Unveiling the Cannabis Industry: Insights, Risks, and Regulation Ross O'Brien from Bonaventure Equity welcomes Jeremy Burke, a leading thinker and journalist in the cannabis industry. Jeremy discusses his new venture, Cultivated News, a B2B newsletter providing insights on the cannabis industry for professionals. They also delve into the public health risks associated with the illicit cannabis market and the need for effective regulation in the industry. Produced by PodConx Ross O'Brien - https://www.linkedin.com/in/rossobrien/ Bonaventure Equity - https://link.bve.vc/Visit-Us Cultivated News - https://www.cultivated.news/ Jeremy Burke - https://www.linkedin.com/in/jeremyberke/
Unveiling the Cannabis Industry: Insights, Risks, and Regulation
Ross O'Brien from Bonaventure Equity welcomes Jeremy Burke, a leading thinker and journalist in the cannabis industry. Jeremy discusses his new venture, Cultivated News, a B2B newsletter providing insights on the cannabis industry for professionals. They also delve into the public health risks associated with the illicit cannabis market and the need for effective regulation in the industry.
Ross O'Brien - https://www.linkedin.com/in/rossobrien/
Bonaventure Equity - https://link.bve.vc/Visit-Us
Cultivated News - https://www.cultivated.news/
Jeremy Burke - https://www.linkedin.com/in/jeremyberke/
[00:00:00] Hi everybody, and welcome back to another episode of Cannabis Capital, the podcast. I'm your host, Ross O'Brien, founder of Venture Capital Firm, Bonna Venture Equity, lifelong entrepreneur, author of Cannabis Capital. The. Book, there will be plenty of Easter eggs of shameless plugs of the book. As always, and as you know in this podcast, we like to go beyond the headlines, so I'm thrilled to have round two with a good friend, and I think one of the leading thinkers in the space and journalists in the space, Jeremy Burke.
So we're welcoming him back to Cannabis Capital Podcast today. Jeremy, good to see you again. Yeah, thanks for having me back, Ross. That intro made me seem more, probably more dignified than I am, but I, but I'm happy to get into it with you, [00:01:00] so let's do it. Well, you know, it's our story. We get to tell it like we want it, right?
That's right. Yeah. Winners, right History or something. Something like that. Awesome. Well, speaking of writing history, Going beyond the headlines. Let's jump right in cuz you're out there in the forefront of some exciting new projects. So first of all, tell everybody where they can find you and um, let's talk about your new newsletter cultivated for sure.
So last time I went on this podcast I was. The senior cannabis reporter at at Business Insider. I've since left Business Insider to launch my own venture. It's called Cultivated News, so you can find it. WW Cultivated News or, or Follow me on Twitter. I, I post the link to it at JF Burke. Um, and, and the genesis of the newsletter is really to take the reporting that I was doing at Business Insider, but build a.
B2B ish. And I, and I'll explain why ish a little bit in a little bit more detail, but to build a newsletter for professionals in the cannabis industry, [00:02:00] um, everything you need to know, headlines on Capitol Hill International News, um, to what's really going on inside cannabis companies, how they're making decision, how they're market.
And how investors like Ross are looking at the market and what they're looking for. So it's both, um, a little bit adversarial. It, it's, it's hardcore reporting, but it's also educational. Um, and I hope it's a fun read too. So, you know, if you work in cannabis, if you're interested in cannabis, I'd encourage you to subscribe.
It's free, it's weekly right now. It will be twice weekly soon. Um, and once you know, I get all my ducks in a row, it'll actually be a daily newsletter working towards that. As a reader from Edition one, it's great. I love getting it in my, in my inbox, and what's really interesting about it is that it seems to be a natural progression from a lot of the conversations that we have offline together and checking in on the market and the things that we're looking at doing together.
I love what you said about Capitol Hill, so maybe this is the Cannabis Capitol Hill episode, or at least starting there. Look, so I would love [00:03:00] to, to touch on policy, but maybe we should just go backwards. I read your, uh, cultivated newsletter today and it really struck a chord as it always does, introducing, you know, some of the, what did we say?
Cannabis emptor, buyer beware sort of, uh, problems with the cannabis space. Let's talk a little bit about what you're covering today and some of your per perspectives. Cause I think that's great interest point. Yeah, sure. So, I mean, you know, I can go a couple ways, like, like the sort of. The way I think about it is it's a little bit about what's interesting to me, right?
When I'm writing it. Um, and hopefully that's interesting to the people that are reading me. Um, you know, journalist is only as good as it sources, so it's sort of a reflection of, like Ross said, all these ongoing conversations I've had. Um, so, you know, I, I can start anywhere. I mean, I think one interesting piece just.
You know, by dent of me living in New York City, loving New York City, I, I'm very interested in what's going on with the cannabis story there. Um, and I think there ha there's been a lot of reporting around, you know, what the [00:04:00] regulators are, are doing incorrectly. I think that's been a lot of the focus and while they have a lot of room to improve, You know, I try not to throw stones like I'm not a regulator.
I can be critical of them as a reporter should be, but I could not pretend to do a better job than they can. So the angle I took on that was okay. Instead of just throwing more shots at these regulators, why don't we take a look at. What consumers think about the industry, right? There hasn't been a lot of data around that.
There hasn't been a lot of studies showing like where consumers are buying their cannabis, what they think about it, or, or why, uh, they're choosing to buy at these places. And just to kind of back up and set the stage there, um, New York City or New York State has legalized cannabis for over two years now, but there's about.
You know, I think the last count was seven or eight dispensaries, legal dispensaries open in the state, so go figure where all the product is coming from. It's from illicit dispensaries. These are basically just bodegas or convenience stores that open up, and now, because there's no penalties, they can sell cannabis.
[00:05:00] Right. And so I worked with a company called Nug md. They're like a telehealth platform for For cannabis, medical cannabis patients. And they, what? What is their name again? Nug MD. N U G G md. Do you think some of these quirky naming mechanisms are gonna be some of the undoing of the real potential there?
I mean, it seems weird to me to co-mingle nugs with telehealth, right? I'm like, it'd probably be the last place I would go. My professional answer would be, I should not opine on that. My personal answer would be yes. And I, I, I make that distinction because, you know, I cleverness and I get the, uh, wanting to be little tongue in cheek and using puns for sure.
It's not the way I would do things personally. Look, we used to say on this podcast, we would talk about blunt truths, right? Like, yes, I get the plant words, but at a certain point, like telehealth is a serious. Real business that that is an incumbent healthcare [00:06:00] service offering that is going to be disrupted by the symptom of cannabis being legalized.
Like that is true. I Is it symptomatic of the key sort of players in the place that. Players in the space that, you know, some of this might get in the way. Like I think if I was advising them, I'll give you my personal opinion, my professional opinion, like I would do a name change on that company because I don't think institutional investors or the healthcare institutions that will need to get on board with this will take them seriously.
Totally. And look, I agree with you. Perspective is definitely a good one and it's an educated you. There's undermining. And, and, you know, to n MD's perspective, like the seriousness of the work they're doing. I think like the, the data they gave me is, is really good and it's, it's rigorous. Yeah. I actually dunno them and I'd like to connect with them.
Yeah, yeah, yeah. No, I mean, it's a good piece of feedback for them if they, they're looking for little more, little more money, but, you know, regardless, like it's, you know, I don't wanna go off too much a tangent here, but I, I'll say this. [00:07:00] See it play out in, in, you know, in, in, with my expertise in media coverage of the industry, right?
Every headline has to have some sort of stupid pun, and it's like 2023 and for some reason, Old editors at, you know, stodgy newspapers, like it hasn't gotten old for them to keep throwing those puns in there. Um, and I think it does a disservice to the seriousness of the coverage, right? The importance of the issues that we reporters are working on.
I think it's silly. I would like to move past it. Like, not every, every article you see about Anheuser-Busch says, are you getting buzzed off beers? Or something like that. It's like beer industry. It's a serious industry. Mm-hmm. Anyway, that, that's my little, that's my little tangent. No, that's interesting.
Yeah. But you know, I think it's a huge problem and we can, we can get into that further episode three. Yeah, exactly. But going back to the survey, I mean, basically I wanted to really understand like who is buying from legal dispensaries and who's buying from illicit dispensaries, and are there consequences of these actions?
Right. And I think those consequences are hard to. [00:08:00] The truth of the matter is, is that, like I said, there's only a handful of legal, legal shops and the illicit ones, you know, there's no oversight. There's no jurisdiction for any regulatory agency to say like, Hey, you have to sell the people over 21. These products have to be tested according to the state guidelines that we've set out, that are, that are evidence, evidence-based, and science backed.
And so oftentimes people are just buying at these stores. And not only that is a. I thought, um, maybe, I don't know if my readers did, but I thought was sort of a shocking number of people trusted the products that they were buying at these illicit dispensaries. You know, upwards of 42%, I think, or, or excuse me, 44% said that, you know, they think the products are accurately labeled in terms of THC content at illicit dispensaries, or at least enough that they are concerned about that over 40%, that they, the product contaminants enough they concerned.
That's not happening at illicit cannabis shops. [00:09:00] And if it is happening, it's because the products have been transported illegally from states that do have the capacity to do it, like let's say Colorado or California. So I think my message to regulators here is that there's a clear public health risk. Um, ultimately it's probably a matter of time before people get sick from, from tainted products, whether it's heavy metals or pesticides.
And the longer you don't have legal stores open, the more risk you're injecting into the market. Um, over time it will catch up. God forbid people haven't gotten sick yet, but, you know, in early 2020. 2019, you know, the valli with the, the lung issues with vapes. That was a concern and that was straight from the illicit market.
And it's four years later and we haven't, it seems like we haven't really learned from that yet. Um, and at the end of the day, like the other data, just quickly that stood out to me was that, you know, 72% of, of, of survey respondents said that, Price and convenience were the ultimate factors in deciding where they're gonna buy their cannabis.
They're, they're pretty agnostic to whether it's a [00:10:00] legal store or an illegal store. They might rather buy legally, but if it's too expensive and too far of the way, they're not going to, that's a risk. Like cannabis legalization was supposed to solve these health risks. Clearly it's, it's failing right now in New York.
Um, and so it's something I'm, I'm paying very close attention to. I, I think it's one of the most important issues. Uh, and candidly, we think everybody's, most people. Our sleep at the wheel when it comes to the regulatory headwinds that are in front of us. So to step back for a minute and come full circle to this public health risk, which I think is very real in this illicit market, we've got a quality issue.
That exists also in the legal market too. I mean, everybody knows of testing labs out there that will just give you the results that you want, right? And so we're building these systems, but this isn't, this is still in its infancy, right? These are still new, new emerging market. We're putting new business models together.
I will go on record saying I think the Achilles heel to the [00:11:00] entire recreational industry is, is vertical integration. And we can come back to that, but I think that is the center piece of where a lot of this stems from and the challenges are gonna be potentially insurmountable. So it's not a space that we invest in, but I think it's very problematic when we look at.
The regulatory headwinds, and this is where the Capitol Hill piece comes in, I think is really important. Um, I would like to hear some of the things that you're tracking. Look, there's been a lot of tailwinds, right? And regulatory momentum and advocacy momentum has created the cannabis industry, right? You know, I believe it's an economy, but the cannabis industry is applicable when you look at the recreational market, right?
And let's be clear, like going in and buying pre-rolls at, you know, med men, that's not healthcare. Okay, so you can call them patients all you want, but that is not medicinal, right? Like it's a fallacy. So you know, people are acquiring for intoxication. And, you know, all of this has come about because regulators were embracing, [00:12:00] you know, easing regulations, right?
So that we could bring cannabis into the legal market, which we should do. We have to do, and we are doing right. But I think we've experienced a period of sort of like positive momentum where it's just kind of people like just assume there's inevitability of like, yeah, we'll just get this changed and get that changed and get a new law in the books.
Now we're starting to see a lot of pushback. I mean, Cory Booker himself said recently, you know, Cannabis is a dangerous drug and he is not wrong. Right. But that's the nuance with this, where it's, it's not the same as just putting, you know, chocolate bars, you know, or, or, you know, sugary drinks in, in, in, uh, gas stations.
Right. Look, I totally agree with you on the education standpoint there, both regulators and lawmakers themselves often don't necessarily understand what they're regulating and I think cannabis is like one of the most clear examples of that. I, you can, you can look at in, in modern times, right? As you say, it's, it's not a harmless [00:13:00] product.
Smoking is smoking. Um, you know, adults are free to choose what they want to do, but you know, there are effects on your lungs and there's more increasing research that, you know, there are carcinogen in, in marijuana or cannabis smoke. Like I, you know, the jury is still out. I don't know, but there's some troubling research there.
I think especially where there's really troubling research and, and I've written about this a bunch, is.
Whether that's, you know, lower risk, like increase in anxiety, depression, or higher risk. Like, like those people who are predisposed to schizophrenia. Um, smoking a lot of pot in your youth can maybe tip the balance where, uh, maybe it wouldn't have expressed itself in adulthood, but because of. Adding drugs to your system.
It does. And while you know, that's not a reason to clutch your pearls and say, we shouldn't legalize this. It's information that is very useful for regulators. And I'm of the opinion that regulation is good. Um, you know, maybe outing myself as a liberal here, but regulation is good and, [00:14:00] and we should sort of.
Bring potentially dangerous products under regulatory purview. And I think that's the project of cannabis legalization. It's not saying this is harmless. Let everyone do this free for all libertarian thing. It's saying like, here's a product that we can do a lot better job at at hitting sort of public health goals by regulating it by, by bringing it to the light.
Not only that, you know, we can capture tax revenue and do all these other things and, and create industries and all these other knock effects, but ultimately it's like, You know, we're trying to make this safer for people who will choose to use it or not choose to use it, or, sorry, will definitely choose to use it, not just cause it's legal.
They're gonna do it anyways. And, and that's, that's the catch up aspect. And you can sort of, you know, I'll, I'll let you ask the question, but you can go, go into that further with the Safe Banking Act, which is, um, you know, sort of, I think a little bit of a Hamed way for regulators to wrap their heads around the industry.
With the cat being so far out of the bag and so far ahead of where legislation and regulation is right now. Look, I think [00:15:00] clearly it's a net positive to have legal cannabis, right? But it's not a binary yes or no, right? And I think that's part of the, part of the issue when Cory Booker said, these are dangerous drugs.
And I said, I agree with them, you know? It's not that there's, you know, a fatal dose, right? They're safe and well tolerated. It's things like what you said about like, what, what happens? We don't, there's certain things we don't know yet. Right? And that research needs to be funded and understood. Like the same way that, you know, an adolescent brain reacts to alcohol.
Like, it'd be hard not to assume that there's gonna be some effects on an adolescent brain, and should there be, you know, should we have those safeguards? Is that the, is that the right way to have safe, well managed? Cannabis in our communities. Right? So, you know, we saw this in, in, in Oregon. It's, it's, and not to pick on Oregon, but like in, in generally in states like, okay, we've got, you know, dispensaries and, and then it's, then it's like all of a sudden then we ask the question, well what do we do with people driving on this?
Right. [00:16:00] Right, right. And, and there's no test for it. You have to use field sobriety. Like it's actually not a, you know, the, the, you can have THC in your system for an extended period of time and not be intoxicated. So how do, it's not the same as alcohol. You can't regularly say like, okay, if we are going to be responsible and build industries around this, There needs to be guardrails and regulations that spell out the landscape under which that we're gonna operate.
Like what's stunning to me was the, the statistic that you said earlier about how many people assume that they're safe and quality products are what they say they are in the illegal market. Because there's this assumption with C b, D, right? When you go into a Walgreens and there's a CBD thing on a CBD product, Which is, you know, it's barely a nutraceutical right on the shelf.
People assume that there's been the rigor and, and research and quality control processes in place of everything else that's on those shelves, and it's not. Nobody has ever done [00:17:00] any toxicity testing on cannabis or ccb CBD in particular. Right. So those confluence of things, great. So let's put those know, let's not hide that in a corner.
Let's put the, that knowledge on the table and understand how to build a regulatory environment around it, cuz it will not be a zero regulatory environment. The question is, is do we want to collaborate for smart regulations or do we want to have to react to knee jerk reactions, which is typically what happens.
It reminds me almost, and this is gonna be a twisted metaphor, so, so bear with me, but. CBD at Walgreens. It reminds me of Victorian England where you had home remedies for everything you had and Coca-Cola like. Sure.
Structured way to evaluate safety and efficacy. Right. And that is what, that is the situation we're in with cannabis right now in cities like New York. And you'll just example, like I, I'm also school right now, and so [00:18:00] I'm. Otherwise smart people my age who go out and consume cannabis and drink and whatever, and like even they who don't, aren't really paying attention to the industry, didn't know that where they're buying their cannabis was illegal.
These are smart people who have access to this information and, and the fact that they don't know means that, Everyone probably doesn't know. And when you're in the cannabis industry, you think that these are inherent truths, but they're really not. And I think we have the, a duty to, to speak to that.
Right. And so it, it's just an interesting question and, and I think that the one other thing I'll say on that is that, you know, a lot of advocates do set up the binary you spoke to, right? They're like, alcohol does all this bad stuff. You know, cannabis doesn't, it's not lethal. There's medicinal benefits.
So like why is it illegal? I don't think that's the right question to ask. The right question to ask is how do you move use into safer patterns, right? Because you can make the same argument on their side. Like you can take the sort of Alex Berenson, Kevin Sabot approach where they sort of cherry-pick studies that show negative effects.
And again, I've, [00:19:00] you know, written about this, I'll plug my newsletter again, but where they cherry pick studies and they show negative effects and they say This is a reason to put the cat back in the bag and say, we're not gonna legalize this cause of all these effects. That's not really scientific to me.
The right answer is to figure out how policy can balance both the harms and benefits of this. And that's a really hard problem and it demands. A lot of time, attention and focus from lawmakers. Obviously they're pulled in many different directions. Cannabis is far from top of mind on Capitol Hill, but, but it deserves that treatment, I believe, and I, you know, especially the media has role to play in, in pushing that.
And so you've been writing recently on the Safe Banking Act, and you just mentioned a minute ago that seems to be, um, the area where some of these conversations are happening. So what's, what, what is the latest, what is, um, what are you reporting on seeing and, and, um, where's this going directionally?
Cause Safe banking's been on the table for four years now. Three years. Yeah. So yeah, I mean, [00:20:00] I think, I think, uh, I called it the ninth times charm was. You know, has been proposed in the house. The new piece here is that it received a full committee here, or a full Senate banking committee hearing in the Senate.
It had never received a markup in the Senate before. Uh, sure symbolically that that means something that senators are paying attention to this, but when you really hear the level of discourse around the nuances of legislation in the Senate, uh, To be optimistic about its chances passing don't. On the ground and say it's not gonna pass.
I'd love to be wrong. It would certainly help, you know, my own career aspirations if it pass. So I have, I do have a dog in this race, but you know, at the same time, it's like when you listen to Republican lawmakers, a lot of them are just saying like, cannabis is bad and harmful, so why are we gonna allow them to bank?
It's like a very kind of silly, pedantic argument they're making. And then on the other side, you have progressives who. [00:21:00] I think rightfully so, don't want banking legislation to advance ahead of full scale legalization, but at the same time, it's like if you're hearing these arguments from Republicans, it's like maybe you should go after banking because nothing else is gonna happen.
Right? They're so far behind the eight ball in terms of the legalization debate that I really don't see. If you could get. One, let alone 10 Republican senators, you need to, uh, pass the filibuster, you know, into, into full scale legalization votes. I think, you know, a good example of that is Steve Daes from Montana.
Um, he's sponsored the Safe Banking Act numerous times, and he will continually go on record and say, I am against legalization, but here's why we need safe banking. Right? And so it's like, I think it is incumbent upon. Democrats and progressives to, to work under that framework rather than this pie in the sky, like, we're gonna get full scale legalization passed and we're gonna reform the criminal justice system using this.
Um, I, I don't see that [00:22:00] happening Now the other nuance there is that there is, Talk of tying different pieces of legislation together to make both sides happy. Um, one is adding the Hope Act, which would basically give states a fund to expunge cannabis related records, and tying that to safe banking. Like that to me, is a huge win-win, both for progressive advocates as well as Republicans.
Right? It's palatable to both sides. Even Republicans don't wanna see people unjustly imprisoned, or maybe I'm projecting, I'd say most Republicans don't wanna see people unjustly, imprisoned. And most progressives wanna make it easier for minority-owned cannabis businesses to actually have the nuts and bolts of, of being in business and growing their business.
So that is my one sort of optimistic take there that I'm hopeful that if hope is tied to safe banking, there's a possibility that we can get there. But the more that there's infighting on both sides, the less that becomes a possibility. You know, the one other piece we saw recently last week? [00:23:00] There's a group, I think it was a minority cannabis association.
I have to fact check myself on that, but they wanted to add language into safe banking that would allow more formal capital markets interaction with the cannabis industry, meaning up uplifting or, or being able to list these stocks in the NASDAQ stock exchange. Allow broker dealers and investment banks to come in and really do deal making in the industry.
And obviously that's, that's beneficial. It would free up a lot of liquidity. A lot. Business is a lot more avenues to grow, but at the same time, like that to me is a little bit unrealistic given both the limitations that Republicans have on the bill, as well as progressives who really are against, you know, the Wall Street boogeyman coming into the industry.
Like you have to work under that kind of ideological divide and figure out the narrow path that this can get through, and the path gets narrower and narrower each time the bill gets debated, in my view. That's super interesting and fascinating. I mean, I [00:24:00] was in DC for the very first vote on safe banking and working with some of the lobbyists, some of the language in particular, the areas we were focusing on were things like uplifting and being able to have, you know, companies on the US exchanges as opposed to going up to Canada and you know, and all these things.
If they're operating under the legal framework of us on a state by state basis. I mean, it's simple to sit here and say it, but that's a no-brainer. To me, right? In the sense of like if a company is able to operate under. Legally, in any business, in any state, then they should have access to the fullness of the financial system.
Right. You know, morphine is a schedule two substance. You know, you can't tell me that morphine companies, a, it has an important role in healthcare, can't, you know, float an I P O or bank in their state? Right. And the interesting thing when I was, this had a moment where it felt like cannabis was one of the only bipartisan issues in [00:25:00] dc especially in that time when we were back doing these first votes, I think we were looking to whip, um, maybe six votes or something, six Republican votes.
So we got 11. Right in a, in a live debate on the floor that actually, and everybody was over the middle, they're like, oh, this is really happening. Sort of both sides are like, Hey, we got something here that feels like a win-win, and here we are, how many turns later? And if the window is getting smaller and smaller for getting something done, and the path to thread, as you described it, is getting narrower and narrower like everybody loses, right?
So at some point we just need. Functional government to make some initial steps to pass this right? There are other reporters who are better placed than me to speak to the nuances of who's a gay, who's a nay, and why that may be. But you know, two things are true, right? Safe banking as written, it was just up to the house.
It would be law by now. The Senate is the obstacle. Um, and I think, you know, when I talk to AIDS in these offices, [00:26:00] these are always offs. Just say, Every single piece of, of social justice language you add to it, you lose a Republican vote and, and so like that's the calculus, right? Yeah. When you're working under that framework, it's pretty impossible.
Like I don't see how the math maths there and how that would work. At the same time, personally speaking, when I put on. My own view into the situation, like of, it's such a common sense, no-brainer piece of legislation. Like I totally agree with you. If states are able to legalize cannabis, like why can't they list on the Nasdaq?
Like this would help the industry so much immensely. And it's completely unfair to these companies, right? It, it, it, it's, it's an unfair market that they're operating in. And not only that, it's like I was, I was just looking in, and I'm sure you're familiar with this, like I was thinking about two 80 E, which I'm sure listeners this podcast know it so I won't go into detail to describe it.
But the genesis of that federal tax code is, is one cocaine dealer in Minnesota who's trying to deduct his business expenses. In 1974, he made a hundred grand selling Coke, [00:27:00] meth and, and weed, you know, in Minneapolis in 1980. In 1974. Got taken to court in 1982. Basically was ordered by the IRS to file his taxes.
He tried to dis deduct his cost of goods sold, and they said, no way. Um, Congress passed. So that's the world we're living under, where 50 years later, these. Very well established legal businesses are still operating under this bill. That was really meant to slam one specific cocaine dealer in Minneapolis in the seventies.
I, if that doesn't speak to like this crazy world of cannabis that we're living in, I don't know what does, but, but that's it. And it's like, the fact that we can't get that changed doesn't give me a ton of hope for getting really good, broad, full scale legalization passed. At the same time, you know, I'm sure political scientists study this, but when public policy moves, or sorry, public opinion moves so far ahead of Congress on an issue, I'm sure policy will follow eventually, but you need to do the groundwork to [00:28:00] get there.
And that's did risk of the. They also run the risk of the pendulum swinging in the other direction as well. Like there's all this exuberance and enthusiasm. Then the recorrect is even more back to, oh, all of a sudden now we're back to complete prohibition. Somewhere in the middle is where everything shakes out.
Right, exactly. And clearly this pendulum is swinging in the other direction. And I would hope that, you know, the folks that are advocating for the issues that are important to them are able to see the forest through the trees. Right. And you know, We need the foundational frameworks of some wins here. We can't have just all losses across the board on the regulatory side.
Right. Exactly. And, and look like if you are, I mean, I, I don't like, I, I don't invest in, in cannabis stocks just to, to maintain editorial independence. But at the same time, like, you know, if, if every, if every catalyst sale, it's not a great place to invest. Right. So you're fine. No, no, sure. But like, but look, if I was an investor, it's like, you do want, you do need a win here.
Right? The whole sector needs it. Like the entire sector just trades basically on. [00:29:00] The whims of what, you know, a couple Republican senators think like if, if say passes, it's gonna go up. If it doesn't pass, it's gonna continue to tumble. And that's a crazy situation to be in, not only if you're an investor, but if you're running a public cannabis company like that, that's hard to deal with.
I don't envy that job right now. Yeah, it's, it, it, it's, it's challenging for sure. And look, as you know, people love to, and you probably see this a lot when you're out there talking with folks in the space, and, and I would imagine you get a barrage on a regular basis of just like the bitch sessions, right?
Of yeah. Like, Hey, oh, this has been done and that's been done, and Oh, this is unfair. And Oh, big wall, the Wall Street boogeyman and blah, blah, and all this stuff like, Okay. Look at, you know, look at the medical device space, right? How many medical device companies are started every year and how many of them fail?
It's gonna be maybe 10%, maybe less. I don't know. I'm making this up, but there's no way. It's more that's actually succeed, right? So why would we expect those? Ratios to be any [00:30:00] different in any other industry? Right, so starting companies is hard. Startups are hard. Emerging industries are hard. Emerging sectors are hard.
You don't get a free pass just because you love cannabis. And unfortunately, or fortunately, you know, the cream rises to the top in any. Economic system that's an open market. Like, like a free, a capitalist, free capitalist market. Like we're in. So the capitalist perspective, you know, has to play a role in this, right?
Otherwise, you know, what do we have, you know, state run, you know, cannabis dispensaries? Look, I, you know, I'd say my own, my own opinions are a little bit more pro capital, but many people I talk to I think would be just fine with that. And that's the dynamic I think that that. When the two sides talk to each other, they just don't really get, I think there's a lot of people who would just say like, you know, there's a lot of people who, who not like capitalism, do not think it's effective, don't wanna see it.
And while Sure they want a little money in their pocket, [00:31:00] everyone does. I think. They would be just fine with a government run ration of cannabis. Now, I don't know if the product was shitty. Sorry for my language, if the product was bad. No, we can say whatever the fuck we want. Yeah. I mean, if the product was shitty, like look, that might change, but I think there's more people, when I talk to investors, there's a lot more people than I think they think that.
Would be just fine with a completely socialized cannabis system. Right. And then they'll be the first people that'll say, oh, the government's putting like nanobots in my cannabis to track me. Right? Sure. And, and, and I think the Venn diagram where we go, like, where does this go? It's positive. I look, it's, it's not my opinion, but, but the Venn diagram there, um, I think it's, it's, it's larger than, than I think people give, give credit to.
And it's an important function of how advocacy works. I think on the on, especially on the nonprofit side, there are people who would say that the desire to generate wealth for yourself that may take away from someone else is, is wrong, and that's the [00:32:00] standpoint they're coming at this from, and that is why you get such.
Vociferous opposition to safe banking now? Personally? Do I think that's right? No. Do I think that's a useful way to regulate in the economic and political and social system we have right now? No, I think it lacks nuance and I think it lacks understanding of reality. It's, it's quite idealistic, but at the same time, it's, it's useful to understand that perspective when you hear this opposition in order to target more effective arguments against it.
Look, when I started, uh, I opened up my book. Oh, shameless plug the air ho shameless book plug. Shameless plug. That's a, that's a new trick for the podcast, Jeremy, you first hear. When I opened up the book, the first thing I did was acknowledged advocacy, as you know, creating this potential for an industry, right?
Like you have to start there, but it's a building block, and then you build upon that, right? So it seemed, from my perspective, [00:33:00] smart regulations is the building block from which that gives us the opportunity to advance, right? So this is what, and it's always so weird to me when the word progressive, like has a negative, you know, connotation to it.
Everything should be progressive. We should be progressing, not regressing. There's no certainty other than, you know, the status quo will change, right? So when we think about, when we think about the regulatory environment, the size of the market, This distinct bifurcation now developing from our vantage point between, you know, real medical applications versus, you know, holistic.
Right. You know, it's a challenging, the, the recreational market is challenging. I said, you know, they're shitty stocks or whatever, but like, investors are fatigued. Like, there's no question I, I, talking with one of my investors, you know, this week and it's like, oh, you know, I'd like to be doing some of these deals, but you know, I've been getting beaten up.
Right. And. You know, I hate to say it, but what somebody said early on, you know, somebody who I knew in the [00:34:00] space was, was like, listen, don't ever confuse a bull market with brains. Right? And so I think we are still unwinding, right? This bull market like so. This over this irrational exuberance drove valuations into the stratosphere.
Right? And you're having this reset that was happening, whether there was a pandemic or not, right? Or whether there's that that happened pre pandemic, the reset of the collapse of the public cannabis securities. Anyway. But these are, these are cycles that run through. When you have a functioning economy, there will be cycles and everything.
There's no just one way. I mean, that's what got us into the. The housing crisis problem 2008, every model just showed the value of houses only going one direction, right? They go the other direction, everything falls apart. So look, we've gotta navigate, and this is a new frontier market. It is going to be choppy, right?
It's certainly not for the faint of heart, but the silver lining to all that is we've accepted that cannabis is, is part of our communities. And to me, that feels like the biggest heavy [00:35:00] lift has been done. Right. This is like, yes, you can have conversations around are there health benefits, are there challenges, you know, is, you know, whatever the sort of arguments are.
But at the end of the day, people are spending money on it. There's an economic system that's working. Regulations need to catch up. Yeah, totally agree. And I, and I think one of the things you can look at right, is, is Canada, um, you know, I'm Canadian as you are and yeah, I'm be there this week. I'm Canada on Sunday.
The point is, is that if five years into the Canadian Federal legalization experiment, if there were things that would cause the sky to fall, the sky would've fallen for sure. And even people who did not like it, even communities like Mississauga, which is a big suburb right next to Toronto, just allowed cannabis stores a month and a half ago.
Uh, even though cannabis is legalized in 2018, and if you go around downtown Toronto, You know, every other block for better or worse, you know, has some sort of dispensary on it. Right? Um, [00:36:00] so the thing is, is that like people react very strongly to social change and, and cannabis legalization is a huge social change, and you can debate the merits and the pitfalls of it, but, Ultimately when you get a cannabis store in your community, it doesn't really change much.
Right. You can just not shop there. And that's probably the only thing you'll see is it's, you know, what was once an empty storefront or something else is now a cannabis shop. And that's like really all the change. And maybe you're getting a lot better music coming around. Yeah. Or, or even you're getting more people visiting your community.
Like there are like, look, there are tangential economic benefits to clear, it's. What I don't understand and I can speak more freely cause I'm not, you know, sort of employed by mainstream publication anymore, is like, I just don't understand the reticence change that many lawmakers have. And I feel like you find that reticence.
Um, The reticence is further entrenched, the more ideologically extreme on [00:37:00] either side, the lawmakers are. I think that's interesting because I think it is incumbent upon all of us that are in this space. You know, our US as investors, you as a journalist and entrepreneur, founders, advocates, it doesn't matter to at play.
It is not the job of regulators to be cannabis experts. Like that their job is to regulate. Right? And let's just assume that government at least tries to function the way it's supposed to, right? Which is ultimately an acting policy on behalf of the interests of the majority of their constituents. Right.
It should, you know, make things easier to do business, not harder. It should make things safer, not more dangerous. Right? Like just the general tenets of, of, of government. It's incumbent upon us to educate those people. We can't. Show up to have these conversations with regulators and expect that they know the story of Charlotte's Web.
Right, right. Like so, and we have [00:38:00] to, I ta I was talking to somebody that was actually a lobbyist or worked with a lobbying group at Google and I asked a question like, you know, that's interesting. Like Google, huge organization, or like huge company. Like, what do you lobby for as Google? Aren't you already so entrenched and said, said, no.
She said, it's our job to educate regulators to give them the information, even if it's not skewed towards a specific objective. Like we just want them to have the fullness of information and be able to collaborate where we can help. I was like, wow, that's a really. Sensible, non nefarious way to engage with government.
Right. And I feel like if you get too entrenched on these certain agendas and individual opinions or life experience, it gets in the way of things that can be done for the broader good. It just seems that way to me. No, I think, I think that's really good point. And you know, I think, I think one of the things that I hear from.
On the left is that, and I think right [00:39:00] lot of cases they're concerned with ultimately. The groups that have the ears of lawmakers and potential regulators are well-funded groups and well-funded groups in cannabis are, you know, generally a few pretty well monopolized, entrenched, you know, multi-state operators and look like, you know, they're incentivized by their shareholders to make more business for themselves.
Like that's what they should do. If I was the CEO of one of those companies, that is what I would do if I was in one of those companies. I expect my CEO or, or my, my C-suite to be doing that. Um, but it's not some hidden agenda. Right? That's my point point. This is the thing like, yeah, yeah. It, it's, of course they wanna make money for themselves, right?
It involves like, you know, yes, there maybe should be a little more consideration made because of what cannabis is and what it means. And, and it means both historically and socially and personally to many people. But it's not nefarious, it's not evil. Like that's what companies are doing. All the time in every single industry, um, when your first interaction with it is cannabis, maybe [00:40:00] that puts people on the back foot a little bit.
But that's something that's a system that can be worked around. Like there, there's a world in which like, you know, cure leaf can make a lot of money, but. Progressive advocates can have their own micro cultivation home grow where they're sharing with each other, right? Like that all can exist under the same umbrella.
It's just, you have to be careful to keep yourself aligned on these objectives. I think, um, and then may easier than done just to, I was just having this conversation with one of my investors before we jumped on this call, just around generally, you know, the lack of sort of public discourse, right? And the, the willingness to have.
Conversations and have tough conversations and debate, right? Like it's okay to change your mind. Like it's like it's, it's okay to say, you know what, I didn't actually have the fullness of information and maybe this way is better than the way I thought it was. It doesn't matter what side of an issue that you're on, right?
It, you can only get to resolutions if you can evolve your thinking. And I think that's my point is that, [00:41:00] you know, the more we are focused on putting facts on the table and representing, you know, Truth in science, um, which I think is one of the most important parts of this, certainly from our healthcare vantage point, and that, you know, regulatory pathways can exist and should be open for business.
Then you get into the nuances of like, how do you co, how do you put those together and how do you adjust them and how do you tinker with that? Right? But trying to take big, broad strokes every at bat. Isn't gonna get us there. You should see my Twitter dms every time I release a newsletter to see if people really wanna, uh, productively disagree or they want to Wow.
They wanna cast well. I can't wait. I can't wait till they hear this. Yeah. I mean, look, it's fine. Like, that's sort of part of the role that, that I've chosen to take, like being a little bit public and, and my sort of opinions and perspectives. You're gonna get that as you should. Yeah, but ultimately, you know, by and large, you can generally discount the hysterical opinions and can talk to [00:42:00] who Viewpoint.
That's right. There are both on the left and. That are really smart and, and differ from me in a lot of these issues you've talked about that I'm always willing to hear out and they're always willing to hear me out. Um, and I think that's, at the end of the day, it's like you do have to kinda pick and choose your battles in terms of these little personal conflicts.
But overall, it's a microcosm of the broader debate around honing in on a strategy that benefits both the industry and the movement as to separate but mutually intertwined. Pieces of cannabis legalization. Um, and I think that's where the challenge is. It's like right now the movement could not be further apart from the industry.
And ultimately all that's gonna do is undermine the overall goal that both. Look, as always, such an interesting conversation. Um, I love hearing directly from you the things that you're working on. Jeremy. Uh, I would encourage everybody to sign up for Jeremy's newsletter and let's put the podcast up on [00:43:00] Twitter and see if we can have some healthy.
Debate around some of the more controversial things. Um, so thanks every for joining us for the Cannabis Capitol Hill episode with Jeremy Burke and Jeremy again. Tell everybody where they can find you cultivated news or find me on Twitter at jf burke and please subscribe to newsletter. Let me know what you think.
Um, it's free, so not, not a huge ass. Brilliant. Well, I love what you're doing. Really important voice in the space and I. Always, uh, really enjoy our conversation, so thanks for joining us today.