Volume 1, Issue 7

September 2014

CHERYL SHUMAN & THE NOTED BUSINESSWOMAN TALKS ABOUT THE FUTURE OF THE INDUSTRY

PLUS: LEGALIZATION AND THE TRADITIONAL INDOOR GROW SHOP

HARVESTING: THE FINAL STEPS TO PERFECTING YOUR CANNABIS CROP

September 2014 $6.99

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A MESSAGE FROM THE PUBLISHER Onward & upward! MARIJUANA VENTURETHE JOURNAL OF PROFESSIONAL nother month people thinking. Remember, Marijuana CANNABIS GROWERS AND RETAILERS has blasted Venture is about helpful information that VOLUME 1, ISSUE 7 SEPTEMBER 2014 by and we’re moves the industry forward, and to that end, nowA moving into we’ll never hold back the best available data PUBLISHER fall. By the time you when we find it. We’re currently reviewing Greg James read this, CannaCon CEA lighting studies published at several [email protected] and Hempfest will be major universities around the country, and history, and farmers I’m sure many readers will find this series EDITOR will be gearing up for in the future to be fascinating, informative the fall harvest. Speaking of CannaCon, I and — hopefully — helpful. Garrett Rudolph attended the first two business days with [email protected] editor Garrett Rudolph and sales manager Lisa Smith, and loved it. My hat goes off to ACCOUNT EXECUTIVE the organizers, who took a big gamble, and Lisa Smith promoted an event that brought together more than 150 different companies under [email protected] one roof to further their businesses. Based on what I saw and heard from our booth, ART DIRECTOR the event was a big success. Lots of people Christopher Dollar were talking business, handing out cards [email protected] and making new connections. Thank you Bob Smart for organizing the event! EDITORIAL ASSISTANT We also got a lot of feedback about the magazine at the event, and it was almost Patrick Wagner universally positive. The only complaint I heard was that some people wanted to see CONTRIBUTORS more information on the retail side of the Todd Arkley business. To that I would simply reply that Chris Bayley we took note, and will try to find more articles and products that can help those Chris Crew opening legal marijuana stores. David Kerr This month, you may notice a change in Debora Peters Marijuana Venture’s look. After an amazing William Slusher first six months (which saw us grow from The other big news in this issue is the Miles Stover eight pages to more than 80), we believed first-ever large-scale (legal!) marijuana the time was right to make some minor auction. Randy Williams at Fireweed Farms tweaks to how the stories and advertisements decided to go the auction route as a way to were presented and organized. We hope you sell his outdoor-grown crop, and I think like the changes, and looking ahead to the it’s a brilliant idea, and one that will likely Marijuana Venture future, we’ll continue to improve and refine garner a lot of attention. Included in the P.O. Box 1419 this publication. crop is four low-THC plants, of which the Renton, WA 98057 Starting next month, you’ll find the first profits from the auction will go to a local 425-281-1348 in a series of articles that we will publish organization or non-profit. We decided monthly on developments in indoor and that it was newsworthy enough to devote greenhouse growing based on university an entire page to the announcement. It’s www.marijuanaventure.com research. In academia, indoor or greenhouse another example of an entrepreneur testing www.facebook.com/MJVenture growing with artificial lights is referred to as new waters and making exciting things Marijuana Venture assumes no responsiblility for any claims controlled environment agriculture (CEA), happen in this emerging industry. MV or represenations contained in the magazine or in any advertisement. All Material contained is for educational and that’s the term we’ll use. I’m sure people purposes and intended for the legal marijuana business where will disagree with some of the articles and GREG JAMES allowed by state law. Marijuana Venture does not encourage conclusions the researchers come to. That’s PUBLISHER the illegal use of any of the products contained within. a good thing, though, because it will get

4 | MARIJUANA VENTURE // September 2014

CONTENTS // SEPTEMBER 2014 Features 15 Eight Takeaways from CannaCon ...... 9 Q&A with Peter Zuckerman ...... 21 Marijuana Legalization and the Traditional Indoor Grow Shop ...... 37 Cutting-edge Design Meets the Retail Cannabis Industry ...... 53

Products & Services Testing HydroFLOW Part II ...... 61 A House that Could Build ...... 65 Basics of Grow Room Photography ...... 69 Bar Codes - What Growers, Producers and Retailers Need to Know ...... 70

Guest Columns Chris Crew: Legal ...... 29 High Society/High Profile William Slusher: Politics ...... 73 Ten questions with Cheryl Shuman. Todd Arkley: Financial ...... 74 Armando Perez: Technology ...... 77 LEGAL PAGES Miles Stover: Buisness ...... 78 David Kerr: Debora Peters: Accounting ...... 80 Denials, Withdrawals and Appeals Steven Fuhr: Politics ...... 81 25 Editorial Letter from the Publisher ...... 3 HARVESTING Letter from the Editor ...... 82 The final steps to perfecting your cannabis crop Misc. 30 Quick Picks ...... 59

WEED IN Marijuana Venture’s goal is to provide the best information possible WINE COUNTRY to the legal, licensed, commercial marijuana buisness. Our belief is that Growing Marijuana in Yakima Valley a great buisness publication will help 42 professionals in the industry create more efficient and profitable buisnesses.

www.MarijuanaVenture.com | 7

Jeremy and Jesse Elkins of Elkins Inc. Eight Takeaways from CannaCon By Garrett Rudolph and Patrick Wagner usiness people from around the four-day trade show would have probably nation visited Tacoma, looked pretty similar to a trade show for the “As marijuana continues its for the first-ever CannaCon. The construction industry or a gardening expo. shift toward the mainstream Bevent featured more than 100 vendors geared Sure, there was a booth or two that displayed in the near-future, is it far- toward the cannabis industry, as well as pipes and bongs, grinders, vape pens and fetched to imagine hundreds speakers and seminars throughout the four- marijuana-themed clothing. But far more day business-focused event. prevalent were vendors working to alleviate of thousands of kitchens CannaCon coincided with the 23rd the banking obstacles cannabis business having Magical Butters in their annual Seattle Hempfest, just 34 miles north owners are facing; lawyers, accountants and cabinets, right alongside the on Interstate 5. Hempfest has been billed as insurance agents were staking their claim as Keurig and the Cuisinart?” largest event of its kind — part festival, part go-to business professionals for the former protest, part activists’ rally, part celebration. black market industry; companies with backgrounds in science served both the Here are eight takeaways from CannaCon: growing community and the testing needs of the industry. 1. The face of the cannabis industry is Other vendors and speakers included changing. The stereotypical, counterculture heating and air conditioning experts, security look of the marijuana crowd may always firms, local gardening celebrities, and even … be a part of the industry, but it’s evolving a government official. It’s safe to say even two rapidly toward the mainstream. Surely, not years ago, a government official would have everybody will embrace this change, but it had to go incognito if they were attending a has to be acknowledged as part of the process cannabis industry convention. of legalization so many activists have devoted their life to. 2. The fact that CannaCon was even CannaCon was a perfect example of that successful shows a different approach and shift. different mindset than many of the other To a casual observer, a quick walk- large cannabis industry events. Scheduling it through of the Tacoma Dome during the >> continued on page 11 www.MarijuanaVenture.com | 9

<< continued from page 9 about best practices, different manufacturers during the exact same time frame as Seattle and the regulations, both from the medical Hempfest was some combination of brilliant, side of the industry and the recreational side. bold, daring and dumb. And even now, it’s From the perspective of state-licensed hard to say which of those descriptions is retailers, the edibles selection and supply most accurate. can’t expand soon enough. On one hand, there are probably hundreds At CannaCon, there were seminars on of people that would have liked to go to both cooking with cannabis and developing events, but were somewhat forced to pick tinctures. At least three of the vendors with and choose. CannaCon did offer a shuttle to booths manufactured extraction machines Hempfest, which allowed for some back and that will likely be used by processors as a first forth, but many people were not willing to step for creating a wide variety of marijuana- make that trek. infused candies, baked goods and beverages. Still, the events had completely different Then there are the Magical Butter focuses, and many of the folks that were machines. They’re fairly compact, reasonably interested in the business aspect of the priced and seem simple enough to use. industry had no interest in Hempfest. At the Although they aren’t large enough for most same time, Hempfest is such an institution commercial operations, they’re probably that it’s hard — if not impossible — for a perfect for smaller-scale cooking projects for newcomer to compete for people’s time and the home chefs. money. It’s likely some of the Hempfest As marijuana continues its shift toward organizers were none too pleased there was the mainstream in the near-future, is it far- another cannabis industry event in the same fetched to imagine hundreds of thousands region at the same time, but with nearly half of kitchens having Magical Butters in their a million people attending Hempfest every cabinets, right alongside the Keurig and the year, CannaCon’s attendance probably barely Cuisinart? made a dent. In the future, would CannaCon be more 4. Interest in the cannabis industry expands successful being held a different weekend well beyond the borders of Washington and than Hempfest? It’s hard to say. Some people Colorado. People stopping by the Marijuana Venture booth came from all parts of the outside the region might not have even come (From top to bottom) Subzero Scientific was one of to Washington if not for the “world’s largest United States and Canada. There were lots of three companies that make commercial extraction pot protestival.” people from Florida, who were preparing for machines at CannaCon; Will Smith shows off Bud Bar business opportunities in medical marijuana, Display’s line of 502-compliant sniff jars; television 3. just in case the Sunshine State voters approve gardening expert Ciscoe Morris spreads some of his Edibles are big. There was a lot of interest expertise during a seminar. in edibles and a lot of people asking questions >> continued on page 12 www.MarijuanaVenture.com | 11 << continued from page 11 the recreational party soon. be prepared to be completely transparent — Amendment 2 in November. Other recent events, like the National or there’s a good chance you won’t be able There were also dozens of people from Cannabis Business Summit and Expo, to get your license. It seemed many people California’s medical market, looking for hosted by the National Cannabis Industry that were going through the complex and ideas and products that would boost their Association, or the International Cannabis challenging application process were initially company to the next level in profitability and Business Conference in Portland on Sept. resistant to reveal things like addresses, efficiency. 13-14 indicate the direction the industry is sources of income, criminal history, their There were also quite a few people from headed. well-guarded growing secrets and techniques, the South, interested in the nuts and bolts of or even their real name. the industry, as well as the chance to visit a “The gold rush mentality of the Now, people are ready to draw you a map state where they could freely visit a growing marijuana industry continues on a napkin, invite you over for a tour, tell number of retail stores selling legal marijuana to draw parallels to the dot- you all about the time they were busted for (if those stores had product in stock, that is). com boom of the late 1990s. possession in 1986 and explain step-by-step Just as many people in Washington have Everybody wants to jump into how they take care of their plants to produce taken fact-finding missions to Colorado to the best bud in the region. develop their business models, many others the next million dollar idea.” are visiting Washington to see where their 7. The phrase “outdoor grown” might already state could be headed in a few years. 6. There’s a massive difference between be passé. Speaking with Jeremy Moberg, I-502 applicants and the “run-of-the-mill” president of the Washington Sungrowers 5. CannaCon was part of the first wave of marijuana entrepreneurs. It seems I-502 Industry Association, he explained why he trade shows dedicated to legal cannabis. A applicants are getting more comfortable with prefers the term “sungrown.” The WSIA has number of attendees talked about industry their backgrounds and their business plans focused its efforts on educating lawmakers events in Las Vegas, Denver, Portland, being poked and prodded. Perhaps Marijuana and business people about the environmental Chicago and Los Angeles that they were Venture’s vantage point as a well-liked local and economic benefits of using the sun to either attending or thinking about attending. trade publication makes applicants feel more grow cannabis, rather than millions of watts Although only two states in the U.S. willing to open up. of artificial lighting. currently allow recreational marijuana, nearly Or perhaps it’s just a factor of the Not only is sungrown cannabis better for two dozen other states have implemented Washington State Liquor Control Board the environment, you have to admit: It’s got some form of medical marijuana — a likely peeking inside every nook and cranny for the a nice ring to it. first step to full legalization — and at least past eight months. two more (Alaska and Oregon) could join If you’re going to apply for an I-502 license, 8. The gold rush mentality of the marijuana industry continues to draw parallels to the dot-com boom of the late 1990s. Everybody wants to jump into the next million dollar idea. The positive sides of the equation are that there are millions of dollars in this industry to be made. There are going to be some really good products, tools and inventions developed and implemented in the coming years. As advanced as the cannabis industry is now, it’ll only accelerate from here. The flip side, though, is that there’s a lot of competition. CannaCon showed that for sure. With more than 100 vendors spread across the Tacoma Dome floor, there were at least a half dozen packaging companies, three that made trimming machines, three that built extractors, four different magazine publishers, three or four trade associations, a handful each of nutrient and soil producers, etc. And this industry has challenges the dot- com era never had to face. Imagine the dot- com boom if the Internet were banned by the federal government. And people could face long-term prison sentences for using or selling the Internet. Those are the kind of challenges this gold rush faces. MV

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High Society/High Profile Television star. Business woman. Cancer survivor. Cannabis activist. Ten questions with Cheryl Shuman. arijuana Venture: We’re excited to We’re all very excited. I’m thrilled to Therefore it makes sense to understand have you coming to Seattle for the have Marijuana Venture working with us to that branding is not about getting your target MGreen Rush financial conference. highlight the best that the cannabis industry as market to choose you over the competition, but Can you tell us a bit more about your to offer. Count on the best of the best! it is about getting your audience to see you as the involvement with that group? only one that provides a solution for their needs. MV: In a recent article in Adweek, you GreenRush Financial Conferences provide the Cheryl Shuman: Seattle is one of my favorite talked about branding. What are you feelings finance, investment and educational solution to cities. Currently, I’m dividing my time between on branding – or the lack thereof – In the this new muti-billion dollar industry what I refer to as the “Golden Triangle for marijuana business? The objectives that a good brand will the Green Rush” — Seattle, Denver and my achieve include: Delivers the message clearly, home base in Beverly Hills. When I founded Shuman: The cannabis industry is evolving confirms your credibility, connects your target the Beverly Hills Cannabis Club, I made a at warp speed in front of our very eyes in prospects emotionally, motivates the buyer and decision to work with the finest companies real time. We are witnessing history with the solidifies client loyalty. and entrepreneurs in the cannabis industry. movement transforming from the criminal GreenRush Financial Conferences is a Recently, when I attended the Weedstock sector to the lawful sector. Only now, can brand that we plan to make a leader in the Conference held by Marketfy and Benzinga, we as business people begin to emerge from business-to-business, education and finance I met several new publicly traded companies the cannabis closet to develop brands and aspect of the legal marijuana and industrial from Canada. One of those was the team from corporate identities, because the industry itself hemp industries. Green Rush Financial Conferences. I love seeing the business of the cannabis industry “As a branding expert and MV: Are there any companies in the marijuana exploding right now; in fact, I refer to it as “The business that you’re especially interested in, or Pot Com Boom.” media strategist, it was simple: intrigued by? We discussed my history of producing Cannabis/marijuana needed events and conferences such as the historic Shuman: Yes, I’m most excited by our portfolio KushCon Events in Denver, the first cannabis a damn good rebranding of brands. Our first company, the Beverly Hills trade shows in history grossing $1.7 million campaign and I was focused on Cannabis Club, was founded back in 1996 and drawing over 150,000 people over a three- has a complete line of branded products now day period, as well as many other events I’ve leading the way.”” in production and expansion plans to Seattle, produced and been the keynote speaker on. Denver and other cities by 2016. We are also Their first seminars were in their native Canada is becoming big business. purchasing land throughout the country to and outrageously successful. We decided to The brands that we work with as the most build out 420-friendly resorts by 2020. We’ve officially form a partnership to launch Green recognized branding, media and public relations been in meetings to launch a new skin care and Rush in the United States, where I will be firms are the brands that will become household anti-aging line of products with . headlining and hosting the speaker and media names by 2016 worldwide. The leaders of these Our media projects in production with program with the best speakers in the world, brands will dominate the covers of magazines William Morris Endeavor in Beverly Hills but also in charge of the media outreach and and television news broadcasts. Smart business are covering feature films, documentaries, overall production for the first event in Seattle players in the sector will recognize the necessity television and of course mass media outlets on Sept. 23, 2014 and then building out a 15- of standing out from the crowd and vying for with CNN, Fox Business News and ABC. To city USA Road Show Tour. top position. I love building out their media date, Cheryl Shuman Media has generated over From my research, GreenRush Financial and marketing strategies. I’m so blessed to $537 million worth of earned media worldwide conferences have done an excellent job in have the greatest job on the planet and work and growing in content production each day. Canada being the first company in Canada to with the top leaders in the field. My focus is on Echelon Cannabis, formed with my hold a well-attended and informative business- leaving a legacy building the biggest and most business partner Norton Arbelaez, is our to-business conferences focusing on finance and successful brands in cannabis history. new consulting group, providing full service education for the medical marijuana, industrial In every industry, a solid brand identifies >> continued on page 17 hemp and alternative medicine industries. the leaders. www.MarijuanaVenture.com | 15

<< continued from page 15 business development solutions to emerging companies in the cannabis industry. Green Rush Financial, of course, because with my huge network and experience, we have the opportunity to match funding partners with great business ideas and companies. This traveling road show of “Cannalebrity Rockstars” are going to dominate the media in each market, thus growing our message at even greater reach, speed and impact. Cannabis Technologies is another interesting company set to dominate the research and development of cannabis medicines. I’ve worked with and interviewed some of the most respected scientists and researchers in the world from the University of Jerusalem and Dr. Raphael Mechoulam and the Tikun Olam Medical Gardens, among many others. The research and science team they’ve put together is going to revolutionize cannabis as a medicine worldwide. It’s exciting to realize that cannabis will soon be available to treat not only a multitude of illnesses but it will heal economies worldwide with countries like Canada being federally legal encouraging other countries, hopefully the USA to legalize federally.

MV: What states do you feel will be the next to legalize recreational marijuana, and when do you think California will take the recreational plunge?

Shuman: Alaska will be next. Regarding the other states, the most important thing we can do is to start raising money to get these campaigns Cannabis Club members are “high society/ wild, wild west. Dispensaries are everywhere, properly funded in all the states necessary. high profile” and can’t take chances entering open one day and closed down the next with My business partner, Norton Arbelaez has a traditional dispensary, so we produce a no regulation, no real quality control or started the process of forming a Super PAC to modern day type of “speakeasy” mansion party organization. However, I do see and believe financially support political candidates who experience at least once a month for our inner that with all of the success of Colorado and support the cannabis industry and to remove Washington, combined with the celebrity and from office those who do not support us. media power we have in the L.A. market, we We are extremely well funded with “I realized quickly that will see the success of the Super PAC funding major players and will be making a public a successful run in 2016 for full legalization announcement on our strategy and team within cannabis itself was the for the responsible adult use of cannabis in the next 60 days. victim of a smear campaign California. Count on it. For decades now, George Soros, John I love going to the different markets in Sperling and the late Peter Lewis have spent by the Hearst Corporation Denver and Seattle as well as other states and billions of dollars supporting the cannabis throughout history.” can’t wait until we see reciprocity in all states industry. Norton and I have organized the next and the ability to travel with cannabis. Soon, I new breed of billionaires to take the cannabis hope that our media efforts will make cannabis industry to the next level on an international circles. We have five-star chefs who prepare a consumption as normal as having a glass of platform. We are filming the entire process. Yes gourmet cannabis-infused meal for our guests wine with dinner. indeed, the revolution will be televised. with fine wines, but more importantly the finest cannabis strains grown organically at MV: You’ve been called the “most powerful MV: You are well known in Hollywood and our farm in Northern California. To the right woman in the marijuana business.” How did Beverly Hills. How different is the scene down of each china set is a personal vaporizer for you get started? there from Colorado or Washington? each guest and a sampling of a gram of eight different strains that are paired with the food, Shuman: I’ve built several multi-million dollar Shuman: Here there are public circles of similar to what someone might experience at a companies in my lifetime. I started working in cannabis consumers and then the closet high- wine tasting in the Napa Valley. >> continued on page 18 profile, red carpet circles. Our Beverly Hills In the mainstream L.A. world, it’s the www.MarijuanaVenture.com | 17 cannabis politics and policy. As stated earlier we are forming the most powerful Super PAC ever formed in the cannabis industry. We control the message, the money, the politics and then the entire movement on a worldwide level.

MV: Are there any things that you’d change about the way recreational marijuana is handled in Washington and Colorado?

Shuman: Colorado and Washington have been both pioneers and leaders in the medical and recreational marijuana front. The industry insiders and interested parties following the progress of these two States have mostly good things to say to date. The rest of America is looking to these two State Leaders as an example and a model to follow. Undoubtedly they will have pros and cons, but the smart politicians and money seems to be generally in favor of what they have accomplished to date.

MV: Have you had any personal experiences with medical marijuana use, or do you know anyone it has helped?

Shuman: Absolutely! Cannabis saved my life with cancer and works for chronic pain issues from several broken bones in my neck and back << continued from page 17 media strategist, it was simple: Cannabis/ from past car accidents. I work with patients the television industry at the age of 18 with a marijuana needed a damn good rebranding every day from pediatric oncology patients and national top-rated show called PM Magazine campaign and I was focused on leading the way. children with Dravet Syndrome to Veterans back in 1978 and was known as the nation’s The message was simple: Marijuana saved suffering from PTSD and phantom limb “Coupon Queen.” my life, marijuana makes me a better human pain to corporate patients who have anxiety The power of this television show made being with a better quality of life. Marijuana disorders to elderly patients with dementia and me a millionaire by the time I was 21. I realized can heal our people and heal our economy chronic pain. The common thread/bond is that the power of media and have always used it as through jobs and revenue. I researched and they all have found a superior quality of life a strategy to build companies. After a near fatal learned about a woman from the 1930s, Pauline using cannabis. I love my work and can’t think car accident in the early ‘80s I started a new Sabin, who led a group of high-society women of anything else I could ever want to do. career and was known as the “Optician to the to overturn alcohol prohibition. I’m proud to I’m the luckiest person on the planet to be Stars” working with celebrities such as Tom lead women to overturn cannabis prohibition. alive, to work with a plant that I love and people Cruise, Julia Roberts, Madonna and hundreds Media and political experts will confirm that I respect. More importantly, I get to work of others. I designed, manufactured and sold women are the secret to legalization, specifically with clients and witness the American Dream these sunglasses and eyewear lines on the QVC moms. coming true with the success of building new network with a $150 million deal over a seven- As the executive director of Moms for companies. Pot Com Boom indeed! year period and was one of their first exclusive Marijuana, we represent over 500,000 women TV personalities that was also the co-host of around the world that support and share our MV: Any types of companies or services to the shows. message and we are growing like “weeds.” We avoid? This success expanded into the No. 1 are leading this movement and we will see product placement and branding firm for film, legalization in a record rate by 2016. We are Shuman: Watch for the company that television and the music industry. As an expert unified we are organized. I’ve had a vision from continues to create bold statements about their in celebrity lifestyle brands, we produced print the moment I was diagnosed with cancer and corporate objectives. Typically if it sounds too and video content with celebrity fashion brands I made a promise to leave a legacy behind. At good to be true, it is. for outlets all over the world including Access age 54 now and a survivor of cancer, I have As with all emerging sectors attracting Hollywood, Today Show, Entertainment dedicated the rest of my life to the cannabis capital, there will be scammers looking to Tonight and more. industry and movement worldwide. capitalize on some of the misinformation When I was diagnosed with cancer in floating around. Investors must be cautious, 2006, cannabis saved my life. As a high- MV: Are you doing anything with politicians to but if all investors remain on the sidelines, they profile corporate business woman, I realized speed up the legalization process? will be missing one of the most exciting new quickly that cannabis itself was the victim of industries to come into play in recent decades. a smear campaign by the Hearst Corporation Shuman: Yes, I meet with politicians There will be winners and losers, but the sooner throughout history. As a branding expert and throughout the USA and internationally on we find out who they are, the better. MV

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Questions & Answers with Peter Zuckerman his November, Oregon residents will be able to vote on Measure 91, which would legalize the possession and Tsale of recreational marijuana with a system similar to that in Washington State. If the measure were to pass, marijuana in Oregon would be regulated by the Oregon Liquor Control Commission and would help generate millions of dollars in tax revenue in the first two years, according to the Yes on 91 campaign. The campaign recently announced an investment of $2.3 million in television advertising to support the effort. What are the key elements about Measure police, drug treatment, drug prevention and This will be the second attempt at 91 that give it a better chance of being mental health programs. Previous measures marijuana legalization in three years. In 2012 approved by voters in comparison to did not do that. Measure 91 has stricter limits — the same year Colorado and Washington 2010’s Measure 80, the last failed attempt than previous marijuana measures. To craft removed prohibition of cannabis — Oregon to legalize marijuana in Oregon? the measure, we consulted with everyone voters rejected Measure 80, also known as The entire measure is more than 35 from tax experts to drug experts to parents to the Oregon Cannabis Tax Act. pages long, so it is hard to summarize all the law enforcements to legislative lawyers to the The measure failed 53 percent versus 47 differences, but it is completely different from governor’s office. The measure went through percent. previous measures. For example, it would more than 50 drafts. We believe this measure Yes on 91 spokesman Peter Zuckerman legalize, regulate and tax marijuana for adults is a good way forward, and that will help us recently spoke with Marijuana Venture 21 and older in a way that is substantially pass it. Please check it out yourself at http:// editor Garrett Rudolph about the potential similar to beer and wine. voteyeson91.com/. >> continued on page 22 for Measure 91 to be approved, and how Previous measures did not do that. The advocates can help support the campaign. tax money generated would go to schools, www.MarijuanaVenture.com | 21 but unlike Washington, Oregon already has a (regulated) medical marijuana program, so we believe that will help ease the transition because Oregon already has experience with a regulated approach. After Measure 91 passes, the first legal sales of marijuana will not begin until the first half of 2016, so Oregon will have time to roll out sensible drug policies in a deliberate way. One key difference between our measure and Washington’s is that we have a much more realistic tax rate that will allow the regulated market to more easily compete with and shrink the black market.

What kind of benefits do you see Measure 91 bringing to Oregon? Measure 91 will allow police to focus on more important issues, like stopping violent crimes. It will reduce the power of drug cartels, which receive tons of money because of black market marijuana sales and use some of that money to commit human rights atrocities. It will make it easier to do research on marijuana to discover more about its medical benefits. And it will generate money for essential public services like schools.

What can people do, both inside and Marijuana plants, part of an illegal marijuana grow operation, outside Oregon, to help ensure Measure thrive on private property near Rye, Colo., Aug. 15, 2012. 91 gets enough votes to be approved in the Using a UH-60 helicopter equipped with a hoist and nets, Colorado National Guardsmen helped move an estimated November election? 7,000 to 9,000 marijuana plants -- nearly $15 million street We can’t win this without help. For value -- from two grow sites in the area. (Official Air National Guard photo by Master Sgt. Cheresa D. Theiral/RELEASED) people out of state, every donation makes a difference, and a victory in Oregon is crucial to keep up our movement’s momentum. << continued from page 21 It often seems medical marijuana Please go to voteyeson91.com/donate. For This is obviously not the first attempt to proponents are at odds with efforts to Oregonians, we also need donations and legalize marijuana in Oregon. Why is the legalize marijuana to the general adult people who can share their stories by going timing right this time around? population. What — if anything — have to voteyeson91.com/share-your-story. We are going to fight for every vote, New Approach Oregon and Measure 91 but a growing majority of Oregonians done to appease both groups? I’m sure the message to Oregonians is “get support a new approach to marijuana and One major thing we’ve done is retain the out and vote.” What else can you convey are open to Measure 91. Simply put, more medical marijuana program. Measure 91 will to local voters about the importance of and more people are coming to understand not impact the Oregon Medical Marijuana making their voice heard? how treating marijuana as a crime has failed Program in any way. It will stay the same. The Before we can get out the vote, Oregon and that Measure 91 is a better way forward. only thing that will change is that research voters need to make sure they are registered In the last decade, more than 99,000 on the benefits of medical marijuana will be – and many people think they are when Oregonians have been arrested or cited easier to conduct once marijuana becomes they’re not. If you’ve moved since the last for marijuana. In addition to the financial legal. Right now, too little research is done, election and haven’t re-registered, you are cost, it’s a distraction for police who could but we have an opportunity to change that. automatically removed from the voter be focusing on more important issues, like registration rolls because of our vote-by-mail violent crimes. Furthermore, being arrested What has Yes on 91 learned from system. To register to vote, go to the Oregon for a small amount of marijuana is traumatic, Washington and Colorado? Secretary of State’s website. I’ve seen elections and it gives people a record that follows them We have the advantage of going third won or lost, so don’t just register yourself. around every time they apply for a job, try to and have learned a tremendous amount from Register your friends and get involved with get a loan, or try to get housing. We’ve spent the states where a legal, regulated and taxed the campaign. Now is the time to win nearly 40 years and a trillion dollars on the approach has already taken affect. We’ve sensible drug policies in Oregon, and we war on drugs. The numbers make it clear it’s taken the best of the laws from Washington need your help. MV not working, and it’s time to try something and Colorado and tailored Measure 91 to else. fit specifically with Oregon. Like Colorado,

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GUEST COLUMNIST

Legal Pages: FREQUENTLY Denials, Withdrawals and Appeals ASKED QUESTIONS By David Kerr Question: Can producers licensed nce your of unemployment benefits (you’ve got to through I-502 purchase clones from application think hearing appeals from people that want unlicensed markets after the initial 15- is submitted to produce and sell tons of marijuana ought day acquisition period? Oand starts working to add a little spice to their dockets, no?). The its way through the department has good resources on its website Answer: No. Washington State that explain the hearing process in detail. “After the 15-day period to move Liquor Control Board The appeal hearing is conducted before the plants over, I-502 producers can review process, there an administrative law judge (ALJ), who will only acquire clones from other licensed are any number of make a decision and recommendation to the producers,” said Mikhail Carpenter, actions the Liquor Control Board can take: Liquor Control Board on your application. spokesman for the Washington State The decision and recommendation of the Liquor Control Board. • Denial — If the Liquor Control Board ALJ is not binding on the Liquor Control The Liquor Control Board does not believes that you are not qualified for an Board, which could decide to not adopt the track the source of a producer’s initial I-502 license for one reason or another, the judge’s decision and recommendation. supply of plants; however, after the first LCB can issue a Notice of Intent to Deny. The impact of a denial can be significant. 15 days, transactions can only occur This sets up a right for you to appeal the Revised Code of Washington 34.05 between state-licensed producers and denial. says an applicant cannot reapply for the processors. license sooner than one year from the date Purchasing clones from a non- •Withdrawal — If the Liquor Control of the final order of denial. Additionally, licensed source is classified as a Group 1 Board finds your application was defective the personal history disclosure information Public Safety Violation, Carpenter said. A or incomplete in some way, the LCB can requested by the Liquor Control Board first offense of this violation would result administratively withdraw your application. requires that you list “business licenses that in cancelation of the business owner’s If you don’t want to appeal a potential you have ever held, currently applied for, or I-502 license. denial, you can also voluntarily withdraw have been denied/revoked/suspended in any Group 1 violations are considered the your application. It will be as if you never state.” This means that if you believe there most serious because they present a direct applied in the first place so there is not right may be an opportunity to reapply for an threat to public safety, under Washington to appeal. I-502 license in the next year (and there is no Administrative Code 314-55-520. indication from the LCB when or if it will In addition to purchasing marijuana Notice of Intent to Deny open another licensing window), and you from an unauthorized source, other end up with a denial, then you may be frozen Group 1 violations that could result in If you receive a Notice of Intent to out of the opportunity to reapply. cancelation of license for a first offense Deny (NID), you have some decisions to Administrative and voluntary are selling marijuana to an unauthorized make, and you don’t have very much time to withdrawals source and sales in excess of transaction make some of them. If you do nothing, the If you get a notice of administrative limitations. application will be denied. However, you can withdrawal, your options are different For more information on the Liquor elect to appeal the denial. because a withdrawal is different than a Control Board’s traceability system, the Washington Administrative Code 314- denial. When an application is withdrawn, board has created a new mailing list to 55-070 provides that if the Liquor Control it is as if no application was ever submitted. communicate changes to licensees and Board decides to deny your application, There are good and bad aspects to this. Since software vendors who use the system. you can appeal that decision under the there is no denial, you do not have a right Interested parties can sign up for the Washington State Administrative Procedure to an administrative appeal. Therefore, if you mailing list at http://listserv.wa.gov/cgi- Act (RCW 34.05). The administrative want to fight the administrative withdrawal, bin/wa. hearing appeal process starts with a written your recourse is through the courts rather request to the Liquor Control Board. You than through Liquor Control Board/Office Question: How many testing labs have 20 days from the date of the NID to of Administrative Hearings process. have been certified to serve the I-502 request a hearing to appeal the denial. However, since there is no final denial, marketplace in Washington? The Washington State Office of the provisions of RCW 34.05 are not Administrative Hearings (http://www. applicable. That means there is no one-year Answer: Five, as of mid-August. oah.wa.gov) conducts the administrative freeze on reapplying for a license (assuming The five state-certified labs are hearings on a wide range of government the opportunity to apply again ever presents Analytical 360, Confidence Analytics, actions, from child support issues to denial >> continued on page 26 >> continued on page 26

www.MarijuanaVenture.com | 25 GUEST COLUMNIST

<< continued from page 25 about certified labs on its website. << continued from page 25 G.O.A.T Labs, True Northwest, Inc. “As soon as a lab is certified, they gain itself) and there is no requirement that you and The Werc Shop. Analytical 360 and access to the traceability system where disclose the withdrawal if/when you apply Confidence Analytics are both based in producers/processors can find them, as such again. Seattle. Analytical 360 also has a location in posting them anywhere is unnecessary for Appeal or withdrawal – which path? Yakima. They were the first two companies our purposes,” Carpenter said. You should be aware that the decision to in the state that were certified. pursue an appeal, rather than to allow your G.O.A.T. Labs (which stands for Question: How do I pay my I-502 excise application to be withdrawn is, to a degree, Genesis Organic Assurance Testing tax? mutually exclusive. Once you start down Laboratories) is based in Vancouver. True Answer: The Washington State Liquor the appeal process path, the opportunity to Northwest, Inc. is based in Olympia. Control Board will accept cash, check, withdraw is gone. That means you can’t start According to the Washington State cashier’s check or money order as payment of an appeal and then suddenly withdraw your Liquor Control Board, “Third party testing your excise tax obligation, according to the application if it looks like you are going to labs must meet certain accreditation LCB website. However, cash payments will lose your appeal and end up being denied. criteria in order to be certified as a lab only be accepted in person by appointment Before you appeal you should talk that is allowed to test useable marijuana only at the headquarters in Olympia. The with your attorney, carefully consider your and marijuana products under the I-502 payments are due no later than the 20th of options, make a clear-eyed assessment of regulatory system.” each month for the prior month’s activity. the likelihood that you will prevail in the The Liquor Control Board has Business owners can call 360-664- appeal, and weigh the potential downside of contracted with the Center for Laboratory 1789 to schedule a payment appointment. being frozen out of reapplying for a year and Sciences on the campus of Columbia Basin The Department of Revenue will not having to disclose the denial if/when you do College to conduct the certification process. accept excise tax payments from marijuana get the opportunity to apply again. MV Marijuana Venture will keep an businesses. MV ongoing list as more labs are certified for Each month, Marijuana Venture will publish answers to Attorney David Kerr serves business clients testing. frequently asked questions from governing agencies, legal and throughout the State of Washington, including According to Carpenter, it is unlikely financial experts and contacts familiar with the process and the industry. If you have a question you’d like to see addressed, emphasis on the emerging legal, regulatory and the Liquor Control Board will post updates email [email protected]. compliance issues facing new cannabis business.

26 | MARIJUANA VENTURE // September 2014

JEFFREY STEINBORN LAWYER “The Constitution is not a technicality.”

• Criminal defense since 1968

• I-502 and problems with the Washington State Liquor Control Board

• Licensed in State and Federal courts

• Experienced in search and seizure and forfeiture law

119 1st Ave. S., Ste. 260 206-622-5117 Seattle, WA 98104 [email protected]

28 | MARIJUANA VENTURE // September 2014 GUEST COLUMNIST

or not to maintain a moratorium on legal Legal Pages: Did your city ban legal marijuana businesses is really a top priority for their constituents. In the last few weeks marijuana businesses? Don’t give up hope! alone, after considering the costs involved with Fight your local moratorium a legal battle, Mason County and the cities of Chehalis, Centralia, Elma and Hoquiam each By Chris Crew decided to scuttle their respective moratoriums. f you happen to in a row, you will be taken much more Third, a legal strategy gives your elected live in a city or seriously. Look for someone on the council or officials political cover for throwing in the county that is trying commission that seems supportive. You may be towel and letting your business move forward. Ito prevent you from able to get them to put you on their meeting Put yourself in their shoes. They have taken the starting your marijuana agenda. This will allow for more discussion stance, most likely, that allowing marijuana business, do not give up time and increase your ability to successfully businesses will hurt your community. Their hope. Realizing your persuade them. Elected officials frequently give supporters are applauding them for taking dream of opening your in to sustained citizen demands. “bold” stands on marijuana. These elected marijuana business may If you are afraid of coming off poorly officials are afraid to go back to those same still be in the cards. After all, the majority of or simply want a little more strength in your people and say that they changed their Washingtonians voted for Initiative 502 to approach, consider hiring a lobbyist or advocate minds. The lawsuit gives the elected officials legalize recreational marijuana. It is a minority to represent you. An experienced advocate can a reasonable explanation for changing their of elected officials that have decided to thumb do a combination of speaking on your behalf position. They can say that in their hearts they their noses at the democratic process by at public meetings and setting up private still hate the evil reefer, but that the city or enacting bans and moratoriums that are directly meetings with each of the elected officials. county will waste too many resources if they counter to the purpose of I-502. Through a These private meetings have the potential to be continue delaying implementation of I-502. combination of a lobbying campaign and a very fruitful. If your initial lobbying campaign Legal argument legal strategy, many of these elected officials can is not successful in persuading your elected In my opinion, the moratoriums and bans be persuaded to accept the will of the voters officials to change their position, it may be time are unconstitutional for two main reasons. First, and allow your legal marijuana business. to consider a legal strategy. the moratoriums and bans are unjustly taking Why take action? Legal action your property without due compensation. The Many license applicants feel intimidated by A legal strategy has the power to prohibition on the government taking your the idea of lobbying or taking legal action. This tremendously influence elected officials in three property is a bedrock principle and based on leads to the wait-and-see approach. People can key ways. the takings clause of the Constitution. Second, try to wait out the city or county with the hope First, your legal strategy creates an the moratoriums and bans are preempted by that their local elected leaders will eventually ongoing attention to your issue. Once you file previously passed Washington State law — feel the wave of change. If they get lucky, some a lawsuit, you force the city or county to focus Initiative 502. When state and local laws are other prospective marijuana business owner in on and reconsider the decision to implement a in conflict, the local laws are preempted from their area will mount a successful lawsuit or moratorium. It also forces the city or county to going into law by the preemption clause of lobbying effort; but if they don’t get lucky, they seek in-depth advice from an attorney. With a the Constitution. These two constitutional are going to miss out. lawsuit, you can change the narrative and give vulnerabilities are giving many plaintiffs the Most savvy business owners are not willing the elected officials a new reason to see I-502 confidence they need to move forward, while to sit back and wait for that to happen. That is businesses from different perspectives. worrying many city and county attorneys. for good reason. My perspective is that there is Second, using a legal strategy forces the As the lead attorney for THC Law Firm, I a slowly closing window where running your elected officials to acknowledge that blocking recently filed a lawsuit against the city of Bonney marijuana business will be absurdly profitable. implementation of I-502 can be costly. Keep Lake over its moratorium. My clients are asking The current ridiculously high retail price-per- in mind that most elected officials are regularly for $2.5 million in damages as a result of not gram of marijuana will eventually come down a making difficult budget decisions that forego being able to open a retail marijuana store after little. In the meantime, many of the new I-502 funding important community projects winning the licensing lottery. The risk that the marijuana businesses are generating extremely — some because they cost a few thousand city will have to pay my clients anything near impressive revenues. Just waiting to see if a ban dollars more than their budget allocates. this sum is a good reason for many elected or moratorium will get lifted could cost your Fighting to defend a moratorium or ban on officials to consider allowing state-licensed new business hundreds of thousands of dollars, I-502 businesses could cost the city or county marijuana businesses to operate in their city. or worse, keep it from ever even opening. thousands of dollars every month in attorney Conclusion Lobbying fees. These mounting fees will constantly If a local moratorium or ban is destroying The best strategy to fight your local remind elected officials that prohibiting a your dreams of opening a marijuana business, moratorium starts with a lobbying campaign. business that is clearly allowed by state law is a it is time to consider fighting back. Through a This can be as simple as going to your local serious matter that has consequences. A lawsuit combination of lobbying and a legal strategy, city council or county commissioner meetings forces elected officials to connect the trade-offs many elected officials can be persuaded to and giving brief, prepared speeches during the that are occurring as a result of focusing on accept the will of the voters and allow your legal citizen comment section of those meetings.If prohibiting I-502 businesses. These trade-offs business to open. Often, fighting the bully is you can get friends and supporters to come and of valuable time and resources are a powerful the best way to get them to leave you alone. MV speak alongside you, and go to a few meetings reason for a city or county to rethink whether www.MarijuanaVenture.com | 29 Lilac Haze is a strain that’s being bred for outdoor cultivation in Eastern Washington.

30 | MARIJUANA VENTURE // September 2014 Harvesting: The final steps to perfecting your cannabis crop By Chris Bayley or all the time and hard work that goes the food web, synthetics, depending on the in to growing cannabis, some crops application, will eventually decimate the This story is the first in a two-part always seem like they’ve failed to reach soil’s microbial life. series. Part I will discuss the necessary steps Ftheir potential. One of the most common One method of fertilizing pushes your leading up to harvest. It will focus on how a reasons for this usually comes down to plants toward elemental storage and the high brix count, combined with the proper rushing the drying process. There are a few other will deliver nutrients to the plants as macro nutrient ratios, can position plants for simple steps that can be taken to ensure your they need it. This of course, is exactly what a more complete finish. It will also include end product reaches its full potential. you want. View your finished cannabis design concepts for a harvesting facility, and How cannabis is grown and how it’s product, the dried flowers themselves, as an the importance of climate control in drying dried are the main contributing factors empty vessel just meant for transporting the and curing rooms. concerning its eventual smokeability. main components we are after, the terpenes Part II of the series, which will be in The debate that continues regarding the and . the October issue of Marijuana Venture, will differences between growing naturally or Feeding plants for optimal results is the address harvesting. It will explain the process synthetically, and whether there really is a same as it is for humans. The human body from harvesting to drying and curing, as difference, needs to be fully understood. responds magnificently while following an well as a processing technique that, when The old adage “what goes in must come out” eating regimen that focuses on secondary done properly, can rival the best gaseous most certainly applies to a smoked product. and micro nutrients while balancing macro concentrates for taste at a fraction of the cost. Cannabis easily stores excess fertilizer, heavy nutrients. As with humans, in order for metals and toxins. In fact, it is so good at that, plants to perform at their best, growers need that when the Chernobyl nuclear reactor to focus on the plants’ secondary and micro melted down in 1986, cannabis hemp was nutrient needs and then simply balance the brought in with other plants to help aid in macro nutrients according to the plants’ the phytoremediation process. Cannabis is growth cycle. an incredibly efficient storing mechanism. Another example demonstrating the Staging the Brix differences between synthetic and natural One sign of a healthy plant is its brix, growing practices is how nutrients are up- or sugar level. As growers, the goal is to taken by a plant. When using all-natural maintain as high as possible brix level within growing methods, nutrients in the soil are our plants. It is a sign that your plants are made available via the symbiotic relationship articulating their full genetic expression that exists between a plant and the microbial and that you’ll get the most out of their life. Like the saying implies, “Feed the soil, aromatically produced compounds. not the plant.” Something to expect when your plants The exact opposite happens when using are bursting with sugars can be called the synthetic fertilizers. Instead of building “honeysuckle effect.” healthy populations of micro-life to support >> continued on page 33 www.MarijuanaVenture.com | 31

<< continued from page 31 If the brix levels are high enough and proper drying techniques used, you can expect nectar droplets to dry into a tacky pitch-like consistency anywhere the epidermal-layer was compromised. This observable fact should not be confused with nectaries, which are glands that produce a sugary liquid in some plants, because cannabis doesn’t have them. Growers can use a specialized tool called a refractometer that is used to read the brix scale, or sugar content. The importance concerning a high sugar content relates to any plant whose end purpose is related to enhanced taste and aroma. Think herbs, spices, cocoa and grapes to name a few.

Timed fruition Another aspect to harvesting cannabis that’s worth noting is the correct time to cut your plants down. This can be broken down into two categories. The first has to do with your fertilizer regimen. Aside from environmental factors, macro nutrient ratios coupled with the plants growth cycle will greatly determine consistent maturation times. The second aspect has to do with fully mature trichomes. A lot of growers say things like, “I prefer harvesting my plants early to produce a more up-like high,” or “I harvest my plants past maturity to get more of a stoned effect.” Even though you can harvest a plant at any stage of development to suit your high, most growers will want to harvest their plants at peak floral development. Here’s why: Harvesting an immature plant means that you’re missing out on peak terpenoid production. You’re literally forgoing potential taste and smell in lieu of a cannabinoid profile, which itself is incomplete. More often than not, it is better to keep equivalent on a camera, which will let you important step in the process in determining searching for a particular strain that, when view the trichomes through your computer. the quality of your finished product. Curing fully mature, suits your needs, rather than Generally speaking, the cannabinoids is a process used after drying to enhance the sacrificing a plant’s potential by cutting it are at their peak when resin inside the quality even further; it can be viewed as the early. Besides, cutting a plant prior to peak trichomes has gone from clear to opaque, icing on the cake. development means sacrificed weight, and with a few glands beginning to turn amber. Harvesting, drying and curing rooms most producers will not want that. need just as much thought into their It takes a little time to learn the Harvesting facilities functionality as the rest of your facility. idiosyncrasies of each strain, including when The whole harvesting process is one of Efficiency with your design will allow the to harvest it. In order to get a strain or crop the most misunderstood stages of cannabis harvest process to function more smoothly. to mature at the same time regularly, you production. Drying and curing can make One step should easily follow the next, will need to keep all parameters consistent or break the smoking experience, and more and all the rooms should be controlled throughout the growing process. Any importantly, can make a decent strain better atmosphere growing environments, or deviation can throw any number of things and a great strain fantastic. C.A.G.E. for short. The system needs to off. To learn your strain’s peak harvest The point of properly drying and curing allow for temperature, humidity and sterility window you will need a way to monitor the cannabis is to highlight the terpenoid and control. It is during this initial stage of trichome development. This is best done cannabinoid profiles while negating the plant drying that your plants are most susceptible with a hand-held 10x to 50x magnifier or the matter itself. The drying stage is the most >> continued on page 34 www.MarijuanaVenture.com | 33 << continued from page 31 to pathogenic attack. Special considerations for outdoor/indoor them down into controllable sections. This Your harvesting facilities should begin growers saves time and makes the whole process more with a staging room. Depending on your For outdoor growers, if you can harvest manageable. setup, this is where you could roll in a your plants while the weather is cooperating, Something to be cautious of is drying hydroponics table or a cart full of plants in then consider culling the sun leaves (without both your indoor-grown and outdoor-grown containers. You would harvest the plants and considerable resin) right in the field. Sun cannabis in the same room, especially if it move the containers or trays into the cleaning leaves run the greatest risk at being infested is attached to your indoor growing facility. room. This allows for a smooth, conveyer like with pests so discarding them in the field Without taking serious precautions, it’ll be motion. becomes a preventative measure. Also, there just a matter of time until bugs have been To expand on this notion, your whole is no easier time to strip the sun leaves than introduced to your indoor operation. With growing facility should be designed like this: when the plant is still upright. When you’re all the responsibility that already exists Entrance /storage/maintenance - cloning/ done, you can place them right onto the with a grow operation of this magnitude, a mothers - grow rooms - flower rooms - compost pile. potential battle with pests should be avoided harvesting/drying/curing/ - processing - back Depending on the size of your outdoor at all cost. to entrance. All of the phases should easily plants, the harvesting protocols will be more Next month, we will get down to roll into one another, and if possible, should or less the same. The exception is with harvesting, so until then, “Stay focused and all be accessed independently. monster plants, which will mean cutting let it grow.” MV

34 | MARIJUANA VENTURE // September 2014 YOUR CANNABIS BUSINESS IS OUR BUSINESS.

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www.MarijuanaVenture.com | 35 36 | MARIJUANA VENTURE // September 2014 Grow Big Supply is not just the largest indoor gardening retailer, but it’s also open 24 hours a day. Marijuana Legalization and the Traditional Indoor Grow Shop By Patrick Wagner ven before Colorado residents voted presence at the 2013 , right owners approach growing cannabis. in favor of Amendment 64, which alongside photos of using LED lights to grow At a gardening supply store in La Plata legalized marijuana possession and basil and cilantro. County, a customer service rep (who chose Esale for recreational use, many indoor grow “There are definitely spaces around the to remain anonymous) was eager to discuss shops and hydroponics retailers had been country that we see that people are not willing the new business and potential future for witness to a steady increase of business year to discuss cannabis at all,” Frender said. “I cannabis crops. The stain of the previously after year. have seen that dramatically decrease here illegal business was hard to wash off. Crowds of tourists and consumers can in Colorado since the amendment passed. “It’s still a real gray area for us,” the rep now trek across the state, largely enjoying More people are openly willing to discuss the said. “Some customers will talk to us about cannabis freely. However, many business aspects of growing cannabis directly.” it. It’s not like we can just tell them to shut owners remain wary of officially hitching Nationwide garden suppliers have been up. But for us and all the people like us, our their wagons onto the emerging marijuana selling marijuana cultivating products under suppliers are still in all 50 states so we have industry. the guise that their customers have been gotten a little bit more lenient about talking “Some people are still stuck in the Stone growing tomatoes in their closets and garages about it; whereas five to 10 years ago if you Age and will hang up on you if you mention for decades. But now that recreational use of were to ask about it (cannabis) at all you the nasty ‘C’ word or the ‘M’ word,” said cannabis has been legalized in Colorado, the would automatically be asked to leave.” Kevin Frender, one of the owners of Black masses looking to cultivate tomatoes in their The rep continued to explain that mid- Dog LED. closets have begun asking new questions that tier suppliers need to consider that there Black Dog LED, from Boulder, is one of put shop owners at a crossroads between are another 48 states that treat the plant the suppliers that openly identifies with the their suppliers and their customers. as a narcotic and that they cannot have an medical and recreational marijuana markets. Coloradan business owners are in the open forum just because of the Colorado It has been supplying both indoor hobby midst of a changing legal atmosphere that has state laws. It should also be noted that many gardeners, as well as the cannabis growers, many faced with the choice of turning away larger suppliers have been getting by just fine since the company was founded in 2010. business for fear of being guilty by proxy. without openly acknowledging the emerging Black Dog sells by storefront and through It’s clear the divide between state laws and marijuana market. Many grow shops made its website, where it displays photos of its federal remains central to the way business >> continued on page 38 www.MarijuanaVenture.com | 37 Black Dog LED showcases its products at a recent Cannabis Cup.

Colorado has some difficulty finding its << continued from page 37 growth happened in 2012 — that’s when we ground on addressing the new marketplace. similar statements about the incline in started to become a real full-service store.” During its (first ever) legal study of the business year after year, allowing them to Since that significant growth a few marijuana marketplace, the Colorado slowly expand and continue to prosper; short years ago, the company has courted Department of Revenue separated the however, Grow Big Supply in Denver has the marijuana community by hosting a marijuana market into three subcategories: seen an unprecedented expansion from number of events for everyone from industry Regulated market: a simple second-hand shop into a retail insiders to those who would find themselves The production and sale of medical and juggernaut. on the fringes of , including recreational marijuana that is allowed under With 30,000 square feet of retail space tailgating parties and industry cocktail Amendment 64, and that is monitored by in three warehouses, Grow Big Supply claims mixers that feature the “Grow Big Go-Go” Colorado enforcement agencies, such as the to be the largest grow shop in the world. dancers. Every solstice Grow Big Supply Marijuana Enforcement Division and the Another unique lets local graffiti Colorado Department of Revenue. quality at Grow Big “The customers have artists transform its Black market: Supply is summarized warehouse walls in a Production and sale or distribution of by the slogan, “Always definitely loosened up. Some graffiti battle. Every marijuana products that is considered illegal open, never closed,” of the older guys will talk Thursday Grow meaning customers Big Supply hosts a under Colorado law. This includes the sale of your ear off, but some are still marijuana to minors without a red card, the are able to access the networking event unreported and non-permitted production same services at 3 looking over their shoulders .” where information is of marijuana for the purpose of sale or a.m., as they would at exchanged and new distribution, and the smuggling of marijuana 3 p.m. contacts are created. outside of the state of Colorado. “We are the only grow shop in the world “Our job is to nurture the grower that never closes,” its website boasts. whether you’re a home grower, outside for Gray market: The store is open 24 hours a day, seven vegetables or whatever someone’s doing with Illegal distribution of marijuana products days a week, 365 days a year. one light or 2,000 lights. Our job is to make that are grown or acquired legally. This “Technically we started in 2010. It them successful. We really try to nurture includes the sharing of marijuana from started as a used gear store,” said Colin those relationships and every Thursday really home-grown individual production, or the Gordon, a manager and commercial helps out with that,” Gordon said. sharing of marijuana acquired from a licensed consultant for Grow Big Supply. “We were The perks of being king have allowed marijuana dispensary or retail outlet. basically a consignment kind of pawn shop. Grow Big Supply to live up to its name, We’d buy and sell used gear. The significant however it seems that the farther you get from 38 | MARIJUANA VENTURE // September 2014 the Denver hub, the more growers might have to play coy about their intentions. In the town of Nederland, Greener Mountain Grow Shop owner Scott (last name withheld) noted that while the conversation about cannabis has definitely loosened up between consumers and suppliers, it still carries many of the social taboos it always has. “When I first opened, a lot of people would come around looking for advice on their tomatoes,” he said with a laugh. “And I would just try to not get into other people’s business.” The owner said he hasn’t seen much of a difference in sales since Amendment 64 was implemented. He said every year he sees a shortage of good fertilizer, and he has seen a small increase in hydroponic growing. “Every few months a new law gets into effect,” Scott said. “People are getting excited about the prospect of selling their own, but the market hasn’t really changed.” Scott opened his shop in the small town in 2009 and has been a local go-to for indoor and outdoor gardeners since. Despite the amendment for recreational use in Colorado, Scott points out that there still is a good amount of paranoia leftover from the past few decades. “The customers have definitely loosened One Love Garden Supply opened in 2010. up. Some of the older guys will talk your ear off, but some are still looking over their (recreational) retail side on top of that.” of Grow Big Supply. shoulders,” Scott said. The lingering fear At One Love Garden Supply in “The distributors we work with and from the black market days still surfaces Boulder, co-owner Mike Leago said he a lot of the companies we work with are when a helicopter flies overhead, and the looks to acknowledge each customer’s needs national companies and they don’t want possibility that law enforcement officials are individually as a way of moving forward direct affiliation with hemp,” Gordon said. scouting for illegal grow operations. It could while being mindful of the present. “Now we don’t volunteer the words, but be paranoia but the state has done little to “We’ve gotten more open with instead of saying things like trichomes or quell fears. Amendment 64 in terms of helping people terpenes, we can talk about the essential oils Some would say that business owners out,” Leago said. “But we kind of want to be that your plant will produce, about flower have good reason as the state definitions the guys who are right in the middle, not the growth, flower density. You don’t have to use of legality for the marijuana market have guys advertising in the paper on how to do those words to get your point across, there certainly not encouraged many grow store this or that.” is a larger lexicon of words that are more owners to open up. Leago opened One Love Garden Supply understandable now,” Gordon said. There was a trend beginning to surface with the help of his two northwestern Semantics may seem trite to those between the grow shops who played coy with partners in the spring of 2010 alongside a outside of the industry, but in order to their marijuana curious patrons and with the slew of other shops that sprouted up at the maintain the relationship between suppliers grow shops who answered questions directly. time. and customers, grow stores have to tread Since Amendment 64 was enacted in January “It seems like everyone around here in carefully around details. the garden and hydroponics suppliers who Colorado was jumping in from a closet or The current law in Colorado — different made room for an open dialogue about a spare bedroom into a warehouse without than the initiative that legalized marijuana cannabis saw a spike in sales while the knowing the proper steps on how to change in Washington — could potentially bring opposite was said for those who turned a and grow into this space,” he said. another type of customer into local grow blind eye to the business. “We’ve always tried to stay on the right shops. In Colorado, adult residents are “We see sales are just going up in general side of that line, never going over the top in allowed to grow up to six marijuana plants, but it’s still a growing industry and instead terms of what we’re talking about. We can as long as they are kept in an enclosed, locked of a spike, we are going to see a longer explain every process when people come area and that extra precautions are taken to upward trend,” Frender said. “From what I in without getting crazy specific about too ensure that only authorized adults have have seen the medical side still seems to be much.” >> continued on page 40 coming along very well and now we have the That sentiment was shared by Gordon www.MarijuanaVenture.com | 39 << continued from page 39 access to the plants. Children and pets should be kept away from the plants at all times, the state warns. Home-grown marijuana cannot be sold in any form. The home grow portion of Amendment 64 means a license is not necessarily required to grow marijuana legally under state law. Mike Cross of EZ Trim in Broomfield, said business owners may be more likely to open up if they knew that the customer was operating legally and that they were licensed. Like Black Dog LED, EZ Trim has operated with an open forum for all customers including those looking specifically to grow cannabis. The company manufactures bud trimmers for rental or sale and as part of Indoor Tropics focused on tropical plants their mission statement the company lobbies but serves a wide variety of gardeners. “to help promote and support the cannabis industry in every way we can...” possible that come fall their businesses will “I think that the problem at hydroponic Washington shops start to notice a real change in sales. stores, in general, the issue that they run into “Summer months are typically a slower is that they have a very broad customer base,” face challenges time,” said Jason, the owner of The Green Cross said. By Kristen Schell Thumb Gardner in Graham. Jason, who was “In other states there is a certain amount ow that Washington has legalized previously an electrician, used up his savings of careful that you have to be. It’s just a marijuana, state-licensed growers to open the shop. “don’t ask don’t tell” situation, so they don’t Ncould potentially bring an influx of business Although not specific to the cannabis have any more information than they need. to the state’s independent indoor gardening market, some business owners said they’ve I think that people are very careful talking retailers. However, among dozens of grow seen an emerging interest in indoor gardening about it because they need some form of shops and gardening stores in Washington, among hobbyists. insulation or protection.” many are still unwilling to discuss the impact Kyle and Kelsey Walters, the owners With all of the gray still in Amendment Initiative 502 has had on their businesses. of Indoor Tropics, said they haven’t seen a 64, EZ Trim abdicates any notion of negligent The conflict with state law and the federal huge increase in sales, they have noticed a operations by maintaining a disclaimer on Controlled Substances Act has kept many new market of consumers with an interest in its website that specifically condemns the business owners wary of openly discussing growing various plants and vegetables. illegal use of its equipment. The statement cannabis. Sometimes that conflict makes “It’s been exciting to see a newfound puts responsibility on the end-user of the it a challenge for businesses to serve their interest in gardening,” Kelsey Walters said. equipment and looks to have had little to no customers’ needs. For those businesses that Indoor Tropics, with locations in impact on sales since Amendment 64 went have been willing to discuss I-502’s impact, Cashmere and Ellensburg, specializes into effect. the reaction, thus far, has been mixed. in tropical plants and also hosts master “Certainly, I would say that it “It’s too soon to tell,” said Stan Coe, gardening classes. The family business has (Amendment 64) has increased our business owner of Renton Indoor Garden Center. remained successful, and the owners also at least 25 percent nationally. It has opened Coe has turned his shop into a family make an effort to be a positive influence up the floodgates for people to get more business; they all work together and have built within their community. comfortable, so we’ve seen an increase in sales a family environment for all of his customers In addition to the conflict of state and locally and nationally,” Cross said. at retail locations in Fife and Everett, in federal laws, brick-and-mortar stores have Comfort seems to be a valuable addition to downtown Renton. These shops seen a challenge from “show rooming” and commodity for many suppliers in Colorado work on long-term relationships with the online retailers that potentially offer better who have suddenly found themselves on distributors to build a solid reputation and pricing. the frontier of the cannabis trade. Looking to help both the business owners and the Show rooming is when customers go forward, Cross and others agree that in the consumers of the product. into the indoor grow shops and take up next few years they will see comfort settle in Coe has made a point to deal directly hours of the sales person’s time, comparing alongside cannabis law. with the manufacturer to help save customers and contrasting various elements required “As more states come on board on a time and headaches trying to get a product to grow with no intention of purchasing recreational level, I think that as you see that under warranty fixed or replaced. the product. After picking the salesperson’s continue, the federal government will start Many outside variables, including brain and gaining the information they’re to have a hands-off approach towards the online sales and the time of the year, have looking for, the customer will leave the store industry,” Cross said. “But I think the biggest made it a challenge to determine if I-502 has to purchase the goods from another source. MV thing is going to be the language of the law.”MV helped or hindered business, Coe said. It is 40 | MARIJUANA VENTURE // September 2014

Randy Williams (left) gives a tour of Fireweed Farms to Altitude co-owners Ken Delp and Tim Thompson (right). in Wine Country ByWeed Garrett Rudolph t doesn’t take long to understand the significance of the wine industry in Prosser, Washington. Just off Interstate 82, you’ll immediately see the evidence. Roads bear the names Iof different varietals. Signs at nearly every intersection direct visitors to this winery or that one — nearly 40 in a town that covers just 4.4 square miles at the eastern end of the Yakima Valley. >> continued on page 44 Ken Delp and Tim Thompson opened Altitude at the earliest moment the Liquor Control Board allowed.

<< continued from page 43 Business names, like Bonnie’s Vine and a cannabis reconnaissance mission of sorts Gift, Wine Valley Inn and Wine O’Clock, (they eventually modeled their floor plan pay homage to the city’s biggest — and after Northern Lights Cannabis Company possibly only — tourist attraction. Prosser in Edgewater), learning more about retail proclaims itself as the “birthplace of the operations and the world of legal marijuana, Washington wine industry.” when they received a game-changing phone It’s also become a small, surprising call on June 4. focal point for the emerging legal cannabis Altitude had originally been told to industry in Washington State. expect a September opening date by the Altitude was one of three state-licensed Liquor Control Board, Thompson said. marijuana retail stores that opened at the The governing agency’s plan was to have the earliest possible moment allowed by the first wave of stores located in King County Washington State Liquor Control Board — to be able to serve the bulk of the state’s 8 a.m. on July 8. Meanwhile, just two miles population. up the road, Fireweed Farms is working to “They said, ‘Hey, we’re having problems prepare one of the largest legal crops in the getting these stores licensed in Seattle. Do state for a fall harvest. you think you can be ready by July 1?’” Both businesses drew the ire of some Thompson said. “Ken was on the line with local residents, but both have been able to her, and he says, ‘No, I don’t think we can persevere through the numerous state and be open. I know we can be open by July 1.’” local obstacles to get up and running. With just 27 days left before the state’s projected opening day of retail sales, it was Retail Frenzy exactly the answer the Liquor Control Board Altitude co-owners Tim Thompson wanted to hear. and Ken Delp were visiting Colorado on >> continued on page 47

44 | MARIJUANA VENTURE // September 2014 www.MarijuanaVenture.com | 45

<< continued from page 44 However, Delp’s brash statement was made even more so by the fact that the Altitude team didn’t even own land at the point, or have a lease in place for their store to reside. With only small chunks of Prosser being properly zoned for a marijuana business, Delp and Thompson basically resorted to going door-to-door, looking for property owners that were willing to sell, before finally finding the empty lot on Merlot Drive where the modular retail location now resides. Miraculously, once Thompson and Delp found the location and finalized the sale, everything else came through without a hitch. Everything was completed faster than they expected and under budget from what they expected, Thompson said. “I’ve been involved with a lot of big projects before, and I have never had something go as smooth as this,” Thompson said.

“The Tier 3 grow operation features a canopy of about 14,000 square feet, where Williams grows 30 different strains and is looking at a massive harvest in the fall. ”

However, throughout the process, the Altitude co-owners have had to deal with a community that hasn’t always been on board with legalized marijuana sales coming to their town. During the November 2012 election, 56 percent of Prosser voters cast their ballot in opposition to Initiative 502, which would Fireweed Farms employee Jamin Trent stands next to a eventually remove prohibitions against the monstrous marijuana plant, which stands about eight cultivation, sale and possession of marijuana. feet tall less than three months after being planted. When the news came out that the local chiropractors, Thompson and Delp, were “We argued from a factual basis,” by hiring more than two dozen employees. seeking to open a retail marijuana store, Thompson said. “Most people who were Once the store hours are more consistent, protestors began to picket in front of their against it argued from an emotional one. … Thompson and Delp said they expect to office. Most of the people that spoke at the meeting have about 40 employees. “Christ judges sinners,” one sign read. were church members — people that I go to Overnight, Altitude became one of “Just say no,” another said. church with, quite frankly. … Most people the top six or seven employers in Prosser, Eventually, the Prosser City Council once some of the myths are dispelled, they Thompson said. opened the topic for discussion, packing the start to think about things in a different Thompson said he has lost a few council chambers with folks both in support way.” clients by opening the marijuana shop, but and in opposition of the business. Prosser The council eventually sided with the vast majority haven’t had a problem was already somewhat unique in the region Altitude and allowed the business to move with it. He sees the marijuana business as — most of the other cities in Benton and forward. Altitude immediately became a >> continued on page 48 Yakima counties had already imposed bans positive influence on the local economy or moratoriums. www.MarijuanaVenture.com | 47 << continued from page 47 potentially piggy-backing on the wine tours that frequent the Yakima Valley. He also pointed out the contradiction between the community’s willingness to embrace the wine industry, yet shuns legalized marijuana. “I can understand if you’re against this on moral grounds, but you need to be consistent,” Thompson said. “Alcohol is much more damaging than marijuana in every way.”

Historic Auction Randy Williams has also lost a small handful of customers from his primary business, a carpet cleaning company, since breaking ground for Fireweed Farms. But that hasn’t deterred him from becoming one of the first state-licensed, large-scale outdoor grow operations in Washington. And he’s sure to draw even more attention when he harvests his crop, probably sometime in October. Rather than selling product at a set price, Williams said he’s going to auction off the crop in lots of 5-100 pounds. More than a million dollars and 1,000 pounds of product could exchange Randy Williams describes some of his plants at Fireweed Farms. hands when Williams hosts the auction on

48 | MARIJUANA VENTURE // September 2014 Nov. 15. A razor-wired, eight-foot-tall, chain- Experience Matters – Put Ours to Work for You link fence hides his crop from view of the public, but one step inside the gate reveals a jungle of deep green plants that will likely begin outgrowing the confines of the fencing. The Tier 3 grow operation features a canopy of about 14,000 square feet, where Williams grows 30 different strains and is looking at a massive harvest in the fall. “I want to have the biggest plants in the state,” Williams said. A Division of Premier Southwest Insurance Group The majority of the plants, which could be 11-12 feet tall by the time they’re harvested, were planted May 9, Williams said. At one point, he had counted 453 large plants, 69 small ones and about 150 clones America’s Marijuana Business on his property. He already harvested about four pounds of cannabis to help supply retail Insurance Experts stores when they first opened. Amazingly, Williams and his family “More than a million dollars 1-855-507-2622 and 1,000 pounds of product www.PremierDispensaryInsurance.com could exchange hands when Williams hosts the auction on Nov. 15. ” are able to operate the farm with minimal outside help and not a great deal of resources. Fireweed Farms has just one employee — Jamin Trent, from Benton City — and to date, has used just $30 worth of fertilizer, Williams said. He believes the same rich soil that has created the booming wine industry deserves credit for the lack of fertilizer he’s needed. When preparing his land for the plants, he High quality R600 dug several feet into the ground, unearthing soil that had been untouched for centuries N-Butane and to provide the base for his cannabis-growing R290 N-Propane business. He said the climate of south-central refrigerants in Washington is also a perfect for growing. The freezing temperature doesn’t start as 30 lb. and 50 lb. early in the year as it does in the northern part of the state, and the minimal humidity cylinder sizes helps prevent molds, he said. And he scoffs at the notion that outdoor- grown cannabis is somehow inferior to plants grown indoors under artificial lighting. Williams expects some of his plants, like the Phone: (530) 378-4443 Email: [email protected] Blueberry Purple , to test somewhere in *DISCLAIMER: This product is intended to be used as a refrigerant only and the range of 25 percent THC. EcoGreen Industries, L.L.C. is not responsible for any results obtained from any other use, including personal injury or death. >> continued on page 50 www.MarijuanaVenture.com | 49 They’ve also positioned themselves well both for the present and for the long run. By rationing its initial supply of product, Altitude is one of the few stores in the state that has been able to avoid the constant opening, closing, reopening cycle that many stores desperate for product have had to struggle through. Although the growers with product ready to sell have the upper hand in the market right now, that won’t always be the case, Thompson said. To that end, the Altitude owners said they’re looking to partner with vendors that are in the business for the long haul. “Do you want a one-night stand or a long-term relationship?” Thompson said. “We stopped working with the people that wanted one-night stands. … If you’re in this to get rich quick, you’re going to end up poor real fast.” Oftentimes, it only takes a short amount of time to distinguish the businesses that are well-run, Delp said. “The cream is going to rise to the top, so that’s what’s going to happen with a lot of the producers, processors, and even retailers,” he said. “A lot of producers that don’t have their ducks in a row, so to speak, are going to go by the wayside.” The three main producers Altitude worked with to acquire its initial supply Altitude co-owners Ken Delp (left) and Tim Thompson of marijuana were Monkey Grass Farms, show off some of the artwork in their retail store. Peninsula Cannabis and Fireweed Farms. Thompson said he’s spent a lot of time << continued from page 49 not just on the phone, but driving around However, on the flip side, he also has the state to meet with suppliers face-to- four plants which are the complete opposite face. He said those meetings have paid huge for medical purposes. He said he expects the dividends for building relationships and Bubblegum strain to be just 0.16 percent getting a better understanding of how each THC and 3.07 percent CBD. company is run. Is there even a market for a product that Although he expects the industry to won’t get the user stoned? shift more toward written contracts in the “I believe there will be,” Williams said. future, right now, he said, most business is Those four plants — one large and three conducted with handshakes. on the smaller side — will produce about Despite Altitude’s early success and signs eight pounds of usable marijuana, he said. that point toward it being a benefit rather The profit he makes from those four than a detriment for the local community, plants will be donated to a local organization the Prosser City Council has since reopened or charity, Williams said. the discussion of imposing a moratorium. Although it wouldn’t have an effect on Future of the Market Altitude or Fireweed Farms, it could slow Thompson and Delp realize they’re in a down or prohibit future businesses from favorable position in the market, as just one moving forward with their plans to develop of less than two dozen retail stores that have another tourist industry in Washington’s been able to open for business in the first wine country. MV two months since the Liquor Control Board began licensing retailers.

50 | MARIJUANA VENTURE // September 2014 NEED HELP WITH YOUR I-502 LICENSE/BUSINESS?

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www.MarijuanaVenture.com | 51 52 | MARIJUANA VENTURE // September 2014 The finished look at the Minerva Canna Group’s finished retail space. Cutting-edge Design Meets the Retail Cannabis Industry pening and operating a marijuana to set a new standard for the medical dispensary is not easy. With an marijuana industry. At the time Briones excess of red tape and hoops to jump started considering changes, his business was Othrough, being successful in this industry already booming. Located in a small two- requires an investment of time, work, and room building that could barely handle the money that can exhaust even the most number of patients it was serving, he knew dedicated business owners. Once the doors it was time to expand. When a building on are finally open, it can be easy to get caught the same property became available that up just keeping the business running, rather was more than four times the size, Briones than focusing on growing it and making jumped on the opportunity. improvements. However, some dispensaries But, in order to convert a former cycling have focused on raising the bar and putting shop into a thriving medical marijuana themselves above the competition. business, he wanted to bring in somebody One such dispensary is Minerva Canna with expertise in dispensary design. Briones Group, located in Albuquerque, New hired Megan Stone, from The High Road Mexico. Design Studio — an interior design firm Owner Erik Briones wanted his business >> continued on page 54 www.MarijuanaVenture.com | 53 << continued from page 53 to grow their own cannabis, including soil, (Top) High Road Design went for a classy, yet stylish that specializes in marijuana dispensaries fertilizer, organic pesticides, gardening tools, look when redesigning Minerva Canna Group’s — to bring his vision to life. With a total indoor lights, growing supplies and other dispensary investment of approximately $65,000, Stone cultivation resources; Minerva Life offers (Bottom) Minerva owner Erik Briones and The High helped Briones transform the new building products that would be found in a regular Road Design Studio’s Megan Stone. into an exciting, upscale cannabis experience. smoke shop, such as pipes, papers, bongs, “Through the use of natural materials vaporizers and even hemp clothing. The rest — wood, stone and vegetation — and a of the facility houses other wellness services diverse array of textures — cement floors, such as massage and acupuncture to draw an flat walls, leather and velvet upholstery, glass even larger clientele. tiles, brushed metal finishes and rough stone In order to make the dramatic — I designed a modern, elegant, yet casual transformation, existing elements such as atmosphere to appeal to people of all ages closets, walls and doors had to be shifted and backgrounds,” Stone said. “Their new around to provide a more suitable and space is designed to offer a comfortable, safe accessible use of space. High ceilings and and unique dispensary and retail experience warm wood beams paired with sky blue to every visitor.” paint give a natural sense of open space Stone and Briones divided the large, that brings in the outdoors, while large historically-registered, warehouse-style graphics and images of cannabis on the building into a small, indoor business walls connect patients to the organic nature complex, with a comfortable lobby and of the marijuana industry. Minerva Canna waiting area in the center. Only one room has a significant amount of windows, so was devoted to the actual dispensary, custom decal coverings were created to allow which was given a complete makeover and natural lighting while still providing privacy rebranded as Minerva Medicine. Meanwhile, and security, obscuring the view into the new divisions were opened in other sections dispensary from the street. of the building: Minerva Grow is dedicated to selling everything a patient needs in order >> continued on page 56 54 | MARIJUANA VENTURE // September 2014 (Above & Right) A look at the construction phases of the project.

www.MarijuanaVenture.com | 55 << continued from page 54 The most expensive aspect of the project was the display cases, but Briones said they were a worthwhile investment. They provide organization and allow all inventory to be stored below the display, so that budtenders never have to turn their back on patients, allowing for peak customer service where another layout would not. “If a dispensary owner was debating whether to spend their money on that, I would advise them to look at their model and what they are trying to convey to their patient/customer,” Briones said. “If it’s a high level of customer service and professionalism, you are crazy not to do something like this. You are missing out on a huge customer service opportunity.” By restricting dispensary access to doctor-recommended patients, only but still allowing regular foot traffic into all of the other departments, Minerva Canna has expanded its clientele and expanded its revenue streams. In addition, the business model solves another major dilemma in the medical marijuana industry — the frustration of potentially being taxed to death. Unlike other industries, dispensaries are unable to write off many of their normal business expenses, including rent, products, employees and utilities. Because Minerva Medicine is only a division of Minerva Canna Group, all of the other divisions are able to function as regular businesses do, allowing at least a portion of their expenses to be written off. Briones’ investment in Minerva Canna The photos below show the dispensary’s old layout. Group’s expansion is already paying off. The business has doubled its yearly sales and the number of patients seen on a daily basis. “Our sales have continued to increase,” Briones said, pointing out that by the end of the second quarter, “we will be where we were at all of last year. “It is just dramatic. I think it’s a number of factors: having a really cool, big dispensary, referrals throughout the state.” Briones said customers from Las Cruces and Carlsbad routinely make the four- to six- hour drive to his shop in Albuquerque once or twice a month. “The design has improved our business substantially,” he said. “We have raised the bar so high in New Mexico that other dispensary owners have come in with jealousy, calling it phenomenal. Patients have such a better cannabis experience with us than any other producer in the state. We just had our best quarter ever, and we do have the best dispensary.” MV

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Green Thumb Adds suppliers and we’ll take all the guess work The commission stated that the drivers out of problems that arise for them,” he said. and passengers of charter and excursion Scale Services “Chuck is a key part of our growth strategy. vehicles are considered to be in view of Two Washington companies dedicated He has a wealth of knowledge when it comes the general public — therefore state law to serving the local cannabis industry have to scales and the service industry. In addition prohibits the use of marijuana products. joined forces to form GT Solutions. to being a product supplier/partner, we The notice also referenced a state law that Green Thumb Logistics and Services has want to be able to service the industry for prohibits smoking in public or at a place of partnered with Dime Bag Scale Company to warranties, technical support for hardware/ employment and a federal safety regulation off scale services to I-502 companies. Chuck software and training of software. This that prohibits the use of marijuana by Olivier, of Dime Bag Scale Company, takes will allow our producer/processors to have commercial motor vehicle drivers. on the role of solutions partner, acting as just one supplier/partner to call if almost The companies were notified that failure the primary sales person for all of the new anything happens in their operations.” to comply with the law will result in the offerings. cancellation of their state-issued operating “We now provide support for nearly permit. every aspect of the producer/processor State Says Marijuana, In April, the commission published operations,” Green Thumb co-founder Alen a report about the safety of charter Nguyen said. Buses Don’t Mix and excursion “party buses” and made GT Solutions provides vendor managed Transportation safety officials inrecommendations to improve safety and inventory services and delivery of products, Washington issued a notice Aug. 21 to oversight of the developing industry, which including lighting, growing supplies, facility charter and excursion bus operators that the the commission will ask the Legislature to supplies, custom packaging, scales and scale consumption or use of marijuana products consider in the 2015 session. The report servicing, soil/compost reclamation and on their vehicles by passengers is still against found numerous incidents across the a high-intensity discharge bulb exchange the law. country involving party buses that resulted in program. The Washington Utilities andinjuries and fatalities; however, commission Nguyen said GT Solutions will be better Transportation Commission issued the notice staff found no record of reported deaths or positioned to serve the industry. after several transportation companies filed accidents in Washington State. MV “We’ll be in better tune with our permit applications to provide marijuana- clients, they don’t have to manage multiple themed tour bus services.

www.MarijuanaVenture.com | 59 60 | MARIJUANA VENTURE // September 2014 Testing HydroFLOW Part II: First wave of lab results n the Fourth of July, Sea of Green in humans and animals. Farms in Seattle set out two HPC measurements, in use for more “Tests on the first batches of hydroponic grow tables loaded with than a century, are used to indicate the pot harvested around the state O50 cannabis plants each. Both tables had the effectiveness of water treatment processes. same strain of Blue Dream. One table was Heterotrophs are broadly defined as by Analytical 360, one of the equipped with a HydroFLOW device from microorganisms that require organic carbon state-certified labs, found that Acoustic Water Treatment Service on the for growth, including bacteria, yeasts and about 10 percent of the samples water/nutrient supply line, the other was not. molds. “Plate count” is exactly what it sounds Within days, Sea of Green’s head grower like – after a 48-hour incubation period at 37 failed because of common Mike Thrapp noticed the HydroFLOW degrees Celsius, the number of visible CFUs mold…” plants seemed greener and healthier, but the are counted. Seattle Times | Sunday, July 27, 2014 experiment required hard data from a neutral Lab/Cor performed CFU counts for third party to be useful. each sample, with both samples testing On July 16, after the water/nutrient mix negative for E. coli. had cycled through the grow tables 14 times Meanwhile, the CFU count from the during the previous week, 100 milliliter untreated water of the “control” table was BY THE NUMBERS samples were taken from each water/nutrient 44,125. The CFU count for the water treated container, placed in a cooler and delivered to by the HydroFLOW device was 38,319 — a Percent of Washington’s first crop of state-licensed Lab/Cor, Inc. in North Seattle. reduction of about 13 percent compared to 10% marijuana that was Lab/Cor is an analytical laboratory the control sample. rejected for excessive mold designed initially as a consortium of This means the chance of algae, mold or content. scientists. Formed in 1992, it provides the fungus in the finished product is reduced by scientific community with its expertise in about 13 percent. Percent reduction of electron microscopy and microanalysis. At the same time as the Lab/Cor water measured CFU per After a 48-hour incubation period, Lab/ samples were taken, Biosan dip slides were milliliter in water 13.2% treated by HydroFLOW, Cor tested the water samples for E. coli, fecal taken from each tank. Acoustic Water compared to a control coliform and heterotrophic bacteria. Treatment Services uses these tools to sample. Two terms at work here are colony determine before and after conditions of forming units (CFU) and heterotrophic plate water systems using HydroFLOW. count (HPC). Although the dip slides are not as CFU is the metric used to determine accurate as the computer-counted lab results, how many viable bacterial cells are in a they do create a visual reference point. After sample per milliliter of water. It can show the 48 hours incubation, the two sample vials degree of contamination in samples of water, show a significant difference, with the water soils, vegetables, etc. or the level of infection >> continued on page 62 www.MarijuanaVenture.com | 61 (Top) The difference in << continued from page 61 bacteria between the treated by the HydroFLOW device showing control and HydroFLOW samples can be seen in a much lower concentration of bacterial this test growth. Lower bacteria count means less (Middle and Bottom) opportunity for algae, mold and fungus The HydroFLOW device installed at Sea of Green to grow. Less mold means a better shot at Farms. getting top dollar for your crop. While the data is an important measuring tool, farmers must also rely on their senses to understand how well their plants are doing. Thirty-three days into the grow at Sea of Greens, Thrapp said he’s noticed a significant difference between the two different grow tables. “I’m really specifically looking at the nutrient uptake – I noticed that with the HydroFLOW unit, it doesn’t seem to using as much nutrients, but it’s still growing at the same rate, if not a little better.” Reaching into the water/nutrient buckets, Thrapp said “There’s slime, and then there’s more slime. HydroFLOW system has substantially less slime — it’s a lot easier to clean.” MV

To follow the progress at Sea of Greens, check out Acoustic Water Treatment Services’ YouTube channel. Part III of the “Testing HydroFLOW” series will be published in the October issue of Marijuana Venture. Part I can be found at www.marijuanaventure.com.

62 | MARIJUANA VENTURE // September 2014 www.MarijuanaVenture.com | 63

The Ashville hemp house. A House that Hemp Could Build By Patrick Wagner aron Schmidt, a journeyman it’s indistinguishable from any other building plasterer, stares silently at a photo, materials. trying to identify the type of plaster Steve Allin, author of “Building With thatA was used to build the Asheville hemp Hemp,” is a hemp guru of sorts. He believes house in North Carolina. His guesses industrial hemp is an untapped natural sound like questions before he calls out resource. Allin travels across the world to his partner for help. After several more teaching classes on hemp building and the wrong answers and moments of frustration, benefits of using the plant as a tool for society. Schmidt and his partner decide the mixture “If you want to make a difference must be a dismissible one-off brand. rather than just talking about the ecological The compound itself looks innocent problem we face as a species then we need enough. Faded green dust, with short dusty tools to carry out this work,” Allin said. stems and smaller fibers that look almost “Hemp is an amazing tool for these problems like grass clippings that have been dried in and being able to build houses free of toxins the sun. The drying hempcrete blocks look with little or no heating or cooling needs, almost like any other wet cement with just then that’s what you should do.” a slight greenish hue to them. At a glance, >> continued on page 66 www.MarijuanaVenture.com | 65 The use of hempcrete can be an efficient way to insulate a house.

<< continued from page 65 The simplest way to get your hands on hempcrete is by ordering it from a vendor Although Schmidt has worked as a or by attending one of the many hemp- “Because of its black market plasterer for nearly two decades, his inability focused seminars that have been growing to identify the hempcrete mixture wasn’t in popularity. The recipe is simple enough roots, the cost of hempcrete necessarily due to lack of experience or to recreate on your own for construction varies from vendor to vendor, customer interest. More, it’s because the experiments, and Allin pointed out there is world of industrial hemp has been mired in no real need to purchase the finished product but is still generally cheaper legal contradictions for decades. Hempcrete if you can create the mixture yourself. to produce as an independent is still suffering from the same national “We need to be creating local versions contractor. ” restrictions that have kept it a secret from to reduce transport costs,” Allin said. “I am plasterers like Schmidt; but with the way positive that most existing recipes for the laws have been changing in the last few years, Hempcrete binder all perform in similar industrial hemp might become the nation’s ways but manufacturers will always claim all-in-one solution for the first time since that their products are superior in some cases marijuana prohibition. the only one that works.” Hempcrete is an alternative material for Because of its black market roots, insulation and construction. The mixture is the cost of hempcrete varies from vendor a combination of cement, lime, water and to vendor, but is still generally cheaper hemp. Despite the fact that hempcrete has to produce as an independent contractor. a lower carbon footprint than , the However the advantage of using hempcrete product has been a casualty of the prohibition is what you don’t have to pay for. of marijuana. Contractors are normally required to 66 | MARIJUANA VENTURE // September 2014 heat concrete mixtures to roughly 3,000 degrees Fahrenheit to get the concrete to set. With hempcrete, contractors are able to set the mixture without having pay for such an enormous amount of energy and as an added bonus, they wouldn’t need to wait nearly as long either. “We have discovered that the combination of hemp hurds (particles of the woody core of the stem created during the removal of the fibers of the outer skin) and a binder made from limes or clays, that unlike cement allow water vapor to move through it (hygroscopic) produces a masonry-like material that both insulates and stores heat,” Allin said. Allin said he and his associates have discovered that the combination of hemp hurds (particles of the woody core of the stem created during the removal of the fibers of the outer skin) and a binder made from limes or clays produces a masonry-like material that both insulates and stores heat. Unlike cement, it allows water vapor to move through it, Allin said. “These might not seem very valuable qualities in combination but it means we can produce a home that has the energy consumption of a ‘passive house’ without the need for layers of plastic or pumps to provide air supply,” he added. The hempcrete texture can be seen on the interior of this home. These benefits are compounded further by the natural insulation properties of the Exposure to natural elements like snow and lime-based mixture, which reduces the need rain do not affect hempcrete walls and roofs, RECIPE for auxiliary heating and cooling by up to 60 even if you live in a rainy climate like the Four parts hydrated Type N lime and percent. The malleable nature of the mixture Pacific Northwest. one part Portland cement. The lime needs allows it to be used in almost every part of The availability of hempcrete varies to be at least 95 percent calcium and needs a building’s walls and roof and due to this throughout the country. Although the to be ready to use since it only has a three- flexibility, contractors are not required to mixture is legal to use in all 50 states, only month shelf life. install expansion joints. a few states have allowed growing industrial The mixing can be done by hand for The self-healing properties found in hemp, and it is still illegal to import the seeds smaller batches; however gloves are a must hempcrete stem from the lime used in used to grow the plants in the United States. since the lime in hempcrete has natural the mixture, which should be roughly 95 Contradictions like this have hampered the caustic properties. Larger batches should be percent calcium. The calcium in the lime has production of hemp since the early 20th done by a drum or mortar. a continuous hardening effect that slowly century. Regardless of the size of the batch being petrifies over time. This element allows Buildings made from hempcrete can prepared, the most important part is to keep constructs to heal with the passage of time, be found easily throughout the nation and the mixture consistent with the recipe. whereas concrete remains cracked and slowly the rest of the world. Unfortunately, the 1. Start with 1.5 parts water in your degrades. majority of these buildings have been built as preferred mixing container. Another benefit of using hempcrete a novelty or as a proof of concept and not as 2. Add one part cement and mix evenly over concrete is that slumping and vibrating the serious long-term investment they could until slurred. castings no longer factor into the construction easily become. 3. Finally, add four parts hemp and mix time table. Slumping is a commonly known Although several states have until evenly distributed. problem with concrete, where the mixture decriminalized hemp production, it — like Experts agree that the mixture’s water will shift or collapse under its own weight. its psychoactive cousins and ratio is paramount to success and Steve Allin Unfortunately the benefits of using sativa — remains illegal at the federal level notes that a building needs to be designed hempcrete do not extend to a building’s with action from Congress. MV with hempcrete in mind in order to reap all foundation below ground. Since the of the benefits. mixture is lime-based, prolonged exposure to moisture results in slow deterioration. www.MarijuanaVenture.com | 67

Basics of Grow Room Photography Simple tips to document your operation ave you ever tried to shoot photographs made specifically for people that spend a lot of inside a grow room lit by high-pressure time working in rooms with artificial lighting. sodium bulbs? The California-based company makes glasses for HChances are those pictures turned out use under high-pressure sodium bulbs, metal heavily tinged in yellow, making it difficult to halides and LEDs, as well as eyewear for outdoor tell the true coloring of the plants and almost grows. impossible to accurately portray the health and quality of a crop. In the black market days of Here are a few more basic tips for taking great marijuana cultivation, growers commonly did indoor photos of your operation. not want to document their operation for fear of - Practice on tomato plants before you self-incrimination. go into the grow room. It will sharpen your Now, with legal, licensed cannabis growers composition skills. spread across Washington and Colorado, more - Test out various f-stops on your camera and more people in the industry are looking for until you find a depth of field you like. Some simple ways to document their process, both for like a sharp focus on a single point, some want their own records and to share with retailers, everything in the frame to be sharp. processors, consumers or other growers. - Hold still by using a quality tripod. The key is a quality camera filter that can - Hold real still. Once you’ve got your offset the yell0w-tinted HPS lights, such as one exposure and focus dialed in, use the timer made by Method Seven. feature or a remote shutter that will allow you to - Consider the position of the fans in the The Method Seven filter shifts light from take your hands off the camera. grow room. Park yourself between the fan and the red/yellow spectrum back toward “natural” - You get what you pay for when it comes the plant when you take the exposure to block light. The above example shows a pair of photos to cameras. Smart phones these days can take the wind. Fluttering leaves may not be the look taken with Apple iPhones. The top left portion great pictures, but they can’t match a digital SLR you want. was taken without using the filter; the bottom when it comes to customized settings. - Be trigger happy. Remember, it’s digital, not left portion was shot by holding the filter in one - If your camera supports it, learn how film, so take lots of shots. Get a few “insurance” hand and the iPhone in the other. to manually set the white balance. The light shots with everything set on automatic, then go The same experiment was performed with available inside a grow room seems like a trip to crazy in manual mode. Experiment to find the similar results using a point-and-shoot Nikon the sun – at first. A properly set white balance right combination of aperture, shutter and ISO Coolpix S800C and with a Canon EOS Rebel will make the exposure look better than the speeds for your grow room. MV T5i digital SLR. automatic setting. Also, try shooting in RAW In addition to its camera equipment, mode and adjusting the white balance in post- Method Seven also produces a line of glasses production. www.MarijuanaVenture.com | 69 Bar Codes - What Growers, Producers the distribution of bar code numbers. There are presently two ways to obtain and Retailers Need to Know proper GS1 UPC-A compatible numbers. By John Sample • You can deal directly with GS1 at http://www.gs1.org/. Currently it is necessary What are Bar Codes? rapid identification of specific SKUs. The to join GS1. There is an initial fee for the Bar codes are a machine-readable graphic likelihood of inventory quantity irregularities numbers needed. And there is a yearly fee for representation of a number. The number is is greatly reduced. continual use of the numbers. used to identify a unique stock-keeping unit, Imagine this scenario from the retailer’s • Prior to 2002, purchasers of GS1 bar or SKU. The bar code number can quickly be point of view. You have Hindu Kush codes received a perpetual license on the read by inexpensive scanners. This number is available in 1-, 2-, 4- and 8-gram packages. codes they purchased. Owners of these pre- then used by your computerized accounting The value of these packages will be quite 2002 codes can resell unused numbers. These system for proper inventory control. different. If, in the process of selling a 1-gram pre-2002 numbers do not require yearly fees There are a number of types of bar codes. package, an employee accidentally delivers and run for about $25 each. “UPC-A” is the standard bar code used in a 2-gram package to the customer – you the United States for most retail products. have an inventory irregularity issue. This How many bar codes will I need? can cost you money. With proper bar codes You will need one bar code for each Why do I need a bar code? on all packages, and if the retail employee SKU you intend to sell. As in the Hindu There are a number of advantages of uses a scanner for item identification, the Kush 1-, 2-, 4- and 8-gram packages above having a bar code for cannabis growers, risk of inventory irregularity is decreased – you would need four separate bar codes. producers and retailers. The mostdramatically. Bar code numbers should not be important is proper inventory control – “recycled.” You risk alienating your retail which is mandated, in Washington, by the How do I get a bar code? base. MV Washington State Liquor Control Board. GS1 is the non-profit, international Having bar codes on inventory items allows organization that sets standards and controls

70 | MARIJUANA VENTURE // September 2014 www.MarijuanaVenture.com | 71 ATTENTION 502 APPLICANTS AND LICENSE HOLDERS:

THE TIME IS NOW TO ORGANIZE AND INFLUENCE. We are forming a Political Action Committee (PAC) for the purpose of advancing the business interests of those within the licensed marijuana trade. We will: WE NEED YOUR HELP · Lobby for less onerous regulations and taxes · Advance the interests of 502 businesses AND SUPPORT! · Challenge moratoriums and unfair For more information contact: business discrimination John W. Comerford at: [email protected] · Contribute to politicians that support our industry with WACPAC SUPPORTER in the subject line. GUEST COLUMNIST

find where the Constitution puts the feds in the pleasure prohibiting business except and That freedom ‘thingie’ only so far as is necessary to protect the public By William Slusher good, and it’s not even very clear on that point. Wiki-walk listed as tolerant. Go figure. What seems to be coming under increasing through I’m not sure what this means but I have a scrutiny in America today is whether marijuana marijuana hunch. Why are we the first of the heavyweight poses any real threat to that public good ... that legalizationA is nations to begin to see a four-category is ... a threat not exceeded by the dangers of interesting: legalization of recreational marijuana? Is it government attempts to outlaw same. “On 28 May possible that legalized marijuana has stuck its Liquor is not considered good for 2013, Colorado periscope up in America because of our fetish the people, per se, and it can clearly be became the world’s for, you know, that ... freedom ... thingie? quite harmful when misused. Yet the costs first fully regulated The budding (no pun) evolution of (metastasized crime, deaths, violence, recreational cannabis marijuana into a legal product in America may counterproductive incarceration and frittered market for adults” (followed by the obscure become a more important social milestone tax billions) of the Prohibition ‘cure’ proved state of Washington). “On 10 December than many now seem to suppose. Reactions more a threat than the ‘ailment.’ Moreover, 2013, Uruguay became the first country in the I hear range from a wholesale collapse of that pesky ... freedom ... nuisance kept rearing world to fully legalize the sale, production and American culture to a flash-in-the-pan doper its head. So America elected to re-permit distribution of marijuana.” fad in altitude-sick Colorado and uber-libbie that pleasure subject to reasonable measures The only countries where all four realms Washington. Still, most folks seem to either shielding non-drinking citizens and all minors. (cultivation, transport, sale and possession) despise or hail the notion that in ten years, It’s a safe bet that massive new tax revenue was of marijuana are at least decriminalized, as maybe less, the entire U.S. will be in that not overlooked as well. opposed to outright legalized, are Cambodia, legal section of the marijuana chart in all four Similarly, no one not on an interplanetary the Czech Republic, the Netherlands, and the categories. Cheech and Chong flight pretends marijuana notably progressive Uruguay. (North Korea is is a harmless pleasure. Its physical and listed as “probably illegal.” Ya think? Is there “Its physical and psychological psychological health effects are not fully anything pleasurable under Porkie the Norkie researched, and, like all pleasures, marijuana that isn’t illegal?) health effects are not fully can be dangerous to users and non-users alike Several countries have dabbled in researched, and, like all pleasures, when enjoyed recklessly. decriminalization or limited legalization of marijuana can be dangerous to Consequently, as with liquor, mountain cultivation and possession, but only four of climbing, racing, bicycling, contact sports, ninety-five countries listed have essentially said, users and non-users alike when flying, horseback riding, eating, marriage and hey, you know, we don’t think government has enjoyed recklessly.” other potentially dangerous activities, there any business telling adult citizens they cannot is risk to using marijuana not to be trifled enjoy marijuana so long as no one else’s rights If so, it’s probably not because the with nor (in marijuana’s case) indulged in by are violated and minors are not involved. founding fathers anticipated our ‘advance’ to minors. Four, out of ninety-five. About four consuming a plant that was all but unknown But, beyond these reasonable cautions, percent. as a rec drug in America until the early 1900s there so far appear to be well less annual It isn’t exactly shocking that communist (although George Washington raised hemp participant deaths and injuries from consuming countries like China and Vietnam aren’t on the as a primary fiber crop at Mt. Vernon). More marijuana than from any of the sometimes legal marijuana bandwagon, not to mention likely a hint is to be had in the words of James deadly but appropriately legal activities above. the predominantly Muslim countries. After Madison: “In the United States the ... People, So the question seems to be gurgling up all, most of these nations share the same fun- not the Government, possess the absolute all over: What business has government telling index rating as Porkie’s rocking Norkies. Don’t sovereignty. The Legislature, no less than the adult Americans they cannot produce, sell and promise to meet your buddies for drinks and Executive, is under limitations of power.” use marijuana? Says who? Or more importantly, toke at, oh, say, the Riyadh Deja Vu. (OK, OK, but it’s supposed to be that way.) says what legitimate constitutional argument? Somewhat surprising is that virtually none Likewise in the words of the Bill of I strongly suspect that, as this question of the other non-Muslim national heavies like Rights Institute: “When ratification of continues to surface all over America, Germany, France, or the UK are on board. the Constitution was being debated ... the the Colorado and Washington marijuana Neither is India, also not exactly a leading one principle that was suggested by every industries are going to start seeing a boatload party-animal destination. The wild and crazy state is [that] the states and the people keep of legal competition. MV Russkies are semi-tolerant (want to see a semi- those powers not delegated to the federal gulag?), but still in the illegal column. Canada government, and which the Constitution does William Slusher is an author and columnist with has a mish-mash of undeclared policies on not forbid in Article I, Section 10.” a small ranch on the Okanogan River. His newly marijuana except that they still hold sale to be I’m a retired police/medevac pilot and an reprinted down-and-dirty Southern murder illegal. Even Brazil is legally weedless though author who’s never used pot, not a lawyer, but mystery “Shepherd of the Wolves” is available possession is tolerated. More striking is that near as I can tell Article 1, Section 10 just says through Amazon, cmppg.com or local bookstores. notoriously liberal countries like Finland, the states can’t print their own money, enter Norway and Sweden are not ‘at-ease, smoke- into treaties with other nations, or engage in ‘em-if-you-got-‘em’ locales. They aren’t even other such clearly federal duties. Also, I can’t www.MarijuanaVenture.com | 73 GUEST COLUMNIST

your analysis of these accounts and assist Financial Pages: Account with implementing the detailed mechanics to set up these accounts in your accounting management for tax purposes software, as you will be using more asset/ inventory accounts than usual. But for your By Todd Arkley back-of-the-envelope calculations, thinking reating the Don’t make the mistake of thinking that your of costs in this manner — produce/acquire financial accounting software is the only data analysis vs. sell — will give you an approximate idea accounts for and collection tool you have in your toolbox. of your federal tax burden. Cyour cannabis business Another example: for your grow, it In some situations, you may need to can be confusing, might be a good idea to have separate split an account into two categories. For especially with the expense accounts for soil and nutrients, but example, if you are a grower, most of your restrictions of Internal it would be unnecessary to have separate rent payments will be related to growing Revenue Code 280E. accounts for each and every type of soil or cannabis, but some of your rent will likely Below are some simple nutrient you purchase. The question you cover administrative offices as well. In this strategies to ensure that your financial should ask yourself when looking at your situation, it would be wise to have two records are not only compliant for federal soil account is “Am I spending too little, too rent accounts — Rent: Growing Facilities tax purposes, but will also provide you with much, or just enough on soil?” If the answer and Rent: Administrative Offices. Broadly relevant and useful financial data. is “too much,” then you dig into the one soil speaking, the rent related to your grow would account further to locate the problem. It isn’t be tax-deductible under 280E and the rent Basic accounts necessary to have 10 separate soil accounts to related to your administrative offices would Don’t get too complex. One of the locate this information. not be deductible. However, if the offices are biggest mistakes small business owners make Regardless of the amount of accounts used to monitor the grow, some of that rent is setting up too many different accounts you set up, make sure to keep an electronic could possibly be deductible. On the other when installing and establishing their or paper copy of every expense receipt for hand, if the offices are only used to track and accounting software. If every single item you easy retrieval, and include plenty of narrative monitor sales, then that rent would probably purchase has a separate line item on your description in your accounting software not be deductible. financial reports, not only will it take much when inputting the expense. By doing this, The most important part when splitting longer to prepare your books, but also your it will be much easier for you to find and any costs into deductible vs. non-deductible financial data will be much less useful. examine the specific expenses needed for categories is to document your methodology The best way to think about this is more detailed analysis. In addition, if you do for determining the split. It is crucial that you to start at the macro level — one account is decide to split an account up in the future can justify to the IRS your allocation of costs Revenue and the other account is Expenses — (for example splitting a single Internet/phone if you happen to be audited. Create processes and slowly add more accounts as you review account into separate accounts), maintaining and standards for allocating expenses and your business plan and operational structure. detailed records will make that process much follow them. Keep a file that documents how The primary reason to add more accounts easier to manage. you treat each expense category. Not only is to provide you relevant information to will this keep you compliant on your federal IRC 280E compliant accounts understand the profitability of your business. tax return, it will also create accounting Tied in with this, as we will discuss later, Because of IRC 280E, you will be standards to be used by all employees within is the ability to track the tax treatment of adding/modifying accounts that would not your business. certain expenses. be necessary in a typical small business. After Staying compliant with IRS regulations For example, a cannabis retailer will creating your basic expense accounts, take a is crucial and to do so, you need to keep need to keep very detailed records of each step back and review your chart of accounts. detailed financial records. It would be a individual product that they are buying and Each account should be able to go into mistake to assume that staying compliant selling. Where should you monitor this? one of two categories: Cost to produce/ with IRS regulations does not affect your Your inventory software will keep records acquire your product, or cost to sell your bottom-line. The same data that is needed of the stock you have purchased, down product. If it is a cost related to acquiring/ by the IRS can also be utilized by you to to the individual product. Your point-of- creating your product, then it will likely be improve your overall profitability. View these sale software will keep detailed records of an allowable deduction on your federal tax restrictions as a challenge and those of you what you have sold, down to the individual return. If it is a cost related to selling your who can survive, in spite of these restrictions, product. But in your accounting software, product, it will likely not be allowed as a will be much better positioned if and when it is not necessary to have an inventory deduction on your federal tax return. tax reform occurs at the federal level. MV account for every single item. A handful of By doing this analysis, you should be accounts — Flower, Edibles, Concentrates, able to get a rough estimate of what your Todd Arkley, CPA, is the owner of Arkley for example — will likely suffice. For detailed deductible expenses will be on your federal Accounting Group, which provides financial financial analysis, you will be using your return and thus, what your taxable income management for small businesses and the inventory tracking and POS software, in will be. I do recommend that you have an cannabis industry. He also serves on the board of the Coalition for Cannabis Standards & Ethics. conjunction with your accounting software. experienced bookkeeper or CPA review 74 | MARIJUANA VENTURE // September 2014

GUEST COLUMNIST

live view, but are limited to 7.5 frames per New regulations clarify second on recorded video. We have been given a bit of respite with this new edit as well in that “areas I-502 security issues where marijuana or marijuana waste is By Armando Perez never present are not considered control areas and do not require camera coverage.” the Internet is not even something that is n the July issue This is wonderful news because we have all required by the regulation.It is definitely of Marijuana been operating under the assumption that preferred by the inspector, but I see nowhere Venture, we 95-100 percent area coverage was required Iexplored the risks and in the regulation where an actual Internet regardless of whether product would be connection for the surveillance system benefits of choosing within a specific area (excluding those areas, is a requirement (similar to the fact that certain types of like restrooms, where the assumption of nowhere in the regulation does it say that security cameras. privacy precluded camera placement). your alarm system must be monitored, just A choice that was One final clarification which has that it must exist and make noise). afforded by a murky helped bring camera counts down is When setting up an IP camera system, and ill-defined section of Initiative 502 the final paragraph limiting the 20-foot internal IP addresses are applied to each (Washington Administrative Code 314-55- rule to outdoor grow areas. The previous device. This is done via programming, and 083), allowed for multiple interpretations version was written in a way that we had not through a connection to the Internet. of the same rule. Since that time, the to assume that we needed coverage of a 20- The actual Internet connection is of great Washington State Liquor Control Board foot perimeter of all entrances. The newly benefit though, in that it does allow for has released a modified version of this edited regulation requires this only of fences remote management and alarm verification. section, thereby clarifying exactly what and entrances specifically for outdoor grow It’s also nice to be able to pull up your type of cameras must be used. The new operations. smart phone and check on your plants and regulations clearly state that the systems Now that the regulation is clear, we employees. must be IP compatible, but also that the can all get on with providing surveillance cameras themselves must be IP cameras. “Areas where marijuana or systems that provide compliance and The regulation now requires marijuana satisfy the Liquor Control Board without businesses to have: marijuana waste is never breaking the bank, and hopefully do so in “...a complete video surveillance with a way that actually provides some value to minimum camera resolution of 640x470 present are not considered control areas and do not the operator. Unfortunately, even today, a pixels and cameras must be internet protocol full month after these edits were released, (IP) compatible.” require camera coverage.” I have heard of a Liquor Control Board Pardon me while I do a little dance inspector who recently passed a system over here and thumb my nose at certain with analog cameras. The next challenge is Another clarification made by the experts in the industry who chose profit ensuring a level playing field, not just for new edits to the regulation is that “all over protecting their clients by selling them the 25 percent excise tax, which is what all cameras must be fixed and allow for clear non-compliant analog camera systems and the regulations are focused on, but a level and certain identification.” This means we promising compliance (at a lower price, playing field for all the players on the field are not to use pan, tilt and zoom (PTZ) but higher profit margin, mind you). So as well. This also begs the question, what cameras. PTZ cameras are motorized after descending from my soap box, I feel about the operators who passed inspection and can be controlled by the user or by a it appropriate to explain the new, highly with what is now clearly a non-compliant edited version of the I-502 security camera program. The problem with PTZ cameras camera system? MV section and what it does and does not is that when they are looking over here… mandate. something is bound to happen over there. As an indication of how much the When using PTZ cameras, there is a Armando Perez is the general manager of CCTV regulation has been edited, there have been tendency to use fewer cameras to justify the Dynamics (www.i502CCTV.com), a surveillance 394 words removed from the regulation use of the more expensive motorized camera. equipment distributor with a focus on system design and custom security camera systems. and 287 words added to a section of the This justification leads to blind and regulations that originally only contained lower quality than would otherwise be had 537 words. Almost 75 percent of it has been for the same amount of money with more rewritten. Let that sink in. cameras. The most common assumption is that The new regulation gives a solid if cameras are IP compatible, they must definition to video speed. We now know be connected to the Internet in order to we must have a minimum of 10 frames per function. This is not only a false assumption, second per camera. Be careful out there: but having the camera system connected to many systems meet this requirement on www.MarijuanaVenture.com | 77 GUEST COLUMNIST

will be the same for the building regardless Financial survival for the of the revenue levels. Vehicle lease payments, dues and property taxes are examples of fixed costs. year 2014 and beyond Variable costs (VC) fluctuate based By Miles Stover upon activity. Taxes on sales, transportation very company 1. Determine the per-unit selling price and costs, supplies and packaging materials are — no matter the direct costs. examples. We are keeping things real simple what segment of Let’s say you sell cannabis by the gram. In now acknowledging that some costs have a Ethe cannabis industry, this example, the “direct cost” of the material variable and fixed element to them. and no matter what is $10 per gram. 5. Set up a spreadsheet with these BEP level of profitability 2. Calculate your contribution margin per formulas so “what if” scenarios can be or lack of profitability unit. considered. the company is Let’s say you sell cannabis for $18 per Let’s make the BEP a financial experiencing – should gram. The “contribution margin” (CM) is management tool for you and potential always be looking for money. Even if you are the amount you get above the direct cost of investors. To get a feel for how this tool can making money so fast you don’t know what each unit you sell. This is the amount you be used let’s ask some questions: to do with it, keep looking for more money at contribute toward the overhead costs. 1. If we can reduce overhead by $10 how the right price. This column will discuss what 3. Calculate your overhead costs. many less units do we need to sell to break the people with money want to talk about Overhead (OH) is made up of the even? and how to talk their talk. expenses you incur in your business that need 2. If we raise the selling price by $1 and The bottom line is that by computing to be covered before you start to earn a bottom- units sold go down 10 percent, what happens a few ratios, you will know exactly how line profit. Typical costs are insurance, labor, to the break-even point? you rate against your competition. You will rent, taxes, advertising, office supplies and 3. If we raise the price by $.50, but it know exactly where you need to improve to utilities. These are calculated in total dollars takes an increase of $100 in overhead, what improve your chances of attracting capital at and not on a per unit basis. happens? the right price. 4. Determine your break-even point. 4. If competition suggests we lower the The following discussion of some basic Once you know your overhead costs, selling price by $1 how many more units need formulas will tell you a lot about how to run take that amount and divide it by your to be sold to break even? your business, but more importantly, will also contribution margin in dollars per unit 5. What if the price we have to pay for make you learn about the accounting tools Example: Let’s say your overhead is $1,000 material goes up $1 per unit and overhead that you will need down the road. and your contribution margin is $8 per unit. goes up $120 due to security issues and we There are really only two types of Your break-even point in units is (OH/CM add one employee at $3, but terminate a now investors — financial and strategic. Financial = BEP) or $1,000/$8 or 125 grams. Simple! former employee at $4 OH? What is the investors look at the bottom line to see if Now let’s see why this is a good starting place BEP? you meet their investment criteria (there are to do financial forecasting. Using an electronic spreadsheet allows specific ratios they will look at). Strategic Let’s say you are able to cut overhead the various “what if” scenarios to be played investors invest in companies where they costs to $800 in the example above. Your out easily. An Internet search of “How to can get some “value added” such as getting break-even point goes down to 100 grams. compute a break-even point” will show you into a niche they want to get into fast, get Then, let’s say you raise your selling price $2 multiple other ways to compute BEP based a relationship the investor never has been per gram, bringing your contribution margin upon your individual information. able to get before or get something that to $10. Your break-even point goes down to The easiest and best way to set up an complements their other operations They will 80 grams. Investors will want to see these income statement spreadsheet for BEP and look at different ratios. relationships so they can play “their games” the formulas used by investors is to take your Regardless of the type of company — if they can do things less expensively than income statement below the Revenue section investors are looking at, they all look at certain you can, they know your break-even point and set up five columns as shown below. This financial indicators. The simplest indicator to will also go down, resulting in more profits. makes it easy to drop in budgeted amounts calculate is the break-even point (BEP). It is Let’s complicate things just a little. Don’t or actual results to get the management very easy to compute and is a good start to panic — this knowledge will help you as well information you need. understanding the other indicators investors as a potential investor. Once you get a feel for what you are will look at. Overhead costs are made up of variable trying to accomplish, the list of expense The break-even point is where your and fixed costs. We need to divide them for categories grows on your spreadsheet but products stop costing you money to produce a better understanding and to produce a the premise stays simple. (Jumping the gun and sell, and start to generate a bottom-line forecasted net profit. a little — if you go to the Risk Management profit for your company (and ultimately an Fixed costs (FC) are any costs that do not Association books for your specific SIC investor). go up or down based on volume/revenue. For Code and/or NAICS Code you can put your Let’s do a very simple break-even point example, rent will be the same if you sell 100 spreadsheet together in the exact same format analysis. grams or 1,000 grams of cannabis. Insurance as they use so you will know exactly how you

78 | MARIJUANA VENTURE // September 2014 GUEST COLUMNIST

funding, you need to know the language of business. Unfortunately for those of you that do not like accounting or even thinking about accounting — you need to change your attitude. Accounting is the language of business. These articles will not be about accounting, per se. They will be about how accounting and ratio analysis can tell you if your business is in trouble, whether you are under-performing or performing better than your competition, and also about how to use accounting to tell a story that will attract investment. compare instantly. The Risk Management be used by your competitors and investors Knowing accounting can also tell Association Statement Studies collection is valuable. Knowing certain ratios also tells investors you know how to get out of the of books — formerly known as the Robert you if you are performing at an acceptable trouble you are in, or how you are doing so Morris Associates Company Statement level against your competitors. Knowing that well and why they should invest in you. Many Analysis — tells you what every banker accounting is not to be feared and truly is the of the questions you will be asked on your looks at to compare your financial ratios and common language of business should make fundraising adventure are standard and we success against your specific competitors. you more receptive to doing simple ratio will talk about them. In fact, most questions Investors use the same analysis because it is analysis on a consistent basis. you will be asked will relate to how you stack so comprehensive and unbiased, while maybe The real bottom line is that you are in up against your competition. MV using a few different ratios than a banker business to make a profit. The more you know Miles Stover is the founder and president of might.) about how to do it, the better. Turnaround, Inc. and TurnRight, Inc. For more In future articles, we will discuss In this short article we have learned than three decades, he has worked hands-on that there are ratios and statistics that you sophisticated ways to attract investors, how with organizations from start-ups to Fortune 100 will eventually be forced to face to run your to make presentations on the subjects they companies in a variety of roles. business more efficiently and/or to attract care about and the accounting issues they investors. Knowledge of the ratios that will are concerned about. If you are looking for

www.MarijuanaVenture.com | 79 GUEST COLUMNIST Taxes for retailers: Cannabis vs. paraphernalia By Debora Peters dilemma paraphernalia. I have visited a number of retailers will retailers and it appears that most stores have face is how dedicated a larger portion to paraphernalia toA set up your retail due to the fact it takes up much more space space to efficiently than cannabis. serve your customers Once those determinations are made, and maximize tax a review of all facts and circumstances need deductions. As we to be considered prior to a conclusion of know, paraphernalia is how to record the stores expenses. The first not a controlled substance and therefore does method is based solely on square footage. not fall under the same regulations as Internal If the store’s total space is 1,000 square feet Revenue Code Section 280E. Paraphernalia and 80 percent is allocated to paraphernalia, is federally legal and therefore a deduction is then 80 percent of all operating expenses, allowed for ordinary and necessary business such as rent, utilities and insurance, can be expenses. expensed against the paraphernalia activity An important fact to remember is that For the remaining 20 percent of space that is just because a business incurs an expense it allocated to cannabis, no deduction would be still may not be deductible on the federal allowed unless the expense can be considered return. IRC Section 162(a) defines that as cost of goods sold. in general, the expense should be routine The second method is that of gross and directly related to the business activity. revenues. When two activities are operated Ordinary does not require habitual or under the same business and are financially made often; the court only requires that the dependent upon each other, this method expense is one that is ordinary and necessary must be considered as well. If the store’s for that business. When you are considering annual income is $1,000,000 and $900,000 the deductibility of an expense, six different of that comes from cannabis products, the elements are required to be met: calculation would be as follows: 10 percent 1. Ordinary; of rent, utilities and insurance can be 2. Necessary; expensed against paraphernalia activity and 3. Expense; the remaining 90 percent will be allocated to 4. That was paid or incurred (if using the cannabis activity. Once again, unless the accrual method of accounting) during the expense can be considered as a cost of goods taxable year; sold, no deduction would be allowed. 5. In carrying on (excludes start-up I have heard many comments made that expenses, which are deducted differently); there is no way to make a profit in the state 6. A trade or business activity. of Washington in the cannabis industry. I To translate, this means that a retailer disagree; with proper planning and pricing of for tax purposes is actually conducting two your product, there is still a profit to be made. separate activities under the same business. As complicated as these issues seem, the key The first is selling cannabis products, and to success is planning and understanding deductions are limited to only Cost of the tax issues. I would recommend you seek Goods Sold. The second activity is selling professional guidance to help get you on paraphernalia, which all qualified ordinary the path to profitability. In next month’s and necessary expenses are allowed to be issue, I will be addressing the federal rules deducted. and regulations for employment tax issues So how do we handle this challenge? as well as 1099-MISC filing requirements. The answer is very carefully. When a retailer Regardless of whether you are a retailer or is setting up their store, you should consider a producer/processor, it is important to the square footage you are dedicating to understand these federal filing requirements selling cannabis products and the square and the record retention rules. MV footage you are dedicating to selling

80 | MARIJUANA VENTURE // September 2014 GUEST COLUMNIST MARIJUANA VENTURE Advertisers Directory Knowing when to quit Accounting/tax services By Steven Fuhr Peters Tax Solutions ...... 35 Buildings/land available ver the Fourth going, or that it would cost us this much, or that South Fork Business Park ...... 22 Business services of July weekend so many new obstacles would keep popping up Hyper Micro ...... 57 I watched on a daily basis. No one could imagine how many ASM Direct Services ...... 71 O“Saving Private Ryan” of us would be lost in the first wave, how brutal Consulting Tri-Q Systems ...... 41 again. If you haven’t seen it would be, or how clogged the beach would get. 502 Enterprise ...... 47 it, you owe it to your The scary thing is 80 percent of us haven’t even Steve Fuhr ...... 70 fellow American soldier gotten a first call up yet. In D-Day terms, we Gold Tree Consulting ...... 51 to do so. At the very least, really just started hitting the beach. Display cases Bud Bar Display ...... 36 go on the Internet and Much like our troops in the D-Day Electrical distributors/retailers watch the Omaha Beach invasion, it took a while to get a safe position North Coast Electric ...... 26 scene. Veterans of the battle say it was the most secured, but we finally found a new site. Our Indoor Tropics ...... 46 The Grow Shop ...... 52 realistic war scene ever shot, and when you see unit is now moving forward, along with about OGA LLC ...... 80 the first landing craft open its door, you definitely 100 production and processing operations, and Groco ...... 84 get a taste of the horrors these young men faced reinforcements are ready to join the fray as each Employment Viridian Staffing ...... 27 on D-Day. Most don’t make it to the beach hour passes. We even have our retail division on Events alive, and many who do just take cover behind the flank now to supply us with the life-blood Green Rush ...... 19 anything they can find, crying and shivering from of any army: cash. Our industry is finally taking Greenhouses fear. However, a few brave souls push on, despite big steps forward at a time when so many forces Horticulture Services ...... 36 HVAC overwhelming odds. have vowed to destroy us, Elkins Climate Control ...... 51 That same week, our “This is turning into a war of and we are now a cohesive Machinery team prepared for our own force to be reckoned with. Tri-Q Systems ...... 41 attrition, and only those who Eden Labs ...... 51 invasion of sorts. After Winston Churchill once Apeks Supercritical ...... 75 year-long battles with are willing to stick it out will said “Success consists Merchant services columns of government of going from failure U.S. Debit Services ...... 12 agencies and battalions of win. And this battle is far to failure without loss DMS Financial ...... 27 Rock Solid Financial ...... 70 county officials, we tried from over.” of enthusiasm.” It may Misc. supplies/equipment to take a foothold on a sound trite, but it speaks Method Seven ...... 6 small piece of land to create a defensible position. well to what we have all had to do to push on in EcoGreen Industries ...... 49 Packaging Fear and uncertainly gripped our team, as we this brutal campaign. Earthwise Packaging ...... 10 had lost our first four battles brutally. Comrades As battle scarred as I feel some days, I’m Bud Bar Display ...... 36 were dropping all around. Most are getting happy to report that everyone in our unit is still Kush Bottles ...... 52 WS Packaging ...... 57 slaughtered before even hitting the beach. As our alive, and I dare say, enthusiastic. It would have VacuPack ...... 59 door opened, the bullets started to fly, and then a been easy for us to say, look at the hit we took Sweet Pack ...... 57 mortar landed right in front of us. Still in shock, losing our fifth location — poor pathetic us — Insurance I looked for a place to hide and cry. Actually, I and everyone would have understood, but instead Premier Dispensary Insurance ...... 49 Gunning and Associates ...... 67 thought we were dead. we stayed together, dug in, regrouped, assessed Labeling As of July 1, our team has officially lost five all our options, covered each other’s backs, took Maverick Labels ...... 48 sites. The last “mortar” to hit was our fine county immediate action to improve our position, kept Leading Edge Labels ...... 64 Legal enacting an emergency moratorium, after enacting our heads down, and then we kept moving THC Law Firm ...... 8 a favorable I-502 ordinance seven long months forward. Jeffrey Steinborn ...... 27 ago. One of the sites we actually lost twice. We’ve So these days, when I hear a licensee tell me David Kerr ...... 35 lost investors and a long list of other battles too. they’re thinking of giving up because this is all too Garvey Schubert Barer Law Firm ...... 64 Lighting/electrical supplies As I looked around, I noticed most every other hard or frustrating, I tell them my battle story. As Powerbox ...... 2 licensee was in a similar skirmish. For some, fatal a British citizen myself, and battle hardened, I feel SolisTek ...... 18 blows had been struck by the Washington State I’ve earned the right to say, “Keep a stiff upper lip North Coast Electric ...... 26 Cycloptics ...... 32 Liquor Control Board, and the fight was over. and soldier on.” I think back to what my partner Dorm Grow LED ...... 35 Others lost locations, investors, or both, but I’m Andrew told me when this latest moratorium was Eco Grow ...... 58 finding many just hide from the unrelenting fire announced and I was sure we were done. He said, iGrow ...... 83 Groco ...... 84 and shock. They’re not dead; they just give up, “This is turning into a war of attrition, and only Security just like some young boys did on D-Day, hiding those who are willing to stick it out will win.” CCTV Dynamics ...... 23 behind tank traps. They are not cowards either. And this battle is far from over. Security Safe & Lock ...... 26 They are just overwhelmed with fear and trying to Of course, we all know what Churchill Software CannabisTracker ...... 63 survive. As I watch this movie unfold, I wondered would say if faced with such a daunting task as Soil/nutrients why is it some push ahead under overwhelming we are today. He’d stand proud, with a fine single Miller Soils ...... 13 odds when others give up? malt scotch in one hand, and (if it were legalized North County Bounty ...... 16 Testing labs In the fog of this I-502 campaign — this then) a big fat in the other, and say we Confidence Analytics ...... 68 war as I now call it — it helps to know that you should “Never, never, never give up!” M V Trade/business associations are not alone on the beachhead. You’re not the Washington Cannabis PAC ...... 72 only one who is afraid either. No one imagined Water equipment Acoustic Water Treatment Services ...... 63 when this all started it would take this long to get www.MarijuanaVenture.com | 81 A LETTER FROM THE EDITOR

under-funded business models and miles of red tape are going to force many businesses Hello Oregon, Colorado to close their doors. Eventually — and this he August issue today, proving that we’ve created something could take several years — the industry of Marijuana that has value for both our readers and our will be highly competitive, not significantly Venture advertisers. different than bars and restaurants or the Tmarked the six- We started spreading our readership to alcohol industry. The difference between month anniversary include state-licensed marijuana businesses success and failure could hinge on how for our fledgling trade in Colorado and Oregon in June. Although well you understand taxes and accounting publication. However, we’ve generally steered clear of the medical strategies, how efficient your grow operation it’s only been the industry for a handful of reasons, we believe is, or how well-designed your retail store is. past three or four Oregon voters are likely to approve Measure To that end, our readers are the most months that we’ve been mailing to all state- 91 in November that would pave the way for important aspect of what we do. licensed marijuana businesses in Colorado legalization similar to the system in place in I’m not an expert in horticulture or and Oregon, so I don’t feel like we’ve been Washington. retail. I’m not an expert in marijuana or how properly introduced. to run a business. As we continue to expand our That’s why we’ve enlisted experts in their readership, advertising base, page fields to contribute to the magazine, and we count and the scope of our coverage want to report on this industry from an of the cannabis industry outside of unbiased, scientific perspective. At times it Washington, now seems like a perfect might shake up the conventional wisdom of time to recap our story and lay out the industry, but our purpose is the long- our vision for the future. term success of those pioneers that are We launched Marijuana Venture taking great risks in this emerging space. in March with an eight-page black- And we’re always looking for more and-white newsletter. It wasn’t even people that are willing to contribute stories, stapled together. Just two sheets of photos, opinions, letters to the editor, paper, folded in half and mailed to If you have a question, comment about 4,000 business owners. We really or complaint about a story, shoot me had no way of guessing how fast — or an email at Editor@MarijuanaVenture. even if — it would gain traction, but com. It’s also an opportunity for business we believed the legal marijuana industry owners to get involved. Email us photos was in desperate need of a highly targeted of your plants, your products or your cannabis business magazine. operation and staff members. Tell us That assumption proved to be what stories you’ve enjoyed or which completely accurate. ones you’ve hated. Suggest topics for us There were already dozens of weed to cover in the future. Submit a question magazines directed at the consumer — for our team of attorneys, or for an some of which are very well done — but upcoming “Ask the Expert” section on none that did a great job of speaking to the Turning our attention to cultivation. Contact us to change or update business owners. So that was the approach the future, we plan to keep using the same your subscription information. Or just drop we took. We were going to be blatantly and formula that has proven successful so far. us a line to introduce yourselves. intentionally different than the “stoner” We’ll continue to grow and continue to And don’t forget that email and our magazines. refine our process. Every month we discover print edition aren’t the only ways to stay The growth rate has been fantastic there are more important stories to cover connected to Marijuana Venture and the to witness. We’ve been able to organically than we could ever fit into a single magazine. latest hot topics in the cannabis world.Check increase our page count almost every month, As a writer and an editor, it’s a great problem out our Facebook page, follow MJVenture on going to 20 pages our second issue, then 36, to have. Twitter and Instagram, and visit our website, 48, 64 and 84 in August and September! Ultimately, we want Marijuana www.marijuanaventure.com. MV Every step of the way, we’ve made sure Venture to be the national go-to for the best to improve the quality of our paper and information on running a legal marijuana GARRETT RUDOLPH printing, as well as refining the style and business. We want our readers to become EDITOR substance of our stories. wildly successful in whatever aspect of the Looking back now, I’m extremely industry they’ve chosen to pursue. It’s true the amazed and grateful for those early businesses industry has the potential to create hundreds that took a chance on advertising with us — of instant millionaires. But on the other 75 percent of them still advertise with us hand, excessive tax rates, over-regulation,

82 | MARIJUANA VENTURE // September 2014