From June 20 to 22, the California Cannabis Industry Association held its annual conference in Oakland, California (Cannabis Business Summit & Expo). The show, like the industry, attracts a broad spectrum of participants ranging from cultivators to retailers and all of the enabling businesses serving them (e.g., fertilizer companies, insurance companies, branding firms, etc.). With such a diverse audience, there were as many agendas as attendees. After the three days however certain dominant themes were noticeable, including:
#1 "The show is so much bigger than last year." This statement was heard in just about every conversation and served as a proxy for the continuing strong growth of the cannabis business ecosystem. Visually this was represented at the expo by a large showroom full of exhibitors, representing every nuance of the supply chain fighting for the attention of the attendees.
#2 "There are too many cannabis events." When asking people what the next conference or convention they would be attending, a recurring theme was that there are far too many conferences being held and people will be choosey in picking which ones to patronize. This isn't surprising. The first people to make money in a new industry always seem to be conference organizers, however they are also the first ones to fail when inevitable convention saturation and fatigue sets in.
#3 The Regulations and Taxes coming to California. While most industry participants in California feel that the coming regulations are beneficial, necessary, and inevitable, there is concern about excessive red tape and taxes. Anyone who has tried to do business in California knows that the Golden State has an insatiable appetite appetite for both.
#4 "Did you hear, the DEA is rescheduling marijuana to Schedule II?" On the first day of the conference a small Santa Monica newspaper published the (apparently) inaccurate story that the DEA had committed to reclassifying cannabis to Schedule II (under the unnecessarily misleading heading "U.S. Gov't Will Legalize Marijuana on August 1"). "This was quickly discredited (by the DEA) but not before causing a firestorm of speculation what exactly rescheduling would mean to everyone's business and whether it was a good or bad thing for the industry. (Here is Richard Baca's summary of the good, bad and ugly of any such move.)
#5 "There are a lot of investors here". The CCIA conference was held right after an ArcView investor event (in the same hotel) and there was lot of bleed over between the two as it seemed the majority of ArcView investors stayed for at least part of the CCIA Expo. ArcView is analogous to technology angel groups (e.g., Band of Angels, Tech Coast Angels, etc.) and is made up of high net worth individuals looking for cannabis deal flow. In addition to the ArcView private investors, several small funds and "accelerators" (including Gateway and Canopy Boulder & Canopy San Diego) were working the halls reinforcing the impression that there is already a lot of money out there.
#6 "People are still being busted." On the same day that the rescheduling rumor was making its way around the conference, people's phones were blowing up with the news that the Santa Rosa company behind Absolute Xtracts and Care By Design was being raided by local police and the DEA. While this raid seems to have had as much to do with a jilted ex-employee as it did with drug laws, the point was made that despite all of the exuberance about this new industry, law enforcement is still active and people are still being arrested.
While it seemed that 99% of the people in the Oakland Marriott for there for the cannabis expo, it must have seemed a bit strange for the 1% of travelers who just happened to have booked that hotel during the show. I'm sure there were more than a few people must have called home saying "You won't believe what is going on at my hotel...". Welcome to California.