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The Greed Rush: Venture Capital Enters Cannabis 

Wednesday, Apr 20 2016
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"I'm not afraid of quote-unquote Big Pot," DeAngelo tells me in between sips of milky tea.

But if there is a Big Pot in Northern California, it would be DeAngelo, a former petty weed dealer from Washington, D.C. who founded Harborside in 2006 — and enjoyed incredibly fortuitous timing, as a dispensary in Hayward on track to sell $52 million worth of cannabis was raided the following year, giving Harborside, one of only four dispensaries allowed in Oakland, almost total access to that market sans much serious competition. DeAngelo went on to co-found Steep Hill Labs, one of the Bay Area's biggest cannabis testing facilities, and was a cofounder of the ArcView Group, the cannabis industry's first big network for accredited investors.

Harborside recently received initial approval from Monterey County officials to open a massive greenhouse in the Salinas Valley, one of dozens he and other cannabis entrepreneurs are hoping to open in the land of Steinbeck.

DeAngelo's vision is to have cannabis products in every household in America. To do that, and to begin in Monterey, Harborside — which already sells enough marijuana to become one of Oakland's biggest taxpayers — had to take on investment. DeAngelo formed a for-profit public benefit corporation that will eventually own all of the company's assets — à la Google's Alphabet — and has hired professional people like John Yost, the ad maven who worked on the campaign that launched Yahoo in the 1990s.

And neither he nor the market will have any patience for entities who decline to modernize.

"Yes there will be a battle for the cannabis industry's soul," he tells me with increasing intensity. "And yes, there will be a lot of displacement as the industry professionalizes."

"But here's the hard truth," he says, leaning forward. "The really hard truth. Because cannabis has been illegal, there have been a lot of people able to sell cannabis, to grow cannabis, and to advocate for cannabis in ways that are not terribly effective. For a long time, you've been able to grow fairly mediocre weed, run a fairly mediocre dispensary, and skate by for a long time. You could be a cannabis, quote-unquote advocacy organization that takes in a lot of money and doesn't get anything done."

"Those days," he says, leaning back in his chair with a sense of triumph, "are ending."


About The Author

Chris Roberts

Chris Roberts has spent most of his adult life working in San Francisco news media, which is to say he's still a teenager in Middle American years. He has covered marijuana, drug policy, and politics for SF Weekly since 2009.

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