Several hundred people packed a conference room at the Los Angeles Convention Center on Thursday with one common goal: to become cannabis cultivators.
During a seminar at High Times magazine’s second annual Business Summit, experts offered advice for both experienced growers looking for legitimacy in a post-Prop. 64 world and aspiring cultivators who are seeing green.
There’s certainly a lot to learn. And there are many unknowns, such as how much a state and most local cultivation licenses will cost. But Leslie Bocskor with cannabis advisement firm Electrum Partners also encouraged cultivators by reminding them that this is an exciting time for the industry.
“Federal illegality is our friend,” he said, keeping big players like Pfizer and the potential Starbucks of the world away while cannabis remains illegal at the federal level. He predicts that will change in five to seven years. But in the meantime, he said, “It’s an entrepreneur’s dream.”
Here are nine tips to keep in mind.
- Check on local laws. Just because the state plans to start issuing licenses soon for cultivators and other businesses, that doesn’t mean particular cities and counties will allow it, pointed out Aaron Justis, owner of Buds & Roses dispensary in Los Angeles. Also, Justis pointed out that localities that do allow grows often have very particular rules that can limit your options. With grows relegated to indoor warehouse space in Los Angeles, for example, he said most available real estate in the massive city is already maxed out. So look carefully at local policies before investing any money.
- Look at available resources. Bocskor said he’s heard many stories of people being lured into buying land in places like Desert Hot Springs, which is among the first Southern California cities to allow commercial cultivation. But after they’ve already invested money, they learn there won’t be enough electricity to power a large grow in the area for another few years and that they may need to truck in water. “All the sudden, what seemed to be so appealing is now dead,” he said.
- Choose a niche. Do you plan to grow to sell flowers straight to dispensaries or to edibles companies? Do you want to follow a craft beer model or a big tobacco model? Do you want to only grow or branch out into other parts of the industry? “If you try to do all of them, you may find yourself spread too thin because the competition will be intense,” Bocskor said.
- Think about the end user. Whether you’re catering to patients, recreational users or both, Justis said it’s important to think about how the products you’re producing will meet their needs. Offer a wide variety and stay up on the latest strains, since the science of cultivation is always evolving.
- Learn about testing. Testing all products will be mandatory in California’s future regulated market. And that doesn’t mean just testing for THC and CBD content, points out Harry Resin, a High Times writer and cultivation expert. There are also terpines and flavonoids to consider, along with the entourage effect of the host of 400 compounds present in the plant. Customers need to know what they’re getting so they can learn which strains ease their physical ailments or give them their preferred high, he said. And testing isn’t just for the end product, Justis pointed out. Test product and soil early and often throughout the growing phase, too, so you can constantly tweak your process to improve efficiency and results.
- Be smart about planning the layout of your building. Too often, Resin said new growers want to create one massive, 20,000-square-foot grow room. But he recommends thinking about large spaces in terms of smaller grow pods, with different strains going at different phases. Also, for productivity sake, it’s important to include mother rooms and clone rooms and dry rooms so you can process the plant without interrupting the cycle too long between harvests.
- Learn from mainstream agriculture. Expand your horizons by looking at best practices in agriculture, not just in the cannabis industry, advises Bocskor. Pick up a used textbook online from a mainstream agriculture school and keep learning.
- Create a detailed business plan. Are you planning to finance your own business or seek capital? Are you growing a business to sell or to own for yourself? Do you have a head grower and a general manager, and do they work well together? As someone who vets business plans, Bocskor said being able to answer these questions in a realistic way is key.
- Look to the future. Bocskor quotes hockey great Wayne Gretzky: “Play where the puck is going, not where it’s been.” He predicts that medical marijuana licenses will become obsolete as federal prohibition falls. Big players are coming, he said, though there’s a window of opportunity now. And get involved in advocacy and politics at all levels, Justis recommends, since changes are needed in areas such as banking and gaining local acceptance.