On Thursday afternoon, officers from the Toronto Police Service swept into 43 marijuana dispensaries in a massive raid on both sides of the city. The cops arrested 90 people, issuing a total of 257 charges. About $160,000 in cash was confiscated and a few hundred kilograms of cannabis-based products- including marijuana, resin, oil, chocolate, cookies, and candy.
Investment analyst Aaron Salz, an expert in the Canadian cannabis industry, was quoted saying “there’s definitely some effort” by licensed growers to get the police to shut down their unlicensed competitors. Curiously, the raids were conducted on the very same day industry leaders gathered for their annual Canadian Cannabis Business Conference in downtown Toronto.
Licensed growers have an impressive list of politically connected executives; including a board member of the Liberal Party of Canada, a former Ontario Liberal cabinet member who worked on a radio show with mayor John Tory, and a former director of the Young Liberals of Canada. Was it only a coincidence that Thursday’s raids were perfectly timed for the largest Bay St industry event of the year?
Yesterday I decided it was time to learn more about the cannabis industry, their executives, and how they’ve structured their business models. My first step was to dig into the people who gathered at this week’s Cannabis Business Conference. I’ve entered each of the listed speakers into the interactive chart posted above- it was a fascinating exercise.
The growers are only the tip of the sensimilla bud. Industry stakeholders include a long list of lawyers, investment bankers, academics, and people building “shovels” for the marijuana gold rush. But while Bay St executives and Liberal apparatchik are looking towards an enormously wealthy future, the only stake offered to the activists who made legalization a possibility was the one shoved up their arses during Thursday’s Eliot Ness style raids.
One thing that stuck out to me most researching this chart was the parallels to what I saw working as a management consultant in the years preceding the great telecom bubble of 2000. Like the telcos, the cannabis growers are using the same philosophy of “build it and they will come”. Switch the phrases “data centre capacity” with “grow room capacity” and “Health Canada licenses” with “rights of way”, and cannabis grower’s business plans sound eerily similar.
But there’s one major difference, the corporatization of Mary Jane is based on an idea so outrageous it couldn’t possibly succeed without the industry’s political connections (and the ineptitude/corruption of Bay St financed media). I can’t help but sense a feeling of deja vous, reminders of past consulting engagements I worked on at Enron and Worldcom.
Today’s posting is only a teaser, stay tuned for the full story early next week. Until then, have a look at the interactive chart, you can find a larger version of it here. And if you’re wondering about what the industry’s outrageous idea is I’ll leave you with a hint- switch the word “cannabis” with “tomatoes” in their business plans, and think about exclusivity in the context of recreational sales.
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there is some more information here: http://tvo.org/article/current-affairs/the-next-ontario/these-prominent-canadians-want-you-to-buy-their-weed
It’s probably safe to assume that none of the “medical” cannabis producers will accept competition.
Just like Al Capone and his North Side gang tried to rub out the South Side gang with Bugs Moran. It should be interesting to see what happens to these “prominent Canadians” should they attempt to enter the U.S once the DEA and U.S Customs finds out that they are making money from growing and selling pot.
Hyya Greg, looking forward to reading the full story . I will say , however, that i do strongly oppose the sale of any drugs anywhere . For that reason, I support the raids that took place . Having said that, however, while i oppose the impending legalization of drugs , if they must be sold , would rather see them sold through some official government agency. I say this because this way, at least in my opinion, there is / are some safe guards in place , something like what is in place now for the sale of alcohol through the LCBO. i think that selling it through these store front operations, invites gangs and the mob to get foot holds into this market, one that will no doubt raise millions, if not billions in possible tax dollars. No, i don’t want more government control into ones daily life, but I do think that in this case, they are the only ones whom, I think would and could be responsible enough to sell this stuff. I think as well that selling it through government only outlets, they could undercut the prices to be so low that they would , at least in theory, put the street level dealer out of business, at with respect to pot sales.
I have my own views on this drug and what it really does, and where it leads, but that is for another discussion.
It was to end a potential gang war. Same thing happened in Montreal five or six years ago. The money in pot is ancillary services; it’s agricultural like any other crop.
BTW, Greg, if you’re reading, the queen is now informed and involved.