The Road To Legal Cannabis: Unpacking Three Pillars For Success

At the recent Benzinga Cannabis Market Spotlight, the panel “Converting the Illicit Market to Legal Channels in New Jersey” took a deep dive into the complex transition from illicit cannabis operations to regulated market structures. Moderated by Chirali Patel, managing partner at Blaze Law Firm LLC, the discussion featured Jennifer Cabrera, partner at Vicente LLP, Suzan Nickelson, founder & CEO of Holistic Solutions and Dr. Chanda Macias, CEO and chair of Women Grow.

In this article, we offer some insights shared by these longstanding cannabis industry referents, that you might find useful if you are making your way in the cannabis industry.

Transitioning To A Regulated Market

Dr. Macias opened the discussion with a reflection on the challenges faced by operators moving from the illicit to the legal market. "It’s a hard conversion; you will lose a lot of money."

Despite the financial hardships, she emphasized that the move is motivated by core values and a long-term vision for sustainability in the industry.

“It goes down to your core values and sustainability. If you are willing to do what you have to do for your customers and want to stay in the business long term," she said.

Strategies For Legacy Operators Entering The Legal Market

Nickelson shared insights from her experience working with nurseries and legacy markets, highlighting the importance of compliance, data management and community collaboration.

“Finding collaborative individuals is key, sharing resources is key, building together, and supporting each other coming into the field.”

Cabrera discussed the barriers to market entry, particularly the financial challenges new brands inevitably face. She suggested licensing as a viable path.

"Other options include licensing your brand to another partner that's already working. Of course, making sure you protect your brand and get a percentage of revenue out of it."

Empowering Through Education And Resources

Zeroing in on tools to facilitate entering the market, Patel introduced the New Jersey Cannabis Training Academy, a free technical assistance program aimed at social equity individuals. The program is currently under development by the New Jersey Business Action Center and will launch soon.

Nickelson added, "I started my company on the iPhone 6 Plus, being a single mother to three, going through a divorce," she said. Drawing from her journey of overcoming adversity to establish her business, she encouraged leveraging all available free resources.

Legal and Financial Foundations For Success

A key moment of the event occurred when Macias outlined her “three pillars to be successful” in the cannabis industry: Education, Engagement and Funding.

“You need to know what you are going to do, and how,” meaning that having a business model design is fundamental to success during the first steps. Another cornerstone has to do with building networks: “It’s about how I'm spiraling this education so that it makes sense to my business.” She recommended attending events such as Benzinga Capital Conference, where you can meet colleagues and mentors and pitch your ideas to people navigating the same waters.

“You cannot build a rocket ship with a screwdriver” was Macias’ final advice, since “funding is the fundamental stone to empower your business.”

From Left to Right: Chirali Patel, Jennifer Cabrera, Suzan Nickelson and Dr. Chanda Macias. Credit: Corynn Egreczky.

Supporting Roles in the Cannabis Industry

There are plenty of business opportunities in the billion-dollar cannabis industry. Many are present in the insular, non-plant-touching arena.

That’s why Nickelson highlighted the opportunities for administrative assistance, professional support, delivery, and marketing roles within the industry. She called on professionals to get more involved, adding that there is massive demand for highly specialized professional services.

Building on that good advice, Dr. Macias added that non-plant-touching businesses have remarkable opportunities to grow through services and crowdfunding, avoiding the extra tax penalties associated with plant-touching companies.

An interesting recommendation if you are a professional aiming to join the cannabis industry.