The Ins and Outs of Licensing - Branding Bud Live Episode 13
THE SUMMARY
Obtaining a cannabis license entails hurdles, roadblocks, complications, and nuances unique to the industry. Building a national cannabis brand state-by-state in a fragmented and evolving landscape is extremely complicated. Check out the conversation we had with Sara Gullickson, CEO & Founder of The CB Advisors on "The Ins & Outs Of Cannabis Licensing".
THE CO-HOSTS
David Paleschuck, Adriana Hemans
THE SPECIAL GUEST
Sara Gullickson, Founder & CEO of CB Advisors
THE FULL TRANSCRIPT
David Paleschuck
Welcome to Branding Bud Live, the live stream that’s 100% THC and 0% WTF. Every week we speak with business people about the business of cannabis. I’m David Paleschuck, founder of Branding Bud Consulting Group and author of the first book on cannabis branding. I’m joined by my co-host Adriana Hemans, a Marketing executive with over 8 years in the cannabis space. Hi Adriana!
Adriana Hemans
Hi David. Thank you for that intro. I’m so excited to co-host the show with you. We’re bringing amazing guests from across the cannabis ecosystem to share their perspectives. What makes our show unique is that we focus on building a community - and we encourage audience participation. It’s not just about us talking, it’s about all of us building something together. So feel free to drop your questions and/or opinions in the chat, and we’ll share them too.
David Paleschuck
Thank you, Adriana. And thank you, everyone, for joining us today. We have a lot of hot topics to get into today. In an industry defined by fragmented state markets and increasing competition, today, we’ll be talking about “The Ins & Outs Of Cannabis Licensing”. Specifically, we’ll be discussing:
The hurdles, roadblocks, and complications in obtaining a cannabis license.
What does building a national cannabis brand entail from a licensing perspective?
Are there different rules and requirements for different states?
Our guest is Sara Gullickson, She is the Founder & CEO of The CB Advisors and recognized as one of the “Top 20 Women to Dominate the International Cannabis Space”. More importantly, Sara has secured over three dozen - that’s 36 - cannabis licenses in sixteen states.
We also have audience participation activities as well. We’ll throw a stat up on the screen, so you can test your industry knowledge. We’ll be sharing a few stats with you today, we think you’ll find interesting, so please stick around for the entire show.
Adriana Hemans
Hi Sara!
Sara Gullickson
Hello. Thanks for having me. I'm excited to talk with the two of you!
Adriana Hemans
Hi Sara. Welcome. You’ve been in the cannabis industry for a number of years. Tell us about yourself and what you’re passionate about.
Sara Gullickson
I've been in the cannabis industry 13, almost 14 years. So that kind of dates me a little bit. But, you know, I got in not knowing what was going on, or if I was going to like it or hate it. And fortunately for me, I fell in love with the industry, I fell in love with the pace of the industry. And I've been able to work in you know, 20 some odd, you know, states maybe even 30 By now and five countries. And so, you know, my, my passion for the industry was realistically just my, like wanting to learn about something new and my out-of-the-box thinking and I grew up in a naturopathic household. My sister was diagnosed with a rare blood disorder when we were young, and the doctors wanted to take her spleen and put her on, you know, a bunch of medicine. And so, you know, since I grew up in an environment that way, when somebody came to me and was like, hey, get involved in cannabis, it wasn't scary. For me, it was just like, okay, you know, if somebody can take something natural and make themselves feel better, like, let's check it out. And so I would say I was young and naive. And that's what got me in. And then maybe fear kept me going. But yeah, I'm super passionate about the industry, I had chances to exit. And, you know, I'm still here. And I still love creating projects, and, you know, helping states legalized or go from med to recreational and, you know, that's kind of the very high-level version of why I'm here and what I love.
David Paleschuck
That's awesome. You know, it's amazing. 13 or 14 years is a long time in the cannabis industry. For like, a long time in any industry. I feel like but especially in cannabis. It's true. It's true. And you know, I've been in now just over 12, almost 13 years, and, and it's rare. I don't hear other than the really old school, old school. Totally. Yep. So it's just, it's interesting.
Sara Gullickson
I think we're Oh, geez. Now. This is like dog years, too, right. So it's like, you know, we've been in it longer than 12-13 years.
David Paleschuck
We used to talk about that when I worked in Microsoft. And cannabis is, I don't know what's No, there has to be an animal a year. That's more corresponding to the cannabis industry. Working in Microsoft is a dog. Yeah, it's pretty tough. And it's it changes all the time. And, and that's what's pretty interesting about it. You know, I'm curious, we spoke word in the intro, I spoke about the hurdles and the obstacles to obtaining a license. We just talked briefly about different states, and maybe some of the, you know, the differences and maybe some of the more glaring differences from state to state, just give us a sense of how differently the rules are.
Sara Gullickson
Yeah, so we pretty much categorize cannabis licensing states into three categories. So we have the Limited License, merit-based highly competitive state processes. And then those, you have to pull out all the stops. I mean, we've had clients spend $500,000, just on the application, not even knowing if they were going to actually get the license. And those are in states like Pennsylvania and Maryland, Hawaii. And so those you know, you have to really work on building a great business plan telling a good story, being a local, that's function grade and, you know, the environment that you plan on opening and so that local jurisdiction has some trust in you and some faith in you. And those are like my favorite projects, because so much strategy goes into them. You know, so much community building, you know, real estate selections, very competitive. And then building out this, you know, 1000 Page RFP or request for proposal with all your standard operating procedures, outlining to the government, how you are going to function within their environment. You know, it's, it's challenging, it's a great task and for us, you know, there's a lot of copy-paste consultants out there, but we really like to ensure that the plan is very, very customized to the local format, whatever that looks like. And as you know, the local formats they are different in every state, you know, pending on whether it's med rack, how many licenses you know if your vertical or not meaning can you cultivate process and sell? Or are you just doing one of the distribution channels. So you would I would say merit-based is the is the heaviest lift and a competitive Limited License process. And then the second category is checklist process. So checklist processes, you know, here's 10 things, you have to show us that you have real estate or maybe you know, a community plan or whatever that looks like, the government goes through it, make sure you have everything, and then you pass through. And those are a lot of times in like California, Colorado, so it's not necessarily a limited license. State. And then now in a lot of states now have lottery, which is my least favorite. Arizona has a lottery. That's how I got involved in the industry. And it's like, Hey, show us a couple of things, make sure that your apps compliant, and then we're going to literally pull your name out of a lottery machine. And then whoever gets it wins.
Adriana Hemans
I have to jump in here. Someone's going to pay $500,000 to get set up. And they may end up with absolutely nothing, because it's just a randomized drawing.
Sara Gullickson
So the merit based licenses where it's limited license, and you're putting your huge RFP or request for proposal together that can cost you around $5,000, the lottery fees are going for anywhere from like $250 to like two years ago, we participated in Arizona's lottery and it was 25K. So I haven't seen anything for a lottery that was over the $25,000. Cannabis is crazy. We know that it's crazy in every arena. And so that's how we really categorize the three license types. And then there's obviously idiosyncrasies upon idiosyncrasies in each of the categories?
David Paleschuck
Well, because I know, for example, in Washington State, you know, one of the things that's really slowing things down is that investors, I believe investors need to live in this game of residency in this game, and therefore, it's saturated already. Everybody that lives here wants to invest, as an investigator, really, from out of state is looking to invest, you know, to move or to set up residency. So it's just, it's so intriguing to see not only state by state, but I guess we'll talk later about, you know, retail versus retail and dispensary versus cultivation versus, like, the different types of licenses. But we'll, we'll jump into that a little bit later.
Adriana Hemans
So I'm curious to hear from you, David mentioned, you have 36 licenses that you've secured? What is it like managing so many?
Sara Gullickson
So we do a lot of client work at the firm. And then I am such a serial entrepreneur that I do a lot of like my own projects, where I'll put together groups of local people and investor. So I personally do not have 36 licenses, I wish I did, because I'd retire. But I do not, I have about eight licenses. And you know, my business model is really simple. The first license that I got was in 2018, I was already starting my family. And since my skill set is obviously very strong and license acquisition, you know, I'll put together a local groups with investors, and then we'll do the application fee for equity or Yeah, for equity. And then my model is simple, I either have the local people run the license, and that works very, very well. And then if they need me, and if they need our help at the firm for standard operating procedures, or marketing help or strategy, you know, they give us a call, or give me a call. And then some of my licenses, I just I rent out. And so what that means is all either have a management group or somebody will come in and get equity in the license and run the facility. So, you know, I think everybody's, you know, impression is that I know so much about cannabis and I know a lot about cannabis. But I know about the business side of cannabis. Like if you put me in a grow, I kill your plants, like it just would not be great. And even in a retail environment, like I don't know, the ins and outs like everybody else does that literally is in a facility every single day. So and then, you know, the same goes for clients, like a lot of times we have so much fun working with a client and see such great success and security number license that they're like, Hey, we're local, we're new to the industry. We haven't had this industry before. And can you open us and it's like, Of course we can open you and so we'll work either on like a, you know, Statement of Work proposal or retainer just to say like, Hey, what do you need, call us when you need us or else? You know, we'll actually do our whole grand opening for them. But my goal was never to be in a facility A every single day. You know, I learned very early on in my career that I like the consulting element of it because I like being able or before I had kids, I guess, I like being able to work from Thailand, I like to be able to work from Croatia. And so, you know, being a consultant has led to a lot of flexibility and had, you know, I've been able to create a life that a lot of people couldn't even imagine before COVID.
Adriana Hemans
Let's jump into our first audience participation. What do you think should we do? Should we throw up a slide and get started and see if people are ready to take some guesses and throw some? There are some guesses in the chat with cultivation?
David Paleschuck
I think the audience is ready.
Adriana Hemans
Right. This has to do with cultivation licenses. And the question is California has the most cultivation licenses of any state with 6,881? Which state holds the second spot with 1,406? Is it A Washington, B Colorado, C Oklahoma or D Oregon?
David Paleschuck
And these are cultivation licenses. Just to be clear.
Adriana Hemans
We were talking about cultivation earlier. And that's the area I admittedly know least about. I leave that up to the experts. I have so much respect for what they do what my area is more on marketing, retail, and now compliance having to come work now at Chorus Compliance.
David Paleschuck
Well, I'm curious to see because we definitely have a number of cultivators. Today, cowboy they're flooding in. In the meantime, I just want to call out a couple of people from the Pacific Northwest here. One is Brittany Parker. Hey, Brittany, we definitely have to get together as a team. We have all these people in the Pacific Northwest in Seattle that never gets together, except that you have some others in a snow day as well. Thank you, everybody. Well, wow, it seems like D is.
Adriana Hemans
This is a hard question. Maybe it's too hard. should reveal the answer.
David Paleschuck
Let's do it. Well, before we do, Sarah, sorry, what do you think the answer is?
Adriana Hemans
It's amazing looking at this chart, because there's such a huge steep drop off from the top state or the state with the greatest quantity to the next level down.
Sara Gullickson
I actually would have guessed Washington, to be honest.
David Paleschuck
Interesting. It seems there's a blur between Oregon and Washington. But there's quite a drop-off. Oregon comes in second behind California with one that was 1,406 affiliation licenses. And then Washington comes in third with 1,070 licenses. Making the west coast the leader in cannabis cultivation.
Adriana Hemans
Yeah, which would be exciting. If interstate commerce comes around, right. The West Coast will be exporting across the US potentially.
David Paleschuck
I think New York is a great example of, of laws coming into effect or licenses coming into effect and licenses being handed out yet that laws really being lagging behind, so when New York, I think it's a great example of people might know their license, but they're first figuring out the laws. And now I couldn't be more at this point, I believe two dispensaries in Georgia. But it's just interesting to see. Is there any thoughts about you know, that lag time between when somebody gets a license and when they actually open up a dispensary or skirt cultivating? How does business manage that?
Sara Gullickson
Yeah, it's interesting. So we just submitted a light or a couple of applications in Alabama. And their timeline is like two years. So basically, they'll take In the RFP or RFQ, phase, grade them, score them announced the winners. And then I think that the winners have like 1218 months to open. And so by the time you do all that, it's two years out, which is really crazy, especially since people are having to like lease buildings during that two-year period prior to even opening. And in Alabama, you get three retail outlets. So it's not just one building you're holding over. But at the end of the day, like, especially in the merit-based application programs, it takes that long, I mean, if you're getting 1000-page or a 500-page application, they have to read them, they have to score them, and there has to be like some sort of, you know, a lot of them go through an algorithm, but you still see people go through it, well, if you're grading your 10th app for the day, like I guarantee the score is not going to be as high your board, right. So I mean, it just takes time, I actually do really like it when the states put that like opening timetable on. Just because I think that going into the program, you have to have some integrity and meaning have the capital or have your investors like lined up to open, you know, but with, unfortunately, with anything good, like, it takes time, they can't just like throw these stores up mine and the people that can, or the multi-state operators that are like literally so sure that they're going to get these licensed, otherwise, they're going to have the cash to purchase one. And then they're going to be able to open because they've already done real estate selection, all of their tenant improvements, their marketing is already live, their communications team is intact. And so, you know, the longer timelines just allow for the industry to be, I think, what we all still crave for it to be, which is an incubator for local groups to also get in and have, you know, dispensaries with some flavor and monopod groups and local people that are doing really cool, unique things, instead of just getting all the licenses to the multi-state operators. Absolutely.
Adriana Hemans
I love what you just said about the incubator for community-based businesses. It's awesome.
Sara Gullickson
Yes, I mean, we've seen so many cool groups that are local people with amazing resumes, either working at corporate or entrepreneurs themselves, get these licenses and do really great things with them. And so I'm just, that's why I keep my firm. So bow Tiki, it's like we really like to work with the people that have good intentions and good ideas for the industry, so that we're creating cool businesses that are compliant, and that people like feel good going into.
Adriana Hemans
We talked a little bit about the struggle of people who are applying for licenses and how that can be really challenging. And we know that another challenge is also competition from the illicit market. Can you talk a little bit about that, and about sort of that interplay of vertical integration and combating competition from the illicit market?
Sara Gullickson
Yeah, so, you know, in my example for this is always like, when has a community ever been able to fully shift their culture? It just doesn't really happen. Right. And so California's culture is cannabis it, it's where cannabis was born. It's where the industry was born. It's where like, the legal industry. And so I know, a lot of the California operators are having a hard time, you know, with competing, because the fees are high, the regulations are stacked. They don't necessarily make sense together. And so, you know, I don't know that there's an answer to that New York's going through the same thing right now, where it's like, I mean, if you're downtown New York, you can get I mean, pretty much any drug you want, right? And that's part of the culture in New York, right? And New York functions, unlike anywhere else in the United States. And so it's going to be really interesting to see how that's, you know, how that, how that levels out, you know, and how the playing field ends up looking once there's like legal operators. I mean, in Canada, it's the same thing, right? I mean, I used to speak on Tony Robbins road show, so he did so much in Canada, and I went into a dispensary made a purchase, and then I told my friend that was in Canada, like, oh, I went into this dispensary because like, yeah, that's, that's not a licensed one. And I'm like, Well, how would you know, you know, so, you know, I just think it's, it's, it's kind of part of the deal. And I don't see in a lot of those markets that I just named, like the illicit market shrinking completely. And then what was your question about vertical integration?
Adriana Hemans
Oh, just how does it help or hinder if it's allowed in certain states, for people to stay competitive against businesses that are popping up don't have a license don't have to pay taxes? What does the interplay look like between those two factors?
Sara Gullickson
So I don't think it's like a vertical conversation, I'm more looking at it as a limited license conversation. Because if you have even 5000 licenses or 3000 licenses, there's got to be or 300, whatever it is, there's got to be a way to have some sort of a task force, ensuring that that's the number of licenses right 5000 is probably a little steep, but you get what I'm saying. For me, I'm not a huge fan of vertical integration, unless it's like true vertical integration, where you're allowed to cultivate process and dispense your own cannabis. But once you get into the wholesale markets, the barrier to entry is so steep to run a vertical, like, if you're looking at like Florida, or New York or Arizona, you know, to open up a vertical license, you're looking at, you know, 10 million easy.
David Paleschuck
And then that shuts out, a lot of people are like us, and in some states, you're forced to do that, you know, so, and we have a slide, which just talks about vertical integration. You know, it really, I mean, it really comes down to, you know, to the ability for salad, the inability for some team to basically, not only have the discipline, let's start off with the cultivation, cultivation, building and global facilities, then they need everything that brings it right up into the processing, and then all the way through to the story retail dispensary. So what that does is that offers a lot of money, which really a lot of the mom-and-pops out of the running for something. So, you know, it's interesting to talk about that, and our slides coming up in a moment, but it will just kind of just show. Here we go, you know, so, so really, you know, the effects of vertical integration, and I'll just read through this quickly is, each company wants to grow, process and distribute their own product, and only a few companies can afford to receive a license during a small market with limited competition. It's expensive startup costs, and high barriers to entry perpetuate the inequitable ownership of employment. And from a medical standpoint, patients are left with fewer options, and less overall assets. So it's really interesting, you know, when states take this approach of vertical integration, I don't think they really, you know, thought through how it really affects not only cannabis as a whole, but the various communities, whether it be patients or adult-use markets, or mom and pops that wants to be in the market for, quite frankly, the legacy folks that have been in the market and have been serving communities who are similar to what you said earlier. They don't get to perpetuate what they've been doing. Serving for years. So really interesting. To see this and to think about it, you know, in, in some ways that, you know, if you think about it, vertical integration is somewhat inequitable, and unfair, really puts the folks with money in the right spot at the spokes of one rolls. This is just an example of how this works. And how if it were a little, a little, if it was horizontal integration, it would just be a little more flowing. People can pick and choose the markets they want to serve or the leverage their core capabilities. You know, so they can focus on that.
Sara Gullickson
Yeah. Focus on. Yeah, I totally agree. Just because then your skill set has to be like retail environment, manufacturing, and like agriculture, basically. And it's like, that's a really wide skill set.
David Paleschuck
Right. Like whom? Who does that? You know, it's interesting. Well, it's hard to do at all. It is hard, though hard. It's one of those things. You know, so let's just flip this around for a moment. What, what makes a perfect cannabis license applicant? And is there such a thing? You know, when what are the cannabis boards looking for? I guess you said a few different things earlier, but what makes a great cannabis license applicant?
Sara Gullickson
So it's funny because I started speaking like early on into my career in cannabis and I would always like position the five elements that are great to have when you're, you know, applying for a cannabis license and a lot has changed in the cannabis industry, but that has not changed. So you know, you have to have a team of people that can execute and be compliant. You have to have a group of people that no cannabis, you have to have the financial resources to do the business. community ties, and I'm not talking about white envelopes and politicking, I'm talking about community ties to the environment that you're opening in, I believe are always going to work for you with, you know, making sure that that municipality knows what you're capable of, and how much they can trust you. And then the fifth things always been real estate. And so those were really my five ingredients that I started touting, you know, even back in the day, and that's not really changed. I mean, now we have some elements like diversity, or social equity, and like that changes the makeup of your team. But for the most part, if you have, you know, those five things, I'll work with you, if you don't have those five things we will. So you know, those are the things that we look for, and somebody that would be positioned very well to dip their toe into the industry.
Adriana Hemans
Since you just mentioned social equity programs a second ago, Sarah, can we talk a little bit about that? And what are some state programs that are doing this effectively? And maybe some that you see that need some improvement? Any examples?
Sara Gullickson
Yeah, so that conversation is interesting for me, because like, all of my personal licenses are diverse licenses. And now the diversity conversation has gone by the wayside. And now it's all about social equity. Right? So I mean, I understand it, and I get why it makes sense to include some of the people that have been wronged by, you know, cannabis criminalization, or whatever that looks like, you know, to get them into the industry and start, you know, you know, them down the path of like, you know, producing in like a legal fashion, right. It's just, you know, the back doors, so wide open on these programs, because of the fact that, I mean, I've interviewed hundreds and hundreds of social equity applicants, and I would say 98% of the social equity applicants haven't had the resources, financial resources or skill set to put a deck together to put a performer together. And I'm not saying from like a credential standpoint, but they, if they have the like business framework, they might not have the cannabis framework. So to me, my favorite social equity programs so far, is New York. And literally, we were joking when we did New York, because we were like looking for unicorns, which we literally were. So we were looking for somebody that had, you know, cannabis convictions, and then we were looking for somebody that also turned their life around and was a business owner. And so we ended up working with two groups, and submitting the applications within for them and taking equity in the business because they didn't have you know, cannabis. You know, they didn't have cannabis experience. So I felt like getting in our hands versus one of the MSOs, we could really, you know, do something that would, you know, set their family apart and, you know, get them the resources that they potentially needed to run the facility themselves, or just have like a legacy for their family. Right now we're working in Illinois. It's free for all, you don't have to have a residency requirement, people from all over the country can apply. The credentialing is like very, very loose. We're working in Washington; we actually just signed a woman today. That's planning on, you know, submitting her application, and she needs help. And she's like a total rock star, she has, you know, degrees upon degrees and has her finances in order. So that's super exciting. But Washington has the residency requirements. So, you know, like you said, Washington, supersaturated. Washington's been, you know, in the game for a really long time. And so these are licenses that were given back or gone out of business, and now they're giving them back out, which I think is good, but you know, who knows how much runway they're going to have. And at that point, it's a very competitive business and what's your marketing line item every single month? So I'd say New York's my favorite New York also has funding I forgot to mention that so we can get our funding through the state for our actual real estate and tenant improvements, and then we just have to raise capital for our operations which I think is like a fabulous I think if we saw more states come online in a fashion like New York did I think I would be I'd feel really good about it. If we see you know, states like Arizona and Illinois, you know, come online where it's just kind of a free for all and then you know, the MSOs are tying the people to a contract and giving them a $400 gift certificate just to like to put their name on that. without reading the contracts like that's the problem.
Adriana Hemans
You heard it here first states coming online copy New York.
David Paleschuck
Yeah. You mentioned something earlier, which kind of caught me by surprise to get into this diverse a diverse license and a social equity license. It's interesting. The nuance between those two are there are their specific diverse licenses and social equity licenses.
Sara Gullickson
So before social equity came online, there were usually a number of licenses in some of the state. So if there were 100 licenses available, they'd give 25% of them to diverse entities. So that's either women owned and ran and African American or whatever in that state. classified as diverse, but now that the licenses are getting so like synthesize, I guess I would say, they kind of put that out and brought social equity in. So we're not seeing a lot of diverse application categories that puts women to the front of the line or defer other diverse categories to the front of the line, because social equity is kind of taking those over. So that's the correlation that I was like, hinting to, I guess,
David Paleschuck
Should we jump to our audience participation number to do it, who's ready? It's a choice. The audience, this is your chance to shine again. And thank you, everybody, I see. Aaron. So let's jump into this. All right, quiz number two, as of December 22, so just really, a month ago or two months ago, what state had the most dispensary retail? Retail? Is it A California, B Michigan C Oklahoma, or D Colorado? And again, this is only dispensary and retail licenses. It's just reeling from the last two months. Jason McHugh from California on refresher.
Adriana Hemans
I'm seeing quite a few guesses for D Colorado and a couple for A California, let's say about evenly split between A and D. And I also want to say thank you to Aaron for clowning me for my background. Definitely going to be on room Raider for sure.
David Paleschuck
Okay, I said before I have a book for that shelf. Cool. Well, all right. We've got Oh, Aaron see otherwise. All right. Well, before we go to the, the answer that we asked here.
Sara Gullickson
I'll go with A.
David Paleschuck
So for the most part, you're thinking, thinking it's either California or Colorado seems to be the go for the answer. Let's reveal the answer.
Adriana Hemans
Surprising answers. Erin got it. Right, Aaron guest see? And so did Jason. Good job.
David Paleschuck
So surprisingly, Oklahoma has 3,628 dispensary licenses, which equates to 24% of all, again, retail licenses, nationally granted. And if you just look at the numbers here, they might be a little hard to see. But let me just throw these two things out, which is really interesting. So California has a population of just about 39 million people. And they have 1,092 dispensaries, whereas Oklahoma has 3.9 million people, right? California has 10 times more the amount of people in Oklahoma and the dispensaries are 2,628. California has 10 times more people with how half the number of dispensaries versus overall. So it's really interesting to sort of see that and you know, Sarah, is that I don't I don't know, like, is there any rhyme or reason, you know why certain states have, you know, can really go off the deep end and other states and more maybe moderate with their, with their counts on like, under their license counts.
Sara Gullickson
You know, I'm just I'm not a big fan of unlimited licenses, I just think from like a regulation standpoint and making sure that they're actually like regulated facilities is just like a huge nightmare. But states like Oklahoma, like they just came out the gate and they were like, this is going to be a free for all. So I've worked on one project in Oklahoma. And it's just like, it became like an incubator for crime and bringing in, you know, foreign dollars and mob ties and just too much like political negative political interference. And then in California, I think that numbers shrunk significantly, because of the fact that it was a free for all right, and then they put all these crazy regulations on top of everything, and then the state's regulations doesn't make sense with the municipality regulations. And so it's just become like a real nightmare for people to like, function and California. So for me, I mean, I think that like, when you're talking about why the states do what they do, I think they know what they're doing. Right. So like, New York, when it legalized, they did vertical licenses, and they did a handful of them, they knew what they were doing, they were bringing the big dogs in, and letting the big dogs have the lion's share. And then people complained and now they're like, you know, separating it and bringing, like smaller people and, and social equity candidates and stuff like that. So, you know, I think back in the day, the states did get a lot of flak for doing it. And now everybody has their eyes on the cannabis industry. And it's become such a hot topic of conversation that the states know that they can't get away with that stuff anymore. And, you know, same goes for, you know, the unlimited licenses like Oklahoma came up, the floodgates gave all these licenses away, and then all of a sudden, they were like, shoot, we have to put a moratorium down because we don't know what we're doing. And like, it's just gone wild. Right? So it's like, why wouldn't you do something like, you know, Texas or some of the other states that said, pending on the patient count or pending on, you know, supply and demand, then we'll add licenses online. To me, that's the most realistic and logical approach. But you know, each state has their own agenda. And it takes, you know, I think when I first got into this industry, I was so blind to politics, you know, and sometimes like adding things like that in the bill, get it passed, or it gets the right pockets behind it. And so, like, we're not in a perfect world, and like, the more I learned about politics, and why things are the way they are, the less critical I became, because, you know, would you rather have no medic or recreational use in your state? Or would you have, you know, without capitalism or with capitalism, you know, what I mean? It's just like, it's not like a perfect program. And I think once you kind of throw the like negatives, out the window, instead of like, trying to, like critique all the programs, it's like, Okay, here's the framework of the programs, we can lobby to bring some other things in, but like, at the end of the day, like, it's amazing what the industry is done in such a short period of time and gotten access to millions of people that wouldn't have had it before. So at the end of the day, we're still doing awesome, you know?
Adriana Hemans
Yeah, a couple of really good comments just popped up that I wanted to call out. One is from Ruth who added, Oklahoma grow, and retail licenses are available to any resident for about $2,500 super helpful contacts. And also, I liked what Aaron said, a low bar to access license is true social equity. Interesting perspective there.
David Paleschuck
Just to comment really quickly, the scenario you said something which is amazing, you know, dealing with clients all the time in the cannabis industry in developing brands, and programs, we always say we, Adriana and I, we always say who your clients, you know, we asked about their customers and your clients, we always start there first. And it's interesting that you just basically said like, the state should look at who their cannabis consumers you know, what I mean? And, and once you know, who you are appealing to, and what the needs are, then you can start setting up the programs that offer the licenses that support the people that need the license. Yeah, yeah, it's really interesting. So, quick, quick last question here. I mean, how does how does real estate you know, tie into this you know, this is one need to have real estate first before license is it the chicken or the egg? You know, is there real estate come first for licensed consumers?
Sara Gullickson
Most of the states that are not social equity programming, you have to apply with real estate, New Jersey, Texas, Alabama, the social equity elements are different where they're giving it away by the region and most of them. And so you don't have a physical address at the time of applying, which I know it's a chicken-and-egg conversation but real estate's the hardest part, right? So, to me, it makes sense that you at least have like a letter of intent or something maybe not even binding, that if and when the license is awarded, here's where you would open. I mean, some clients, we go through 40 5080 listings to check setbacks. I mean, it's just real estate is the hardest space.
David Paleschuck
Interesting. Well, Sarah, thank you so much for joining us today, taking us through a lot of the ins and outs of cannabis licensing. Super helpful, and I hope would help, or listeners just kind of get their heads around the different types of licenses or the speeds of the industry is fragmented of the states. So it's nice to know there's somebody that can connect those dots for us in the industry and makers. So thank you, again, for joining.
Sara Gullickson
Thank you so much for having me. Yeah. Have a great day. Thank you.
Adriana Hemans
That went by so fast, I learned a lot.
David Paleschuck
It always goes by fast. We are at our 45-minute mark of positivity, learning and knowledge on this Thursday morning. That said, we are at the end of our show. So we'll be back again next Thursday, February 9th. And we'll be chatting with Kim Prince, the CEO of Proven Media, which is a PR firm based in Arizona that focuses on cannabis. We're excited to be discussing “When Cannabis Public Relations Becomes Cannabis Crisis Management”. We'll be talking about a lot of the things that had happened in the industry and how companies can create a safety net and think about issues before they happen. Thank you everybody for chatting with us today. We'll see you next Thursday.
Adriana Hemans
Thanks, everybody.
David Paleschuck
Bye bye.