The Benzinga Cannabis Capital conference kicked off in the Windy City of Chicago on October 8th and 9th, drawing experts from across the global legal industry.
Seeing the clientele demographics and product displays across the Marriott convention hall was a sobering reminder of how far the industry has come on its journey to social, political, and economic legitimacy—despite macroeconomic headwinds, constant regulatory pressures, and internal challenges within the $100 billion industry.
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The “Dude, Where’s My Car?” stereotype has turned into “Dude, Where’s My Investment Vehicle?”
And if I want weed now, I can get it from a multi-billion dollar, legally compliant multinational company instead of from a guy named Zebra behind the 711 – though I’m not going to lie, Zebra always had fire on deck. When I told my in-laws I was going to a cannabis event, they certainly didn’t expect my recap of hob-knobbing with investment bankers and insurance analysts.
Major talking points that cropped up throughout the first day include the bifurcation of the Intoxicating Hemp vs. Marijuana markets, considerations around 280E Internal Revenue Code regarding ‘trafficking in Schedule One substances,’ the Amendment 3 ballot proposition in Florida, lamentations about ‘regulation without enforcement,’ and nascent opportunities in the global cannabis market among numerous other topics.
The industry presence here was almost exclusively ‘non-plant touching,’ with insurance brokers and investment analysts unpacking the latest data insights and market trends in place of my usual cannabis connections—the ones who can roll a perfect spliff with one hand while they’re driving.
Of particular interest on Day One of the conference was Boris Jordan’s keynote. The Curaleaf founder is perhaps the figurehead for not only MSOs but MNOs—multi-nation operators.
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Curaleaf has been at the vanguard of the global regulated cannabis market, debuting on the Canadian Securities Exchange in 2018 with a market cap of a whopping $4.5 billion.
How often Boris hot-boxes his private jet is still a mystery, but if anyone had an excuse to do so, it would be him.
“I must’ve been in and out of Turkey 50 times over the last few years,” says Jordan in reference to the opening up of the Turkish market.
In addition to describing the early opportunity that may exist for well-connected companies to apply for cannabis licenses in Turkey, Boris unzipped the growing ‘conflict of interest’ between the intoxicating hemp market and the legal marijuana market.
Emcee Jackie Bryant was ebullient and efficient in her role, keeping programming on track and transitioning between panels and keynotes, offering another mark of excellence for the event at large.
Intoxicating hemp vs. marijuana markets
Jordan estimated that the legal intoxicating hemp market is worth between 20 and 25 billion in the U.S. and that the rapid growth of this ‘loophole industry’ on the heels of the 2018 Farm Bill has led to price compression in the cannabis industry.
Later in the day, a Round Table discussion titled ‘Hemp vs. Marijuana’ invoked animated audience participation and spirited debate as representatives from the ‘legal marijuana’ sector detailed their concerns about a perceived lack of regulation or enforcement regarding intoxicating hemp companies that sell a very similar product without having to abide by the costly and prohibitive structures that legal marijuana operators have had to invest in and follow in their journey to market, creating an unfair playing field.
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Ironically, these concerns echo the indignations expressed by members of the grassroots cannabis community and legacy market when corporate cannabis arrived on the scene and lobbied to create the licensing and regulatory schemes that kept everyone unable to compete in the legal market in the first place.
280E remains a burden
The spirit of the Internal Revenue Code 280E was to disrupt drug traffickers, not to create headaches for the Board of Directors of billion-dollar companies operating in regulated markets. Yet, as far as cannabis remains a Schedule I substance federally in the United States, companies operating in the legal cannabis market are adversely impacted by their inability to seek relief in the form of ‘deductions or credits for any amount paid or incurred in carrying on any trade or business that consists of illegally trafficking in a Schedule I or II controlled substance within the meaning of the federal Controlled Substances Act.’
280E will continue to impact the cannabis market in the U.S., which is the most robust in the world; according to Boris Jordan, either an amendment is made to the tax code, or cannabis is rescheduled.
“We could wake up on December 15, and everything will have changed overnight—though I don’t expect it to happen, it could happen that fast,” remarked Jordan.
All eyes on Amendment 3
The upcoming ballot proposition in Florida garnered significant traction throughout the day, emerging as an oft-repeated topic of interest and consequence to the U.S. cannabis sector. If Ron DeSantis is against Amendment 3, that’s all the motivation I need to be in favor of it.
The Amendment would legalize ‘adult recreational use’ of cannabis, potentially making Florida the 25th state to allow for such.
Day 2: trends for the future
The second day of Benzinga Cannabis Capital offered further analysis of the current market conditions and strategies for navigating the challenges and opportunities amidst the ever-evolving dynamics and shifting regulatory frameworks underpinning the global cannabis industry.
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The first panel of the day I caught was “Thriving In the Face of 2024 Cannabis Headwinds.”
One takeaway from the panel came in the advice to “make your existing portfolio show returns, not just new assets.” I interpreted this as a suggestion to commit to long-term strategy and cultivate existing revenue streams in an operation before trying to front load with new features that look good but ultimately don’t support your core investments.
Excitement about forthcoming AI technology and data integration platforms colored the “Maximizing Margins: Leveraging Data for Effective Cannabis Retail Pricing and E-Commerce Strategies,” in which panelists shared insights for making sense of the mountains of data available to a cannabis company. One idea that emerged from the panel was the importance of looking for trends rather than fixating on a single data point—Internal data: start with internal data – what is the data set size? Where was the data sourced?
“I’m not interested in one data point—I’m interested in trends,” said Robert Beasley, CEO of Fluent.
As an example of one such trend, look to pre-rolls: “Sales of pre-rolls are skyrocketing,” according to Weedmaps VP of Revenue Jackie Gonzalez-Becerra.
The increased market penetration of Baby Boomers coming to legal cannabis was addressed as well. Baby Boomers reportedly have ‘higher ticket prices’ and love edibles. Knowing this data set could potentially inform a marketing strategy for getting ahead of the Holiday Shopping spree.
“Get on top of your data strategy and get ahead of the holidays,” one of the panelists instructed the audience.
Another highlight was “The Medical Cannabis Experience: Best Practices for Patient Access, Care, and Loyalty” panel. The theme of bifurcation in the cannabis industry continues in a different divide with the adult use recreational vs. medical cannabis models.
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NFL Hall of Fame nominee Ricky Williams, one of the most iconic and outspoken advocates for medical marijuana in a time when the professional sports world and much of mainstream society at large were openly dismissive and punitive about cannabis use, received an ovation from the crowd after reminding everyone that it was focusing on helping people with cannabis as a medicine that drove the movement to where it is today, not an exclusively for-profit model that has led to price compression across the sector.
The highlight of Day 2 for me was Jim Belushi’s fireside chat with superstar publicist Zoe Wilder. Belushi offered insightful analysis of his experience running Belushi’s Farm cannabis brand while being effortlessly funny and characteristically impromptu. Wilder did a great job in keeping the chat on track while playing off the eccentricities and spontaneities of her witty counterpart.
“I got into acting because I want to make people feel good—that’s my purpose. Everyone struggles all day just to feel good, and I want to give them that bump up—cannabis does the same thing. The transition from actively cannabis was aligned with my purpose”
The inimitable Beard Bros Pharms hosted the official conference afterparty, marking their continued ascent from grassroots cannabis community advocates to bankable global cannabis media property.
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The Benzinga Cannabis Capital Conference in Chicago showcased an extraordinary range of perspectives, data, and insights honed from deep industry experience throughout its two-day run last week. Though there are clear growing pains with the emergence of a legal, regulated market for this magnificent plant that has deep roots across myriad cultures throughout history, the continued march towards widespread cannabis destigmatization on the global stage is made abundantly clear by events like this.
The cross-pollination of different professional demographics and industries that all touch the cannabis community today is a sign of clear progress, and the education and networking opportunities afforded to attendees of Benzinga’s conferences will surely continue to pay dividends across the board as the industry matures and continues its penetration of global markets.
*This article was submitted by a guest contributor. The author is solely responsible for its contents.
