Veteran Bay Area investigative reporter John Geluardi (an East Bay Express contributor) released his first book, Cannabiz: The Explosive Rise of the Medical Marijuana Industry this October. A former staff writer for the SF Weekly, Geluardi saw so much momentum building behind medical pot, he researched and reported a 200-page non-fiction paperback, released by Pollipoint Press of Sausalito, available nationwide and online. As essential primer to the rise of and challenges facing the sector, Cannabiz offers a front row seat to one of America's historic new movements. Geluardi talks with Legalization Nation about investing in pot, economies of scale, and new fissures in the field in this two-part Q&A edited for length and clarity.
Legalization Nation: The ASA estimates there are over 300,000 qualified patients in California. I suspect you don't see that number leveling off.
John Geluardi: I think there's tremendous momentum behind the industry. Not only does it have momentum but it's become very muscular. The medical marijuana industry, any time it goes into a new town, it's not met with open arms. There's always a fistfight with the law enforcement, city council, county supervisors, and the industry's become very adept at winning those fights. I think the industry is definitely going to continue to grow, the question is: how fast? ... It's ease and convenience. More and more people who are getting their marijuana on the black market start opting more and more for ease.
LN: And cost. The new SPARC dispensary in San Francisco regularly has $24 1/8ths, which is half what a street dealer charges.
John Geluardi: Dispensaries as they exist are sort of like the big business compared to the mom and pop black market dealers in terms of convenience and everything else. And mom and pop business don't do well when a large business can come in with advertising dollars and a certain openness.
LN: It sounds like the dispensaries' next conquest is the Chamber of Commerce, then?
John Geluardi: That's one of those things I write about in the book, there's a tremendous effort to try and get dispensary owners involved in their communities. They're trying to get them to be much more open, to get to know their neighbors, and not act furtively the way that some dispensary owners feel like they have to act. Every time they attend city council meetings on a regular basis they're becoming a more intrinsic part of the communities they operate in. It just reaffirms this notion that city councils and the county board of supervisors can't just say no to medical marijuana. ... It's a radioactive issue and you want dispensary owners who are going to to be amenable to the community's wishes, such as not opening too close to high schools or weird hours of operations, all the sort of things that make communities nervous.
Richmond is a good example: City councils, as they approve dispensaries, they should be vetting the owners and what their business plans are, all those things are important not only to a city but to the industry itself.
In the book I look at two cities, one is Oakland and the other is Los Angeles. Oakland is the city that did it right. Los Angeles is the city that didn't do it right. And one of the things that Oakland did right was by being fairly muscular in their regulations. For its international reputation, Oakland only has four approved dispensaries and it's hugely popular in Oakland.
LN: So you got any investors tips? Are you putting your money where your book is?
John Geluardi: I have not put my money where my book is yet. I'm not quite sure how to do that. It's still a little nebulous. I think if you're going to invest in marijuana and you want to invest in [publicly traded companies] companies like Medical Marijuana Inc, you'd have to look at sidelines; the sort of things that support the industry, not the marijuana itself: testing equipment, publications - newsprint is dying around the country, marijuana publications are thriving largely because there's so much money in this. It's the only way that a lot of dispensaries can advertise; as well as marijuana attorneys; hydroponics companies, that's a good investment right there. Look at the success of iGrow, now they're WeGrow and within a year they've already started to expand.
LN: Is this why Esquire Magazine named marijuana lobbyist a top ten 'New Job for Men'?
John Geluardi: I think so, because of the way medical marijuana laws are written each community has to address their own issues, so dispensaries are hiring PR people and lobbyists like crazy, and it is an interesting job.
LN: We had marijuana lobbyists lobbying against marijuana in the last California election and lot of that came from the medical cannabis dispensaries. How did that strike you as the author of this book?
John Geluardi: I think the industry is going to have to smooth out its rough points. I quoted [Oakland dispensary owner] Stephen DeAngelo pretty extensively in the book and he was in his subtle, quiet way adamantly against legalization. Certainly Stephen DeAngelo has a lot to lose if legalization was to occur, but I think the opposition from within is typical of any movement.
The marijuana movement, I really believe, is a legitimate political movement. Any time you've got people in prison for something that is debatably not a crime, it ranks as a movement. In any movement, it achieves a certain amount of success and then people get comfortable, people get power, people get money and they want things to stay the way they are and that's definitely what happened in this last campaign.
EDITOR'S NOTE: Stephen DeAngelo of Oakland's Harborside Health Center issued the following statement in response to John Geluardi's characterization of his position on legalization. "I have devoted my entire adult life to bringing safe and legal access to cannabis to all adults, and to freeing everyone who is in prison for cultivating and distributing it," DeAngelo said. "John Geluardi has confused my choice of language and tactics, with my ultimate goal. I think the recent outcome of Prop 19 validates the incrementalist strategy I have long advocated as the most certain and rapid road to full access for all adults. Similarly his accusation that my economic interests determine my political positions is mistaken. The reality is that I have used my imagination and vision to create businesses that advance my political and social goals, that I have mobilized the power of private enterprise to achieve public benefits."
[Come back tomorrow for the conclusion of Legalization Nation's John Geluardi interview, wherein he discusses the fallout from Prop 19's failure, and the medical pot industry's political forecast.]