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Little farmer, your host here.
I'm here with a special guest.
I'm here with Ernest Tony of Bible can.
He is the owner and founder.
He's here today to tell us a little bit about what he does and where he's taking everybody in the cannabis world.
Welcome Ernest.
How are you today?
I'm doing great.
Thanks for having me here.
Cool.
So could you let the people out there know exactly what BIPOCAN is and how you came up with the idea?
Yeah, absolutely.
Yes.
So started the organization in 2020.
BIPOCAN is a national cannabis business membership organization and consulting firm.
And what we are doing is trying to make the industry more accessible and profitable for minority entrepreneurs, professionals and social equity applicants and operators.
I started the organization, like I said, in 2020 amidst the pandemic.
There's also a ton of social unrest happening in the country.
I had been working for marijuana business daily at the time.
So if you're familiar with them, they're the industry's largest cannabis business publication for the retail and medical industries in the U.S. and Canada.
They also host MJ BizCon, the industry's largest cannabis business conference and expo.
I had worked for them for a couple of years on marketing and partnerships.
And I felt like I was in a position where I had traveled not only across the U.S., but across the multiple countries, meeting people who were interested in these new cannabis markets and industry taking shape.
And I guess what I saw was that there was not a whole lot of diversity in those rooms, in business ownership and leadership.
And 2020 was just that time where I think everybody sort of paused and was trying to reflecting on what life looks like.
For me, it was how can I spend my time, energy, efforts to do something for good, to help communities that I was tied to and felt strongly about.
So when I started BIPOC, I had no idea that it was going to be a business. I just know that I was in a position where I could help people get in, get connected, maybe make it easier for them to have some success in business.
And that's how I got started.
So, yeah, you were told me that you grew up in what state again?
In Virginia.
Virginia. I wondered the second time.
Virginia, I'm from West Virginia, so we're not too far apart. And you said that your father was a correctional officer or somebody in your family was a correctional officer growing up.
And then you noticed a correlation of some of your neighbors and friends getting locked up.
And could you explain that to the listeners out there? Like you explained it to me.
Yeah, yeah.
Some kind of the reason you got into cannabis, I believe, or at least that's the way I understood it.
Yeah, you know, it's funny because like I think that definitely played a role, you know, thinking about my background, where I came from, some experiences there, you know, when it came time for me to start my organization.
But a little bit of background. I grew up in a small town in rural Virginia. It's called Farmville.
When I grew up, I think the population was around 6,000. Maybe there's 7,000 people there now, something like that.
But, you know, it's about an hour away from Richmond, out in the country. It has, you know, pretty poor, poor county when I was growing up for sure.
And it also is a unique place that sits at the center of some of America's major civil rights moments.
Literally, the county seat is about 15 miles away from Appomattox County, and that's where the Civil War ended.
But also, you know, back in the 1950s, there was a whole lot of issues in that town where, you know, related to segregation and racism.
And back in the 50s, there was a student-led walkout at the Black Public School on account of the poor and inferior conditions of the school.
It was very overcrowded and unsafe, things like that.
But anyways, like that movement was actually one of the key pieces of the Brown v. Board of Education case, which outlawed segregation, you know, public segregation of education in the U.S.
And my town, as a response to that, they didn't want to integrate, so they removed funding to close the Black School. And for a period of close to a decade, there was no options for education.
So if you were a person of color, if you were a poor white person, you couldn't go to school. The only option was private school.
I give all that background because, you know, when you remove opportunities for people to get education and have access to, you know, things that's going to improve their upward mobility, then those effects follow you, follows your families for several decades.
And I don't think it's a coincidence that there was a whole lot of people trying to figure out how they can make a living, and there's likely an increase in, you know, cannabis distribution and sales.
A response to that was a correctional facility was brought to our town. And when I was five, my father started working there as a security officer.
And over his 25 years working there, you know, he moved up the ranks all the way up to administration. That correctional facility ended up being one of the biggest job creators and revenue producers for that town and the surrounding six counties.
But it was also, I also saw how it was sending people from my community behind bars. So I knew the people who work behind the scenes there, and I got to see exactly like how, you know, the private, you know, prison industrial complex was, you know, making money.
But I also saw how it was sending neighbors, family, friends to be behind bars. And it was interesting because at one point when my dad was working in administration, he had three older siblings who were locked up there.
And when I would go home, or actually when I would leave school to go to the jail, I would see one of my uncles out there pretty much every day.
You know, he was on work release, but he's in his orange juncture suit, and I'd say hi to him and then immediately walk inside the building and see my dad and, you know, like his boss and people from the county and things like that.
So it's like I knew the people who worked there and the people who were, you know, getting locked up.
And I think what I saw is that a lot of folks from my neighborhood were the ones that were getting, you know, targeted for cannabis possession because when I go across the street or a couple miles away to the suburbs, I knew plenty of people they used, but you never saw the police, you know, stopping by and, you know, interrupting their daily activities.
So yeah, I have seen that in the country of West Virginia too, from a small town country, West Virginia, and a lot of poor whites and minorities were getting locked up and targeted, just as you were saying.
Some of the listeners out there don't actually know what social equity is. Could you explain what social equity is real quick?
Yeah, you know, we're sort of talking, so what you and I were just talking about, you know, where we grew up, sort of experiences that we've seen, and even if you think of just a history with cannabis, going back to like the 1920s with Henry Anslinger and, you know, the reefer madness, you have all of this negative propaganda.
And then you have the 70s and it was Nixon leading the war on drugs, really, and you know, people in his administration came out years later and said that this was actually the war on drugs was a covert way for them to essentially, you know, target black and brown communities, you know, get those, you know, trying to basically find ways to reduce their options in society to lock them up.
The war on drugs was not really war on drugs. It was a war on race and poverty. And so social equity is this, you know, philosophy that's about justice and fairness. It's about trying to make sure that there is equality and access to things.
The cannabis industry is an interesting one because, you know, now you have this regulated industry, the first adult use or recreational legal industry or market was in Colorado, you know, where we are.
That was formed in 2014. So you have this very new legal cannabis industry that has generated billions of dollars in revenue off of legal cannabis sales.
At the same time, you have over 40,000 people who have been, you know, who are behind bars for simple cannabis possession and use. The majority of those people behind bars are poor people and people of color.
So the same people who are more the most likely to be convicted and arrested and sentenced for possession, despite the fact that there's not really any much difference in usage between them and their white counterparts, they're the ones who are most likely to pay the price for cannabis in the first place.
They're also the least represented demographics in the industry. You know, you can see across the board that there's less than 4% like black and brown ownership and businesses in the cannabis industry.
So that is a problem when you see that this very new industry, which is generating billions of dollars, is not actually creating revenue or opportunities for the exact same demographics that are still locked up or who have been most affected because of cannabis prohibition by the war on drugs for the past several decades.
Social equity is supposed to level that playing field. It is supposed to create equitable access and business ownership for individuals from those communities who have been directly impacted.
So people who have maybe gone through the criminal justice system because of cannabis possession, if they choose to start a business in cannabis, the social equity program is a way to give them that access.
They've already had so much taken away from them. We talked about some of those residual effects that happened in a lot of poor communities like in the US.
You remove a father, a mother, family figure from the household because of cannabis conviction. Those people can't make money. That's less income that's coming in.
That family wants to, someone from that family wants to start a business, but they don't have like the decades of working and the capital to start a business because the law, in the first place, is what put them behind bars.
Then they're even farther behind if they actually want to pursue that dream. Social equity programs can help mitigate some of those barriers.
That's just the idea. Thanks for bearing with my long-winded answer.
We actually met at a social equity meeting down at the Tetra Lounge. You spoke. That was after I had already tried to set up a dispensary, lost a lot of money.
That's when I had switched to my website, moving more to an advocate myself and trying to find another niche into the cannabis community or the cannabis industry.
Some of the things that you said at the meeting really struck. Could you kind of repeat some of those things? How much it costs to get into the industry? What are some of the barriers there? What are some other options? What does it bring to your community?
How many different jobs have you seen that are brought in just because of the cannabis industry, but you're not actually in the dispensary selling way, but growing?
Yeah, absolutely. I'll try to touch on some of those. A few minutes ago, I shared that we have in the US this $30 billion cannabis market.
Just in Colorado, in the first eight years of legal sales, there's been over $12 billion in revenue generated between 2014 to 2021 through legal cannabis sales.
Now, we're using those numbers. Those are big numbers, but that's really just a small percentage of the overall economic impact that these industries bring.
Usually, when people are thinking, well, in the past, like when people learned that I was working in the industry, I'd probably say 90% of the time, people would reach out to me and they'd say, I'm surprised that you're working in cannabis. You're the last person I thought would do that.
Or there would be people who say, Ernest, how do I get a license?
For the people that were interested in getting a license, start asking questions and you realize that I think a lot of times people think that getting that license is going to be like this lottery ticket.
It sounds like a fun thing to do. Having your own cannabis business, state license regulated one.
But when you remove that veil and look at just the challenges to even get to that point, it's huge and it's costly.
I mean, you're talking about one of the most regulated industries out there. Cannabis is still Schedule I due to the Controlled Substance Act.
There are a ton of implications with that. It's not fully legal. We have a whole lot of stigma associated with it. You can't access basic banking right now.
But beyond that, because of its Schedule I status, if you were to start a licensed cannabis like dispensary or cultivation, then there's a thing within the U.S. Tax Code called Section 280E.
And part of that tax code prevents you from writing off certain expenses for the sale of products or for businesses that are not fully legal.
That creates some real issues for cannabis businesses because there's a lot that they can't write off and costs of good souls.
So it's not an exaggeration, but there are some cannabis businesses, some dispensaries, that are paying up to 70% in taxes because of that inability to do write off.
So we're talking about federal tax, state tax, excise taxes. In addition to that, it's a capital intensive business.
I mean, you have to not only raise a lot of money, I mean, probably well over a million dollars and even higher depending on the market that you're in,
just to support the operation and everything that you need in order to open up those doors.
We've seen a whole lot of issues with cannabis licenses after they get allocated.
A lot of times that might be, they might be mired in litigation and lawsuits.
So even in places like Illinois, when there was this promise to bring social equity to the state, licenses were awarded.
There was a lot of issues with how they were awarded.
And then you had lawsuits which prevented those licenses from being functional for close to two years.
Now, if you have a license and you're planning to open up a business and you can't because you have to pay rent on a facility for two years,
those are other hidden costs that many license holders have experienced.
I know that that has been a reality for people in some of the early markets too.
I remember Dr. Shonda Masias, who runs Alera Holistic out in D.C.
I remember hearing her speak about how she had found a landlord, said that she was going to open up a cannabis facility,
went through a whole lot of struggles to actually get the license when it was finally awarded,
ran into some issues with that landlord not wanting to allow the business to actually function, change his mind,
and then her paying rent for a year and a half on a building.
It's just a whole lot of complications.
Something really similar happened in West Virginia where I went back home.
They were supposed to open a dispensary in my hometown.
It was the only person in West Virginia who was from West Virginia that was awarded a license.
So you sum up a quarter of a million dollars and they had three licenses to open three dispensaries.
In one town, he couldn't find a place to rent because it was zoned.
He couldn't get in three times the rent.
Or it was just couldn't do the codes, couldn't get the walls high enough around it or something.
In the other town, he even bought a building.
It was great.
Right across from a church, the Methodist church was fighting against if we were allowed to go in.
The third one, he couldn't get the building all the time so he never got one put up, I think,
with all the costs and he lost all his money.
Yeah, I've heard so many stories that are similar with people putting in their life savings,
borrowing funds, taking out loans.
They might want a license and think that's their lottery ticket and they're just beginning.
But you asked me another question. You talked a little bit about how now we met and you had recently decided
that you were going to pivot after not being able to get that license.
So doing more work on the advocacy side, even running this podcast,
trying to figure out other ways that you could still participate in the industry.
That has been something that I've been trying to educate a lot of folks about over the past couple of years.
As I was saying, when I got my start in the industry back in 2018 working for MJ Biz,
we'd go out and host these major events.
In Vegas, in 2019, I remember over 32,000 people being there.
Well, having over a thousand exhibitors on the floor, those are not all cannabis companies.
Most of them, probably 80, 90 percent, are providing some type of service to support the industry.
So you may call that an ancillary business, something that is adjacent to the plant.
It doesn't directly touch the plant, but it is something that's critical to the supply chain or provides a service that a business owner could use.
And that's where I see a ton of opportunity existing.
And when I was talking about, I was using that number earlier, we were saying, OK, Colorado has generated $12 billion in the first seven years.
The market is worth $30 billion at the moment.
We're just looking at a piece of the puzzle.
We're not talking about how much money are the lighting companies that sell the products make or how much are could you potentially make as an accountant or a general contractor in this industry?
I mean, if you think about if you were to think about this industry as any other type of industry, what are you know, every industry needs certain types of services.
So I think a lot of times people get really laser focused on trying to get that license so they can own and operate dispensary.
And I definitely don't want to deter anyone from that, you know, especially like, you know, if that's your dream and you want to go after it and you have the connections and the means to make that happen, you know, go for it.
At the same time, I just want to make sure that people are aware that there are a ton of other ways that you can directly be involved in this industry, too.
That's one of the things that I haven't seen like social equity really touch from like a policy or program aspect.
I mean, so much of it is about, OK, let's create access to licenses for plant touching businesses.
But, yeah, it would be pretty cool if there was like some programs out there that could also tackle like the minority business ownership problem by by also being able to support some of these services,
ancillary businesses that that also touch the industry.
So, yeah, there's really hundreds or thousands of different ways to be involved.
But delivery packaging logos.
One of the biggest thing is compliance.
If you're anybody into compliance, you can help a business stay in track because there's so much things that you have to comply with.
So many rules, so many laws, lawyers, anybody. There's tons and tons of opportunities within the industry without owning the license, like you said.
Yeah, absolutely. And my business is an example of that, too.
You know, like I said, we are trying to remove some of the obstacles for people to get into the industry, to start their business, to make referrals and connections.
And, you know, we are forming some strategic partnerships with local operators, some multistate operators.
We are working with cannabis companies, cultivators, delivery, you know, manufacturers and everybody there like needs some type of assistance.
Obviously, like capital is like the biggest thing that has been the biggest barrier for everybody, quite frankly, in this industry over the past couple of years.
But, you know, even beyond that, like our service is one that is trying to help the business owner figure out, like, the tools and resources they need to enter and to grow their business.
So you are not only in Denver, you said you're national. So I know you have an office in Virginia, you mentioned Massachusetts.
A lot of new states showing up. If anybody wanted to get involved or get in contact with you, how would they go about getting in touch with you?
Yeah, so you can check out the website, BIPOCANN.com. It's B-I-P-O-C-A-N-N.com. I'm also easy to find on LinkedIn.
You know, you can search for the business. You can just search for me. My name is Ernest Tony. T-O-N-E-Y. Those are two ways to find me.
We can be in touch that way. I will say, yes, we are, you know, I'm headquartered out here in Colorado, Denver metro area, and that's where we have like our biggest footprint.
But I started, you know, BIPOCANN, not because this was like diversity and representation was not because it was an issue that was unique to Colorado.
I mean, this is going to be an issue. This is an issue that's unique everywhere in, you know, the legal cannabis industries and especially as new states come on board.
You know, you're going to have a lot of people who have been following the industry. They might be aware of it. They're trying to figure out, OK, is there a pathway for me? Is there an opportunity for me?
You know, we can be a resource there, too, because of, you know, what we do here is not really unique to one specific place.
We have members in multiple states. I'd say our biggest presence right now is here in Colorado, Virginia, Illinois, and some of the mid-Atlantic states.
So, but yeah, we're just trying to help as many people as we can.
So one last thing here. I know we're short on time. It's a busy Monday.
Do you have any advice for people in new states that are becoming legal or states that are already legal to promote the social equity there?
Who do they need to contact or what are some things they should do or look out for or something to avoid?
When you're saying that they're the social equity acts are coming up, but then they're difficult to actually get into motion. I've seen that happen here.
Even a delivery company started up, but nobody will use them to deliver.
And they're not taken off. Is there anything that you can recommend for these people to look out for and to contact their politicians or whatever and to make sure it doesn't happen in the beginning?
Or so they can change the laws? Yeah. Yeah. Yeah. Thanks for that.
I mean, they're so like, I think anytime you want to start in these new markets, there are usually a lot of challenges.
There's gonna be a challenge like every time you want to start a regulated cannabis industry in a new place.
Colorado is unique. I mean, we, for all intents and purposes, we weren't the first medical market, but we were the first state legal market.
We were the first to try to create a framework for I think what has been modeled in other states.
And I know a lot of eyes were out here on Colorado because this is sort of ground zero for this regulated industry, which is less than a decade old.
Colorado started this market and social equity was not at the forefront of it.
I mean, I think back then, I mean, I've talked to people who were involved with creating this first market and I believe that their interests were how can we show that this is a viable market and it creates a ton of opportunities.
And it has like a lot of benefits.
And I think by the time Colorado got to trying to address social equity, you had a lot of places like in Denver, which were already saturated.
It's probably the most competitive market in the world.
You know, if people don't want to find dispensary retail locations, there's issues with expenses, availability, zoning.
I think that these newer states are at an advantage because, you know, they actually have, they can look to blueprints, they can look to frameworks, they can see what worked and what didn't work.
And that has the potential to be more advantageous.
With regards to social equity, you know, I think there are some places that are, that are, you know, trying their best, but I feel like what needs to happen in these new places is you have to like, you have to make sure it's not happening in a vacuum.
So, you know, a place in the South decides that they want to start a social equity program.
Well, there needs to be a lot of stakeholders in that room.
I mean, you need to have some people who have, who have done it.
You need to have, you know, people who can also communicate that social equity is, is more than solving, you know, social issues, but it's also a health and an economic issue too.
I think that there, I know that there are some folks like back in my home state or my native state of Virginia that won't even entertain the conversation of social equity because of the way it sounds, because they don't understand it.
They don't want to acknowledge that so much of this industry was directly tied to like, like I said, this war on racism and poverty.
But you have some of those folks that might own farmland and care about, you know, creating a new economic center, an economic agricultural center.
And I think you shift the conversation of those folks to say, how can we find ways to use this as a tool that can create businesses for, you know, communities that have been impacted for underrepresented people?
So I'm being very theoretical here.
What I really, what I really think is like in these new markets, you need to have, you know, some people, you know, some advocates who've been there.
You need to have, you know, people who have been directly impacted at the table.
So, you know, just recently hosted an event where we brought together about 20 social equity applicants and operators and we had some, you know, my organization and two other advocate organizations, Minorities for Medical Marijuana and Marijuana Matters.
We had conversations to figure out, okay, well, what were the challenges? What are the ideas where we can work together? How can we create, you know, some pressure in such a way that we can get the legislators and the policymakers to create laws and policies that will actually benefit us.
And we had state regulators in the room to listen.
So we need to have real honest, hard conversations with people that are in a position to do something about it in a room.
I'm happy to be a resource.
And if I'm not the right person, I know the right people, so I can, I can, I can be a resource that way too.
The advice I got is people need to talk about it more instead of being afraid to talk about it.
Just communicate, get it out there. Another one, just try to make sure that the states aren't limited to only four or five operators.
Make it open to more local people. Make sure that they're involved. People can get a license if they're in that state and local, locals.
And make sure the taxes aren't too high. I've noticed that the tax relief is up to 75%.
And if you're adding all these taxes up, it just makes it so expensive and so hard for anybody to get started unless you already have a couple million dollars.
And a lot of these people don't know much about cannabis and they're just investing money.
And when you don't know much about cannabis, you got to have love for the planet. You got to have, take care of it.
Yeah, you're right about that.
And I'm glad you brought that tax, those last two points, because I think too many people, I think it's easy.
So a lot of times when people get your elected officials, okay, they're not necessarily, they're not going to be experts in cannabis policy.
You might have some, like one or two, but in general, like, I mean, I remember when I was paying attention to some of the conversations that were happening in Virginia,
and people were coming up with ideas about trying to treat that market like the same way you would like the regulated alcohol market.
And it's not the same. It doesn't have, it doesn't carry the weight. It doesn't carry the history.
And you're also not dealing with a substance that is under control substance acts.
So I think a lot of times, you know, people don't understand the nuances of the laws, the policies.
I mean, even out here in Colorado, where, you know, I think like sometimes people will see something on the ballots and will say, let's tax the cannabis companies more, you know,
and give it to, and make the funds go to something that is...
Education and marijuana. That's what happened here. It wasn't a labor, like, we're going to throw some money into the public school system.
But then what I heard, a lot of the money actually went into training police officers on cannabis or education, cannabis education instead of public schools.
And it just kind of got shifted to another place.
If you do have the alcohol and regulated like tobacco, those, even our food is not highly regulated like the cannabis is. Cannabis is over, over regulated.
You have to take some of this regulation out, I believe, to make sure in other states you don't overregulate it, overtax it,
because you're just going to shift more money back into the black market, which is even going to be harder to deal with once it's legal because it's there.
Yeah, I mean, that's another great point, too. And that's happening in a lot of states right now because, you know, like...
California, I guess, is probably the biggest example right now.
Yeah. And for those folks, like, does it really make sense for, like, they already have, like, their customer base and distribution network.
There's, you know, does it really make sense for them to try to go through the process of doing this in a way that, like, I don't know, like, I think getting rid of taxes, I think getting rid of that section.
Yeah, definitely like lowering them or finding ways to offset it needs to happen because not only is it difficult for companies to be profitable,
but I think it's also going to make it that much harder to incentivize. You know, it's just such a capital intensive business, you know,
if you want to be on the plant touching side that, I mean, there has to be more incentive and pathways for people to get in.
I totally agree with that. So, I highly appreciate you coming on the show today, Ernest. I know you got a little appointment here, so we've got to get out of here.
But it was a pleasure talking to you today. Definitely want to keep in touch and help out as much as I can.
Virginia, if you are wanting to get into the business, make sure you get in touch with Ernest here. He can help you out. You need some advice.
I think Maryland's becoming legal to here to go to states very soon. So, you guys, these are some things to look out for.
And if you're getting into the business, good luck and tune in next week. We'll have another episode. And thanks for tuning in. Peace.
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