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I’m Mad as Hell About the Proliferation of Carpetbaggers in the Cannabis Industry

I’m Mad as Hell About the Proliferation of Carpetbaggers in the Cannabis Industry

As you all know, there are few things that piss me off more than abuses of power.

My brow furrowed a month ago when I read that the 20-year incarceration of a drug dealer in Missouri was finally ended when the state graciously decided to release the convicted non-violent offender who was serving a life sentence for selling six (6) pounds of pot.

Likewise, a scowl is still present on my face about the bureaucratic clerk in Kentucky who gets her day in the spotlight for not giving marriage licenses to same sex couples — and then gets a backstage pass to meet with the Pontiff, Pope Francis, when he visited D.C. last week.

But, the stories that I continue to hear about carpetbaggers fleecing an unwary public and legitimate businesses looking to take advantage of the cannabis gold rush by winning a PPR license through the application process, or those looking for kickbacks for including a vendor in the RFP for their unsuspecting wards, or growers attempting to corner the market in states like Ohio, take the cake.

Andy Joseph, CEO of Apeks SuperCritical, a manufacturer of high end CO2 extraction equipment, called me last week to share a story about getting a good old fashion shakedown from a consultant working for a Maryland license applicant. Apeks sells direct to end users but does offer a reasonable 5 percent finders fee to those that introduce them to clients that bear fruit.

The reason Andy was fuming, and I agree with him, is that he tells me this consultant effectively told him to come up with a higher commission schedule or he would leave Apeks off of the consideration list that he submits to his client.

Now, I am not naive. Consultants are a necessary part of the distribution channel for the sellers of products and services, and there are more than a few highly reputable consultants in the Cannabis Industry that have earned their fees by helping clients win these potentially lucrative licenses, and the clients are making business decisions that include the fee schedules they agree to if performance conditions are met.

But, threatening not to invite one of the industry leaders in extraction equipment to pitch their wares to a potential end user is just flat out wrong. So much for serving your client’s best interests.

I asked John MacKay, who heads up Waters’ sales and marketing efforts to the cannabis community and is a regular contributor to CBE, if he has run into this as well given that they also sell direct to the end user. He said that he hasn’t, at least not that he is aware of, but that he has no idea when and if they have been excluded for not using this channel.

Tony Gallo, one of the good guys in my book and another regular contributor to CBE, recently shared another story that fits the bill.

As a security consultant that has a lifetime of experience in other high risk industries before entering the cannabis space a couple of years back, Tony told me of the padded and greedy bids some newbie contractors have submitted to his clients in the past. In one case, a vendor competing for the security camera contract for a client of Tony’s submitted a proposal for $65,000 for a job that, Tony estimates, shouldn’t have run more than $25,000 grand, give or take. Tony said he sees quite a bit of this in his application writing activities, and he issues a stern “let the buyers beware” warning to the applicant community.

There are rumors of unsuspecting applicants contracting with consultants and assisting them in their application process to the tune of a six figure fee, regardless of the success of their application effort. I can’t substantiate this but have heard it from more than one source — and generally, where there is smoke, there is fire.

So yeah, this carpetbagging type of activity does exist in the Cannabis Industry and it makes me mad as hell…but so does amateurish efforts to win licenses without doing the necessary due diligence.

Regarding the Responsible Ohio front, more on that later. Stay tuned, because this one get’s me mad as hell too!

Rob Meagher

Rob Meagher

Rob Meagher, CBE’s Founder, President and Editor-in-Chief is a 30 year veteran of the media world. His career has spanned from stints representing the Washington Post, USA Weekend, Reader’s Digest, Financial World & Corporate Finance to the technology world where he worked at International Data Group and Ziff Davis where he was part of the launch team for The Web Magazine, Yahoo Internet Life, Smart Business and Expedia Travels before starting his own marketing and Publisher’s Representative Firm. He also ran all print and online media sales and marketing for the Society for Human Resource Management before partnering with Forbes and then Fortune to create Special Sections covering a variety of topics. Rob, who started CBE Press in 2014, can be contacted at [email protected]

This Post Has 2 Comments
  1. I would also place agencies like puget sound clean air in the mix of carpetbagger. They are charging thousands in fees and permits because they consider cannabis a pollutant as “some people could find it offensive to smell”. Yet other farms such as livestock have no impact by the clean air mafia. I may be way off base, but a flower that produces oxygen and a smell that cannot be quantified in a stand of cedar trees is far from a pollutant and certainly doesn’t warrant thousands in fees and permitting. Shame on these governmental agencies for their greedy practices.

  2. The government and big business will be the ultimate in carpet bagging. Cities and towns looking to hold lotteries and hefty fees to run a small business. Big business with cut rate products and give them 10 years to start price fixing ect.

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