however, as far as I could see were more like paper cuts than flesh wounds..