#MYDX #CANNABISGROUP... Despite the obstacles, executives such as Erai Beckmann see a bright future for the cannabis business.
“I think we’re going to see the greatest transference of wealth in human history since the last Prohibition,” said Beckmann, management consultant with Encinitas-based Sol Marketing Solutions.
Representatives of the cannabis and legal professions speak about business opportunities in the industry at a panel discussion in San Diego Feb. 9, 2017. (Photo by Rob Nikolewski)
Beckmann points to examples such as two former Goldman Sachs employees starting their own medical marijuana businesses in New York state, Pay Pal founder Peter Theil’s fund in 2015 becoming the first institutional investor to jump into the cannabis industry and Microsoft teaming up last year with an ancillary cannabis firm.
“That leads me to believe that these people know something the average person doesn’t,” Beckmann said. “Should you start now, the opportunity for gaining more market-share is there to the individual who has that level of risk tolerance.”
In the wake of Prop 64, state regulators are rushing to establish a licensing and taxation regime by the start of 2018 that will include the cultivation of cannabis, as well as hemp, and a promising market for health and medicinal applications from cannabidiol-based derivatives, called CBD.
Siegel, whose San Diego-based company is called Magical Farms, Inc., says there’s a land grab underway.
“You have to find a piece of dirt. Then you put into play all of the zoning restrictions — a thousand feet from this, a thousand feet from that — and that narrows the scope down. The pieces of property that qualify become very hard to find.” Siegel said. “Now the owners say, ‘Whoa, fair market value? No, no, no. Three or four times the amount. In fact, I may want a piece of your business.’”
But he insists it’s worth the hassle for those willing to withstand the industry’s uncertainties.
“If you have the stomach, the vision, that entrepreneurial drive and spirit and you know how to have calculated risks, then this is for you. But it’s like anything. If you get in before the boom happens and you manage it right and you make the right decisions, you’ll be fruitful at the end.”
But Simms offered advice that seems sound for just about any business these days: Find a good lawyer.
“Don’t do anything until you consult with a lawyer so you can understand all of the moving pieces at the state and federal level,” she said. “This isn’t something you can sort of dip your toe in and dabble in anymore. You’ve got to have a competent legal team, you’ve got to have a competent CPA or tax adviser. You’ve got to have competent trademark counsel as well. It’s stop, do not pass go, do not collect your $200.”
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