Speakers at the Real Cannabis Entrepreneur (RCE) conference held in Newark this past Friday and Saturday detailed how Green Rush and legacy entrepreneurs can prepare themselves for success in the adult-use market.
Many readily acknowledged the underground market in contrast to most cannabis conferences where selling a service or product to cannabis companies in legalized markets is the focus. Also, the Real Cannabis Entrepreneur conference featured many speakers and just a few vendors. Those tabling included professionals seeking to help license applicants, CBD and Delta 8 vendors, and constitutionally legally infused product vendors.
Real Cannabis Entrepreneur on Success
UCS Financial Advisor David Cunic gave a presentation on raising capital in the industry and said the process has a three percent success rate. He said the best way to go about raising money is to ask for input first.
“I’m going to be opening up a business. I want to get your feedback,” Cunic offered as a tip to say. “Can I follow up for feedback in two weeks?
Along with a solid plan and presentation, a charming founder helps raise money.
“People invest in you,” he said.
Cunic said the primary places entrepreneurs should look for capital are family, friends, and acquaintances.
“Develop your sphere of influence,” he added.
Cunic said that includes neighbors, hobby groups, religious affiliations, and others. It also helps to join the local chamber and network at cannabis conferences.
“If you’re afraid of reaching out to your neighborhood, then you should not be in this industry,” he said. “If you were opening a bar or pizzeria, it would be natural to reach out to these people.”
Cunic advised solopreneurs to hire a business coach or an investment advisor to help the process.
“Eighty percent of start-ups fail within five years. Ninety-seven percent of cannabis companies fail in the first five years! he said. “Less than two percent of cannabis companies are bought.”
New Jersey License Application Process
Noted cannabis accountant Harry Carpenter of Citrin Cooperman discussed the cannabis license application process in New Jersey’s Green Rush.
“We’re 10 percent of the application,” he said. Carpenter noted the interim regulations say a financial forecast is needed.
With the 2019 medical cannabis license process finally nearing an end, he said, “The applications were geared toward those with significant experience and not the entrepreneurs. And it’s not fair.”
That experience had to be in the legalized cannabis industry. Thus cannabis corporations with experience in other state-legal markets had a great advantage.
“Three hundred out of 1000 was prior experience points,” Carpenter added. “You totally had no chance if you were a local person.”
He noted cannabis corporations have the resources to hold land and space indefinitely and absorb the cost.
“I think it was a barrier to entry in New Jersey and other states. And it was unfair,” Carpenter said.
“I love the conditional license,” he said. Carpenter noted it gets rid of the issues of finding a friendly town and landlord with few assets before applying to the State for a license. “New Jersey seems to be turning a corner.”
“We want to make sure they don’t have Wal-Marts dominating the industry from the start,” Real Cannabis Entrepreneur Master of Ceremonies Gary George said.
He noted the value of having deep pockets.
Acknowledging the Legacy Market
The notorious entrepreneur and advocate Ed “NJWeedman” Forchion and noted other speakers detailed losing money in the Green Rush after signing shady deals saying, “I’ve had a couple of things happen to me too.
NJWeedman has also had deep-pocketed investors offer him deals.
“But they want 51, 52 percent of your business,” he added. “They want too much. You weren’t sitting in prison with me.”
NJWeedman noted that women make and enjoy edibles more than men. Therefore, the prohibition on edibles was sexist, he argued.
“It clearly affects women more that they’re not allowing edibles,” Forchion said.
He said women mostly buy edibles at his underground dispensary, the Joint of Trenton, while men largely consume flower.
“I’d be so mad if my town opted out,” NJWeedman added. “There should be huge resistance to opting out. There should be huge resistance to this no growing.”
Regarding the legacy market having a seat on the table, “the table should be ours,” he said.
Businesswoman and advocate Tara “Misu” Sargente spoke about the value of creating brands around cannabis products.
“There’s nothing proprietary about a plant,” she said
She noted the value of research after being sued by Tasty Cake over the name Mary Jane Mix.
While there are no edibles in the market currently, she said it would happen eventually.
“Don’t lose hope,” Misu said.
Other speakers included the owners of Roll Up Life, that want a license, and Kym B of Tribe Tokes, who detailed her experience in the legacy market and succeeding in CBD against great odds.
“The fucking legacy market is the real market,” she said.