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Go East, Man: California Cannabis Seeks Fresh Markets

Meanwhile, LA author Mark Haskell Smith chronicles million-dollar marijuana strains in new book Baked.

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Call it a reverse gold rush, but a "go east, young man" fever is gripping California marijuana growers, dispensary owners, consultants, and assorted industry members. The fever is rapidly transplanting the Golden State's best practices as well as its more dubious ones to Rhode Island, Michigan, Maine, and Colorado. But no state is really off limits.

"I think it's a natural development, because California has had fourteen years of experience developing medical cannabis," said leading Oakland dispensary owner Stephen DeAngelo. "The industry is more well developed here than anywhere else. If you want to get in on the ground floor, California is not the place to do it."

DeAngelo has been helping to open a dispensary in Rhode Island through his consultancy firm CannBe, comprised of an A-team of lawyers, marketers, managers, growers, and security. CannBe is also looking closely at work in Washington, DC and Oregon.

Similar to a counterinsurgency, the firm takes a low-profile approach, partnering with local forces to train them. For a fee, CannBe provides the advice and expertise to help craft laws, get them passed, and win dispensary permits. But other California groups are less sensitive.

Orange County-based Medical Marijuana Inc. made headlines last month when it rented out the Silverdome in Pontiac, Michigan for what it's calling the second-largest marijuana convention in the country. Advertising depicted a huge bud leaf erupting out of the stadium and a jack-o'-lantern with a joint in its mouth. Local newspapers called it a "pot party," and the local mayor and police chief went ballistic.

"They were really offended by that in a large way," said Medical Marijuana Inc. Vice President David Tobias. The company explained its intent to abide by all state laws, prevent smoking on-site, and tone down advertising. "We agreed to take the joint out of the pumpkin's mouth and take the marijuana bud off the Silverdome," said Tobias.

While California is hosting at least fifteen cannabis-related trade shows this year, Michigan has just three, and Tobias said the company continues to look east. "The ground floor is not in the saturated states like California or Colorado, it's the emerging states that have just passed their laws. Just as the hippies started in California and spread across the country, everything starts here. We'll be bringing the experts and the pioneers of that movement to help people go through the process."

Tobias shrugs off the local backlash, and says it helps publicity. CNN and USA Today covered the Silverdome brouhaha. "There is that kind of 'This is our territory' mentality," he said. "One club said, 'We don't want you from California coming here telling us what to do.' That's some dumbass idiot trying to protect their turf."

However, even a low-profile technique can generate complaints. California dispensary Berkeley Patients Group spun off into the Northeast Patients Group and partnered with locals to win four of the state's eight dispensary permits this summer. One Maine city just okayed Northeast Patients Group's first location. Meanwhile, several key activists see a conspiracy, and penned an open letter to the governor bashing the California influence.

"Our citizens should be concerned when interests from outside our local economy take the trouble to become self-appointed policy advisors to the government of Maine," stated the letter from the Maine Wellness Center signed by various groups, coalitions, and lobbyists. "The early journeys of a reverse gold rush have already occurred."

Berkeley Patients Group spokesperson Brad Senesac dismisses such provincialism. "It doesn't matter if it's cannabis or mayonnaise, people are going to have some sort of opinion," he said. "One location had two people picketing, that was it. Everybody should voice their opinion."

Still, Senesac says the California brand has legs: "KFC is from Kentucky. LA Fitness is all over the country, because people see people in LA as being fit. Does California have the best cannabis in the country? I would say yes, because I've traveled the country."

Easily one the most brazen attempts to capitalize on the California brand comes from Oakland hydroponic supply company iGrow, which has rebranded itself WeGrow and switched from a retail megastore to a franchise company. WeGrow officials say they have sixty deposits of $25,000 each granting exclusive territory to WeGrow store developers. All of Colorado is sold, says WeGrow co-founder Derek Peterson.

WeGrow plans on converting its retail location near the Oakland Airport into a franchise template, with a no-bud version for stores in states where medical marijuana is still illegal. Peterson says the market is indeed going east. "I think that's exactly true," he said. "At the end of the day, when medical marijuana is legal in even more states, California is always going to be the gold standard from a product standpoint, and a pioneering standpoint. The founding businesses will always have that cachet from being the original ones in the market."

Seeds & Stems

Funny, naughty, and hyper-contemporary, hard-boiled summer read Baked follows Miro, breeder of hit marijuana strain Elephant Crush, as he wins the High Times Cannabis Cup and ends up shot in a gangland dispensary dispute. Los Angeles novelist Mark Haskell Smith reads from his fourth book at Booksmith (1644 Haight St., SF) on Wednesday, September 15, at 7:30 p.m. Read our interview with Smith as he talks strains, gangs, and Prop 19 on the Legalization Nation blog.

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