Cannabis industry professionals gathered in Santa Monica on Tuesday evening to celebrate the impending passage of Proposition 64, which allows all Californians over the age of 21 to consume recreational marijuana. The room was filled with yelps of joy as advocates, some of whom have been working toward statewide legalization for decades, spoke of their hard-won victory. But the glee, and the cannabis-infused pork belly sliders, didn’t distract from impassioned conversations about how the industry must now focus on thoughtful implementation of the nuanced law.
“This is very exciting,” said Simone Cimiluca-Radzins, CEO of Kalogia, a company founded to connect professional and nonprofessional members of the cannabis community. “Now, there’s a lot, a lot of work to be done with the regulatory framework.”
Cimiluca-Radzins, who also runs a cannabis consulting firm, said she’s recently been receiving calls from “Wall Street executives” looking to break into the industry in anticipation of statewide, and ultimately federal, legalization of marijuana. If she senses they’re just interested in making money, she says she turns them away. Many of the event attendees displayed a similar protectiveness over what they say are the driving values behind the cannabis industry to heal and to support small business owners.
“The cannabis industry is a multibillion-dollar industry sitting on cottage businesses,” said one cannabis lawyer, who asked to remain anonymous in order to protect her clients. She expressed concern about the craft farmers she represents, many of whom, she says, contrary to common belief, are not making a lot of money but just “hard-working people.”
This is part of the reason Proposition 64 put a five-year moratorium in place that lets existing small growers start scaling up before the state grants licenses to larger operations. According to Sari Gabbay, CEO of cannabis creative agency U2R1, a hot topic now across cannabis-related businesses in Los Angeles is the importance of a marketing strategy. “There’s going to be a lot of competition in the industry, so people are going to have to step up in defining their brand when it comes to quality control, the process of the grow, whether their products are organic and all that stuff,” said Gabbay.
Peter Couture founded GrowLife one year ago in anticipation of this moment. His company, which designed a patented machine that automates the marijuana feeding process, aims to serve the cottage-level growers. He estimates there are thousands of small-scale operations just in Los Angeles that have been running entirely unregulated and untaxed.
“Right now we have people growing one to 25 plants, and then we have mass corporate farms going in Northern California,” Couture said. He anticipates that these smaller businesses will either “craft or scale up,” meaning they’ll cultivate a distinguishing brand in Los Angeles or they’ll move north to expand. Either way, Couture thinks the five-year moratorium will give already existing operations sufficient time to establish themselves before big business rolls in.
Amid the speculation, there remain many questions about how Proposition 64 will be carried out on the state and local levels. The law itself grants counties and municipalities the power to decide where cannabis businesses can be located. They can also ban the sale of marijuana in their jurisdictions, but experts say they don’t anticipate this happening in Los Angeles.
“Everything’s going to change for everyone so there will be growing pains, but the good thing is that this city council has decided it’s going to pay very close attention and bring in all the stakeholders and have us all sit at a big table, which we do, and talk about the problems and figure out the solutions,” said David, who declined to give his last name, the chief operating officer of CBD company Clear Concentrate.
Yet he, like others at the event, still requested to be quoted anonymously or only by their first names due to stigma or remaining uncertainty about the legality of their businesses.
Over the course of the evening, people expressed relief that this may soon change. And in a small way, it felt as if it already had after the passage of Proposition 64 was announced. On the way in, some attendees were denied a cannabis goodie bag complete with a happy face brownie, a citrus acai drink and some chocolate. On the way out, an event coordinator enthusiastically gave everyone the souvenirs to take home. “Here,” she said with a big smile. “It’s legal now!”