California retailer Harborside marked the end of an era this week when it parted ways with co-founder and chairman emeritus Steve DeAngelo, sometimes called the father of the legal cannabis industry.

In a video posted on LinkedIn, DeAngelo said he would continue working to promote “cannabis knowledge and freedom” with a focus on “equity/sustainability/governance” (ESG) issues. “A small band of fanatically devoted cannabis activists” founded Harborside almost 14 years ago, he said in the video, to build a “gold standard” dispensary. The dream became possible when Oakland awarded it one of the country’s first six dispensary licenses.

I spoke to Harborside General Counsel Jack Nichols about the transition and asked DeAngelo protégé Kris Krane, who’s now President of MSO 4Front, about how (or if) smaller companies with activist roots can chart their own course at a time of consolidation. Both suggested companies need to focus on their strengths. For Harborside that might be the high quality retail experience it pioneered, while 4Front is all about efficient manufacturing at scale.

Read the whole thing.

In recent months, special purpose acquisition companies, or SPACs, which function as “backwards IPOs,” have become the darlings of the cannabis world and the broader economy. However, a recent report that Casa Verde Capital, a SoCal investment fund co-founded by Snoop Dogg, has raised a $100M fund, underscores that traditional venture capital is alive and well in cannabis.

Pot stocks are on a tear and legal REC is coming to New Jersey, with more of the northeast likely to soon follow.

So, WeedWeek asked Joe Caltabiano, a co-founder of Illinois based multi-state operator (MSO) Cresco Labs, and Matthew Nordgren, founder and managing partner of Arcadian Capital, a cannabis investment firm which has invested in about 50 companies, how they would invest $100M right now.

Here’s what they said.

Quick Hit

1. For our latest Get to Know feature, edibles maker Sunderstorm filled out the WeedWeek questionnaire. Want your company to be next? Write to hello@weedweek.net.

A few items raised our eyebrows this slow news week:

• Casa Verde Capital, co-founded by Snoop Dogg, has raised $100M for its second fund.
  TechCrunch
• A new carbon air filtration system or “scrubber” technology aims to mitigate skunky odors in the growing hub of Santa Barbara County.
  Santa Barbara Independent
• L.A. said it would grant a reprieve until March 1 to nearly 60 business with licenses that expire on new year’s eve.
  MJBiz
• The Blacklist asked its prodigious list of followers about the best and worst products they consumed this year.
• Roy Bingham, co-founder of data firm BDSA, discussed what’s really driving the industry’s growth.
  MJ Brand Insights
• Legal MED and REC sales climbed a staggering 67% in 2020 according to Leafly. 
• Legalization has been a “boon” for local-level corruption.
  Politico
• This is where California pot taxes are going.
  CBS
• Donnell Alexander, who previously wrote the WW California newsletter, writes about a movement of Black non-cannabis farmers to reclaim their occupation.
  Guardian

New and familiar challenges for 2021

The California industry will continue to grapple with the illicit market as well as new issues. They include the coming consolidation of the state’s three regulators into a single department. Here’s what’s in store for 2021 when it comes to growth, social equity and more. 

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Top execs’ predictions for the new year

2020 was quite a ride. Despite the difficulties we’ve all endured, the California industry saw record sales and looks well positioned for 2021. We asked industry luminaries for their predictions on what’s in store for the new year. They weighed in on everything from Delta-8 THC to whether there will be any motion on federal legalization. Contributors include Nabis CEO Vince Ning, attorney Meital Manzuri, Wana Brands CEO Nancy Whiteman and many more.

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Turning canna-waste into gas

A first of its kind program at San Jose dispensary Airfield Supply Co. aims to turn cannabis plastic waste — doob tubes and such — into fuel. With about 1,300 customers daily, the program initially aims to save 4,000 to 5,000 items from land fills each day. It’s in partnership with CannaCraft and a Sonoma County company called Resynergi.

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T.I. is latest rapper on the equity train

Rapper T.I. has joined Viola Brands as a social justice ambassador. Started by former NBA star Al Harrington, Viola is among the highest profile Black-owned brands in the country. Harrington has said that with Viola’s social equity programs and business incubator he aims to create 100 Black millionaires.

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Report assesses legalization’s impact

A report from a branch of the federally-funded High Intensity Drug Trafficking Areas program found that California teens have a lowered perception of risks associated with smoking cannabis and a higher rate of past-month use than their peers nationwide. Even so, past month use continues to decline among California teens.

Dealflow hasn’t slowed down for the holidays. Here’s what else caught our attention:

• Two big deals: Columbia Care said it would acquire Green Leaf Medical for $240M and Ayr Strategies announced it would acquire Liberty Health Sciences for $290M, largely a Florida play, and make a big move into New Jersey as well. 
• At least 57 L.A. businesses — 14% of the cities’ total — are poised to see their licenses expire before the end of the year.
  MJBiz
• Cookies is getting into the mushroom market.
• MedMen has a new interim CFO.
• Poseidon Asset Management managing director Michael Boniello discussed why he’s bullish on 2021.
• Kate Hudson named Cranberry Sage Cann and a shot of King Street Vodka her “official drink of the holiday season.” Cann co-founder Luke Anderson posted: “While many of our customers use Cann as an occasional alcohol substitute, a growing number are using it as a complement / mixer – and both groups report drinking a lot less alcohol than before and feeling generally happier and healthier overall.”

The year in review

Well, at least none of us have to live through 2020 again. The year began with many in the California industry hoping for stabilization. While that certainly didn’t happen, 2020 did deliver unprecedented growth and sunnier prospects for 2021. Willis took a look at the key issues for California’s industry over the last 12 months — Covid, taxes, climate change and more — and how many businesses persevered.

Next week, we’ll have a preview of the year ahead. 

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Cannabiz awaits the vaccine

Many in the weed world view the plant as an alternative to conventional medicine. As such, it makes sense that some operators might be skeptical of the two newly approved vaccines for the coronavirus. However, Laura Bianchi, a partner at Arizona law firm Bianchi & Brandt, says operators are largely eager to protect their work forces and businesses. “I think people are anxious for some sort of resolution,” she said.

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Weed’s a hot Christmas gift

A survey from vertically integrated Glass House Group anticipates a great deal of cannabis-related gift giving through the new year. No surprise that it expects a lot of cannabis use as well. Of survey respondents, about two-thirds plan to give flower as a gift. Find out what else they’re thinking about how cannabis will help them endure this strange holiday season and ring in the new year. 

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“Advanced Nutrients is racist:” Ex-employees sue fertilizer company 

Update 9/25/25: Slater’s lawsuit was dismissed with prejudice on October 26, 2021.

Lawsuits filed by two former employees make claims, including racial discrimination and wrongful termination, against cannabis fertilizer company Advanced Nutrients, and its CEO Michael “BigMike” Straumietis.

Advanced Nutrients, which is based in West Hollywood, claims to be the world’s best-selling cannabis fertilizer brand, with annual revenue of more than $110M.

“Mr. Straumietis categorically denies the allegations made against him and the company,” the company said in a statement. 

WeedWeek was first to report the lawsuit from Tobias Slater, who claims he was hired to help boost diversity at Advanced Nutrients and was fired after two weeks.

Read the story. Read the lawsuits here and here.

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Non-paying vendors snarl California supply chain

Willis takes a look at how non-paying vendors are wrecking havoc with California’s supply chain. 

Because cannabis companies largely rely on each other to operate in a closed-loop, state-restricted market, when a business falls behind on payments to another company, it can trigger domino effects with wide-ranging consequences, said Ryan Bacchas, president of the California Cannabis Coalition.

Read the whole thing. 

Coming Saturday we’ll look at supply chain issues involving distribution.

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Another regulation to watch out for

Starting on January 3, products containing even a trace amount of THC must carry warnings that they can increase the risk of cancer and birth defects. The new rule, which carries potentially stiff penalties for violations, is mandated by the Safe Drinking Water and Toxic Enforcement Act of 1986.  

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Canna-Tourism to the rescue

A new report from the California Cannabis Tourism Association suggests plant-based travel could help the state’s tourism industry recover from the pandemic.

• “Rather than wondering when tourism will ‘return to normal,’ perhaps a better question is, what will the new normal of tourism look like?” the report asks.

Here’s what else we’re reading:

• In what might be a record, Arizona released draft rules for its new REC industry.
  AZCentral
• Canna Law Blog discussed the top misconceptions about legalization in Mexico.
• Business Insider put together a list of the top 16 cannabis investment firms. (paywall)
• Chicago-based Verano Holdings filed to go public in Canada at a value of $2.8B.
  Chicago Tribune
• In a C$100M offering, Indus Holdings said wildfires dragged on revenue.
  Green Market Report
• The Blacklist posted a video which purports to show robbers stealing $200k in product from a legal grow in Van Nuys.
• Horse race trainers were warned not to give horses CBD.
  Thorough Breeding Daily News

Regime change in Sacramento

In our last issue, Willis Jacobson looked back at the year in cannabis legislation and ahead to the issues lawmakers will likely wrestle with in 2021.

• Today he introduces us to key lawmakers in the California State Assembly and State Senate, as well as lobbyists and other power players shaping the industry’s future in the capital.
• In 2021, California’s three pot regulators are slated to merge into the Department of Cannabis Control. Willis examines what’s at stake and introduces us to Tamara Colson, acting head of the Bureau of Cannabis Control. The state’s top regulator was previously its assistant chief counsel.

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Infused drinks catch on

The Golden State is driving sales of THC-infused beverages, which have made edibles the fastest growing product category in the country. California’s infused drinks market is expected to top $6B by 2025.

• Per data firm BDSA, the top-selling U.S. infused-beverage brands from August through October were: Keef, Dixie and Ripple in Colorado and California’s Cann and Lagunitas/Hi-Fi Hops.