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Research Archives - Hemp Market Report

StaffStaffNovember 8, 2019
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9min00

With the surge of medical marijuana and CBD-THC -free products across the US, medical patients in Florida can rest assured that they can legally obtain medical marijuana for certain health and pain-related conditions at a medical marijuana dispensary in Florida.

Florida’s Compassionate Medical Cannabis Act was signed into law on June 16, 2014, by Governor Rick Scott. This act allowed for specialized doctors in Florida to order low- THC cannabis for patients from January 2015.

That said, recreational marijuana is illegal in Florida, and medical patients that need medical cannabis have to go through Florida’s system of obtaining a medical marijuana card to use at a medical marijuana dispensary.

A Florida doctor must follow certain conditions before being allowed to order low-THC cannabis for Florida patients. These conditions include the following:

  •  The physician must be licensed under Chapter 458 and 459 of the Florida Statutes
  •  Attend an 8-hour training class
  •  Write and pass an examination

With Florida federally legalizing hemp in 2018, there are numerous CBD companies selling hemp online. By 2019, smokable medical marijuana was made legal in Florida, although there is still a bit of a wait to get a prescription. March 18, 2019, Bill provisions include the following:

  •  Allows the possession and use of smokable medical marijuana from a medical marijuana dispensary. 
  •  It allows for the use of a marijuana delivery service used for smoking marijuana to be purchased from a vendor other than a medical marijuana treatment center.
  •  Regulates the amount of smokable marijuana to no more than a 35- day supply for a 35-day period, or no more than one 70-day supply for a 70-day period.
  •  The 35-day supply cannot amount to more than 2.5 ounces, with patients not allowed to have more than 4 ounces of smokable marijuana at a time.
  • Dispensed marijuana products need to remain in their original packaging.
  •  Patients are prohibited from smoking medical marijuana in public, at work, or on private property when not permitted by the owner.

That said, medical marijuana can only be purchased at a medical marijuana dispensary in Florida.

Reasons for Legalization

Over 70% of Florida voters approved wanted medical marijuana approved by 2016. Voters believed that qualified medical patients should have the right to smoke medical marijuana or take it in whichever form they most preferred. 

There was also Florida’s appeal of a lawsuit following the ban. Today, chronic pain is the most common reason patients use to get the state-approved medical marijuana card in Florida. They need to get a marijuana card first so that they can visit a medical marijuana dispensary.

Patients Options

Marijuana is a Schedule 1 drug under Federal Law, which means Federal Law supersedes State Law. Marijuana that contains a high amount of THC is effective for patients with different medical conditions such as:

  •  Autism
  •  ADHD
  •  Chemotherapy
  •  Parkinson’s Disease
  •  To increase appetite
  •  Pain management
  •  Glaucoma
  •  Depression

Risks and Opportunities 

Long-term research is still not available as to the safety of all CBD products. Harvard adds that “without sufficient high-quality evidence in human studies we can’t pinpoint effective doses, and because CBD is currently being mostly available as an unregulated supplement, it’s difficult to know exactly what you are getting. If you decide to try CBD, talk with your doctor — if for no other reason than to make sure it won’t affect other medications you are taking,” adds Dr. Grinspoon, MD, Harvard Health Publishing. 

Whether you’re purchasing medical marijuana from a medical marijuana dispensary or THC-free CBD, patients need to question where their product comes from, and who is responsible for the final quality of the product. The US made medical marijuana and CBD-THC-free products tend to be a higher-quality product with fewer contaminants like heavy metals and pesticides.

Quality control measures in the US come into play in a big way of protecting consumers. That said, consumers still need to ask for a certificate of analysis or COA to examine the analytical testing of the final medical marijuana product from a third-party lab. This guarantees safety and a high –quality product for all patients. 

A medical marijuana dispensary in Florida will have to follow certain rules and regulations, and can only start dispensing medical marijuana after obtaining a receipt of a medical marijuana dispensary license. 

Keep in mind that Florida law requires that medical marijuana patients meet up with their provider at least twice a year. In 2019, the Florida School board also approved a plan to establish a policy to allow for the use of medical marijuana from a medical marijuana dispensary. With medical dispensaries generating millions in sales this year, it’s not surprising that medical marijuana patients may have a hard time making a choice with the huge array of cannabis products, and extended CBD brand lines.

Author:

Olivia Davis is an enthusiastic, creative author and the Communications Assistant at Dr.Green Relief – Medical Marijuana Doctors. Our mission is to aid patients with qualifying conditions to get their MMJ Card so they can use, possess and cultivate medical marijuana legally.

 


StaffStaffJune 14, 2019
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10min00

Oregon State University launches largest, most comprehensive hemp research center in the nation

By Heidi Happonen, 541-737-9180, heidi.happonen@oregonstate.edu

Sources: Alan Sams, 541-737-2331, alan.sams@oregonstate.edu; Jay Noller, 541-737-2821, jay.noller@oregonstate.edu

Oregon State University officials announced plans today (Thursday, June 13) to launch the nation’s largest research center devoted to the study of hemp, and announced that OSU will begin certifying hemp seed for planting in Oregon.

The Global Hemp Innovation Center will be based in OSU’s College of Agricultural Sciences with research taking place across the state and world. Currently, there are more than 40 OSU faculty representing 19 academic disciplines engaged in hemp research, teaching and extension services. The center will serve as a research hub connecting faculty and researchers engaged in plant research, food innovation, pharmacy, public health, public policy, business and engineering.

Hemp has the potential to become a major agricultural commodity in the United States and abroad with hemp plant fiber being used in manufactured products, including clothing, construction materials and packaging. Meanwhile, hemp seed oil is being investigated for use in pharmaceuticals, cosmetics, foods and nutraceuticals. For example, hemp has a long tradition of use in treating ailments by eastern medicine.

Alan Sams, dean of the College of Agricultural Sciences, said the OSU center will be the world’s most comprehensive resource for the study of hemp.

“Our faculty are already recognized internationally as the go-to experts for hemp research,” Sams said. “The launch of this center signifies our commitment to continue to build upon that established expertise and grow our impact across the state, the nation and globally.”

Oregon State’s decision to launch the new hemp center follows Congress’ adoption of the 2018 Farm Bill that removed hemp from the list of controlled drug substances and initiated the creation of a framework for hemp to become a fully legalized commodity in the future.

“Hemp has incredible potential across several industries and sectors, including in food and health products and as a fiber commodity in many products,” Sams said. “We believe that Oregon State University is uniquely positioned to serve the global need for research-based understanding of hemp as a crop and for its use in new products.”

According to the Brightfield Group, an analytics firm that tracks the cannabis industry, the hemp-derived cannabidiol (CBD) market is expected to grow from $618 million in 2018 to $22 billion by 2022.

OSU already is a go-to partner with Oregon agriculture. The university collaborates with the Oregon Department of Agriculture and various state commodity commissions to certify seeds for as many as 48 agricultural commodities grown in Oregon.

As it launches its seed certification services for hemp, the seeds will be for use by farmers that are registered by the state. Oregon State will be the only university in the nation presently to certify hemp seed.

At this time, only state departments of agriculture in Colorado, North Dakota and Tennessee certify hemp seed for use in those states.

By the end of June, OSU researchers will plant the university’s third crop of hemp plants at 10 university experiment stations located in different climates and soil conditions throughout Oregon. Up to eight plots of hemp totaling no more than five acres will be planted at each experiment station. Hemp material will be harvested as the plants are flowering and will be provided to OSU researchers for study. No pollen or seeds will be produced from this year’s research crop.

Jay Noller, professor of crop and soil science at OSU, will serve as director and lead researcher for the new center.

“We want to understand how to efficiently and sustainably grow hemp for seeds, for hemp fiber materials that can be used in textiles and construction materials, including as an alternate to gravel in concrete, for hemp essential oils that have popular health and wellness uses, and for hemp grain for use in foods and feed. Multi-use hemp is what we are excited about globally.”

Noller said OSU’s hemp research center will have a global impact.

“It’s tempting to think of growing hemp to both build your house and treat disease,” Noller added. “I also like to remind people that hemp food is highly nutritious.”

Noller said Oregon State researchers are working with faculty at universities in Europe and China to explore the propagation and uses of hemp. Meanwhile, Oregon State will host in Corvallis a National Academies of Sciences symposium on hemp in the coming months.

OSU is well-situated to provide research, teaching, and outreach and engagement associated with hemp, Noller said. “We have incredible alignment between our research community, the university’s experiment stations and the OSU Extension Service to engage in strong basic research, applied research and scholarly teaching.

“We have very few agencies nationally involved in understanding the agricultural, economic assessment and public health benefits of hemp. Oregon’s location on the 45thparallel is optimal for hemp growth and a unique hemp germplasm – the genetic material used for breeding – was developed in the state over the past several decades.”

Noller said the engagement of 40 OSU faculty, 19 academic disciplines,10 university experiment stations and the OSU Extension Service will combine to make Oregon State’s hemp research effort the nation’s largest.

Beginning in 1936, the federal government prohibited the propagation of hemp plants. Oregon authorized hemp cultivation in 2009, but the Oregon of Department of Agriculture did not license its first hemp grower until 2015. Just three years later, Oregon ranked third in the United States in licensed hemp acres planted behind Montana and Colorado. The 2018 farm bill decriminalized propagation of hemp, and it is anticipated that over the next year the federal government will have a framework in place to commercially produce and utilize hemp grown in the U.S.

As of mid-May, Oregon has licensed 1,342 growers to plant 46,219 acres of hemp this year, according to the Oregon Department of Agriculture. That total is nearly six times greater than the 7,808 acres planted in 2018. Nationally, the number of licensed acres devoted to hemp cultivation increased by 204% from 2017 to 2018, according to Vote Hemp, a Washington, D.C.-based nonprofit organization.

Both Oregon and OSU have a long history of hemp cultivation and research. The university, then known as Oregon Agricultural College, partnered with scientists in the U.S. Department of Agriculture to host a national hemp research center from the 1880s until 1932.


StaffStaffDecember 18, 2017
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3min00

New York Stock Exchange-listed REIT Innovative Industrial Properties (IIPR) closed on a previously announced property in Arizona for $15 million. The Pharm, LLC operates the 358,000 square foot greenhouse and industrial space.

The Pharm is one of the largest wholesalers of medical-use cannabis in the state of Arizona and is expected to complete some tenant improvements to the building. IIPR will reimburse The Pharm up to $3 million for those improvements, which would bring the total investment in the building to $18 million.

“We are very pleased to introduce The Pharm as our newest tenant, and to be able to creatively structure a real estate transaction to meet their capital needs for planned expansion in the Arizona market and beyond,” said Ben Regin, Director of Investments and Finance at IIPR. “We believe that The Pharm’s highly experienced, multi-disciplinary management team is well positioned to continue to grow its market share in a rapidly expanding Arizona medical-use cannabis market, in addition to carrying its highly successful program to new markets in other states.”

The Pharm will use the property to cultivate and process medical marijuana. The initial lease if for 15 years with an initial annualized aggregate base rent of $2,520,000, payable monthly. In connection with the execution of the lease, The Pharm subsidiary also deposited with the Company a security deposit of $630,000.

“Innovative Industrial Properties collaborated with us closely throughout this transaction, providing creative solutions to address our specific capital needs,” said Randy Smith, Founder and Chief Executive Officer of The Pharm. “We are thrilled to have a great real estate partner like Innovative Industrial Properties that provides us the key capital we need to drive our strong growth and execution on strategic priorities.”

IIPR stock has increased 48% for the past year according to Yahoo Finance, versus the S&P 500 which has risen 18%. It is one of the few cannabis companies that pays a dividend giving this stock a 2.4% yield.


Debra BorchardtDebra BorchardtOctober 9, 2017
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3min00

Zoned Properties (ZDPY) released a company presentation on Monday that shows that the company has moved from an annual loss of $501,576 in 2016 to a year-to-date gain of $1 million. Zoned Properties develops and leases properties in emerging industries, including licensed medical marijuana.

The company is coming from a position of strength uncommon among many pot stocks with a solid balance sheet of $9.6 million in assets and $2.2 million in liabilities, but no warrants and no convertible debt. The company currently has six properties in its portfolio with five locations in Arizona and one in Colorado.

Part of the turn in fortunes for Zoned Properties for 2017 was the one-time net gain from the sale of a property in Tempe Arizona for $831,753. The book value for the company as of June 30 is $9.4 million and the market value is $23.7 million.

The stock though hasn’t performed as well as the company’s balance sheet. It has plunged 48% over the past year from a 52-week high of $3.88 to a low of 50 cents. The stock started to recover following the company’s second-quarter earnings release in August. In that release, the company noted that its revenue had increased 23% to $505,000 from the previous year’s second-quarter earnings of $410,000. Operating expenses also declined 32% to $355,000 from the previous year’s second quarter expenses of $524,000. The net income was also positive at $118,000 versus the previous year’s loss of $173,000.

Zoned also announced last week that it increased the space being leased by its tenant in Tempe Arizona. “Expansion at the Tempe Property will drive increased revenue and profitability in the coming quarters as increased monthly rent payments take effect,” commented Bryan McLaren, Chief Executive Officer of Zoned Properties. “Our anchor tenant now occupies more than 50% of the 60,000 square feet of total rentable space under long-term lease agreements with guaranteed rent escalators throughout their terms.”

So, while Zoned Properties is humming along in the Arizona market, some investors may be wanting to see if they’ll be expanding beyond the state and pursuing properties in other bigger markets. The real estate space in the cannabis industry is becoming crowded very quickly. It may be that the stock will respond as Zoned expands their footprint further away from the Arizona market.


StaffStaffOctober 3, 2017
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3min00

New York Stock Exchange-listed Innovative Industrial Properties Inc. (IIPR) announced that it filed for a public offering of Series A Cumulative Redeemable Preferred Stock that would trade under the symbol IIPRPrA. The proceeds from the offering will be used to support the company’s investment strategy of finding specialized industrial facilities that are used to cultivate medical marijuana.

Ladenburg Thalman (LTS)  is acting as the book-runner and National Securities Corporation (NHLD) is acting as the co-manager for the offering.  The company said in a statement that it will grant the underwriters a 30-day option to buy additional shares to cover over-allotments. A copy of the preliminary prospectus for the offering may be obtained, when available, from Ladenburg Thalmann & Co. Inc., 570 Lexington Avenue, 11th Floor, New York, NY 10022, or by email at prospectus@ladenburg.com.

Innovative Industrial Properties recently declared a quarterly dividend of 15 cents. It is one of the few, if not the only, cannabis stocks to pay a regular dividend. This 60 cents annual dividend gives the company a yield of 3.2% on an approximate price of $18.69 per share.

According to Yahoo Finance, there are two analysts covering the stock and both have a buy rating. The average target price is $21.75. The company is down 2.4% for the past year, but in the last six months, the stock has climbed over 9%. The 52-week low is $14.50, while the high is $20.52.

On the last earnings call, CEO Paul Smithers said, “We’re in advanced discussions regarding a number of potential acquisitions with a pipeline of approximately $100 million spanning a number of states including Arizona, Illinois, Maryland, Massachusetts, Ohio, and Pennsylvania to name a few.”

Executive Chairman Alan Gold added, “This nascent industry that has witnessed amazing growth with state-regulated medical-use cannabis markets, now comprising a majority of the United States. We are very optimistic about the future of this industry and our ability to deliver an enduring value to our tenant partners in providing tailored real estate solutions that meet their key operational and capital needs.”

 

 

 

 


Melissa EbanksMelissa EbanksSeptember 27, 2017
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4min00

In November of 2012, twelve years after legalizing medical marijuana, Colorado voters approved a measure to legalize recreational marijuana use. The state adopted a model that allowed only existing marijuana dispensaries to convert to retail establishments.

New research from the Wisconsin School of Business at the University of Wisconsin–Madison reveals that property values in the immediate vicinity of Denver’s retail marijuana establishments increased by more than 8% since the law took effect on January 1, 2014.

Moussa Diop, Wisconsin School of Business assistant professor of real estate & urban land economics, along with James Conklin of the University of Georgia and Herman Li of California State University, say the relationship between the price of houses and retail conversions is particularly important with voters in four states legalizing recreational marijuana use last November and others likely to follow.

“The presence of retail marijuana establishments clearly had a short-term positive impact on nearby properties in Denver,” says Diop. “This suggests that in addition to the sales and business taxes generated from the retail marijuana industry, municipalities may experience an increase in property taxes. It’s an important piece of the puzzle as more and more voters and policy-makers look for evidence about the effects of legalizing recreational marijuana, as the issue is taken up by state legislatures across the country.”

Single family residences within 0.1 miles of a retail marijuana establishment saw an increase in value of approximately 8.4 percent compared to those located slightly further—between 0.1 miles and 0.25 miles—from the site. That increase in property value was estimated to be almost $27,000 for an average house in the area.

While the study did not seek to identify the underlying drivers of what led to an increase in property values near retail conversions, the authors did identify potential explanations including: a surge in housing demand spurred by marijuana-related employment growth; lower crime rates; and additional amenities locating in close proximity to retail conversions.

The findings are in line with a 2016 study that identified a six percent increase in housing values on average in municipalities across the state of Colorado that allowed retail marijuana sales. Colorado’s model of allowing only existing medical marijuana dispensaries to convert to retail establishments was also used in Oregon and will be implemented in Nevada. Other states may follow that same procedure, as the adoption of medical marijuana laws is typically seen as a first step to broader legalization efforts.

The study relied on residential property information from the City of Denver’s Open Data Catalog and a list of retail licenses granted by the Colorado Department of Revenue, the agency responsible for administering the new law.

The paper, “Contact High: The External Effects of Retail Marijuana Establishments on House Prices” will be published in Real Estate Economics.


Chuck EpsteinChuck EpsteinSeptember 5, 2017
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7min00

Fidelity National Title Group, a subsidiary of Fidelity National Financial, the largest title insurer in the world, has issued an underwriting bulletin to its agents in 28 states to not insure any land used “for the production or distribution of marijuana.”

According to the memo issued June 29, 2017 by Fidelity National Title, the company’s Chief Underwriting Counsel said that properties in the 28 states “that have in some capacity legalized cultivation, distribution, manufacture or sale of marijuana products” will not be insured by Fidelity.

The bulletin instructs its agents and people in company operations to include the following language in every title commitment that the company issues in the 28 states. This underwriting bulletin (coded as Fidelity National Title Insurance bulletin 2017 RC-05) states:

“Please be aware that due to the conflict between federal and state laws concerning the cultivation, distribution, manufacture or sale of marijuana, the Company (Fidelity) is not able to close or insure any transaction involving Land that is associated with these activities.”

On its web site, Fidelity National Financial describes itself as “the nation’s largest title insurance company through its title insurance underwriters – Fidelity National Title, Chicago Title, Commonwealth Land Title, Alamo Title and National Title of New York – that collectively issue more title insurance policies than any other title company in the United States.”

The bulletin recommends that if a title company sends out a “welcome” package or instructions before closing that it should include a similar statement saying the land will not insured.  The bulletin also says “the sooner we indicate our unwillingness to insure, the better all around.”

In effect, the bulletin can affect the purchase and sale of undeveloped land, commercial properties, retail stores, and houses, where marijuana has been used even in states where it is legal. In effect, the bulletin and denial of title insurance means that many properties will not be financeable in a real estate transaction.

When a commitment letter is sent to a purchaser, the Fidelity underwriting bulletin means a seller and buyer of real estate have to sign an affidavit attesting that the property was not used for any purposes related to cannabis activities.

The bulletin was issued because the company said it did not want to discover at the actual closing event that the property “is used or intended for such purposes,” which would then resulting declining the title insurance coverage. If the statement is sent to buyers before the closing Fidelity said “it should make it easier to decline earlier in the transaction and put the burden of disclosure on the parties to the transaction.”

Impact on Cannabis-Related Real Estate

Reaction to the Fidelity underwriting bulletin was strong. One title insurance executive said the memo “sounds like a game changer” in terms of how cannabis-related properties can be bought and sold.

He also speculated that the company may have been acting in response to federal pressure to stop the expansion of the cannabis industry in states where it has become decriminalized.

The title insurance executive said “this can be a way to shunt this title insurance business to a subsidiary or the re-insurance industry at a much higher cost for title insurance or to use an indemnity policy.

In a LinkedIn post on March 2017, prior to the issuance of the Fidelity underwriting bulletin, attorney Michael J. Moore, citing an earlier 2016 article written by Vince Sliwoski, wrote “in states that have legalized the plant so far, title insurance companies set up a specific exception in their policies which excludes coverage over governmental actions, such as civil and criminal forfeiture of property under the federal Controlled Substance Act. Failure of the purchaser to disclose its intended use of the property may result in the title insurance company denying liability on a claim relating to property forfeiture because of the marijuana activity on the property. It is recommended that a buyer disclose their intended use of the land. Otherwise, the title company has an argument not to pay on claims.”

Moore also said “many title insurance companies have refused to act as an escrow agent for those transactions, because of the uncertain legalities involved. They have refused to handle the transfer of funds and closing documents. Some companies will not get involved in any aspect of the closing process, while others may provide a facility for the settlement of the transaction and issue a title insurance policy. Without title companies providing escrow services, the parties to a transaction must locate neutral third parties to perform the service.”

While the insurance industry, including life, auto, home, have addressed claims and procedures in states where cannabis is legal or decriminalized, the real estate title insurance directive has more significant and expensive implications.

The Fidelity underwriting directive, however, takes the decision to not insure title for cannabis-related properties to a new level and one that may have been developed at the behest of federal authorities.


Debra BorchardtDebra BorchardtSeptember 3, 2017
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3min00

Outlet stores are a staple of the retail industry and give many companies a much-needed revenue boost. Customers like them because they get brands names they love at a deep discount. A win-win. Dispensaries have been copying many methods of traditional retail and so it wasn’t going to be long before a cannabis outlet store popped up.

TGS Outlet Store opened in July in Silver Plume, Colorado less than an hour from Denver. The owners like the location because it’s right off the highway and convenient for tourists heading to the mountains, but is still accessible for Denver residents. It isn’t too far from a traditional outlet shopping center and so it fits in with the retail theme. Yet, it isn’t operated like a typical outlet store, which normally sells a lower quality product from a designer label and then claims to be discounted from a fake original price. That product is created specifically for the outlet chain.

The Green Solution has several physical stores in Colorado and the owners say that it is the same quality of products offered in their regular stores. “The variety of product offered like “mountain favorites” versus “metro favorites” and items for which we have a surplus of supply,” said Kyle Speidell, Co-CEO and Co-Founder of The Green Solution. “With cannabis, you do your best to project your product six months down the line, but since this is an agricultural product, we may have surplus of one strain versus another and that will take priority in our outlet store.” Since TGS is a seed-to-sale company, it isn’t selling other brands at a deep discount like a warehouse type of outlet store. Discounts will range up to 75%.

“The concept of an outlet store in the cannabis industry is an interesting concept,” said Ken Nisch, chairman of Detroit-area retail design & branded environments firm JGA and a partner in the dispensary company The Clinic. “Outlets existed originally to clear past season’s product, but more recently outlet retailing has become just another channel of distribution sometimes for lesser quality products that were manufactured for outlet sale only, or in some cases manufacturing “mistakes.” Nisch went on to say that designers like Coach and Ralph Lauren have begun to rethink their outlet business because it was cannibalizing their main business and hurting pricing.

Speidell doesn’t believe it will start a cannabis price war. “TGS Outlet store is not simply a price changer, it’s a concept change. TGS is dedicated to continuously offering the highest quality product at an affordable price.”


Debra BorchardtDebra BorchardtSeptember 2, 2017
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5min00

The cannabis industry may have lots of acres of marijuana plants, but polished chief executive officer’s seem to be in short supply. Two different cannabis investor groups confessed that they get excited when they come across a “good” CEO, because too often the emerging cannabis companies are lead by founders that are unable to either take the business to the next higher level or behave in a manner that isn’t appropriate for a company leader.

Take for example, a recent exchange on Facebook  with the CEO of EvoLabs  Alex Cahoj. A woman associated with cannabis smokers made a statement that abortion was normal and not shameful. She linked to a story about female athletes having terminated pregnancies. Cahoj suggested the woman “Just don’t be a whore. It’s not that complicated.”  A comment that was incredibly inappropriate regardless of one’s position on a woman’s choice to terminate a pregnancy. It also begged the question, why would a male CEO of a vape pen company feel the need to weigh in abortion rights and call out a woman in such a public forum and using that language?

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Cannabis insiders say they watched the exchange in real time and were shocked to see it. The comments have since been deleted.

Then there’s Mike Straumietis, chief executive officer of privately-held Advanced Nutrients and known also as Big Mike. His widely followed Instagram feed frequently features scantily clad women in tiny lingerie. His company is touted as the number one nutrient brand and has been reported to have sales anywhere from $65 million a year to $90 million. The products can  be bought through Amazon and Wal-Mart. It’s his company and he has every right to portray himself as the marijuana playboy. However, the cannabis industry has shown itself to be very welcoming to female executives and many have no interest in seeing women’s butts in tiny panties on a CEO’s public Instagram feed.

One of the recurring themes from insiders that preferred not to go on the record, were that many cannabis company founders got their start in an alternative industry with a federally illegal product. This was the catch-22. Experience in the industry meant you were a law breaker. It also meant that maybe that these types of executives (not necessarily the previous examples) either weren’t able to follow traditional career paths for various reasons or had no desire to enter the buttoned up corporate world.

Some company founders have managed to learn and grow with their companies. Others have been shifted to other positions while more seasoned executives from outside industries have come in to take over.

Of course, the cannabis industry isn’t alone in this challenge. Witness Silicon Valley’s bro executive problem. Tech companies may have the more polished CEO’s, but they can’t seem to recover from the bro mentality like Uber’s Travis Kalanick who recently had to step down as his lack of polish became evident.

“The characteristics of a good CEO of a cannabis company resemble that of a good CEO of any other company – intelligence, diligence, leadership, vision, and stability,” said Bryan Meltzer, Partner at Feuerstein Kulick. “As more and more professional CEO’s continue to enter the space, legal cannabis companies, as well as the overall industry, should benefit from the knowledge and best practices utilized in other industries.”

 

As the founders of the cannabis industry either find that they don’t have the skill set to grow with their companies or resist the push to be more “corporate”, executives from other industries looking for a challenge are happy to step in. Eager for the opportunity to get in on the ground floor of an emerging industry.

 

Krista Whitley, CEO and Founder at Social Media Unicorn said, “One of the greatest opportunities for the cannabis industry is for talent from other industries to bring their expertise to our vertical. For both of my cannabis organizations I have actually never put out a ‘Now Hiring’ sign. We aren’t ‘now hiring’. We are always hiring great candidates, so I have a pool of people who want to join our team any time expansion is required.”


StaffStaffAugust 15, 2017
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3min00

Desert Hot Springs in California is becoming a popular place for cannabis growers. The latest deal is an announcement by Canadian company Marapharm Ventures (OTC: MRPHF) to purchase 1.25 acres in the town. The company said that the property is approved for 20,664 square feet of cannabis cultivation and manufacturing. Marapharm paid $520,000 for that property and it is expected to close before August 31.

The company said in a statement, “The city has approved an interim plan for cultivation with a temporary certificate of occupancy which increases the value of the acquisition.” Desert Hot Springs got an early jump on other California cities when it became the first city to legalize large-scale medical marijuana cultivation. While the town has generated a lot of attention for its big Coachella festival, it wasn’t able to parley that into consistent business development.

In just two years since the town passed the ordinances in 2014, it had approved 11 applications and more than 1.7 million square feet of cultivation. The town was also just featured in a CNBC special show, “The Profit.”

“As is the case with our operations in Nevada and Washington, we are growing quickly to become a dominant player in the California cannabis market. This is the third acquisition of property we plan to use for cannabis operations in California and it brings us to 9.49 acres and 151,875 square feet of provisional licenses for medical cannabis. Where appropriate and in line with market and demand, we will transition these to recreational licenses,” said Linda Sampson, Marapharm CEO.

Premium cannabis company Canndescent was the first medical marijuana cultivation facilities in the town and delivered a check for $135,000 in tax payments last year. Tax revenue is a big incentive for the sleepy desert town to put out the welcome sign for cannabis cultivators. In addition to that, the cannabis companies are bringing jobs to the town with Canndescent contributing almost $3 million in wages.



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The Hemp Market Report will target news from the fast growing worlds of cannabidiol (CBD) and hemp. As a sister site to the Green Market Report, HMR will cover financial stories, but also take a look at lifestyle news as well. The Hemp Market Report will also publish sponsored content as we seek to expand our content offerings.


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