As Adult-Use Marijuana Gets Closer, Jersey City Tech Looks at The Future of Cannabiz
The December meeting of the Jersey City Tech Meetup was titled “Green Rush v3 – The Future of Cannabiz in NJ,” and included legal and entrepreneurship panels. This event was originally slated for April 2020 (in person) but was pushed to a later date due to the onset of the pandemic.
In retrospect, the delay to December made this event even more timely, as more than two-thirds of New Jersey voters soundly approved a statewide constitutional amendment to legalize recreational marijuana use on Election Day. A bill to codify this policy was passed and sent to Governor Phil Murphy’s desk for his signature. As of this writing, he has not yet signed it.
Among the panelists at the event were:
- Chelsea Duffy, cofounder and CEO of Local Mōdiv (Jersey City), a medical cannabis dispensary and licensed advisory.
- Matthew Miller, founder of MG Miller law firm (Jersey City), which specializes in intellectual property, mainly serving small business owners.
- Jessica Gonzalez, an attorney with Bressler Amery & Ross law firm (Florham Park) specializing in cannabiz and intellectual property, also outside general counsel for Minorities for Medical Marijuana (Orlando, Fla.).
- Mike Zaytsev, cannabiz author, entrepreneur, and business coach, also founder and CEO of the High NY Meetup group (Brooklyn, N.Y.).
- Ken Starlin, principal at KSDC consulting group, where he advises businesses that grow and process cannabis on how to maximize their profitability.
- Teresa Kearney, sales director at Panacea Payroll (Pottstown, Pa.), a woman-owned business providing back-office assistance and pointers for cannabiz success.
- Chirali Patel, founder of Blaze Responsibly and an attorney with Carella Byrne (Roseland), specializing in class action legislation and cannabis law, and working to educate and empower a new generation of cannabiz leaders.
- Ceallaigh Pender, founder of Salvation Wellness (Jersey City), which is involved in CBD product processing, animal wellness and massage and meditation therapy.
- Adam Callen,CEO ofrootAffects (New York), which features cannabiz consulting, online learning and merchandise sales, as well as a growth facility in Puerto Rico.
A sampling of the numerous highlights:
- Gonzalez: The new legislation is presently a real “mess” on the social inequity/racial injustice front.
- “Election Day was a clear disconnect between legislators and their constituents, with elected officials dragging their feet on this bill for years.”
- To make matters worse, the week before adult use legislation was finally approved by voters, New Jersey officials waited until Friday at 7:00 p.m. to introduce a bill, with a hearing scheduled the following Monday at 10:00 a.m. to discuss it.
- In 206 pages the phrase “social equity” did not come up a single time.
- As a result, Gonzalez and others testified against the bill, causing the proposed legislation to be pulled due to strong opposition.
- The State Assembly and Senate each issued amendments that were contradictory on social equity issues, leading to a government stalemate.
- Individuals and business owners are encouraged to testify (via Zoom) at upcoming legislative sessions, assuming there are future hearings. Alternatively, folks should email legislators directly.
- Kearney: “It’s been an interesting journey … with constant roadblocks for our clients amid an ever-changing road map.
- “This includes challenges, with cannabiz companies experiencing difficulties in establishing bank accounts.”
- The landscape seems to change on a daily basis, so entrepreneurs must be ‘mobile’ and flexible.”
- There are a lot of rules and regulations to adhere to in order to enter the business. It’s not a question of if you will get audited, but when. Many early entrants are former stoners that are unprepared. You need a good team that combines businesspeople with those that understand cannabis.
- Starlin: “Part of the challenge is that there may not be enough weed to go around for patients due to large demand. Approximately 20 percent of adults across the country are presently taking medical marijuana. I am a proponent of a good medical program before a rec program.”
- Zaytsev: “What we’ve seen so far on the East Coast is that none of the other markets have been early to get underway with business licensing. Being realistic, I don’t expect it go smoothly or quickly in New Jersey. You may be looking at a year or more before the ‘adult- use’ program actually opens its doors.
- This is one of the most highly regulated businesses, and more complicated than practically any other industry.”
- New Jersey still averages 96 daily cannabis-related arrests. Smell will no longer be probable cause under the new legislation. Cannabis should be in a legally labeled bag, and it should not be in your front passenger seat.
- For those applying to run a dispensary, time is still on your side, but it’s very important to educate yourself on what you’re getting into. Do your due diligence and start networking. Put a good team together if you plan to succeed.
- Miller: “New York State is 100 percent moving forward on adult use,” and New Jersey will follow suit. “Also, Governor Cuomo and his administration need to be educated on the industry.”
- Pender: “We were originally hamstrung when we wanted to add cannabis into our business. … Until it becomes federally legal, companies should be even more compliant than required, due to all the regulation and risk.”
- Callen: “Having the right relationships on the inside is very important when entering this industry, and it’s not about money.”
- “A cautionary tale is the story of the Busch (beer) heir getting turned down by the state of Missouri after he dumped all of his beer investments in favor of entering cannabis.”
- “I advise cannabiz companies to build a large email list in case they get shut down or blocked on one of the social platforms, which is likely.”
- “Always remember that if you’re in a plant-touching business, you’re in a federally illegal business.”
- Patel: “I totally agree that knowing the right people is extremely important. You need to hustle and have the patience to not give up.”
- “In a state like New Jersey, everything can be very political. You have to attend the meetings. Doing your due diligence, and being visible is also important.”
- “Rule makers and politicians don’t necessarily know the cannabis industry. Having open lines of communications with them is critical. I spent four years on this process.”
- Miller: “Generally speaking, when starting a new business, you want to file as a registered LLC in New Jersey — which you can do online for less than $130 in a single day.”
- “It’s easy to switch from an LLC to corporation, which is better when seeking outside capital and for tax purposes.”
- “Hemp is a fairly straightforward business and non-plant-touching. You can literally download a New Jersey Department of Agriculture application to grow, produce and/or extract something out of hemp.”
- “Product engineering is huge these days. …[For] processors and delivery, the Patent Office does not care about legality when you apply. And once approved, these [patents] last for 20 years. In contrast, you cannot receive a trademark if you’re doing anything illegal, and the government will scrutinize you.”
The video of the Green Rush event can be found here via YouTube.