Save the Dates! NCIA’s New 2019 Events Just Announced
Ready to hang your 2019 calendar on the wall? You’re in luck, because NCIA has just published the 2019 event calendar! Due to popular demand for even more regional networking opportunities nationwide, NCIA is launching two new regional event series in 2019: Industry Socials and Harvest Celebrations and refreshing our well-known Cannabis Caucus Series.
NCIA’s Industry Socialsare about cultivating regional communities of industry professionals, so that they can connect and learn from each other. Cultivating community is the most effective way to strengthen our industry and your business. Touring five cities in the West Coast, East Coast and Heartland regions, NCIA’s Industry Socials are the premier opportunity for cannabis professionals to harness NCIA’s extensive national network by creating meaningful connections with each other and with NCIA staff in a relaxed cocktail setting. Join us to expand your network and cultivate our community! Tickets to Industry Socials are complimentary to NCIA members and only $25 to non-members. Registration opens for the West Coast Tour on November 27!
NCIA’s Harvest Celebrationswill be hosted in five cities in October to honor the cannabis harvesting season and celebrate the continued growth of our industry! Proceeds from NCIA’s inaugural Harvest Celebration events will foster support for NCIA’s federal lobbying work on behalf of businesses serving the industry and the industry at-large.
In light of these new 2019 NCIA events, we also have exciting new sponsorship opportunities to offer! Download the 2019 Event Sponsorship Deck or contact us for more information. Consider this your opportunity to get your brand in front of thousands of new businesses in diverse regions nationwide. We’ll see you there!
Wrapping Up 2018 Cannabis Caucus Events, Introducing New 2019 Events!
October marked the last NCIA events of the year with Cannabis Caucus events in eight regions nationwide and an outstanding 2nd Annual California Cannabis Business Conference in Anaheim, California. As this year’s events comes to a close, we have so much to reflect on and exciting new events to announce!
During this quarter’s Cannabis Caucus events, more than 400 NCIA members, representing 250 member companies, totaling in more than 750 attendees turned out for our eight events nationwide. This means that although these events are growing increasingly popular, they are still small enough to make meaningful connections with other industry leaders in your region. Instead of just making small talk with someone in passing, you’ll get to to have real conversations with some of the most influential leaders in the industry. Year after year, we hear about people striking business partnerships, friendships and impactful connections at these events because they offer the time, space and opportunity to do so.
In the industry’s largest markets, Northern California, Southern California, and Colorado, more than 100 industry professionals turned out at each event. But, perhaps most impressive was the 75 plus attendance in the Midwest, maybe a harbinger of the positive momentum garnered by statewide reform initiatives in this year’s midterm elections!
Cannabis Caucus Highlights
A the Northeast event, attendees heard the latest news surrounding medical cannabis in Maine from State Sen. Eric Brakey (R-District 20), as well as Maine’s adult-use cannabis laws from David Boyer, Maine Political Director at Marijuana Policy Project.
The event in Northern California featured special guest speaker Heidi Mattos, a payroll tax specialist from the State of California Employment & Development Department, who shared critical insights into state payroll tax regulations. In Southern California, we heard a special presentation on “Understanding California Agricultural Labor Laws As It Relates to Cannabis Cultivators” from guest speaker Eduardo Blanco, Special legal Advisor from the CA Agricultural Labor Relations Board.
The Southwest event featured Ryan Black, Campaign Co-Chair for Anita Malik, Candidate for Arizona’s Congressional District 6, discussing federal cannabis reform. Lastly, in the Pacific Northwest, Lara Kaminsky, Executive Director of The Cannabis Alliance (an NCIA Allied Association), spoke about the latest developments in Washington state’s cannabis industry, including the current status of the edibles product ban.
As the largest national trade association in the U.S. and the only organization representing more than 1,700 cannabis-related businesses at the national level, we have pretty deep connections. We know that 70 percent of the individuals who attend our regional events have executive level decision-making authority and 30 percent have heavy decision-making influence. All of this is to say that the caliber of the meaningful connections you will make have the potential to benefit your business in very real ways and quickly.
We also know that these boutique events are frequently attended by industry pioneers and dedicated policy reform advocates, the movers and shakers of the industry, who have helped support the movement for decades. Repeatedly, we hear from event attendees that these events are their favorite because of the quality of the event, the attendees and the sense of community and camaraderie they foster.
What’s Next? NCIA’s New 2019 Regional Event Series Announced
NCIA’s Industry Socialsare about cultivating regional communities of industry professionals, so that they can connect and learn from each other. Cultivating community is the most effective way to strengthen our industry and your business. Touring five cities in the West Coast, East Coast and Heartland regions, NCIA’s Industry Socials are the premier opportunity for cannabis professionals to harness NCIA’s extensive national network by creating meaningful connections with each other and with NCIA staff in a relaxed cocktail setting. Join us to expand your network and cultivate our community! Tickets to Industry Socials are complimentary to NCIA members and only $25 to non-members. Registration opens for the West Coast Tour on November 27!
NCIA’s Harvest Celebrations will be hosted in five cities in October to honor the cannabis harvesting season and celebrate the continued growth of our industry! Proceeds from NCIA’s inaugural Harvest Celebration events will foster support for NCIA’s federal lobbying work on behalf of businesses serving the industry and the industry at-large.
In light of these new 2019 NCIA events, we also have exciting new sponsorship opportunities to offer! Download the 2019 Event Sponsorship Deck or contact us for more information. Consider this your opportunity to get your brand in front of thousands of new businesses in diverse regions nationwide.
Member Blog: First Blush And Branding Need To Go Hand In Hand
Budding cannabis companies: Pay attention to labels from the get-go
Cannabis companies starting up in states where recreational and medicinal marijuana are just being legalized need to pay close attention to their label branding from the get-go. Too often, this critical part of a successful cannabis business becomes an afterthought — which can lead to major problems in compliance, competitive positioning and credibility in the marketplace.
As the cannabis industry expands in the U.S. and now Canada, it’s also maturing. Gone are the days when a purveyor could hang out a shingle and open their doors to teeming masses of buyers without any substantive concern about packaging and labeling beyond early-day regulatory compliance.
With the industry maturing, so is the sophistication of entities charged with compliance. As more is learned about all aspects of the industry — from edibles to raw cannabis — requirements being placed on purveyors are getting more complex. Plus, there are municipal and state regulations that may cross over one another.
Competitive Positioning It’s never too soon to get into the branding game, and distinctive labels that grab attention and share important information accurately are key to making a name for yourself.
A Forbes article earlier this year made the case: “Tim Calkins, Clinical Professor of Marketing at Kellogg School of Management at Northwestern University, foresees a highly competitive environment… an outburst of marketing and branding innovation… ‘We will see very creative brand-building activities in the years to come. I anticipate that marketing investment will grow exponentially as companies work to carve out a leading position and capture value in an emerging market…It isn’t often that you see an entirely new market emerge on the scene, especially one where brands will play a key role. Many people first experienced cannabis as a[n] unbranded plastic bag. This is not likely to be the future state. Cannabis will become a market dominated by strong, vibrant brands.’”
Compliance In their startup enthusiasm, purveyors may miss something on the label compliance scene. It’s easy to do, but can be very hard to fix. Products have had to be recalled, companies have been fined or even shut down for running afoul of regulations. Labels, as a product’s “front door,” are especially susceptible.
A Manufacturing.net report reinforces the point: “Often, cannabis products require specialized labels for traceability and stating suggested medical applications. State laws still vary greatly, and companies should be careful to know and have tools to track their compliance in all states and countries that they do business.”
Bottom line, newcomers to the industry need to be as diligent about their labeling and packaging as they had to be to get license approval. Anything less may result in more headaches than they can imagine.
Credibility in the Marketplace In Colorado’s early days of cannabis legalization, some labeling and packaging looked — to put it mildly — homespun. The look and feel of that early-day branding pales in comparison to the much more sophisticated label and packaging branding typically seen today.
But for industry newbies, there can still be a temptation to move ahead on operations at lightning speed, with branding, packaging and labeling lagging behind.
Ultimately, that may stifle credibility, giving competitors an opportunity to get a leg up. Ontario, Canada’s experience so far showcases how label problems can hamper credibility. Their online marketplace is the only “game in town” so far; there are no brick-and-mortar establishments. But, in a competitive marketplace, purveyor missteps can cause reputation damage as well as regulatory repercussions.
Notes a Civilized.life article, “Ontario Cannabis Store Faces Backlash Over Improperly Labeled Products… When Peter Lyon logged on to the OCS website on October 17, he did so with the intention of buying a strain high in THC — the compound in marijuana that gets you high. However, that is not what he got… Not only is the error in the product labeling upsetting for customers who won’t be getting what they paid for, cannabis retailers have a legal obligation to ensure that their labelling is accurate. Otherwise someone looking to unwind with a low-THC strain could wind up having a panic attack because the product they bought is way too potent.”
The first blush of entering a new marketplace deserves branding, labeling and packaging that measure up.
Gary Paulin is Director of Sales and Client Services for Lightning Labels, a Denver-based label printer that has been offering state-of-the-art affordable, full-color custom labels and custom stickers of all shapes and sizes to cannabis purveyors for more than a decade. They offer many options for materials and laminates and special effects to achieve digital short-run requirements (50 minimum) on up to 15 million labels, plus Lightning fast delivery. For more information and to place orders online, visit LightningLabels.com. For the latest in packaging news and labeling promotional offers, find Lightning Labels on, Facebook, Instagram, Twitter (@LightningLabels), Pinterest, Google+ and LinkedIn.
Committee Blog: Transacting in Equity – The Basics
by Charlie Christopher, VP, Finance, Cirrata NCIA’s Finance and Insurance Committee
“A prudent man must seek to satisfy himself about the means to an end. This demands that he must revisit, again and again, the very elemental principles of his craft independent of how others think and act.” – Tony Deden
In businesses of all sizes it is common to transact in a number of currencies other than cash. The focus of this piece is on transactions involving common equity, the most fundamental unit of business ownership. The first section establishes a framework for how to view equity as currency, and what differentiates equity from other mediums of exchange such as cash. The second section introduces the process for creating reasonable projections based on sound logic. The third section demonstrates a somewhat novel application of concepts, and provides an example of the flexibility that can be introduced into the process. The conclusion is a reminder that these concepts can easily be misused, and that nothing should replace common sense when dealing with extreme uncertainty.
The Problem
Valuing any business is hard. Valuing a start-up is even harder still, not because of process, but because of the ambiguity associated with the output. When a valuation is based on multiple layers of high variance variables then the resulting distribution of value is rightfully broad. This poses a major challenge for operators and investors trying to agree on fair terms, and it can lead to irreparable damage to a young company.
Imagine for a second that you, and everyone else, have a crystal ball that can see the future with just enough variance to keep things interesting. How would that change the way you think about your equity? Would you be offering the same equity deals to your entire team? Would you be flexible with investors interested in your business? Of course not, you would look into the future every morning, update your projections and you would transact in equity in a similar manner to how you would with cash. Even though we do not have a crystal ball in the real world, it stands that to transact in equity with absolutely no opinion of value is the equivalent to being indifferent between paying $.10 or $100,000 for the same product or service.
Equity is a form of currency. It has value. However, its value has a built-in variance that rewards beating expectations, and punishes missing expectations. This is why equity awards are typically used to incentivize contributions that can increase the odds of achieving the former. The act of issuing the reward, in theory, immediately increases the value of the firm through the alignment of incentives. The common exaltation of the aforementioned qualitative attributes of the incentive over the quantitative attributes is also why the standard practice of ignoring a non-cash expense like share-based compensation is so indefensible. The value creation may be real, but to deny that a currency has transacted to create that value is to double count the benefit to shareholders.
The Process
Valuing a business begins from the top down and ends from the bottom up. Top down refers to projections based on the broader market while bottom up refers to firm specific capabilities extrapolated into the broader market. A common mistake operators make is to build up based on capabilities with no regard for how the aggregate ecosystem will react to the sum of all fundamental behaviors in the ecosystem. Starting from the top-down with a defensible position regarding both the size of the addressable market and the number of competitors participating in the market provides parameters for the business’s potential revenue.
Arguing for market share using a top-down analysis is fundamentally flawed if it does not reflect the true capacity of the business. A bottom-up analysis reflecting firm-specific capabilities should be compared to the top-down analysis for reasonableness. Ultimately, bottom-up analysis drives operating assumptions, and operating assumptions are the inputs to nearly every valuation technique.
I subscribe to the theory that posits that the variance in all of the assumptions can be quantified using an appropriate discount rate. In other words, if I’m uncertain and find my forecasted outcome to be highly unreliable I may choose to use a much higher discount rate to calculate the present value of the business than for a business with lower variance assumptions. When valuing a start-up company, I consider the corresponding ultra-high discount rate to cloud too much insight. For start-ups I first calculate a probability of firm failure in each of the forecast years and multiply my operating assumptions by the cumulative probability of success, I then use a more reasonable discount rate as if the firm was not highly speculative. This allows start-ups in the seed stage to more easily defend increases in value before launch. For example, the filling of a major executive leadership position justifies a small reduction in the probability of failure. Thus, your first executive hire has a reason to have received a higher percentage equity award than your last hire, even though the dollar value of the award might be equal. The process facilitates fair negotiations among all shareholders who may commit under vastly different circumstances and with different information. All too often this doesn’t take place, and the animosity that can develop as a result is as real as it is avoidable.
Valuation is admittedly more art than science. Many astute readers will point out that markets don’t operate in the orderly, fundamental matter I’ve proposed. Those critics are absolutely correct. It is a fair caution that not only are the trappings of certainty intoxicating, but sometimes simply observing how others are transacting is sufficient to make decisions. The market is often wrong, but it’s also often right. Remember to update your assumptions as new information becomes available.
Charlie is a Co-Founder of Cirrata where he lends his extensive knowledge from being both an entrepreneur as well as a securities analyst. As VP of Finance, Charlie combines his skills to assist clients through the application process, ongoing operations, and exit strategies.
Prior to joining Cirrata, Charlie co-founded a luxury women’s ready-to-wear label where he oversaw two separate rounds of funding as CFO. He has consulted numerous clients in the cannabis, construction, music, financial services and software industries in which his primary focus was on information systems, optimization, cash forecasting, securities offerings, licensing and capital allocation.
Member Spotlight: RoseRyan
In this month’s member spotlight we caught up with Maureen Ryan of RoseRyan, a finance and accounting consulting firm based in Silicon Valley that officially launched its cannabis solutionthis April. Finance is the language of business, and her firm, since 1993, has helped hundreds of companies get their financial house in order, efficiently and effectively, so they can go further, faster. Passionate about women in business and excited for the racial equity that she sees in the cannabis field, Maureen believes her firm’s best practices and proven approach are a match for many emerging growth companies in our field. To learn more about finance fundamentals, tune into our conversation with her colleagues that we hosted on the NCIA podcast on June 12.
Cannabis Industry Sector: Finance & Accounting for emerging growth companies and large enterprises
NCIA Sponsoring Member Since: August 2016
Tell me a bit about your background and why you launched your company?
My career at RoseRyan has mostly centered around the finance needs of fast-moving tech companies. That changed a couple of years ago after working with a cannabis biotech company and loving it. Around the same time, our consulting firm saw signs that recreational cannabis was headed for legalization in California, and it was then that we realized many cannabis companies of all sizes were going to need the kind of professional finance and accounting support that we offer.
Our focus on the high tech and life sciences markets here in Silicon Valley has put us in tune with the needs of companies that move rapidly and that need to work with government agencies to get their products market ready — much like the cannabis industry. We’ve responded with a specialized solution that will take cannabis companies further, faster.
What unique value does your company offer to the cannabis industry?
From working with fast-moving Silicon Valley companies for 25 years now, we’ve been able to apply our expertise and best practices to the cannabis market quickly and easily.
In addition, we know what investors want. Whether they are private equity or venture capital players, investors want a rational strategic plan, timely, reliable and accurate financials and a solid budgeting framework, just to name a few. Given the current cannabis environment with Canada, these expectations have become even more critical for companies to meet.
From working with over 275 life sciences companies through the years, we also know how to relate to government agencies, like the FDA. And from working with over 325 tech companies to date, we have experiences with helping companies scale fast, in a variety of business situations.
In a nutshell, we help cannabis companies get their financial house in order. Finance is the language of business, so companies absolutely need to get it right. No matter where they are in the business lifecycle — when starting up, growing at high velocity, tackling a tricky transaction or maturing as an ongoing enterprise—cannabis companies need to have their finance function tightly managed for ultimate success.
Our Cannabis Solution offers four levels of finance: 1) a rapid diagnostic review, 2) an outsourced CFO and accounting team to strategize and set up all the essential financial systems and processes, 3) partner referrals to build up or build out a trusted ecosystem, and 4) financial prep for potential merger and acquisition transactions.
Is cannabis that much different when it comes to finance and accounting?
Frankly, no. Let’s face it, when companies are starting out, their books are typically a mess, whether you’re talking about cannabis companies or companies in any other industry. Business leaders are typically not focused on their finance operations — they have so many other parts of the business to attend to, and we get that.
Many of the same business situations that happen to tech and life sciences companies are happening to those in the cannabis market. They’re dealing in the early stage with worries about survival and running on fumes, before they’re able to fundraise and determine their top investments for growth. When the business reaches velocity or even hypergrowth, they have careful decisions to make. Opportunities for a major transformation can spring up, like an IPO or a merger or acquisition. Every industry has their nuances, but many of the business situations that CFOs and accounting teams face are similar in nature.
Cannabis companies have a unique responsibility to shape this growing industry to be socially responsible and advocate for it to be treated fairly. How does your company help work toward that goal for the greater good of the cannabis industry?
We recognize that women and people of color are heavily involved in this industry, which we love. As a woman-owned business, we support and promote the further advancement of diversity. We also find that working with cannabis companies to professionalize their financial operations helps the entire industry, as it creates a stronger, leveled up playing field for their business interactions. A strong finance function is essential for cannabis companies to raise funds. It’s imperative for their valuation, should an IPO, merger or acquisition transaction arise in the future. Accurate financials and tight operations are a direct reflection on the experience of the management team and, to a larger extent, the industry as a whole.
What kind of challenges do you face in the industry and what solutions would you like to see?
If a cannabis company lacks best practices in their essential finance operations, they’re going to run into trouble when dealing with hypergrowth situations. It happens with founders in every field—they’re passionate about their businesses yet many struggle to keep the business running at today’s standards. This is a challenge for any cannabis company that has blinders on and only seeks advice from other cannabis companies or experts who focus on just one industry.
What’s needed is a crystal clear understanding of the critical aspects of a company’s finances, or strategic decisions will be off-base because they don’t have accurate data on hand. Cannabis companies also risk a slowdown if they’re missing a key partner at a critical time, such as valuation, tax, marketing or legal expertise.
We’d love to see cannabis companies absorb the best practices and talent from other explosive-growth industries that’s tailored to meet their exact needs. No need to pave a new trail when one exists already.
Why did you join NCIA? What’s the best part about being a member?
We joined NCIA to be part of the industry-leading association that is dedicated to the industry’s success. NCIA brings key players together, inspires community, shares best practices and keeps us up to date on the industry trends and news. We also like that NCIA is an active investor in cannabis companies. By being part of NCIA, we can stay informed and play a vital role in this burgeoning industry.
What’s it take to be successful in your business? In addition to the June podcast with NCIA on finance fundamentals with RoseRyan, you can check out the firm’s webinar for California-based businesses here: http://bit.ly/thepotthickens
Member Blog: Common Cannabis Capital Cadence
by Sumit Mehta, CEO of MAZAKALI
NCIA’s Finance and Insurance Committee
Companies often benefit from capital infusions that can help them grow their businesses. When and how much capital to raise is a common question, once that is best addressed by balancing need for cash with dilution of equity. This article outlines typical stages for corporate growth along with potential sources of capital and required documentation along the way.
Common Cannabis Capital Cadence
Introduction
While a business does not need to raise money to be successful, one of the primary reasons businesses fail is that they run out of money. Businesses that do need money to survive or to accelerate growth can benefit from outside capital balanced by the related loss of ownership. Effective capital management is thus crucial to business growth and success.
Access to necessary capital can be a significant challenge, as money is cheapest to borrow when you least need it. Access to liquidity, while difficult in any industry, is even more challenging in the cannabis industry for a myriad of reasons. Despite these challenges, cannabis capital infusions are at an all-time high. Companies are well-served to be focused on ‘capital readiness’ well in advance of their desired capital needs.
The true entrepreneur does more and dreams less
Fail to prepare and you may be preparing to fail. Maintaining focus on cash needs and related documentation at every stage of your business growth is crucial to its ultimate success.
Idea Stage – Founders
A founder collaboration agreement can help lay out a working agreement along with conflict-resolution steps for future disputes. A common stock purchase agreement is a binding contract which highlights basic terms for the sale of shares to founders. This agreement will define the parties, the shares to be sold, the purchase price, the timing and method of payment, and the closing date. A shareholder agreement typically accompanies the stock purchase agreement and highlights shareholder rights, pricing mechanisms, voting arrangements and shareholder privileges and protections.
Documentation: Founder collaboration agreement, common stock purchase agreement, shareholder agreement.
Early Stage – Friends & Family
Friends and family can be some of the easiest sources of capital. They are typically more forgiving about business ups and downs, and having a resourceful network of trusted early investors is a good step towards securing money from future investors. It is common to use convertible notes at this stage, and relevant here are a convertible note purchase agreement along with a board of director consent. The intention of this note is that it converts to equity when the company conducts an equity financing.
Documentation: Convertible note purchase agreement, board of director consent.
Seed Stage – Angel Investors
An angel or seed investor is an affluent individual who provides capital for a business start-up, usually also in exchange for convertible debt. An advantage of this type of financing is that it is less risky than debt financing. In the event of business failure, invested capital does not have to be paid back. In addition to the documentation above, most angels will want to see a business plan and a pitch deck.
While the term ‘Venture Capital’ broadly applies to any capital provided to a venture, it typically describes a structured institutional scenario. Advantages of venture capital include amounts typically larger than angel funding rounds along with valuable information and resources that can contribute to business success. Challenges here include the length and complexity of the diligence process along with the documentation burden as highlighted below.
Documentation: A robust data room that includes the above documents along with a 5-year pro-forma model, cap table, valuation, subscription agreements, stock purchase agreements, incorporation documents & bylaws; and vendor, contractor & employee agreements.
Growth Stage – Private Equity
Private equity investments typically result in either a majority or a substantial minority ownership stake in a company. These generally come with strings attached, which can be wound tightly at times. While private equity offers the opportunity to raise large amounts of capital, it is also often accompanied by a loss of control. In order to amplify returns, private equity firms typically raise a significant amount of debt to introduce leverage into the transaction. This has helped coin the term ‘Leveraged Buyout’.
Documentation: A robust data room as above with PE specific documents that may include supply chain verification, tax and audit, legal reviews, intellectual property opinions and management team background checks.
Final Stage – Public Equity
A substantial increase in liquidity is one of the main advantages of this final stage of liquidity. Other advantages include increasing brand and prestige, attracting employees with a stock option plan, and making acquisitions with company stock. Going public is no easy task and requires a large absorption of new obligations, including filing SEC reports, getting shareholder approval for corporate actions, additional legal liabilities and other regulations as introduced by the Securities Act of 1933 and its many subsequent amendments.
Documentation: In addition to compliance with Regulation FD and Sarbanes-Oxley, filing and reporting requirements include annual reports, quarterly reports, proxy statements and insider holding filings.
Conclusion: A sustained and successful capital cadence raises investor confidence and subsequent recommendations to others. Determining a timeline for liquidity is the cornerstone of capital raise decision-making, and a plan created with financial rigor is useful for management and investors alike. While the preservation of liquidity is of primary importance, this is best balanced by the desire to retain ownership and control. When and how to raise money are amongst the biggest challenges for any business, and preparation is paramount to the capitalization of the arrival of opportunity.
Chance often favors the prepared.
In addition to his role as Founder and CEO at MAZAKALI, Sumit is a consultant to The Arcview Group and the Managing Partner of Emerald Ventures. A frequent speaker at investment seminars, Sumit acts as a mentor to Arcview and Canopy companies and serves on the Canopy Investment committee as well as the NCIA Finance & Insurance committee. Sumit and MAZAKALI support NCIA, the Marijuana Policy Project and Students for Sensible Drug Policy.
Sumit has earned an MBA from the University of Michigan, a BA in Economics with Honors from the University of Texas and currently holds Series 7, 63, 65 and 79 licenses. He resides in San Francisco where he enjoys riding his motorcycle, yoga, and craft beer.
VIDEO: Hear From NCIA Members Why You Should Join The Movement!
With more than 1,700 member companies coming together to share best practices, advocate for our industry, and create community, there’s now more reasons than ever to join the movement by becoming a member of NCIA. We recently spoke with a few of our members to find out what’s most important to them about being part of the National Cannabis Industry Association.
If you are a cannabis business owner, the time is now to join nearly 2,000 of your fellow industry professionals in advocacy, education, and community by becoming a member of your national trade association!
Any visit to a licensed dispensary is proof of how far we’ve come with the packaging of legal cannabis. Sure, we still have plenty of standard glass jars, CR pouches, pop-tops and cans; but we also now see proprietary package structures, full branded lines commanding shelf space and packaging so beautiful it doubles as a merchandising tool. Just in the past several months, cannabis packaging design trends have been covered by mainstream media including The Dieline and Packaging Digest.
These are exciting times to say the least, but packaging and labeling remains at the crux of the serious challenges and opportunities that cannabis brands face today.
Keeping Up With Compliance
Here in California, the challenge of keeping up with compliance is beyond real. The race to meet state regs by July 1st were only met with a new set of checklists (literally) the following day. Added labels is the name of the game for any California supplier. This is a real problem for those brands who are trying to stand out with their packaging. Understandably, companies are hesitant to invest in their packaging when the regulations are still in flux. Those who are in this for the long haul need to be agile and forward thinking when it comes to packaging and labeling.
Branding… Because it Really Does Matter With limitations on how a brand can reach today’s cannasumer, packaging is a critical marketing tool. It’s the one guaranteed touchpoint we have, and just like in traditional retail environments, every second counts when trying to capture a shopper’s attention. While it’s tempting to go with the standard compliant packages, a lack of brand value will commoditize your product (and thus, the price point). Brands should ensure that their package is reflective of their unique position in the market. Whether it’s a regional play, a potency position or targeting the growing number of boomer consumers—your packaging should speak directly to who your target market is. Now is the time to create brand loyalists!
Taking a Note from Natural Products
All across retail industries, we are seeing a market demand for products that have a more “natural” approach. From clean ingredients to plant-based everything, it’s impossible to avoid this trend. As the OG natural product, cannabis brands have a real opportunity to take advantage of today’s more discerning shoppers. Tell your story, explain your growing practices, show us your social responsibility… It’s all part of the package, literally and figuratively.
A Need for Sustainable Solutions
To really take our natural story to the next level, we can all agree on the need for more sustainable options for packaging and labeling. It’s great to see some brands, companies, and organizations like W Vapes initiating recycling programs. But as an industry, we need to rally together to work on this issue. It’s definitely a challenge that NCIA’s Packaging and Labeling Committee discuss regularly.
An Optimistic Future for the Realists
For those cannabis brands who can be agile, patient and focused—there is a bright future ahead. Despite the challenges of cost and compliance, an effective package can pay for itself. And if other industries like food and beverage are integrating technologies beyond the QR code (think AR and VR), we’re just getting warmed up. As both in-store and retail experiences evolve, so will the opportunities for cannabis packaging. Form, function, technology and product development are bound to take packaging and labeling to exciting new heights.
NCIA Launches New Website With Enhanced Member Directory
NCIA is excited to launch our newly-designed website which includes an enhanced member directory feature and more.
Visitors to our site will find all the content they are looking for more easily, with a robust home page that features news, blogs, videos, podcasts, industry reports, and more. Finding the information you need from the association you trust is now easier than ever!
We’ve also introduced an exciting upgrade to the design of our popular member directory, which features NCIA’s growing network of the cannabis businesses invested in the future of our industry.
Sponsoring and Sustaining members now have the option to add additional information to their member profile, including company description, company logo, contact information, and social media links, making it even easier for those interested in your company’s services to reach out.
Regular members can upgrade their membership to Sponsoring or Sustaining to take advantage of this expanded benefit by contacting us at info@thecannabisindustry.org.
The NCIA member directory has always been a go-to resource for those seeking the best products and services in the cannabis industry and we are pleased to make it even more valuable to our members.
Partner Blog: From Fashion Lifestyle to Cannabis – A Natural Move?
NCIA is giving away a limited number of tickets to the inaugural Hall of Flowers show happening next week in Santa Rosa. It’s shaping up to be one of the must-see B2B events in the cannabis space for premium brands and industry innovators, all thanks to the fashion and lifestyle industry vets running the show.
Hall of Flowers, set to take place September 17 and 18 at the Santa Rosa Fairgrounds, is the brainchild of Dani Diamantstein, Rama Mayo, and Aaron Levant, three pioneers in the trade show space who have spent the past 15 years producing the most successful fashion and lifestyle trade shows in the world. It’s no surprise they meticulously understand what makes an experience like this worthwhile.
“There are a lot of brands that are flourishing and there are a lot of people focusing on the manufacturing and cultivation, while there are also people partnering with some in the fashion industry,” notes Diamantstein. “I see a lot of similarities between producing trade shows 10-15 years ago and right now within the cannabis space in terms of forging one on one personal relationships, cultivating trust, and exchanging new and creative ideas. This is the perfect time to launch this kind of show.”
The show will be open for two days of discovering, meeting, and tasting and industry pioneer and entrepreneur Gary Vee will be hosting a keynote on Monday end of day. The team has centered the show to be about the experience as a buyer, retailer, and distributor, and have brought together the best across branding, design, packaging innovation, and of course, product. This means some of the most in-demand brands within the cannabis industry will be on-site – over 80 of the leading CA licensed cannabis brands and 60% of CA’s licensed dispensaries are confirmed to attend.
“We’ve spent over 4 years producing this show, perfecting the logistics, regulations, and invite list so that our guests can show up and do what they do best,” says Diamantstein. “We want everyone to have a successful two days while also enjoying work.”
Visit this link and enter code ‘NCIA’ to confirm your complimentary ticket and attend as a guest of NCIA.
Follow @hall_of_flowers on Instagram for real time updates on confirmed brands and visit hallofflowers.com for additional information.
Member Blog: Raising The Bar – Setting New Standards and Building Public Trust
In 1991, professors Harry G. Levine and Craig Reinarman published an article in the healthcare journal The Milbank Quarterly titled, “From Prohibition to Regulation: Lessons from Alcohol Policy for Drug Policy.”
In their study, they note the quiet effectiveness of an industry that has regulated itself without issue since 1934.
“The leaders of the major alcohol industries, just like other members of the economic establishment, have a strong investment in maintaining order and obedience to law. Now, many decades after national alcohol prohibition ended, it is easy to forget that all this was the outcome of self-conscious public policy and not the ‘natural’ result of market forces or national zeitgeist.”
As recreational cannabis laws continue to evolve, our industry—everyone from cultivators to regulators to entrepreneurs—continues to navigate uncharted territory. As we do, we would be wise to lean on the lessons of history and those responsible for managing and maintaining the alcohol industry in guiding our future. Here’s what my study of history leads me to believe:
Regulation Standards Must Do More to Protect the Consumer
I once had an English teacher who doled out chapter quizzes rather than assigning a culminating test or paper after we’d finished the book. Cram for the quiz by reading a CliffsNotes synopsis, or interrogate your more well-read friends on chapter highlights and chances were you’d pass the quiz.
It’s not unlike today’s state testing policies in which cultivators can breathe a sigh of relief knowing that if they simply do what’s needed to ensure the sample they have submitted for testing passes, their entire strain is in the clear.
The result of these kinds of regulations is a frenzy of activity focused on what’s needed to pass, rather than a shift in behavior focused on producing an altogether better product that is cleaner and safer for the consumer. A similar story goes for process validation. Submit batches for testing over a series of weeks and a passing grade ensures that your cultivation process can be considered “contaminant free.”
If our ultimate concern is public health, regulators should consider avenues that result in testing more product, more often. While there are certainly roadblocks that make this far from easy—namely the cost to cultivators and availability of labs for testing—steps in this direction would signal to consumers that shortcuts and workarounds won’t be tolerated.
An FDA-like approach to health and safety are needed to reshape our industry
Levine and Reinarman note that at the time of the prohibition repeal, producers of alcohol, “had to be regulated to ensure that products were safe and of a uniform alcohol content.” These regulatory efforts, “directly reshape[d] both an entire industry and the conditions under which its product are consumed.”
Sounds familiar. While state laws are slowly shifting to allow for greater medical and recreational use, the laws that shape the conditions under which cannabis can be cultivated, sold and consumed are still in flux. Not only do we have to add our voice to the conversation as those laws are being shaped, in doing so we have to advocate for both the industry and the consumer—with lawmakers and in public forums—showing our commitment to safety and uniformity.
That means instituting strict yet sensible FDA-like requirements that center on production, procurement and handling, as well as manufacturing, distribution and consumption of the finished product. It also means implementing common-sense standards like wearing protective gear in our grows, conducting regular analysis of critical control points like storage, packaging and distribution areas, and instituting a contamination kill-step before cannabis extraction is complete.
Reshaping the conditions in which we operate and aligning them with standards already in place for like-minded industries will do for us what it once did for alcohol: move us from an industry continuing its uphill battle for legitimacy to, “something routine and manageable, a little-noticed thread in the fabric of American life.”
We must recognize our responsibility and be conscious of the impact of our choices
Our industry is overflowing with individuals who treat cannabis not as a career, but a lifestyle. It isn’t just about the plant itself. We embrace it for what it represents and how it reflects our core attitudes towards humanity and our planet. Now it is also affording us the opportunity to make a profit in a legal and legitimate way.
As tempting as it is to be swayed by potential profitability, we can’t afford to lose ourselves in the process. Like the leaders of the alcohol industry, we have to be self-conscious about the precedent we are setting. If we can balance passion with profit, we can take pride in being pioneers who reshaped our country’s attitudes on cannabis.
If we take this moment for granted, if we fail to responsibly grow and sell our product, we do more than just damage our businesses; we lose the ability to influence lawmakers and further sway public opinion. Rather than driving cultural change, we will be at fault for failing to take advantage of a moment ripe for change. Now is our time to create our legacy and set the standard for years to come; to evolve our industry from legal to legitimate by being its leaders.
If we play our cards right today, our country may look back at this moment, as Levine and Reinarman suggest, and judge our previous attitudes towards cannabis prohibition much like alcohol prohibition, “repressive, unjust, expensive and ineffective.” With history as our guide, we have a chance to shape our future. Let’s take advantage of it.
Jill Ellsworth is CEO and founder of Willow Industries, which uses ozone-based technology to clean and purify flower and trim while maintaining a plant’s medicinal properties.
Jill is a Registered Dietitian Nutritionist (RDN) with a Master of Science in nutrition, dietetics, and food science.
Member Spotlight: Tidal Royalty Corporation
In this month’s member spotlight, we hear from Paul Rosen, CEO of Tidal Royalty Corporation, a Toronto-based company providing financing for U.S. licensed cannabis operators looking to expand their operations.
Cannabis Industry Sector: Finance and Investments, ExpansionCapital Provider
NCIA Member Since: 2018
Tell me a bit about your background and why you launched your company?
I am a lifelong entrepreneur, having started my career as an attorney with my own firm before founding a number of companies in different industries. Within the cannabis industry, I was the co-founder of The Cronos Group (NASDAQ:CRON, CRON.V), a company that I led as CEO and President for 3 years. I am also a very active investor with over 100 investments in cannabis companies globally, I serve on the Boards of iAnthus Capital Holdings (IAN.C) and Hill Street Beverages (BEER.V), and I am an advisor to numerous companies in the industry.
I see a lot of similarities between U.S. cannabis today and the Canadian markets from 5 years ago, especially around the massive capital investments required to build out an industry of this magnitude. Unlike Canada, however, the lack of access to traditional capital markets makes it much more difficult for licensed U.S. operators to build the scale they will need in order to compete globally. I founded Tidal Royalty Corp. (CSE: RLTY.U) (OTC: TDRYF) to fill this market need and to provide growth-minded entrepreneurs with the resources they need to build sustainable businesses that positively contribute to society.
What unique value does your company offer to the cannabis industry?
Tidal Royalty is a publicly-traded company that provides licensed U.S. cannabis operators with the expansion capital that they need to scale their business. We write institutional-level cheques in the $5MM – $25MM range and have a world-class executive team that can assess and close deals quickly. But what makes us most unique is that we provide financing in exchange for a royalty on future revenue. This is most attractive to entrepreneurs in high-growth industries – like U.S. regulated cannabis – in that they get the benefit of a large capital infusion without dilution, and without the risk associated with debt. We are looking to align ourselves with best-in-class operators that will form the future of this transformative industry: when they do well, Tidal Royalty does well.
Cannabis companies have a unique responsibility to shape this growing industry to be socially responsible and advocate for it to be treated fairly. How does your company help work toward that goal for the greater good of the cannabis industry?
As institutional-level capital providers, Tidal Royalty has a level of responsibility that goes beyond our duty to be prudent stewards of capital for our shareholders. That is, we look to back licensed operators that we feel will positively impact the industry as a whole, in the U.S. and globally. We don’t see these as being mutually-exclusive; the operators that understand their social responsibilities and are willing to accept them are the ones that have the opportunity to make out-sized returns in the long-term. As part of our investment diligence, we not only assess the business case, but also look at how operators interact with their communities and the impact they can have on the segment of the population that they interact with. We think this is important in and of itself, but it’s also simply good business practice.
What kind of challenges do you face in the industry and what solutions would you like to see?
One of the most significant hurdles for many operators is the restrictive banking landscape. The legacy banking environment that discourages many institutions from participating in the regulated cannabis industry poses massive logistical challenges and business risks.
The industry as a whole is working hard to show the level of sophistication and societal benefit that a regulated cannabis market can offer, but the lack of banking infrastructure really creates an environment for criminal activity and black-market operators to flourish. Licensed operators can’t get access to the most basic banking services available to other industries and have to deal with the risks associated with a cash-only economy. I would like to see the states – either on their own or in partnership with private enterprise – really push an agenda to resolve some of these issues. There are a lot of good initiatives proposed that need to get pushed forward to make a difference.
Why did you join NCIA? What’s the best part about being a member?
We joined the NCIA to be part of a like-minded community working to advance the interests of this industry. The level of engagement, innovation, and enthusiasm we’ve experienced from the NCIA organizers and members has been incredible. We’re looking forward to helping contribute in any way that we can.
Campaign Update From Michigan’s Coalition To Regulate Marijuana Like Alcohol
NCIA recently spoke with two key figures in the state of Michigan to get an update from the boots on the ground about the efforts to legalize cannabis for adults this year. Mark Passerini is the founder of a medical dispensary based in Ann Arbor, Om of Medicine, and was also recently elected to serve on NCIA’s Board of Directors. Josh Hovey is the spokesperson for Michigan’s Coalition to Regulate Marijuana Like Alcohol.
Mark, how will adult-use legalization in Michigan affect your business and your community?
For the past eight years, we attempted to make all our decisions from the experience and perspective of a new patient that has never used cannabis previously. This translates to individual consultation rooms so patients may feel free to discuss their medical conditions, symptoms, and concerns in a private space rather than standing shoulder to shoulder at a retail counter.
We believe that when legalization is passed there will be many adults that may want to try cannabis but won’t know where to start, may be afraid, or unsure of the options and our unique consultation process may help them as much as it has helped our medical patients make the best choices for their health and their life. When cannabis is legalized, we plan to continue serving as a resource and education hub with a focus on scientific research.
What are the positive impacts of legalization in Michigan?
Positive change starts with one individual who shares with another who in turn shares with another and so on. Our communities have garnered a better understanding of cannabis, its history, medicinal use, and are actively rejecting the failed policies surrounding its use.
Locking people up for growing or consuming a plant is simply not the best use of critical and limited tax dollars. Many municipalities and states across the country have recognized this fact and passed decriminalization ordinances in order to use law enforcement resources on serious crimes. Communities and states that embraced legalization have also witnessed economic development through the creation of new jobs and much needed tax revenues.
Our research with the University of Michigan showed a 64% decrease in opioid use amongst patient participants. Continued research into the medical efficacy of cannabis will benefit not only the existing patient base, but the community at large.
By creating a whole new type of industry that operates in a responsible way and holds itself accountable to its community, everyone benefits.
Josh, how have you achieved success so far in the Coalition’s Michigan campaign?
True success will come when we pass legalization in November, but we’ve achieved some significant milestones. The first was creating a unified coalition of cannabis reform and social justice advocates to develop ballot language that borrows from the best practices used by the states that have legalized before us as well as Michigan’s medical marijuana licensing law. We also collected more than 360,000 signatures to place the issue on the November ballot. We’re proud of what we achieved so far, but the “vote yes” campaign has only just begun and there a lot more to do to make sure our initiative passes.
What do the prospects look like for the initiative passing this November?
Multiple opinion polls have shown that 60 percent of Michigan voters want to end cannabis prohibition and create a legalized and regulated system, so that’s a very strong starting position as we head into the campaign season. However, we know we can’t just rely on polls and we know the prohibitionists will continue to spread “Reefer Madness” era misinformation about the initiative.
That’s why we’re working hard to raise every dollar we can to make sure we can get the facts to voters across the state. We want to make sure voters know Michigan is wasting millions of taxpayer dollars on the failed policy of prohibition and that creating a legal and well-regulated marijuana market can raise hundreds of millions for three of our state’s most underfunded areas: roads, schools, and local governments.
Anything specific we should know about the program?
Full details of the proposal are available on our website at www.RegulateMI.org. But in short, our initiative learns from the best practices from other states that have gone before us while also borrowing licensing language established under Michigan’s Medical Marijuana Facilities Licensing Act. That law was passed with bipartisan support in 2016 and the first medical marijuana businesses are just starting to be licensed under that program. We believe our very reasonable and well-thought out business regulations combined with sensible personal possession limits will make Michigan’s adult-use law the new model for the country.
What is needed to ensure Michigan passes adult-use legalization?
We need people to get out and vote, plain and simple. Beyond that, there are a few other things people can do to support the campaign:
Make sure your friends and family are registered to vote and, of course, make sure they VOTE YES in November.
Share the facts about the initiative and about the need for legalization on your personable social media pages. You can find the campaign has pages set up on Facebook, Twitter and Instagram.
Don’t allow prohibitionist misinformation to spread. Correct your friends and family (politely) by giving them the facts on the issue.
Donate to the campaign at RegulateMI.org/donate. We need to get our message out every way possible, including television, mail and social media. All of those things costs money and we can’t win without your support.
The Michigan Coalition to Regulate Marijuana Like Alcohol will host a fundraiser on October 17, 2018 in Ann Arbor, MI. For more information, please contact Robin Schneider, Finance Director.
Phone: 517-974-2265
Email: Robin@RegulateMI.org
Committee Blog: California Regulations Public Comment Period Nears Close – Act Now!
Do you have views on the regulations that will govern California’s cannabis industry? If so, California’s window for the public to make comments on the proposed permanent industry regulations is about to draw to a close. But you don’t need to be an expert on arcane administrative procedure or even a lawyer to participate in the comment period. Keep reading to learn more about what is at stake and how to make sure your voice is heard.
Overview and Introduction to the Regulatory Process
On Friday, July 13, 2018, California’s three cannabis licensing agencies (the Bureau of Cannabis Control, or “BCC”; the Department of Food and Agriculture, or “CDFA”; and the Department of Public Health, or “CDPH”) released their much-anticipated proposed permanent regulations for cannabis businesses pursuant to the Medicinal and Adult Use Cannabis Regulation and Safety Act. This began the 45-day public comment period of the regular rule-making process. During this time, the public has a chance to review and comment on the proposed regulations, and the agencies must consider these comments and may make changes based on this feedback.
Below are links to the proposed regulations and the summary sheets released by the agencies:
Currently, cannabis businesses in California are operating under emergency regulations that were originally adopted in December 2017 and re-adopted (with a few changes) in June 2018. The emergency regulations will stay in effect until the regular rule-making process is complete and the final regulations have been formally adopted at the end of this year.
In addition to publishing the proposed regulations, the agencies also each published a Notice of Proposed Rulemaking Action (NPRM), which contains various information about the proposed rules such as a summary of existing law and who to contact with questions and comments. The agencies were also each required to publish an Initial Statement of Reasons (ISOR), which contains the agencies’ reasoning and basis behind why they crafted a rule the way they did.
These regulations will have a number of impacts on how the cannabis industry operates in California. For example, new advertising regulations would go into effect; packaging and labeling requirements would change; certain edible products could contain up to 500mg THC per package (versus the current limit of 100mg THC per package); and outdoor licensees would be prohibited from using light deprivation.
Those are just a few of the key proposed changes. Please refer to the summary sheets published by the agencies, listed above, for a more comprehensive list.
What Makes an Effective Public Comment?
There are six standards in the Administrative Procedures Act (APA) that agencies including the BCC, CDPH and CDFA must follow when conducting rulemaking actions. They are:
Authority – The agency must be permitted or obligated by law to craft a particular regulation. (Gov. Code § 11349(b))
Reference – The agency must refer to the provision of law that the agency is implementing or interpreting via the regulation. (Gov. Code § 11349(e))
Consistency – The regulation cannot be inconsistent with other laws and/or regulations, and needs to be harmonious with existing provisions of law. (Gov. Code § 11349(d))
Clarity – The regulation must be easily displayed or written so that it will be easily understood by the people affected. (Gov. Code § 11349(c))
Nonduplication – The regulation cannot serve the same purpose as another existing state or federal law or regulation. (Gov. Code § 11349(f))
Necessity – There must be substantial evidence in the record for needing the regulation in order to fulfil the purpose of the statute or other provision of law that the regulation implements or interprets. (Gov. Code § 11349(a))
Since the BCC, CDFA and CDPH have to comply with the standards above, it’s a good idea to focus your comments around one or more of those specific areas, as opposed to just making a comment that you dislike a particular proposed regulation without giving any reason why. That way, it is more likely that the agency will respond to your comment by making an adjustment to the proposed regulation(s) in question.
How to Submit Your Comments
Comments on the proposed regulations can be submitted to the agencies by mail or email, or offered in-person at one of the agencies’ scheduled public hearings. Your comment must include the following: (1) the subject title of the proposed regulation; and (2) specific concerns regarding the proposed regulation, which the agencies deem most helpful if they identify the section number in question, discuss the issue, suggest changes to the text, and explain why any desired modifications address the issue.
Please note that all comments received during the public comment process become part of the official record which is public information. Thus, you may not want to include any confidential or identifying information in your comments.
All comments must be submitted to the respective agencies by 5:00pm on August 27, 2018 or provided at one of the scheduled public hearings. Below are the locations of the public hearings, which will take place throughout the state during the months of July and August. (This information is subject to change; please check for updates on the California Cannabis Portal.)
Bureau of Cannabis Control Hearing Dates and Locations
The first two BCC public hearings have passed. There will be a final public hearing on August 27, 2018 from 10:00 a.m. to 12:00 p.m. at the Tsakopoulos Library Galleria, 828 I Street, Sacramento, CA, 95814.
California Department of Public Health Hearing Dates and Locations
The first two CDPH public hearings have passed. There will be a final public hearing on August 27, 2018 at 10:00 a.m. at 8400 Edes Avenue, Oakland, CA, 94621.
California Department of Food & Agriculture Hearing Dates and Locations
The first three CDFA public hearings have passed. There will be a final public hearing on August 28, 2018 from 1:00 p.m. to 3:00 p.m. at the California Department of Food & Agriculture Auditorium, 1220 N Street, Sacramento, CA, 95814.
Some Final Words
Collaborate. Join with other groups, trade associations, brain trusts, friends. Have reading groups. Get together and consider problems and solutions from multiple points along the supply chain, so that the solutions you offer can be relevant, functional, and comprehensive. There are many smart people working on this right now, so if you don’t have the time to this by yourself, link up with a trusted group that is commenting in accordance with your interest. Comment letters signed on by many stakeholders are very powerful.
Most importantly, “Keep Calm and Carry On!” Even though operators may see major changes being contemplated in these regulations, these are NOT YET IN EFFECT. Operators still need to remain compliant with the EMERGENCY regulations that are currently in effect, until the final regulations – post comment period – are officially adopted. This draft can and will change, so folks shouldn’t be making major business decisions based on the draft, as elements may either fall away, shift, or be added. (Think about the 24-hour security guard requirement in the Readopted Emergency Regs – it came and went within a 5-day comment period.) There are items in this draft that are sure to receive a LOT of comments and suggestions, so keep calm and carry on following the emergency regulations during this comment period.
Finally, even for operators outside of California, this process is nevertheless important to watch as the path that California takes will impact how the rest of the country chooses to regulate the cannabis industry, and it is also important to participate in if you plan to expand into the Golden State.
NCIA’s member-led State Regulations Committee (SRC) examines and reviews the varying cannabis industry-specific statewide regulations and works to establish best practices or guidelines for states and municipalities to facilitate the development of regulations and compliance procedures.
VIDEO: Member Spotlight With MedMen
In this month’s NCIA member spotlight, we visit with MedMen at their Santa Ana, CA, dispensary location. MedMen has grown to more than 18 storefront locations across California, Nevada, and New York, and currently employs more than 800 people. Co-founder and CEO Adam Bierman, along with co-founder Andrew Modlin, launched the company nearly a decade ago. Watch this video to learn more about MedMen.
“I don’t think we can expect to ever live out something like this again in our lifetime.”
– Adam Bierman, MedMen CEO and Co-founder
NCIA’s Q3 Summer #CannabisCaucus Series Re-cap
The month of July offered not only NCIA’s 5th Annual Cannabis Business Summit in San Jose, but also in the days leading up, we visited with YOU — our members — in 8 regions across the country for our Q3 Quarterly Cannabis Caucus event series.
Across 8 cities, we connected with nearly 1,000 attendees from coast to coast. Northern and Southern California events, as well as Colorado, saw more than 150 attendees at each!
In Northern California, attendees heard from guest speaker Eduardo Blanco, Special legal Advisor, CA Agricultural Labor Relations Board, as he spoke on “Understanding California Agricultural Labor Laws As It Relates to Cannabis Cultivators.” This informative talk provided vital insight into how organized labor regulations impact the cannabis industry.
In New York City at our Northeast regional event, we heard an update on what’s happening in the New York Legislature from Assembly Member Richard Gottfried (D – 75th District).
In Southern California, we were pleased to welcome Jessica McElfresh, Board Member of the Association of Cannabis Professionals, as our guest speaker in San Diego. Jessica provided a comprehensive overview of San Diego regulations and the slow but steady fight she has helped lead to progress the cannabis industry in Southern California over the years along with the local AAP group, the Association of Cannabis Professionals.
We returned to Portland, Oregon for our Pacific Northwest Caucus to hear from Matt Maletis, Commissioner for the Oregon Liquor Control Commission, where attendees dove into a Q & A session with the Commissioner on issues like analytical testing inconsistencies, METRC reporting, as well as the topic of “oversupply.”
At our Midwest Caucus in Cleveland, guest speaker Erin C. Reed, Senior Legal Counsel, from the State of Ohio Board of Pharmacy offered a regulatory update in Ohio, including how licenses are being distributed and how THC levels are broken down for various tiers of medical conditions. Additionally, we hosted a pre-event mixer for newly awarded licensee holders in Ohio, hosted by our Gold Sponsor Frantz Ward LLP, in the Vu Room of Bar 32.
In the Southwest, we gathered in lively Las Vegas, Nevada and heard from NCIA Member Scot Rutledge of Argentum Partners, with an update on Nevada’s social consumption campaign efforts.
We also returned to Miami, Florida to connect with current NCIA members as well as many newcomers to the industry.
In Denver, Colorado, we enjoyed a lively turnout of more than 150 attendees on the top floor of the History Colorado Center located in the heart of Denver featuring wrap around glass walls and an outdoor covered terrace with stunning views of the Front Range and downtown skyline. Guests
Thanks to our sponsors for their participation and support of yet another successful quarter of NCIA’s Cannabis Caucuses.
Want to get even more involved in NCIA? Want more information about your membership benefits, NCIA’s programming, or content? Please take a moment to fill out this Engagement Form to tell us what you’d like to learn more about. Whether you’d like to submit a guest blog topic for our website, be a guest on our weekly podcast, learn more about our Political Action Committee, or sponsor an upcoming event, just click the box next to your interests, and an NCIA staff member will get back to you.
This month, we speak with Andrew Myers, the Co-founder and CEO of ProGrowTech, which is based in Flagstaff, Arizona. ProGrowTech provides LED lighting solutions for grower operations of all sizes.
Industry Sector:
Cannabis Cultivation Supply
NCIA Member Since:
December 2017
Tell me a bit about your background and why you launched your company?
I spent more than 14 years in state and national politics before founding ProGrowTech with my partners. I was especially involved in Arizona’s budding cannabis industry, serving as campaign manager and chief spokesperson for Proposition 203, Arizona’s successful effort to legalize medical marijuana. I was also one of the authors of the 2010 Arizona Medical Marijuana Act, and co-founded the Arizona Medical Marijuana Association, an organization for licensed medical marijuana dispensaries. I also served as executive director of the Arizona Dispensaries Association.
My team and I founded ProGrowTech because we knew cultivators were unhappy with the quality of grow lighting available. None of the established players in the marketplace had developed a solution that fully met the needs of commercial growers. We designed our Evolve Series LED fixtures to address common grower pain points, helping them conserve energy, increase the quality and quantity of their harvests, and improve profitability.
What unique value does your company offer to the cannabis industry?
Beyond providing top-tier, energy efficient technology, our team works one-on-one with growers, assisting with facility design, energy rebate applications, installation, advanced growing techniques and ongoing maintenance to help their operations succeed. Growers can consider ProGrowTech a long-term partner who can help them elevate their operations in a sustainable way.
Cannabis companies have a unique responsibility to shape this growing industry to be socially responsible and advocate for it to be treated fairly. How does your company help work toward that goal for the greater good of the cannabis industry?
The cannabis industry is still very much in its infancy, which gives businesses like ProGrowTech the unique opportunity to make a meaningful impact. Our team has had a long-standing commitment to supporting responsible growth in the industry.
We’re members of the Resource Innovation Institute’s Founder’s Circle and sponsor and sit on the board of the Cannabis Certification Council. Both of these organizations are hyper focused on improving the efficiency, sustainability and ethics of commercial cannabis operations. We’re also members of NCIA, which has supported, protected and advocated for the cannabis industry since its founding.
My experience with Arizona’s medical cannabis legislation and other team members’ experience as cultivation facility owners and growers themselves has given us a unique, holistic perspective on the industry and where we can make a difference.
What kind of challenges do you face in the industry and what solutions would you like to see?
In the lighting industry, our main challenge is to bring cultivation lighting technology into the 21st century. A lot of large cultivation facilities were built years ago when there wasn’t as much openness in the industry and high quality, energy efficient lighting was scarce. Our role is to not only provide the world class technology growers are missing, but also to educate them. We can help growers expand their vision of what is possible in their facility, allowing them to increase yields while lowering operations costs so they can remain competitive.
Why did you join NCIA? What’s the best part about being a member?
We joined NCIA because we believe in and support the organization’s mission. I have been supportive of NCIA since its founding, and have known NCIA co-founder Aaron Smith for many years.
Most importantly, NCIA brings together innovative, engaging cannabis industry leaders at numerous events each year. These events have been tremendously valuable for ProGrowTech, allowing us to spread our message, showcase our technology and connect with like-minded people across all facets of the cannabis industry.
A year ago, NCIA’s Infused Products Committee (IPC) made the decision to tackle the issue of cannabis testing. It is an issue we feel is at the heart of cannabis legalization and is negatively impacting cannabis businesses across the nation. Although it has been a struggle to get comparable lab results across different labs, IPC believes there is a future where cannabis testing will reach consistency.
We began our process by asking several questions and with the assistance of the NCIA, we crafted a survey that was sent to experts in the field. During our preliminary research, we discovered that most cannabis testing labs view their protocols and procedures as proprietary information.
To gain better insight about the testing sector, we asked Alena Rodriguez, a member of NCIA’s Scientific Advisory Committee (SAC) to participate in an interview. Alena represents Rm3 Labs, a cannabis testing laboratory in Colorado.
IPC: Are you concerned about the inconsistent and varying test results and the impact it has on consumer safety?
Alena: Yes, I’m concerned. I do not take my job lightly; I know that contaminated cannabis can be harmful and sometimes life threatening. That is why I am involved with state regulators and groups like NCIA’s SAC and Testing Policy Working Group. We aim to educate regulators and stakeholders on the importance of practices such as independent audits, proficiency testing and ISO/IEC 17025 accreditation for cannabis testing labs.
IPC: Do you think we are close to having consistent cannabis test results from different laboratories?
Alena: We are well on our way. In Colorado, licensed labs must undergo Proficiency Testing (PT) twice per year. PT is done through an inter-laboratory comparison where participating labs receive the same sample and analyze it using their methodology. Even though our procedures are not standardized to one method, most of the labs arrive at the same result. Unfortunately, not all states require PT yet, but I feel more and more states will adopt these programs.
Along with PT, consistent testing across labs requires the use of high-quality reference materials that are used to validate analytical methods and calibrate instruments. Cannabis testing labs in the United States have limited access to reference standards. Like cannabis, most industries started with limited resources, but over time the science will progress as federal barriers are lifted to make more research and better standards possible. It took decades to develop standardized, consistent methods in other industries, such as in pharmaceuticals and food testing. I don’t see the cannabis industry being any different.
IPC: Should there by penalties if a testing lab consistently provides drastically different results from prior tests of the same product?
Alena: It depends on the situation. If the lab is knowingly breaking the rules or trying to cheat the system, then absolutely. But, most of the time inconsistent results have causes other than fraud or negligence. This industry produces new products every day and some manufacturers and laboratories don’t “get it right” on the first try. There is a lot of research and development that is involved. Three of the biggest hurdles for consistent testing of cannabis products are 1) the variety of sample types 2) the lack of certified reference materials for uncommon cannabinoids and terpenoids and difficulties in obtaining concentrated standards and 3) inhomogeneity in some infused products or concentrates. Product uniformity is critical and should be confirmed by analytical testing for consumer safety. Variable results across multiple labs may suggest a product lacks uniformity.
IPC: Do you believe testing procedures and protocols areproprietary?
Alena: Yes, third-party cannabis laboratory protocols are just as proprietary as the protocols developed by cultivators, concentrate extractors and infused product makers. Testing labs having proprietary methods is not novel to this industry. If a lab in any other industry (e.g. food, medical, agriculture, environment) develops an alternative method to the standard method, they can use it if they can validate against the reference method.
IPC: Should labs be required to prove their analytical methods are accurate by submitting their practices confidentially to a regulatory body?
Alena: Absolutely! Colorado labs are currently required to send all new Standard Operating Procedures (SOPs) and method validations to the CDPHE prior to implementation. I hope more states adopt this practice, if they aren’t doing so already. As of January 1, 2019, all cannabis testing labs in Colorado will be required to be ISO/IEC 17025 accredited. ISO/IEC 17025 accreditation is the international gold standard for assessing the competence and quality management systems of testing labs across all industries to ensure consistent, accurate test results. More than a dozen cannabis labs have achieved this accreditation across the country.
IPC:Are you aware that the ASTM Committee D37 reportedly drafted testing procedures? If published, will cannabis testing labs follow published procedures that are not their own?
Alena: Yes, I’m excited! This is a great step for our industry. I imagine the committee will develop similar protocols to those being used by third-party labs. But as I mentioned before, labs will have the choice to use the published standard methods or their own alternative method, granted it is validated against the reference method. I expect some labs will attempt to validate their methods against the standard methods and some will adopt ASTM’s methods.
IPC: Are you aware of testing labs that allow for “tipping” on their order forms? Does this concern you, and why?
Alena:It concerns me that there are bad actors in the testing sector of the cannabis industry but I’m afraid there are bad actors in every segment of every industry. At Rm3 Labs, we do not participate in or condone unethical behavior such as paying for the results you want. We would never risk falsifying test results because we are aware immunocompromised individuals and children are possibly taking the products we are testing. I would not risk my entire scientific career to give you 5% higher THC potency results or lie about your contaminant testing results. I advise all cannabis testing labs to always act ethically because you are in the business of public safety and your lab is subject to investigation by regulatory agencies at any time.
IPC conducted the above enlightened interview with SAC. While we were inspired by some of the answers, much like our survey attempt this past year, many of our questions remain unanswered. For example, we don’t agree that cannabis cultivators or manufacturers are to blame for receiving inaccurate “clean/approved” test results from labs due to products being inhomogeneous.
That said, it is clear by a couple of the responses that some states, like Colorado, are making substantial progress in oversite and legal requirements for testing laboratories, while other states, like California, are still leaving significant and dangerous gaps.
In our opinion, the industry’s need for consistent and accurate testing results remains at the forefront of the issues facing commercial cannabis today. The ability to send the same sample, from the same batch, under the same conditions, and have it tested by multiple labs, achieving the same results, is paramount to our industry’s future and success. State laws should require it. The industry should demand it. And the consumers most certainly deserve it.
As such, the IPC will continue its mission to drive this conversation forward with both testing labs and operators alike. Only together, can we really solve this crucial issue facing our amazing industry.
Video Spotlight: W Vapes
Learn more about NCIA member W Vapes in this month’s video spotlight. The California-based, award-winning vaporizer company focuses on pure, pesticide-free, CO2 extracted, lab-tested oil. Their products are now also available in Nevada.
VIDEO: Join us at a #CannabisCaucus near you this month!
NCIA’s popular Quarterly Cannabis Caucus event series returns to a city near you in July! Watch this video to learn more about the event series and to hear from NCIA members why you should attend, like garnering insights about how recent policy developments impact your business, and connecting with other industry executives in your region! This event is free for NCIA members, and just $50 for non-members.
This month, we reached out to Sirita Wright, a co-founder of the multimedia company EstroHaze. Sirita, along with her co-founders Kali Wilder, and Safon Floyd, focus their company’s mission on highlighting the businesses and lifestyles of multicultural women in the cannabis industry.
Cannabis Industry Sector:
Media/Entertainment
NCIA Member Since:
January 2018
Tell us about your background and why you launched your company?
Storytelling is the heart of what we do. We found a void in mainstream media’s coverage of minorities building brands within the industry and we decided to start EstroHaze for the purposes of uplifiting those voices. Having worked together for years at another media company, we saw a great opportunity to build a bridge for others looking for opportunities in the cannabis industry.
What unique value does your company offer to the cannabis industry?
Photo by Rich February
Our value lies in our ability to represent and truly connect with our community via ‘edutainment’. From our original video series EstroHaze Escapades, where we explore the inner workings of the legal cannabis industry in states like Colorado and take in cannabis experiences like ganja yoga; to our podcast where we talk startup life and brand-building, as well as interviews with cannabis thoughtleaders and influencers. If that isn’t enough, head to our website where we feature dynamic profiles, blueprints for building your own cannabusiness, cannabis recipes, information on lobbying and more! Bottom line, EstroHaze provides a connection to cannabis and culture that resonates with the people.
Cannabis companies have a unique responsibility to shape this growing industry to be socially responsible and advocate for it to be treated fairly. How does your company help work toward that goal for the greater good of the cannabis industry?
This is the reason why we started EstroHaze – to be a space that amplifies voices that are shaping this industry, voices that, far too often, have been ignored. With ever-expanding cultural influence and increasing buying power it’s reckless to ignore one of the fastest-growing, most educated, and entrepreneurial demographics in the world. In telling stories – the good, bad and ugly of the cannabis industry – we ensure that people are aware of bias and held accountable. The cannabis industry is bigger than any of us and has the power to save lives and improve well-being. Recognizing this, EstroHaze serves a higher purpose and we create content and partner with brands that are intentional about that higher purpose.
What kind of challenges do you face in the industry and what solutions would you like to see?
The challenges we face are typical of any startup, to be honest. Add being women and a woman of color led brand and those issues just compound! Access to capital, government support as a small business, social stigma towards the use of cannabis, etc. We are a startup like any other with opportunity to grow to unlimited heights and that takes capital. The solution is simple–-show us the money and access to opportunities to produce content on a larger scale. For instance, Netflix, VICE, and HBO are just a few networks that have cannabis themed content that is not led or hosted by women of color, specifically black women. Enough already! EstroHaze as content creators can help with that.
Why did you join NCIA? What’s the best part about being a member?
Our NCIA membership was actually gifted to us by a member who was impressed with us and our Demo Day pitch at Canopy Boulder. This membership has given us an opportunity to build more bridges with other like-minded brands, get industry data that is not available to the public, which is priceless, and access to informative conferences and trade-shows.
Top 5 Reasons to Attend NCIA’s Quarterly Cannabis Caucuses
by Rachelle Lynn Gordon, NCIA Editorial Staff
NCIA is proud to announce the return of our Quarterly Cannabis Caucus series this July. These informative and engaging networking events bring together industry professionals, thought leaders, and policymakers with the goal of keeping the community informed about cannabis reform developments across the country from both a political and business viewpoint. Held on Tuesdays and Thursdays in each quarter in the eight most active legal markets, the Quarterly Cannabis Caucus series is a great way to stay up-to-date in this fastly emerging space.
“People attending a Caucus can expect to meet and network with professionals from all parts of the industry including license holders, law firms, insurance providers and other ancillary businesses, all while gaining some key insights into the future of federal and local cannabis policy,” explains Thomas Rosenberger, Executive Director of NCIA’s Ohio affiliate, the National Cannabis Industry Association of Ohio.
What are the top five reasons why you should attend an NCIA Quarterly Cannabis Caucus?
Policy is Changing at a Rapid Rate
Cannabis legalization isn’t happening overnight, but lawmakers across the country at both the local and federal levels are working around the clock on a variety of bills aimed at easing restrictions and promoting business growth. It’s critical for business leaders in the community to stay informed on the latest developments both in their home states and nationwide.
“The cannabis industry is the most highly regulated industry in the country, and faces challenges at the federal level that no other industry does,” Rosenberger adds. “Getting involved with events like the Quarterly Cannabis Caucus series is key to advancing the policy reforms necessary to expand the industry and grow your business.”
Legislators Want to Hear From You
NCIA is committed to strengthening dialogue between industry professionals and legislators across the board in order to promote impactful reform. Cannabis Caucus events offer attendees the chance to voice concerns with their local lawmakers and interact with candidates who may affect future legislation.
“I’ve been going to the NCIA Quarterly Caucuses for the past few years, and I find them totally invaluable, not only for networking but also to get engaged with what is happening on a policy level,” says Shawna McGregor of Grasslands: a Journalism-Minded Agency. “I have been able to hear from local politicians about where they stand on the industry and have appreciated that insight and exposure.”
Regional Events Offer Curated Look at Local Markets
As those in the cannabis space know, each state – and sometimes even municipalities and counties within those states – that has decided to legalize the plant for medical and/or adult-use has widely varying rules and regulations. It is the intention of the Quarterly Cannabis Caucus events to offer a glimpse at both local and national developments with a keen focus on what’s happening within the regions represented.
“Because NCIA holds Caucuses in every region, they are a great place to connect with members across the country who care about getting a nascent industry legalized and regulated on a state and federal level,” adds McGregor.
“I do business in multiple states so it’s nice that I can have my team members attend their regional Caucus and then report back to me on what’s happening in their area,” states Brett Johnson, Founder of SpectrumGro. “It helps me stay ahead of the game.”
Wide-Ranging Networking Opportunities
Quarterly Cannabis Caucuses bring together professionals from every vertical within the space, from cultivators and dispensary owners to accountants and attorneys in order to impact both policy and profits. Attendees have the chance to develop business relationships with other movers and shakers within their communities.
“NCIA offers a tremendous venue for meeting with a very professional and curated group of cannabis business people,” says Scott Jordan of Vertical Companies. “I try never to miss an event if possible.”
They’re Fun!
NCIA members work hard to advance the cannabis industry every day, and Cannabis Caucus events offer the chance to have an impact while also having a good time. Caucuses are held in a relaxed yet engaging setting, and light hors d’oeuvres and a cash bar are provided, plus tickets are free for NCIA members.
Register now for July’s Quarterly Cannabis Caucus series!
Top Highlights from NCIA’s April Quarterly Cannabis Caucus Events
So far, this year has been pivotal for cannabis federal policy. From the rescinding of the Cole Memo, to the inclusion of medical cannabis protections through September and most recently, Sen. Cory Gardner’s (R-CO) commendable work defending states’ rights. Between the quantity of information about cannabis policy changes and managing your day-to-day business operations, staying up to date with accurate news on both the national and local level can be challenging. That’s why NCIA’s Quarterly Cannabis Caucuses are so important for our industry to convene, connect, and stay current on issues impacting the industry.
Thanks to our Government Relations team based in Washington, D.C., participating in our Cannabis Caucus events means that you can get accurate insights into cannabis policy straight from the Hill, as well as local guest speakers offering regional updates from the ground. You can also take advantage of a meaningful networking experience with cannabis executives in your region in a relaxed, professional setting. Cannabis Caucuses are your best chance to get even more engaged with NCIA’s policy work and industry leaders nationwide.
This April, the Quarterly Cannabis Caucus events were held in eight regions nationwide and 1000+ cannabis industry professionals participated!
Highlights from Northern California, the Northeast, and Southern California
In San Jose, Josh Drayton, the deputy director of CCIA, provided an update on CCIA’s state-wide activities representing the industry.
In Boston, we were joined by guest speaker Shanel Lindsay from the Massachusetts Cannabis Advisory Board to share the latest on the social equity program as well as state legislative updates.
In Los Angeles, we saw a huge turnout of more than 350 attendees at the historic Hollywood Roosevelt, and welcomed special guest speaker, Jennifer Hawkins, a business tax specialist at the California Department of Tax and Fee Administration. Jennifer offered an overview on California cannabis excise tax for cultivation and was joined by Alexis d’Angelo, the Southern California Membership and Outreach Liaison for CCIA.
Highlights from the Midwest, Florida, and the Pacific Northwest
In Tampa, guest speaker Sally Kent Peebles from Vicente SederbergLLC gave an update on the Florida medical marijuana program, detailing the licensing process.
At our first event in 2018 in Scottsdale, Arizona, we welcomed nearly 100 attendees to network with their regional colleagues and learn about the recent rescission of the Cole Memo. Attendees also heard from Arizona State Rep. Mark Cardenas (D-Phoenix), who introduced legislation this year that would put a adult-use measure on Arizona’s November ballot.
In Boulder, Colorado, Sen. Tim Neville (R-16th District) joined us to share a motivational talk about the future of the industry to attendees, and an update on what’s happening in the Colorado Legislature.
Upcoming July Cannabis Caucus Events
Get your tickets now!
Early bird tickets are 50% off additional member tickets and non-member tickets now through June 11!
We’re excited to announce that registration for our July Cannabis Caucus Events is now open! Join us in new regions and cities for meaningful networking opportunities with industry professionals, policymakers and government officials.
NCIA Announces Board of Directors Election Results!
National Cannabis Industry Association members have voted in the association’s annual board of directors election and nine candidates have been elected to serve on the board for the 2018-2020 term.
Congratulations to the winners, and thank you to all of the candidates for their commitment to NCIA!
Six board incumbents were re-elected this year and three new board members will be joining the leadership team following the election:
Michael Steinmetz of Flow Kana, one of California’s most innovative companies dedicated to sustainability and empowering craft cannabis farmers.
“We are thrilled to be part of the NCIA board to ensure that the United States does not fall behind in the growing global cannabis conversations. With the continued end to prohibition throughout the country, it is imperative that all the legalized states come together to help bring clear policies to the federal level.”
Mark Passerini of Om of Medicine, a long-time NCIA member and the first board member to be elected from Michigan.
“It is an honor to serve this industry and movement in the capacity of NCIA board member! NCIA will have a tremendous amount of influence on the growth and direction of the cannabis space over the next few critical years. I am humbled to be a part of this community and will vow to do everything I can to make this industry the most successful, ethical, respected, and innovative it can be! I look forward to representing the Midwest as we tear down the wall of cannabis prohibition brick by brick.”
Taylor West of COHNNABIS, leading public relations professional and former NCIA deputy director.
“I’m so grateful for the opportunity to help guide NCIA into the future. I know first-hand how hard NCIA works on behalf of its members. Together with the staff and the other incredible leaders on the board, we’re going to keep building the organization to its fullest potential, both as a powerful voice for the industry and as a valuable business community.”
The new board members-elect will join the NCIA executive director and the nine other elected members at the next board meeting.
Members can contact us any time for more information about the board election results or the election process.
If your business is not yet a part of the movement, please join NCIA today.
Apply for an NCIA Committee for the 2018-19 term!
Coming off a strong and productive year of Committee work, NCIA is excited to announce that we are accepting applications for the 2018-19 Committee term. We need your skills, passion, and wide-ranging perspectives to build upon our energetic, inclusive, and innovative committees. NCIA committees are an opportunity for our members to get engaged in specific industry issues and sectors of their professional expertise and interest.
NCIA Committees enable our members to engage their vast and varied areas of expertise and passion to:
effect change and influence public opinion and policy,
enhance their leadership skills,
expand their professional and personal network, and
develop best practices and guidelines to shape the future of our industry.
“They are all experts in their fields and are all committed to the responsible and equitable growth of the Cannabis Industry. In over 30 years in the insurance industry, this is the most fun I’ve had!” – John Balian, Wood Gutmann & Bogart Insurance Brokers, NCIA’s Finance and Insurance Committee
“There is no doubt that my fellow Committee Members will be the ones to help drive our industry forward and the relationships I’ve made are a valuable benefit of my NCIA Membership.” – Michael Weiss, Nature’s Dream, Inc. (aka Cannacopia), NCIA’s Marketing & Advertising Committee
Our Members in Action at NCIA’s 2018 Cannabis Industry Lobby Days
by NCIA Editorial Staff
The cannabis industry has seen exponential growth in the mainstream support for regulated cannabis markets from both sides of the political aisle. This progress is a direct result of the relationships NCIA has built on Capitol Hill, as well as the personal stories told by our members each year at our annual Lobby Days events in Washington, D.C. NCIA’s 8th Annual Cannabis Industry Lobby Days, hosted May 21-23, was the industry’s most impactful fly-in yet, as our members made more inroads to Congress at a time when the nation has reached a tipping point in the fight to protect legal cannabis.
“So many more people keep coming to Lobby Days which is amazing to see,” said Karson Humiston, founder of Vangst. She’s one of Forbes’ 30 under 30 and the only female in cannabis to make the list. She’s focused on telling members of Congress about the potential for job creation and the economic impact of a fully recognized cannabis industry. “We are talking about jobs as much as possible in order to educate members of Congress about the economic stimulation regulated cannabis is bringing to the states and the need for federal legalization,” she said.
NCIA announced the release of its 2018 State Cannabis Progress Report during this year’s Lobby Days. The publication outlines a myriad of economic and social benefits already being realized by states with successful cannabis programs, including job creation, tax revenue, and reductions in crime and teen use.
So far 2018 is shaping up to be much different from the past seven years, largely because of Republican backlash against Attorney General Jeff Sessions attempting to ramp up federal interference in state cannabis programs by rescinding the Cole Memo. Historically, the GOP has been less publicly supportive of reforming cannabis laws, although there has been a strong current of support among certain segments of the party. Now, they listen and many have even joined us in support of banking and tax reforms needed for our industry to reach its full potential, in addition to their traditional support of federalism issues related to cannabis. Advocates, patients, and NCIA member-businesses all over the United States are keeping this positive momentum going.
At the Lobby Days welcome reception on the evening of Monday, May 21, NCIA Executive Director Aaron Smith said he was delighted with the turnout. “There are so many new faces, so many old friends, and Lobby Days veterans,” he told the audience of cannabis professionals, who had just arrived in Washington prior to the two full days of meetings with congressional offices. “Starting tomorrow, we will descend upon Capitol Hill to show lawmakers what a responsible, politically engaged cannabis industry looks like.” He called Lobby Days one of the cannabis industry’s most important events of the year.
NCIA member and founder of Washington, D.C.’s National Cannabis Festival and the National Cannabis Policy Summit, Caroline Phillips, said that she was proud to see so many members coming to her backyard to demonstrate their unity. “This is a really wonderful opportunity to share with members of Congress the diverse and innovative ideas of the cannabis industry and to show off the professionalism, creativity, and care that the people in the industry put into their work, “she added. “I think a lot of members on the Hill are starting to understand the cannabis industry is a lot more than just stereotypes, and for them to have one-on-one interactions with some of the best professionals in our industry is extraordinarily valuable.”
New to Lobby Days was Attorney Blake Mensing. He was eager to join the crowd of professionals to advocate for the fair treatment of cannabis businesses. “I think that this is the eighth year that this is happening really shows that the industry is coming out of the shadows and the momentum has built to the point that there’s a small probability that things are going back to the way they were [prior to the reform victories of the last decade].” Mensing founded The Mensing Group after he left his job as a Municipal Attorney in Massachusetts to start a cannabis-only practice. “It’s the first time I’ve ever had fun being a lawyer,” he remarked before heading into Senator Orrin Hatch’s (R-UT) office.
Professional football player Mike James also joined NCIA this year to advocate on behalf of his fellow athletes who would prefer to treat their health issues with medical marijuana instead of opiates. The active NFL running back has played for the Tampa Bay Buccaneers and the Detroit Lions during his career, which has wreaked havoc on his body, leaving him with chronic pain that he used to treat with opioids. “Within the NFL, I’m trying to go through their process and change policy. That way, hopefully, they can be an example for society,” he said. Currently a free agent, he’s the first and only active player with a medical marijuana card.
From the need to expand medical access to cannabis, to tax and banking reform, to addressing the injustice of racially disproportionate marijuana enforcement, NCIA hit the Halls of Congress to educate members of Congress and their staffs on what’s happening in their own backyards and the successes of regulating cannabis.
For example, when it comes to tax reform, Heather Sullivan of 3C Consulting said the cash-flow is only one of the issues they have to worry about from the 280E tax burden. “It’s a tough decision come tax season,” she said. “Do you set aside those tax rates so you don’t have that money to use for other things for your business, or do you play the game and run the risk that you’re not going to get audited?” Many cannabis businesses face similar issues, which can effectively ruin a company over time.
There were many Congressional offices that were receptive to the efforts and positions of NCIA members during Lobby Days. Heather took a meeting with Sen. Bernie Sanders’ (I-VT) office, for example, and after leaving the meeting she felt that it went wonderfully, stating, “Senator Sanders is a proponent for the safe and regulated use of cannabis whether in the medical side or the adult use side, so it was a meeting that for us was an opportunity to tell Bernie and his staff how much we appreciate the hard work that he’s done, ask him what we can do as an industry to help them continue the progress that they’ve already made and learn more about where his focus is.” Sullivan is well-versed in the issues facing cannabis businesses today and knows many other officials are still in need of convincing.
In spite of heavy opposition from Attorney General Jeff Sessions, as well as House leadership, the cannabis industry saw a huge victory when protections for medical marijuana were included in this years’ fiscal budget. Now, with the help of our members who flew in to speak about their personal issues and experiences, we can all look forward to an even more progress and a better outlook for the U.S. cannabis industry.
VIDEO: Member Spotlight with Canndescent
In this month’s member spotlight, we visited with CEO Adrian Sedlin at his cultivation and processing facility in Desert Hot Springs, California. His company Canndescent has been acclaimed for its unique, modern packaging designs. Canndescent’s lifestyle-focused strain names, including Calm, Connect, and Cruise, answers this question for consumers: “How do you want to feel?”
2018 Board of Directors Election Now Open!
It’s time to vote in NCIA’s annual board of directors election! Participation in NCIA’s board election is one of the most important ways to engage as a member of your trade association, as it ensures that your values are represented within NCIA’s leadership.
If you are a member of NCIA, we encourage you to review the voter guide of this year’s candidates and cast your ballot between now and May 31 for the 2018-2020 term.
About NCIA’s Board of Directors:
As the largest national trade association for the industry, NCIA’s Board of Directors establishes the organization’s board objectives and strategic direction. Board Members are responsible for building membership, fundraising for the organization, and ensuring that NCIA continues to be the strongest force advocating for the fair and equal treatment of the industry on the Hill.
About the election process: NCIA members will receive an email with a unique link to a secure online election ballot.
There are 9 open board of directors seats and 21 nominated candidates (including seven current board members seeking reelection). Please refer to your voter guide for information on all candidates and for more information on board election logistics before casting your vote online.
Each member business can only vote once and votes cannot be changed once submitted.
Votes are weighted according to membership status.
Voting closes at 11:59 PM EDT on Thursday, May 31.
Learn more about the candidates: 1. Download the VOTER GUIDE. 2. Watch the candidate VIDEOS. 3. Watch recordings of the moderated NCIA Board Nominee Forums which took place on May 2, 3, and 4! Take the opportunity to listen in as nominees answer critical questions about their candidacy and discuss their long-term vision for NCIA and the industry at-large.
Moe Asnani – iLava Gary Cohen – Cova John Davis (Incumbent) – Northwest Cannabis Troy Dayton (Incumbent) – The Arcview Group Etienne Fontan (Incumbent) – Berkeley Patients Group Michael Gruber – Salveo Capital (WITHDRAWN) Aaron Justis (Incumbent) – Buds and Roses Kris Krane (Incumbent) – 4Front Ventures Jaime Lewis (Incumbent) – Coldwater Consulting Olivia Mannix – Cannabrand John MacKay – Synergistic Technology Associates (WITHDRAWN) Michael Minardi – Minardi Law Mark Passerini – Om of Medicine Erich Pearson (Incumbent) – SPARC Ean Seeb (Incumbent) – Manna Molecular Gregg Steinberg – Growcentia Michael Steinmetz – Flow Kana Ian Stewart, Esq. – Wilson Elser Law Firm Kimley Svendsen – Waterstone Staffing Holdings, LLC Manndie Tingler – Papa & Barkley Taylor West – COHNNABIS
Note: Individuals who cast a ballot on behalf of their member-business are responsible for verifying that they are authorized to do so within their own corporate leadership structure.
Not yet a member of NCIA?
If you are not a member of NCIA but want to participate in the election, join today and we’ll provide you access to the online ballot. Your membership will also support the industry’s only unified and coordinated effort to reform federal marijuana laws as well as provide other member benefits enjoyed by the more than 1,500 responsible cannabis businesses that make up NCIA’s national network.
Member Spotlight: Hippo Premium Packaging
Get to know the company Hippo Premium Packaging in this interview with CEO and Co-founder Kary Radestock, who also serves on NCIA’s Marketing and Advertising Committee.
Industry Sector: Packaging and Labeling
NCIA Member Since: June 2016
Tell me a bit about your background and why you launched your company?
CEO Kary Radestock
I worked for a Fortune 500 printing and packaging company for 20 years and produced a lot of high-end, award-winning projects. In the summer of 2015, I started to think about a potential business opportunity after watching 5 different people walk into our facility needing cannabis vape cartridge packaging. I pitched the business opportunity to our executive team, but the instability of the industry and the lack of banking forced the company to deny Cannabis clients from doing business with us. I couldn’t stop thinking about the industry, so I created the Hippo brand, gathered a group of potential company founders and we flew to MJBizCon in Vegas. We needed to check out the lay of the land to see if our business concept could be useful to the industry. I brought one of my award winning rigid boxes with me encasing beautiful bottles of oils. The response was overwhelming. It wasn’t even a question any more. There was a need. Just a couple of months later I quit my job and fully launched Hippo. I haven’t looked back.
What unique value does your company offer to the cannabis industry?
We bring an incredible amount of experience to the industry. You know the saying that it takes 10,000 hours to become a master at something? Well, each of our experts are masters at what they do. We feel there are three pillars leading to brand success: 1. Brand Development/Graphic Design, 2. Marketing Services and 3. Packaging. We’ve adapted mainstream best practices from each of these categories and are applying them to the cannabis industry. Our mantra is to help our customers succeed in this ultra-competitive landscape.
We comb the earth, looking for the best packaging solutions on the market and are proud distributors of an extensive range of child resistant and other packaging products. Our flagship is the Burgopak Duallok™, a beautifully functioning folding carton that is both child resistant (CR) and re-closable. This product is currently in testing and we expect final certification in the coming weeks. These boxes can be beautifully printed featuring custom decorating finishes that our industry enjoys including Foils, Soft Touch, Spot Varnishes, etc. It’s perfect for vape cartridges, pre-rolls, syringes, edibles and much more.
In addition, Hippo has a boots-on-the ground approach to working with our clients. Our sales team is regionalized so we can easily get together to help our clients through the complicated packaging process. Many cultivators and manufacturers are being introduced to a business world that they are unfamiliar with. Having that face-to-face contact with Hippo instills trust and usually allows for a smoother process. We become an extension of their own internal team and their success is our ultimate goal. This regionalized team is supported by our legal compliance department to help us and our clients understand the complicated regulations that change from state to state.
Cannabis companies have a unique responsibility to shape this growing industry to be socially responsible and advocate for it to be treated fairly. How does your company help work toward that goal for the greater good of the cannabis industry?
At Hippo, we feel our immediate and primary responsibility is that of reputation transformation. The industry as a whole has a bad rap for weak and sometimes inappropriate brand development, marketing campaigns featuring scantily clad females and poorly executed packaging. So, we make it a priority to help educate the community about what steps to take to create a quality brand and win the trust of their target consumers. To that end, we write blogs and articles, feature tips on our website and in social media, speak at industry events like High Times Business Summit, Bud Camp, NCIA Seed to Sale Show and many more. We are also in a unique position to help guide our clients in developing their own unique social responsibility programs, of which will go far to endear a mainstream audience.
As far as advocacy goes, we participate in the industry, keep abreast of the issues at the forefront and get involved by attending community meetings and writing our politicians as often as needed. In the near future, our focus will be on lobbying for fair business tax regulations as well responsible packaging laws that protect our children, the environment and our community.
What kind of challenges do you face in the industry and what solutions would you like to see?
Where to start!?!? There are so many challenges.
The regulations here in California have been and remain messy and confusing. We spend way too much time researching these regulations – which are constantly changing and inconsistent state to state. Once the Federal Government declassifies cannabis, then the country will be able to uniformly work together to create consistent regulations across all states.
We also face a lot of financial challenges with new clients who need to get to market but have paid so much money up front for new permits and licenses that they have no budget left for brand development, marketing and/or packaging. Changing some of those fees to post-sale would help the entire industry, including the ancillary companies.
But for Hippo, we understand that one of the biggest challenges our clients are facing is understanding and finding premium certified child resistant packaging options. Packaging has a huge impact on the consumer experience and has been touted to influence 70% of buying decisions in a mainstream marketplace. Cannabis packaging is the hardest working packaging in existence with multiple demands; child resistant, resealable, airtight, tamper evident, regulations galore and that’s before we can even start thinking about how to beautifully represent the brand. With many CR form factors still in development and a shortage of stock items, cannabis businesses are scrambling to find anything that represents their brand well. During these next few years, our industry must lobby for packaging laws that don’t overtax the environment or our community and actually make sense.
Why did you join NCIA? What’s the best part about being a member?
I’m a bit of a geek this way. Early on in my career I worked for a non-profit and learned the importance of networking. Networking got a bad reputation from a handful of card slingers looking for quick business. But the reality is the network I built all those years ago is now paying off – royally. I’ve pulled the human capital I needed to grow Hippo from that network. I joined NCIA shortly after launching the business because I wanted to get to know the industry and its leaders. I needed education and I needed community. With my NCIA membership, I got more than I bargained for. I have served on the Marketing and Advertising Committee (MAC) this past year with so many smart and talented individuals. I’ve had a blast and met an amazing group of men and women as dedicated as I am to bringing solid business practices and professionalism to this industry. I’m proud to serve beside them to bring our members tools to help them succeed.
My mentors taught me to get involved, apply yourself and leave whatever you touch better than you found it. I’m not quite there yet… so I’ll get busy and apply for committee membership again next year.
MCBA exists “to create equal access and economic empowerment for cannabis businesses, their patients, and the communities most affected by the war on drugs,” and NCIA’s mission is “to promote the growth of a legitimate and responsible cannabis industry.” This partnership aligns the two nonprofits’ work around respective projects and events that complement each organization’s mission.
NCIA and MCBA staff representatives discuss each organization’s upcoming efforts and events, select the best opportunities for collaboration, and work out the details of each organization’s contributions to the other’s planned scope of work for the following year. MCBA members in good standing will receive discounted registration fees to select NCIA events, including its Quarterly Cannabis Caucus series, Seed To Sale Show and Cannabis Business Summit & Expo events. MCBA and NCIA’s respective Policy Councils may also collaborate towards mutually shared advocacy goals. Hear more in this recent podcast interview with new MCBA president, Shanita Penny.
In addition, NCIA is pleased to again offer 60 scholarships, in partnership with MCBA, for free registration (valued at up $895) to NCIA’s 5th Annual Cannabis Business Summit & Expo, July 25-27, 2018, in San Jose, CA. The scholarship is for qualified applicants to support minority groups’ success within the cannabis industry.
Applicants must be:
Currently employed as a mid-to-senior level industry professional or as a cannabis-related business CEO or founder for at least one (1) year
Have demonstrated professional, advocacy, or civic/community leadership experience
Be committed to fully engage in all scholarship benefits
Have a demonstrable need for financial assistance to attend the Cannabis Business Summit
Up to 60 scholarships will be granted to the highest-scoring applicants, as determined by members of a joint MCBA-NCIA Steering Committee.
Applications are due by Midnight PDT, May 31, 2018. Awardees will be notified on June 15, 2018. Interested applicants can find more information and fill out the form to apply for the scholarship online.
In the industry’s largest markets, Northern California, Southern California, and Colorado, more than 100 industry professionals turned out at each event. But, perhaps most impressive was the 75 plus attendance in the Midwest, maybe a harbinger of the positive momentum garnered by 
The Southwest event featured Ryan Black, Campaign Co-Chair for Anita Malik, Candidate for Arizona’s Congressional District 6, discussing federal cannabis reform. Lastly, in the Pacific Northwest, Lara Kaminsky, Executive Director of The Cannabis Alliance (an 
My career at RoseRyan has mostly centered around the finance needs of fast-moving tech companies. That changed a couple of years ago after working with a cannabis biotech company and loving it. Around the same time, our consulting firm saw signs that recreational cannabis was headed for legalization in California, and it was then that we realized many cannabis companies of all sizes were going to need the kind of professional finance and accounting support that we offer.
Frankly, no. Let’s face it, when companies are starting out, their books are typically a mess, whether you’re talking about cannabis companies or companies in any other industry. Business leaders are typically not focused on their finance operations — they have so many other parts of the business to attend to, and we get that.
Branding… Because it Really Does Matter
A Need for Sustainable Solutions
Jill Ellsworth is CEO and founder of 
For the past eight years, we attempted to make all our decisions from the experience and perspective of a new patient that has never used cannabis previously. This translates to individual consultation rooms so patients may feel free to discuss their medical conditions, symptoms, and concerns in a private space rather than standing shoulder to shoulder at a retail counter. 
True success will come when we pass legalization in November, but we’ve achieved some significant milestones. The first was creating a unified coalition of cannabis reform and social justice advocates to develop ballot language that borrows from the best practices used by the states that have legalized before us as well as Michigan’s medical marijuana licensing law. We also collected more than 360,000 signatures to place the issue on the November ballot. We’re proud of what we achieved so far, but the “vote yes” campaign has only just begun and there a lot more to do to make sure our initiative passes. 
Industry Sector:
“Because NCIA holds Caucuses in every region, they are a great place to connect with members across the country who care about getting a nascent industry legalized and regulated on a state and federal level,” adds McGregor.
In Los Angeles, we saw a huge turnout of more than 350 attendees at the historic Hollywood Roosevelt, and welcomed special guest speaker, Jennifer Hawkins, a business tax specialist at the 
“So many more people keep coming to Lobby Days which is amazing to see,” said Karson Humiston, founder of 
There were many Congressional offices that were receptive to the efforts and positions of NCIA members during Lobby Days. Heather took a meeting with Sen. Bernie Sanders’ (I-VT) office, for example, and after leaving the meeting she felt that it went wonderfully, stating, “Senator Sanders is a proponent for the safe and regulated use of cannabis whether in the medical side or the adult use side, so it was a meeting that for us was an opportunity to tell Bernie and his staff how much we appreciate the hard work that he’s done, ask him what we can do as an industry to help them continue the progress that they’ve already made and learn more about where his focus is.” Sullivan is well-versed in the issues facing cannabis businesses today and knows many other officials are still in need of convincing.
