So, you want to get into the cannabis industry. Congrats! We need more capable people in these parts. What we don’t need are a bunch of burn out stoners who think being in the industry means seeing how many dabs you can do all day. Get it together; the industry is really only about 50% dabs. Sadly, like most things in life, your access is limited by your budget. However, you crazy kids are smart enough to listen to the My West Coast Buds podcast, so your favorite stoner uncle Joe is going to give you the skinny on how you can get into the weirdo day care we call legal cannabis on any budget!
Zero dollars $0
Hey buddy, no stress, we’ve all been there: big dreams and a small budget. I get it. I’m dividing this one up into two types of people.
I just want to be in the industry.
Show up at a dispensary with a resume wearing clean pressed clothing and politely ask if a manager is around. If they are busy (they probably will be) leave your resume with whoever is working. Make sure to introduce yourself to all of them. Be nice, if they have downtime, make a little small talk and seem like someone that they would want to work with.
When I owned my shop I had at least 10 people a week walk in and ask for a job. Few of them brought a printed resume, and the ones that did got lost in an ever growing pile on my desk. Sadly, most people are average and they leave. Dispensaries don't have time to invest in an average person who is just going to leave in 6 months. The people who got jobs at my store had their resumes handed to me by a budtender who had something nice to say about them. That was the biggest thing. If the people up front liked an applicant and they had an even halfway decent interview with me, I’d give them a few shifts to see if they were worth keeping.
If you just want to be part of the industry, don’t close yourself off to positions with companies who service dispensaries but don’t actually sell cannabis. Working for one of these companies can often have all the same perks of being in the industry and way less stress. Leafly, Weedmaps, Dope magazine, specific cannabis brands you like, they are all on the lookout for clever, hard working, passionate people. Show up once with a resume, show up again a week later, show up again two weeks later, the follow through alone will help them realize you're not a dabbed out idiot, like so many of the people asking for a job.
I want to make money in cannabis:
DO NOT WORK AT A DISPENSARY. Unless your specific goal is to one day own your own dispensary, and you want to make weed money, I would avoid this route. I'll do another post later about the trials and tribulations of running a shop, but for now just take me at my word. You need to follow the steps above but apply to work as a rep for an up-and-coming brand with good marketing or as an apprentice to a grower. Even if you don’t have a ton of experience, get in with them however you can, do everything they will let you do. Don’t miss a day of work for a full year and always say yes to what they offer you. Can you sell? “I'll try.” Can you grow? “Show me how.” If you are a real hustler and you want to be in the industry, turn over is your friend. People above you WILL MESS UP. If you are there and you can do the job passably for a time, you’ll be shocked by how quickly that job becomes yours.
I have some cash and I don’t want to work for anyone. The $5000 - $10,000
Where did you get this seed money? I have no idea and this is by no means an accusation, but I suspect that there is a chance you may currently be “in” the cannabis industry. Has life changed for you and you need to be able to state your income because you want a home loan? Do you have higher aspirations than your younger entrepreneurial self? Maybe you have nothing to do with anything nefarious and you want to take a crack at the industry with a small budget just to see what happens?
You, my friend, need to find an ancillary business that relates to cannabis and work your way into the market this way. Maybe you deliver dispensary supplies to cannabis stores in your area. We used a service like this at my store all the time. No matter how prepared you are, some things are always going to fall through the cracks. Many online retailers of dispensary supplies have awful customer service and always take a few days for delivery; the slight premium you pay to have child proof bags delivered on 3 hours notice is a price happily paid by a shop owner who is worried about staying compliant with the state.
A brief scan of the dispensary rules and regulations in your area can seed countless business ideas. The tech industry refers to these as pain points. What causes the biggest issue in the day to day operations of a store and how does this product eliminate said problem? With the tech industry these pain points are based on the market and are normally harder to identify. You need an intimate knowledge of customer interactions to parse out where the issues in transactions arise. In cannabis these pain points are often the result of inept rule makers who don’t understand the industry. Because of this key difference, these pain points are easier to spot and are pretty consistent throughout the industry--as in, not specific to a single customer. This makes a hyper focused business model more viable in the space, and being more focused allows your investment dollar to go further.
I have $20,000 - $50,000
You’re very similar to the previous tier in that you need to be in an ancillary business. The key difference is that you have the budget to target a section of the market that has more growth potential. With this budget you’ll have the funds to add some support staff as well as a small marketing team. This tier also opens you up to the ability to work with established industries that are currently working in the cannabis space.
In the first year that Oregon legalized dispensaries the people who made the most money did so by installing the state required security systems. Many of these people were independent security contractors who had contracts with larger security companies. If you had an insurance bond, a contract with an established security company and a truck, you were in business. Contact a dispensary, do a bid for a security system, hand it off to another company and keep the difference in price. In a lot of cases the person doing the bid never actually installed or ordered anything and made just as much as the third party company he gave the lead to. You now have the budget to create a business around the fact that companies don’t want to say that they are working with dispensaries. Once you hammer out the details of the niche you want to service, you can repeat the process in other states as they become legal.
I have my life savings and some money from my grandma $50k to $150k:
This is not enough money to start your own company in a recreational state. I'll talk about medical later, but if you really want to talk about it now, email email@example.com and we’ll chop it up. And though there are stories of people who have made this amount of money into a successful company, I just can't in good faith tell you to do this when I'm about to provide a perfectly plausible alternative that will probably lead to your success.
What you want to do is launch a cannabis brand or product. Come up with a concept, a cartridge line, a neat pre-roll idea, a fun edible, whatever it is, and link up with a company that’s already making products. Show them the marketing and tell them you will give them 25% of your revenue to work under their license. Yes, in the long run this will be a big chunk you give them, but it gets you in the industry for far less than acquiring your own license. The other benefit is that you can start pretty much right away. No 6 month (or longer) wait for you to get to market. If the product is good, they may even offer to have their existing sales force help you sell it.
Working with a bigger, more established company gives you the opportunity to buy source material at close to their cost. If you're sharing space with a kitchen that’s buying 10,000 grams of oil a month they are getting a way better price per gram for their oil than you and your tiny startup. Let them make a little money selling the oil to you. You'll still end up paying less than you would if you went to a company directly, and the people you are working with appreciate a little extra cash flow. WIN. WIN.
I have $500k
Go to a state that recently became rec and make oil. Do 50/50 splits with as many companies as you can. Offer to package their oil for them for a fee. You are welcome. Seriously, if you do anything other than this you're asking for issues. You have less tax liability, you have basically free product to sell yourself, and your clients will love you if you provide even basic customer service.
I have $1,000,000+
Call me and tell me where you want to go. If you have a million to throw at this project you probably have more than that elsewhere in assets. Don’t end up in a position where making 3 million a year on your side cannabis project causes a 10 million dollar tax issue. Also, if you have that kind of money, you probably don’t want to deal with an audit.