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The era of illegal marijuana in Michigan ended with at least some indulgence -- you could see the smoke swirling through election night victory parties on TV. But this being the 21st century and this being the United States, at least some were thinking how they could get in on the ground floor.
At the Detroit offices of the financial news outlet Benzinga, overlooking Campus Martius Park, would-be weed tycoons gathered Friday for the Cannabis Capital Conference to meet, network and plot strategies for sharing in a hoped-for bonanza of profits about to rain down upon Michigan.
It wouldn't be a cannabis conference without munchies.
In theory, anyway.
Speakers were relentlessly upbeat, touting the wide-open harvest ahead, a $1-billion to $2-billion marketplace in this state alone.
Bugs remain to be worked out – business development, legal issues, capital, licensing, to name but a few – but also bigger, deeper issues, including how much the role of big money, and Big Marijuana, will play in birthing the state’s legal cannabis industry.
For now, though, the mood was celebratory, with some caveats.
Survival strategies for a new era
Michael Elias was welcomed to the stage with the news his company, Michigan Pure Med, had recently been granted 45 cultivation licenses for the medical marijuana sector, good to grow up to 1,000 plants each.
Forty-five thousand plants is one thing, he said, but the key will be vertically integrating the business to grow, process and provision patients and, later, recreational customers. As the industry ramps up, market forces will push prices down, he said, and vertical diversity will enable those prepared to survive.
The key for the recreational market, Elias said, will be how many municipalities allow cannabis shops. Only 108 are on board statewide so far, but Elias is confident others will follow as they better understand the law and revenue possibilities.
That set the stage for Shelly Edgerton, state director of licensing and regulatory affairs, the agency that will oversee legal marijuana. Having just gotten over the medical market hurdle, it now has one year to come up with a regulatory structure for the recreational market. (It will be legal for adults over 21 to possess up to 2.5 ounces of marijuana, keep up to 10 ounces in their home or cultivate up to 12 plants 10 days after the election is certified, most likely in a couple weeks. But commercial sales must wait for the state department to catch up.)
“We’ll be as ready as we can be,” Edgerton said. “We’ll execute the job the legislature (and) the people have put in front of us.”
Edgerton also expects more than 108 communities to allow pot stores. “The population nationwide is more accepting” of marijuana, she said.
Craft-style micro growers
Rick Thompson, of the Michigan Cannabis Business Development Group, enthused about the “head start” local entrepreneurs will have, given Michigan’s first-in-the-Midwest legalization status. Medical marijuana cardholders number around 300,000, but with 7 million adults of legal age to buy and use it, there’s no reason all 83 counties can’t have a business once the regulatory structure is up and running.
Thompson envisions “micro-grow” operations of artisanal marijuana, doing for the drug what microbreweries did for craft beer. The potential for success is not exactly limitless, but “pot-com” is the widest open field since dot-com, he said.
“The opportunities have no boundaries in this industry,” Thompson said.
More skeptical was Robb LaPeen, a Clio caregiver whose battle with Idiopathic thrombocytopenic platelet disorder made him a believer in medical marijuana. He wants room in this green rush to keep the focus on “patients before profits,” as he put it. He, too, has a company, for smaller investors to get involved in the business, with an emphasis on the medical side.
“Get healthy, not high,” he said. “I’ve been mainstream-medicine free for 10 years.”
