How Reefer Will Be Going Corporate

[User]

Nick Tenant was running an auto detailing business in Detroit when the auto industry collapsed.

He grew up in Warren, Mich. His father worked at General Motors Corp. He started cleaning and reconditioning cars at age 17. In a few years, he landed contracts from car dealers all over the Motor City area. And his business grew so fast, it got in the way of his education.

"I was also going to college for business finance," Tenant told me. "By the time I was 20, I quit college because the business doing so well."

Soon, however, Tenant would be getting a more painful education.

"A lot of the dealerships went out of business," he said. "The other half of them .. their margins got so tight .. they couldn't afford our business."

Tenant knew that if green shoots were to sprout from Detroit's decimated economy, some of them would be weeds.

Now, at age 24, he's the founder of Med Grow Cannabis College, a trade school for medical marijuana caregivers.

Since its founding last fall, Med Grow has graduated more than 400 students, who pay $475 for a six-week course. They can earn between $40,000 a year to well into the six figures, said Tenant, who uses medical marijuana himself to treat his early onset Chron's disease.

Michigan is among 14 states that have legalized pot for medical use, New Jersey being the most recent. Other states are likely to follow, possibly even corn-fed Iowa after a recent recommendation to do so from the state's pharmacy board.

This limited legalization is turning into reefer madness. Denver recently took 235 applications for medical marijuana dispensary licenses. This is considerably more than the 154 Walgreen (WAG) stores across the entire state.

State lawmakers are now looking for ways to tax this burgeoning industry. And just think of all the new green jobs.

"Here's a job title that didn't exist around here a couple of years ago," the Boulder Daily Camera recently reported. "Budtender."

Meanwhile, the science behind the touted benefits of medical marijuana is often in dispute. And so is the law.

States and municipalities are quite often changing their conflicting codes. The Feds, meanwhile, have emphasized that marijuana is still illegal under federal law, although not a prosecutorial priority.

In this uncertain environment, it's never a good idea to brag about business.

Chris Bartkowicz of Highlands Ranch, Colo., recently went on a local TV news show bragging about how he planned to make as much as $400,000 a year from his medical marijuana growing operation, which consisted of more than 200 plants in the basement of his $637,000 home.

After the report, Federal Drug Enforcement Agency officers raided his house and slapped him with charges. Denver DEA Special Agent in Charge Jeffrey Sweetin told The Denver Post this was just the beginning:

"The time is coming when we go into a dispensary, we find out what their profit is, we seize the building and we arrest everybody. They're violating federal law; they're at risk of arrest and imprisonment."

This would be an unfortunate legal setback to one of the few industries in America that is actually growing.

A generation that toked as teenagers wants to smoke as senior citizens. In a recent survey from the Substance Abuse and Mental Health Services Administration, reported marijuana use among 55- to 59-year-olds has more than tripled since 2002 from 1.6% to 5.1%.

I can't see how medical marijuana can be any more deleterious to society than letting rich, old men with hot, young girlfriends use Viagra.

(OK, so there was that one fifth-grader in California who took an older sister's Fruity Pebble's treats, fortified with Mary Jane, to school. But that's not as bad as some other things kids find around the house.)

Medical marijuana deserves a chance to evolve through the full business development cycle, from mom-and-pop start-ups to publicly traded corporations with aggressive M&A strategies.

Folks in fine suits, sitting around marble boardroom tables, are already eyeing this highly fragmented, but incredibly lucrative business, and saying things like, "Let's do a roll-up."

One of them is Mel Roseman, chief executive of Kingwood, Texas-based International Merchant Advisors Inc., which trades on the Pink Sheets for about 13 cents.

On Monday, Roseman put out a press release heralding an acquisition strategy for his company's "Wellness Centers and Medical Marijuana clinics."

Roseman is 68 and said he doesn't know much about marijuana, except for maybe this: "It's a business."

"We're going to bring our resources to an industry full of mom-and-pop shops that don't have it," he said. "I don't know how these little guys do it. We're going to bring in legal expertise and medical expertise on a much larger scale."

Branding, marketing, and mass advertising come next.

Large corporations should be lining up to license that everybody-must-get-stoned song by Bob Dylan: "They'll stone you when you're tryin" to make a buck; Then they'll stone you and then they'll say "good luck.'"


NewsHawk: User: http://www.420magazine.com/
Source: foxbusiness.com
Author: Al Lewis
Copyright: 2010 FOX News Network, LLC.
Contact: feedback@foxbusiness.com
Website: Al Lewis: How Reefer Will Be Going Corporate - FOXBusiness.com

• Thanks to MedicalNeed for submitting this article

[Nicademus]

Great, instead of 1000's of normal people making a decent living, a very few people are going to get obscenely rich. I am so done with that model.