On August 18 the cannabis retailer nuEra hosted a “Small Batch, Big Love” event outside its North Ave. dispensary. Several tents were set up showcasing recently licensed local craft grow cannabis brands and products that will hit the market soon. Craft grow licenses not only allow for the cultivation, drying, curing, and packaging of cannabis products, but also allows for holders to sell wholesale. The atmosphere was lighthearted and fun as a DJ blasted classic Chicago house anthems to keep attendees grooving while they spoke directly to vendors about their companies.
In January of 2020, Illinois legalized the use of recreational cannabis for people 21 and older. However, the dispensaries that have emerged in the local market are overwhelmingly multi-state operators (MSOs). Local would-be dispensary owners from marginalized communities have been at a disadvantage at finding their footing in the new market.
According to a 2022 state report, 88 percent of the dispensaries last year were white-majority owned. Black-owned and Latinx-owned dispensaries only made up 1 percent apiece. Illinois also has some of the highest cannabis taxes in the country at forty percent (compared to Michigan’s ten percent).
This has frustrated many potential dispensary owners, but social equity programs championed by groups like the Chicago chapter of the National Organization for the Reform of Marijuana Laws (NORML) have given people from historically impacted communities a chance to break through.
Laura Jaramillo, who’s originally from Colombia and the COO of nuEra, described her unique journey into the cannabis industry to the Weekly.
“The War on Drugs has been a really big deal in Colombia, but I ended up in cannabis almost by accident,” Jaramillo said.
She says she’s always been interested in policies surrounding cannabis and the effect the plant has had on the country. nuEra is a family-owned company founded by Jaramillo’s father-in-law. Formerly known as nuMed, by 2019 they were making the transition from medical to adult recreational use.
“We knew that [there] was going to be a huge explosion of work and demand and things changing,” Jaramillo said.
She ticked off a list of obstacles new distributors have faced. Cannabis companies “are taxed [at] an effective rate of [about] eighty percent. We have really intense regulations, we have a really hard time raising money…But if [there’s] something that I would highlight in Illinois, in particular, has been the really difficult road to make this social equity cannabis dream come true.”
Ambrose Jackson, the chairman and CEO of The 1937 Group, a minority-owned company in Illinois, reiterated those growing pains.
“The reality is the application process was not set up to really help new entrants gain access to the legal cannabis industry. And that’s why you see multiple years later there’s still a lack of participation by minority-owned, social equity cannabis companies in Illinois,” Jackson said.
“We’re starting to see what we would expect to see when you have more inclusion and diversity in the industry, right? We’re starting to see more and more excitement, we’re starting to see more variety of products…I’m happy to see that we’re finally overcoming that dark space where only a few companies dominate the entire market.”
Fabian Limon, a cannabis lawyer and former police officer, explained the problem of getting a license early on.
“There was a limited number of licenses that allowed an unlimited amount of applications to be submitted for and there were parties that won multiple of these limited licenses,” Limon said. “Why would we allow for an unlimited license application process to allow someone to put in as many applications [as] they possibly could afford?”
It was almost as if “the hope was to limit who got access to these licenses.” Overlooked, Limon says, was the opportunity to bridge the divide and educate the public on ways to be part of the industry without obtaining a license.
Limon is a co-founder of Imperial Products and collaborates with South Side resident and renowned chef Manny Mendoza to distribute artisanal cannabis-infused chocolate and olive oil.
“The plant is giving, right? And really what we like to focus on is the fact that so is the cannabis community,” Limon said. “Cannabis [has] by no means made me some incredibly wealthy person, but it’s made my life richer. And I mean that because of the relationships I’ve made, because of the friends I’ve developed, because of the businesses…I want to build with people. And I want to make money with people, not off people.”
The CEO and co-founder of Umi Farms, Akele Parnell, has a similar mission. He started working for cannabis company Green Thumb Industries in 2017 and wanted to learn about the legal cannabis industry. “I was like, ‘Hey, there’s a lot of money being made in the legal industry and I want Black and brown boys to be a part of it,’” Parnell said.
He went on to work with Chicago NORML and the Cannabis Equity Illinois Coalition to “make sure that legalization in Illinois created opportunities for people that come from communities that have been, unfortunately, affected by the war on drugs.”
Parnell has launched incubators—facilities designed to nurture and accelerate small business’s growth—across the country for African American, Latinx, veteran, and women entrepreneurs in Detroit, Colorado, and New York City. But there is still more work to be done. Throughout Parnell’s career in different markets, he has repeatedly encountered the same issue.
“The biggest hurdle is the racial wealth gap. And so the answer to closing the gap on equity in the industry is really just access to capital,” Parnell said.
While some MSOs didn’t know “everything in the beginning,” explains Parnell, they did have the tools to access that information and the funds to hire people that did know how to navigate the intricacies of the industry. The lack of knowledge on how to run a business post obtaining a license is the gap Parnell wants to bridge, especially in underserved communities.
Although decades of propaganda gave cannabis negative connotations, that stigma leaves room to educate those still not aware of the plant’s beneficial properties. And attitudes are beginning to change after years of hard work.
“I see it every day with our employees, how passionate and really how life changing cannabis is, for so many people,” Jaramillo said. “We invited those craft growers, those small growers, we invited those infusers to come set up and share with our customers and share with our community, the products that we’re bringing to market, all the innovation, all of the love that they’re pouring into those products that they’re producing, and we’re excited to welcome them onto our shelves.”
Vidal N. Granados is an entertainment journalist who covers sports, movies, video games and music events throughout Chicago. He is also a regular contributor for Quip Music Magazine.