Philadelphia's new weed economy is thriving - Technical.ly Philly

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Dec. 23, 2016 10:30 am

Philadelphia’s new weed economy is thriving

Cannabis marketing firms, magic foie gras and specialized business accelerators? The green rush has arrived.

Offerings at a recent underground weed market event in Philadelphia.

(Photo by Christian Velasquez of AutoHD Films)

Edited by Juliana Reyes.
In late October, lines to get into one Philadelphia cannabis party stretched around the block.

Two thousand people bought tickets to the sold out event, according to an event organizer who asked to remain anonymous because of the underground nature of the business. Inside, table after table was laden with every conceivable marijuana product, from e-pens to extracts to edibles. Smoking was encouraged.

These kinds of events have more in common with a visit to Reading Terminal Market than to your local drug dealer.

“We’re very passionate here about weed,” says Mark Prinzinger, founder of Highjinx, Philadelphia’s first marijuana marketing company.

Within the past six months, the local cannabis economy has blown up. New businesses are sprouting to meet a huge need, with or without legal clearance. It’s at once underground and above board, as befits the emerging vertical. With medical or recreational laws now on the books in 28 states, the U.S. is on the brink of a major economic shift. The country’s pot purveyors and consumers are caught in a gray area between city, state and federal laws. Pennsylvania’s Medical Marijuana Program became law this past April. The flowers and leaves of the plant will not be for legal sale in the state, and products must be processed into pills, oil, tincture, liquid and topical forms.

As it stands now, only 3 parcels of land in Philadelphia meet all qualifications for Pennsylvania dispensaries. Frank Ianuzzi, legislative director for Councilman Derek Green, says local lawmakers are working on getting exceptions for the city to allow for 10,000 possible parcels.

That’s why, for most of these businesses, you can’t search Google for locations and other identifying information. But there are plenty of pictures if you know the right hashtags. Check out AutoHDFilms’ Instagram account, run by photographer Christian Velasquez, a cannabis activist and unofficial documentarian of the movement.

“The most dangerous part about cannabis is being caught with it. That’s what really fuels my activism,” says Velasquez. “I want to show that people who smoke weed are good, peaceful, kind people. I want to end all the stigma.”

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All the edibles

If you’re looking for weed-infused foie gras, chef David Ansill, who ran several of his own fine dining restaurants and has cooked at many others (most recently at Washington Square West’s Pinefish), has created Pot Luck. The monthly dinner runs $100 a person. Here’s a peek:

Move over chicken soup.

A photo posted by Enlightened Cuisine ???? (@rasta_squirl) on

On the other end of the spectrum, you can, of course, get medicated cheesesteaks here in Philadelphia. Buy them from the chefs at Inphused Philly for a few dollars more than your standard wiz wit. New customers are referral only. The owner, who requested anonymity, delivers medicated candies and lollipops free of charge to people with MS and other chronic illnesses.

“The stoners pay the bills,” the owner said. “I can’t take a dollar from a sick person.”

Then there’s Bakt Guds, which has been operating out of a secret location since summer 2016. It all started last year when the founder hosted a medicated birthday party, and friends wanted more.

Weed parties that are 'swanky, not sketchy.'

According to the founder (who also asked for anonymity), he and his wife began baking regularly, and just about any Friday night, you can find the Get Bakt Crew in a chill spot decorated with twinkling lights. Bakt Guds supports the founder’s family of four. A first generation college grad, the African-American owner initially considered Bakt Guds a side business, but he’s been able to quit his 9-to-5 job altogether and focus on the enterprise full time.

The first event drew 15 people and now about 40 to 75 show up every week.

“We cater to a group of Black professionals,” he says. His demographic is people with kids who need to find an alternative to smoking. “We are doing it in a swanky way that’s pretty appealing. It’s not sketchy.”

Businesses meet and combine efforts. Inphused Philly teamed up with Bakt Guds over the summer and each increased its customer base. Both look forward to opening brick and mortar locations.

‘Not just stoners’

Highjinx markets all things weed, but no customers are in Philadelphia yet. Prinzinger says he works with companies in legalized states such as Colorado, Oregon and California. “We didn’t initially target cannabis companies, but because of the work we do, a bunch of cannabis companies came to us.” Founded in June 2016, Highjinx now employs 18 at its Eraserhood location, with plans to expand exponentially. He envisions 100 employees by next year.

mark-prinzinger

Mark Prinzinger, weed marketer. (Courtesy photo)

A recent posting for a Highjinx art director position garnered 4,000 resumes, according to Prinzinger. “A lot of people have the misconception that we are just stoners. Realistically speaking, that’s not what we do. Everyone here enjoys cannabis. But you won’t see us hotboxing in the bathroom,” says Prinzinger, who operates within a strict set of guidelines.

Its guerilla marketing strategy has led to connections with “literally hundreds of celebrities,” according to Prinzinger. Rap stars like Gucci Mane, MGK and The Game are paid to boost a product on Snapchat and at live appearances.

When asked about standard digital marketing practices like AdWords, SEO and Instagram, Prinzinger just laughs. “We want to be three years ahead of everyone else.” Some of Highjinx’s clients don’t even have websites.

Incubating the industry

As the culture (and the law) shifts in favor of marijuana, there’s some serious money to be made, in ways you might not consider. For example, Greenhouse Ventures currently mentors three fledgling companies. The Philly-based incubator was founded by Tyler Dautrich and Kevin Provost, backed by advisors like Lindy Snider, daughter of Flyers owner Ed Snider, and David Dinenberg of cannabis company financing firm KIND Financial (also backed by Lindy Snider). Greenhouse takes an average of 5 percent common stock equity from accelerator members and doesn’t invest in its companies. One graduate is the Releaf App, a D.C.-based company that tracks the effects of medical marijuana.

Greenhouse isn’t about the lifestyle. It is a pure economics play. If you’ve witnessed the pent up need in the marketplace, you don’t have to seek out stats to justify an investment in the cannabis industry. But in case you’re wondering, Arcview’s State of Legal Marijuana Markets 2016 report projects the industry to grow to $7.1 billion by the end of 2016, a 26 percent increase over 2015.

Dautrich, Provost and team support companies with ancillary ties to the industry. On Friday, Dec. 9, Greenhouse hosted its second Innovation in the Cannabis Industry conference of 2016. The first, in April during Philly Tech Week, sold out. Tickets were $250 each.

Not a crime but not quite legal

Dautrich loves Philadelphia’s strong cannabis activist community. It has the effect, he says, of equalizing and normalizing the business of marijuana.

In 2014, then-Councilman (now Mayor) Jim Kenney was instrumental in decriminalizing marijuana in Philadelphia, making it the largest city in America to do so. Now, possession garners a $25 ticket, and if you’re caught smoking, it’s $100.

According to those in the cannabis activism community, the cops don’t see handing out pot tickets as a worthwhile activity. The Philadelphia Police did not respond to a request for an interview.

Across the U.S., punishment for marijuana possession, sale and use falls disproportionately to the African American community. If you’re a convicted felon, you are barred from operating a legitimate cannabis business once pot becomes legal. A Black man who went to jail for dealing pot cannot operate a dispensary. Legalization turns out to have racial overtones. That has seemed to translate to a pretty white group of entrepreneurs.

By contrast, Philadelphia’s underground cannabis community is diverse, according to N.A. Poe, the activist who helped, along with Chris Goldstein of PhillyNORML, to push decriminalization through.

In search of ‘real cannabis freedom’

Poe (a pseudonym) is well known in activist circles. He was instrumental in the Occupy Philly effort and his march on City Hall during the DNC featured a 51-foot-long joint. He co-hosted a “pop-up weed garden” in October on the Art Museum steps.

“We are using that gray area of decriminalization to create our own structure without asking the government for permission. We call Philly ‘the cannabis experiment,'” says Poe.

Poe contends that corporate and government players can try to run parallel with the thriving underground market, but they’ll have to catch up. “What are they doing for people in the meantime? We are helping people.”

na-poe

Poe: “We call Philly ‘the cannabis experiment.'” (Courtesy photo)

The Delaware Valley’s poster child for medical marijuana is Tuffy, a nine-year-old girl whose epilepsy symptoms have virtually disappeared through the use of medical marijuana. Poe seeks money on her behalf through a GoFundMe campaign that’s raised nearly $4,000.

Poe imagines that in the next year, medical marijuana won’t be as accessible or affordable as corporate entities and the government promise. “The underground economy, the cannabis community, will dictate terms,” says Poe. “We’re seeking real cannabis freedom, not a 5 to 7 million dollar project to sell sick people cannabis pills. We have to do what’s best for our community.”

As an activist and leader, Poe considers underground gatherings a way to entice people into political action. “Our patients need medical marijuana. Once the regulations come in and people aren’t getting what they need, we can call on the thousands of people who have been to the parties to come to City Hall.”

To move the conversation forward, the first step is to speak openly. After years of secretive, back alley use, cannabis is suddenly mainstream. Poe draws comparisons to the LGBT movement.

“We’ve established ourselves as personalities,” he says.” That gives us a face, and we make it clear that we’re not going anywhere.” Normalization, says Poe, starts with socialization.

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Sue Spolan

Sue Spolan is the founder and CEO of Cohegent LLC. Her career spans journalism and marketing. She's worked in broadcast, print and online journalism and creates and executes social and marketing strategies for Fortune 500 companies and startups.

  • Lefty Grove

    Of course, the cannabis economy has been booming all along, but we have foolishly required that all the money go to criminals and none be taxed.

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