These are exciting times we are living through. Ten years ago if you would have told me we would be on the cusp of legalization, growers would be going mainstream and major politicians would be making marijuana part of their rhetoric, I don’t know if I would have believed you. We have come along way, but we are not there yet. For a lot of entrepreneurs it’s still hard to know when to put yourself out there. After all you don’t want to miss the boat, but people do still get busted all the time.
The other day I was interviewing one such entrepreneur for a story for a local paper. This person gave me all the details of their business in a very candid interview. It sounded like a great idea. They had put a lot of work into it and already had employees, forms, a business name and customers. About 2 hours after the interview they called me insisting that I don’t publish it. What happened I asked? After all they knew what it was for, knew it was on the record and we had planned it a few weeks in advance.
Turns out they were scared. It seems they where not ready to go public after all. Typically there are no take backs with the press. That being said we live in a unique community and I’m not trying to get anyone in trouble. I agreed to hold off on publishing the interview. It got me thinking though: when is the right time to go legit with your weed business? After all we are still sailing through ambiguous legal waters. A lot of people have come out, though, attempting to get legal, and may be the first wave of business people to reap the rewards. I have come up with 4 things to consider if you think your business is ready to go legit.
Number one is the legal consideration. First things first, get a lawyer. Any major business would at least get some form of legal consult and in this business it is doubly important. Checking what you’re doing with a lawyer might seem expensive, but consider the alternative. Ask yourself is what your business doing illegal? This question may be stickier than it seems. There are wild contradictions between state laws, county laws and sometimes even between cities. We all know that growing and selling cannabis is still illegal on some level but what about assisting people in doing that? What about creating products and services that help people do that?
That brings me to the second consideration: education. You’ve got to educate yourself. Again this is something any business should do but it is extra important in this industry. It is your job to know what all those city, state and federal regulations are. Do you need a permit? What kind of records will you need to keep? What do you know about running a business? Maybe your making good money underground. Running a legit business is not the same as growing weed in someone’s garage and selling it to a friend of a friend for a ridiculously huge margin.
Number three then is the economic viability question. Is there a profit to be made in what you are doing legally? You need to know the numbers. Will your business be profitable when you are paying taxes, insurance, advertising and professionals like lawyers, accountants and bookkeepers? What are the profit margins, who are your customers going to be? Maybe you have customers now, but are they going to follow you into the light? What’s the competition like? Do you need a patent or trademark for any part of your business?
Lastly, there is your friends and family. Now we all know a lot of haters and naysayers who aren’t doing anything and don’t think you should be either. I’m not talking about listening to the negative people you may or may not have in your life. What I’m talking about is – are you ready to come out to your family and friends and say this is what I’m doing, this is who I am. A support system is essential during a big life change like starting a business. For some people this one is no problem. For other people this is the biggest problem. Ask yourself can you tell your kids? How about your parents? You can’t just say I’m a landscaper, masseuse, house cleaner, or lifestyle coach anymore. Do you have a straight job on the side? Are you ready for your co-workers to know? Like it or not there are still people, maybe people in your life, that will be put off by you working in the cannabis industry.
Anyway you cut it starting a legal business is a big deal, doubly so when it has to do with cannabis. Make sure you’re protected, educated, viable, and comfortable telling friends and family about it (at least the ones that support you). Finally, whatever you do, don’t talk to the press about it if your not 100% sure your ready to go public.
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