Businesses want in on the growing marijuana industry. This fact was obvious at the Fall 2015 Marijuana Business Conference in Las Vegas last month when over 5,000 people gathered to listen to over 70 speakers and over 230 exhibitors talk about the marijuana industry. It was even more obvious last week when Bruce Knox, owner of Lake Mary, Florida-based Knox Nursery, used a helicopter and a golf course to make sure his company didn’t miss its chance to join the marijuana economy.
Bruce Knox’s company was one of five marijuana dispensary facilities that the Florida Department of Health had approved to cultivate and dispense marijuana to patients in the state. In total, there were 28 applicants for the coveted licenses, and it was hard to get selected. To apply, a nursery had to be in business in Florida for a minimum of 30 consecutive years and grow a minimum of 400,000 plants at the time they applied for the license.
However, getting picked was just the first step for these companies. To actually operate in the industry, each selected applicant had to post a $5 million surety bond. Without the bond, the companies would not get their licenses. The deadline for the companies to prove they had their bonds was 5:00 p.m. on Wednesday, December 9, 2015.
While the other four selected applicants had delivered their bond proof by Monday, Knox still didn’t have his. Knox’s bonding company required 100% collateralization of the bond. That means he had to have $5 million in verifiable collateral before the 5:00 p.m. deadline on December 9th. Keep in mind, the dispensaries were selected by the state just one month prior to the bond deadline!
The Tale of a Helicopter, a Golf Course, a Fast Car, and Marijuana
Knox didn’t get proof of collateralization for his $5 million bond until shortly before 5:00 on December 9th. If you’re wondering what kinds of extreme lengths businesses will go to in order to get in on the growing marijuana industry, you need look no further than Knox.
According to News 4 of Jacksonville, Florida, Knox convinced a friend to fly him via helicopter from Lake Mary to a golf course located near the Department of Health headquarters where the documentation had to be delivered (it pays to have friends who own helicopters). After the helicopter landed on the golf course, Knox had a car waiting for him at the golf course and made it to the Department of Health at 4:58 p.m. Knox Nursery would get its license!
But that’s not all!
Marijuana Business Daily reports that each nursery has 65 days to request formal permission from the state to begin cultivation. Once they get permission, they have to start “dispensing medicine” within 210 days. In other words, getting into the marijuana industry isn’t a done deal for these five businesses yet, including Knox Nurseries.
Businesses are Paying the Price of Entry to Join the Marijuana Industry
It’s not just Florida businesses that are willing to pay to get in on the marijuana industry. For example, to get a marijuana producer license in Connecticut, a company must have proof of $2 million in capitalization, which could be in the form of a surety bond, escrow account, or letter of credit.
It remains to be seen, as the marijuana industry continues to grow, if anyone else will top Knox’s efforts to join the marijuana economy with a helicopter, a golf course, and a fast car.
Susan Gunelius, Lead Analyst for Cannabiz Media and author of Marijuana Licensing Reference Guide: 2017 Edition, is also President & CEO of KeySplash Creative, Inc., a marketing communications company offering, copywriting, content marketing, email marketing, social media marketing, and strategic branding services. She spent the first half of her 25-year career directing marketing programs for AT&T and HSBC. Today, her clients include household brands like Citigroup, Cox Communications, Intuit, and more as well as small businesses around the world. Susan has written 11 marketing-related books, including the highly popular Content Marketing for Dummies, 30-Minute Social Media Marketing, Kick-ass Copywriting in 10 Easy Steps, The Ultimate Guide to Email Marketing, and she is a popular marketing and branding keynote speaker. She is also a Certified Career Coach and Founder and Editor in Chief of Women on Business, an award-winning blog for business women. Susan holds a B.S. in marketing and an M.B.A in management and strategy.