Marijuana Entrepreneurs Eyeing Florida Get Creative

NEW YORK (MainStreet) — The Florida marijuana market may be one of the most expensive ones in the country to do business.

The CBD only legislation signed into law this summer by Governor Rick Scott and the anticipated victory in the fall for full medical marijuana use has made the state a successful model watched by legalizing states downstream. Of particular interest is the way previous legislation is expanded via voter mandate to increase very limited legislatively approved medical access.

Yet offsetting costs of entry to the marijuana business with such a complicated legal backstory can present a challenge. Florida is, as a result, a developing market in which both in- and out-of-state entrepreneurs have to be highly creative even to enter. This is even more true, particularly given the development of existing rule-making taking place around the Charlotte’s Web law, which sets a very high cost to enter the market and not just monetarily.

Growers, under current draft legislation being crafted around the CBD law, must have as much as 30 years of growing experience in the state to be considered for licenses.

Ata Gonzalez, a Florida native who moved to California to participate in the green rush initially as a grower and dispensary owner, is eying his options to re-enter his home state market strategically this time as the CEO of overnight wonder hit GPharmaLabs. The seasoned entrepreneur, father of five and his wife have been plotting the national expansion of their company carefully.

He is a soft spoken, polite teddy bear of a man who has seen his new company go head to head with Godiva this year while attracting the attention of significant venture capital after winning the L.A. Cannabis Cup. Gonzalez talks about the Florida market with the exasperation of a seasoned industry executive who has dealt with the politics of the business and managed to transcend previous obstacles (in now several states).

GPharmalabs attitude is that entering the market now is worth it, because whatever happens in November the company will be able to position itself as a legitimate member of the business community, and thus gain valuable first mover advantages,” Gonzalez explained.

That said, he is not entirely copacetic about the almost absurd market development in the state via legislative rulemaking, which is taking place with little planning or foresight for events even six months down the road in this case.

“We have an MOU [memo of understanding] with existing nurseries in the state,” he said. Nurseries which are eligible under this new legislation do not have to grow the plant but can own 25% of operations. They are just the ones who are able to apply for the licenses. In our case, the grower would like to be involved in the process.”

When asked why he is already participating in a developing market rather than waiting until after November to see how the market shakes out after what is widely expected to be the success of expanded medical access, he is direct and to the point.

“We see as the only upside to participating in the Charlotte’s Web licensing process is that we become a legitimate, operating, licensed business in the state as the vertical expands to presumably other medical after the November vote," he said. "If Florida even eventually follows in the direction of, say, Colorado, perhaps the development of a recreational market down the line, we are already in the door as a licensed producer and manufacturer of cannabis related products.”

No matter what happens, Sunshine State son Gonzalez and his family are facing down these challenges as they occur with the knowledge that in this case, greater change is on the horizon.

“Other than that it is a huge application process, it's a lot of money and as soon as Amendment 2 passes, the Charlotte’s Web law is done and over with,” Gonzalez said as he summarized the impact of the CBD law on his business.

It is a view shared by many in the vertical, even if braving the Florida market (or any state market) or not. Those like Gonzalez who have paid their dues and become the lucky few to get this far are committed to the success of not only their own companies but a vertical they are helping to build from the ground up.

They also understand that the road, particularly in Florida right now might be a bit bumpy. That said, given the unbelievable distance the market has come this year, a little success goes a long way. Entrepreneurs like Gonzalez also have proof, particularly given the national mood and ongoing reforms all over the United States this year on the legalization front, that persistence and patience in riding the sometimes choppy waves can pay off.

--Written by Marguerite Arnold for MainStreet

More from Personal Finance

3 Apps Than Make Retirement Planning Fun for Millennials

3 Apps Than Make Retirement Planning Fun for Millennials

What the Fed Rate Hike Means For You

What the Fed Rate Hike Means For You

What Is Drew Brees' Net Worth?

What Is Drew Brees' Net Worth?

The Best Places to Live in the U.S. if You're Young and Broke

The Best Places to Live in the U.S. if You're Young and Broke

What Is Matt Ryan's Net Worth?

What Is Matt Ryan's Net Worth?