National brands. Franchise stores. Entrepreneurs are plotting a future for American pot that looks quite different from what voters may have bargained for
Beer has its Budweiser. Cigarettes have Marlboro. And now, from Nevada to Massachusetts, pioneers in the legal-marijuana industry are vying to create big-name brands for pot.
When the legalization movement began years ago, its grassroots activists envisioned a nation where mom-and-pop dispensaries would freely sell small amounts of bud to cancer patients and cannabis-loving members of their community. But the markets rolling out now are attracting something different: ambitious, well-financed entrepreneurs who want to maximize profits and satisfy their investors. To do that, they'll have to grow the pot business by attracting new smokers or getting current users to buy more.
To hear these pot-preneurs talk is to get a better sense of how the legalized future could unfold and just how mainstream they believe their product can become. Says Joe Hodas, chief marketing officer at Dixie Elixirs & Edibles, a Denver maker of pot food products: "I want to get that soccer mom who, instead of polishing off a glass of wine on a Saturday night, goes for a 5-mg [marijuana] mint with less of a hangover, less optics to the kids and the same amount of relaxation."
Other startups envision nationwide chains where pot in all forms will be sold in well-lit stores with gleaming corporate logos and friendly, well-trained employees.
Considering that marijuana remains prohibited by federal law, these plans might seem premature. But entrepreneurs believe the country is at the tipping point, with medical weed already legalized in some form by 23 states and the District of Columbia. Eager capitalists are already betting that Florida will go next-and they are raising funds and buying real estate to get ready.
With each new state to vote yes, the possibility of federal legalization grows more real. This makes the big questions surrounding pot commercialization urgent for those on every side of the debate. How should advertising be regulated? Should the rules favor homegrown businesses or national corporations? The legal pot market in the U.S. is already a $3 billion opportunity with the possibility of growing to $35 billion, according to some estimates-and capitalism doesn't leave money on the table. Americans are voting for a change, but are they ready for Big Dope?
From Greek Yogurt to Pot
Adam Bierman is nobody's idea of a pothead. A 33-year-old former college baseball player, he started a branding company a few years ago that created websites and inviting retail spaces for food businesses like fresh-juice bars and Greek-yogurt joints. One day in 2009, after a call from a prospective client, Bierman showed up at a medical-marijuana dispensary with his briefcase to find an old woman with her hair dyed electric blue. She looked "like one of those troll babies," recalls his business partner, Andrew Modlin. "I asked her how much she made," says Bierman. "She said [something like] $300,000-you know, crazy numbers. I was like, 'No, not what you made last year, what you made last month.' And she said, 'That was last month.'" On the way back to their office, Bierman turned to his partner and said, "Why aren't we doing that?"
