Farfetch

Who doesn’t love Farfetch, or Net-a-Porter, or Matches? These sites have changed the way we shop. These companies have evolved because when you are public, you must continue growing or putting out serious profits yearly.

I always loved the Farfetch model. Farfetch gave boutiques across the globe a platform to connect with a larger net of people who would buy their products/inventory. Now, it looks and feels like all the other sites, such as Net-a-Porter. The majority of these online marketplaces across the globe are in trouble. Their valuations have plummeted.  Why?

I do not know the nitty-gritty of how the business works. Did the stores pay a monthly fee?  Did they have to promote their sales to get to the top of the site?  It would be worth looking under the hood to see the business model and what worked. Maybe it was never made to work at what the public markets wanted it to work at.

Farfetch has a market cap of 38 million compared to 5.6 Billion when it went public. What a buy. There is an opportunity here to scale back Farfetch to its bare bones and add the opportunity to use cryptocurrencies, secure shipping prices, and make it work.

Something will happen; I just hope whoever takes control doesn’t kill it completely. There is value there for everyone.

Cannabis Updates

I took a break from reading the latest and dipped into an old favorite, Murakami. He absorbs you into his writings like no writer I have ever read. The characters, the food, and the surroundings are all unique, and eventually, these stories weave into each other. Genius.

I am reading IQ84, a 1200-page tome, and I read this paragraph. A police officer says to herself, “I’d probably have to ask the Yamanashi Prefectural Police to send copies of the related materials in the mail. And for that I’d first have to fill out the materials request form and get my boss’s okay. Of course I’d have to give a good reason for the request. And we’re a government office, after all, so we’re getting paid to make things as complicated as possible”.

I read this and paused. This is the definition of government. I have so many theories, from how the laws have been set up to weird bedfellows to no understanding of how business and lives work, living in their echo chamber, to name a few.

Sitting on the sidelines and watching the state government build a brand new division to oversee a highly regulated product that is still not Federally legal and is a Schedule I drug is wild, frustrating, mind-boggling, and fascinating. Somehow, starting from scratch in a world where start-ups, and even Fortune 500 companies, have changed how business is run, but the government hasn’t. It is layers and layers of laws that are so layered that they don’t make any sense.

I can hardly wait for federal legalization, but after watching NY, I fear for the federal mess that is ahead. Someone at the top has to care about getting this right. Too many people will not succeed in this business, and I fear most will lose everything. That will not be a good look for anyone. Public officials will shake their heads, but the people will be screwed.

Living In An Echo Chamber

I bumped into someone who ran for office and has been involved in politics his whole life. Of course, I asked about the state of the world, and he said we have to make sure Biden wins regardless of his age. He believes that if Trump wins, democracy in the world will shift to something very ugly. I fear he might be right.

Conservatives (let’s be honest, mostly white men) have taken the long road when it comes to change that works for them. They are happy to be what they only want to see. They want to hold on to ideals that keep them all in power. Just look at the courts, particularly the Supreme Court.

Diversity, equity, and inclusion, DEI, is the latest conservative whomp. DEI began in 1948 when Truman signed an executive order to desegregate the armed forces. Then, In 1956, Johnson signed an executive order to ensure that the government hired regardless of race and religion. The civil rights movement amplified the origins of DEI into the public eye.

In the early 2000s, when I sat on the board of our kids’ EL-12 school, hiring diversity directors was happening in every private school throughout the city, including companies. Most of these initiatives failed probably because nobody truly understood their roles. The role is to make sure that there is diversity in the school or the company. It just takes work.

In the early days of CSCNYC, the first computer science programs outside Stuyvesant High School began at Washington Irving High School. In the first year, the program was overwhelmingly male. They fixed it by spending most of their recruiting, interviewing, and doing events for young women, aka basically none for young men. In the second year, there was almost a 50/50 split between young men and women because they figured out that young men would apply to a computer science program without being prodded. Look at how many women have become computer science majors over the past two decades. Remember, women were the predominant programmers before WWII, and then, of course, and unfortunately again, patriarchy took over.

As a female investor in the early days of start-ups, the data showed that company diversity is a win. Multiple studies have proven that companies are more profitable by over 2.5x. Common sense tells us that having different voices around the table creates a merger of cultures that make products that catch a wider net.

So many people are living inside their echo chambers right now. We need DEI now more than ever. Eventually, the tides will turn, and those trying to pull us back will not have the last word. At one point, in the not-too-distant future, many of those anti-DEIs will find themselves the underdog, needing DEI to make sure that their grandchildren, who are white, have the same opportunities as others. Those who believe in diversity will continue working hard to have balanced schools and companies. It is that echo chamber that creates racism. That is what I fear more than anything.

Start-up Land

I have been living in a start-up land since 1990. Some were businesses where I was at the helm; others were as an investor, and others were as an advisor or board member. Each is very different, but the one consistent thing is how quickly things move, how much time is needed, and how you can’t get any of it out of your head. Regardless, it is a very entrepreneurial sport.

I talked to one of Gotham’s team players about the many meetings. We looked at the calendar together and realized all those meetings were necessary. I am not a fan of meetings to have meetings, but when you are building something from scratch, multiple sessions are needed until the foundation is set. The tricky part is when you have time to execute everything, particularly when you are creative. Time is needed to think, and we all must have a life that makes us better as humans.

Maybe start-ups are like a drug. There are some drugs that, after a few hours pass, you are so happy that you aren’t in that mindset anymore; things are a little more mellow. Start-ups are like that. They are also like having children. The first year is nuts. Sleep is tough; things are constantly changing, and you are entirely trying new things and passing on things that don’t work, and then a year passes. You look around, and everything has completely changed, and you can not believe how far you have come.

In year two, things begin to gel. You can sit up and focus a bit more; things start to come together, and you begin to walk, talk, and eat by yourself. The same goes for business. The foundation begins to get set, the players start to lock in, decisions can be made on data, growth is happening, and everything is no longer a fire drill.

By year three, kids still have difficulty dressing themselves, but by year four, they are pretty independent, although I’m not sure you would let them stroll around the block by themselves. As 2024 starts to kick in and Gotham is moving forward, I look forward to year two. I am unsure what I expected as I began this journey, but that is how I have always operated. Jump in, two feet first. In the cannabis industry, everything is learned on the fly, which is exciting and incredibly frustrating.

In the years ahead, relying on Government decisions while building out a business should prove to be challenging but admittingly exhilarating.

Memorials

One of my dearest friends in the world lost his Mom a few months back. The memorial was this past week. The event was a celebration of her life. Different views and relationships with people were part of her life, from children to friends to organizations such as the Rockefeller Museum, Carnegie Hall, and Lenox Hill Place. She lived quite a life.

What I like about a memorial is we get to hear stories about this woman’s life. I had no idea that in 1997, she led the charge to establish Rockefeller’s Women & Science Initiative with three other powerful women. These women changed the university’s trajectory, which had lost its way. There were other organizations where she made an incredible impact, such as the Lenox Hill Neighborhood House and Carnegie Hall. Although I have known his Mom for probably 25 years, my relationship has always been through his eyes.

Our friend’s brother poignantly pointed out that when someone dies, that doesn’t mean that your relationship is over.  That relationship is still inside you. Those memories are still there. The hardest part is that the relationship is now one-sided.  You can never evolve together, work out issues, and delight in new times together.

Family can be brutal. I worked hard at not being my parents, but the lessons, morals, and values still live deep inside me and propelled me to who I am today. I heard that from my friend as he spoke about his Mom. He became the person he wanted to be, which was not easy. I have learned to let my kids live their lives, not the ones I want them to. That is not easy.

These women were from another generation, which was frustrating and challenging. It was not always easy to be a strong woman with her own ideas, where expectations of how to be were set in stone. Women today have more choices (thank god) and can forge their own paths. It isn’t always easy, but we need to look at women of these past generations to truly understand that women of today are standing on the shoulders of women like my friends Mom and my Mother.

I went back and read a post I wrote about my Mom when she died in December 2010. Like my friend’s Mom, she was a complicated woman, much more than I ever realized. As I sat at the memorial and looked around at people I knew and her friends, I laughed to myself, hearing my Mom’s voice in my head. She would have said, “It’s fucking weird getting old”.

Auntie Mame

I am a huge lover of film and went to at least one or two movies a week when the kids were growing up. Due to streaming, I see countless films and try to see all the “Oscar” worthy flicks pre-award ceremony—nothing like chiming in from the couch.

Someone recommended I go back and watch Auntie Mame, a movie I had not seen since elementary school, so I did. The film was made in 1958 and set in 1928. There is nothing better than a film to lock in time so we can see how far we have come or not. I recently saw Love Story and was also a bit blown away by a few things that would never happen in 2024; at least, I would hope not.

Aunt Mamie is played by Rosalind Russell, who is fantastic. She plays an aunt who is the only relative left to care for her brother’s child, Patrick, who had put together tight restrictions with a conservative executor of the will; god forbid he ever died so that his son would not be drawn into the “unconventional” ways of Mame’s life.

That means her flamboyant NYC lifestyle with decadent parties, gay men, lesbians, nudists, writers, and free-spirited artists. When Patrick comes to live with her, he takes notes just to understand what they are talking about. Then there is the crash of 1929, and Mame goes to work. She attempts to send Patrick to a progressive downtown school, but the conservative trustee of the bank will have nothing to do with it. In the end, Patrick goes to an uptight boys boarding school, although always coming back to visit Mame.

Over time, Patrick falls to the ill wills of the conservatives, finds a girl to marry, and meets her family of anti-semites. How they talk about Jews in the film is mind-blowing, but Mame will have nothing to do with that behavior. Remember that multiple characters in this play take a page out of stereotypes. Eventually, Patrick sees these people for what they are: small-minded bigots. It could be a page out of politics today.

Even in Love Story, Ryan O’Neill, Ali McGraw’s husband, got her diagnosis from the doctor instead of the doctor telling her directly. They also drive in a car that should not be on the highway. McGraw even attempts to get O’Neill to make nice with her father because he is turning 60 and might not have much time left!

Few films can stand up to the test of time; Aunt Mamie does. She was ahead of her time. She was a woman on her terms. She was a true socialite in a good way. The movie reminds me of how far we have come and how far we still have to go.

Cannabis Is Pushing Change

Tossing a wrench into anything creates change. Cannabis is a wrench. Finally, this past week, the DEA, which has the final authority on cannabis, has recommended easing the restrictions. The hope is when the DEA formally announces changes; it will take cannabis to a schedule three drug vs. schedule one, allowing research, banking, and essentially Federally legalizing it. In classic American form, lawsuits will fly everywhere after this. Cannabis companies, dispensaries, and farms will want to be able to ship their products across state lines. Every single person in the cannabis industry is waiting for this.

Then there is the fact that over 70% of Americans want to legalize cannabis federally, and it is now sold legally in 24 states, and change is happening daily. Remember that each state has its own set of rules, too.

Fun fact: Connecticut sold over $274m of cannabis in 2023 vs. New York at $150m. The states began opening dispensaries roughly at the same time. Over 19 million people live in New York vs. less than 4 million in Connecticut. It is time for NY to figure out how to do the right thing for all NYers, balancing diversity and generating capital for the state. That is the Government’s job. I fear that the next round of licenses will not create the impact that could be made in taxes or make the consumers happy. It is time.

On the other hand, the multi-state operators such as Columbia Care and Curaleaf each paid $5m plus to the state of New York to secure a dispensary license, keeping the number of stores to a minimum, and are opting not to open. Instead, most are only going after the wholesaling of their brands. Why? The market is not that appealing, with 8000 illegal stores operating in New York. I get it.

Then, there are the beverage brands attempting to enter this market. The alcohol market is waning; people consume almost 20% less at arenas and retail. Sales for non-alcoholic beverages have climbed over 30%. When large companies own market share, they do not want to give it up. Cannabis will be a part of their long-term strategies. Recently, Tilray, a cannabis company publically traded on the Canadian exchange, purchased an alcohol brand. What will the arenas do to capture lost revenue?

It should be an interesting 2024 in the world of vices.

Gotham in Time Out

Photograph: Josh Andrus for Time Out New York. Full article on Time Out is here.

Gotham

As NYC’s first luxury cannabis and cultural store, Gotham doesn’t just sell marijuana; instead it also stocks art, housewares, candles and fragrances. Find the shop in the Bowery at 3 East Third Street. Founder and CEO Joanne Wilson said the store set out “to change the narrative around what it means to partake in cannabis in your life, that it is more of a lifestyle. It is not a transaction.

Gotham also partners with STRIVE NYC, which helps people who face barriers get jobs. 

We sat down with Gotham’s CEO Joanne Wilson and the vice president of marketing Geraldine Hessler to reflect on the business so far.

What has your first year been like so far? 

Wilson: Insane. It’s just been a rollercoaster. When we have all these grand ideas of things we can do and we can execute, it’s like, of course, we can do all these things. We have a great team. But here’s the issue: You’re dealing with a highly regulated product. You’ve got to stick to the rules, you’ve got to stick to the law that constantly sort of changes. You’re competing with an insurmountable group of illegal stores and landlords that don’t want to rent to you because it’s cannabis and banks that don’t want to give you money because it’s cannabis. It’s not easy.

Hessler: The cannabis market is full of ups and downs. There’s always something changing. The goalposts are always traveling in different directions. One of the most important things we’ve been able to do is a pivot based on what’s happening in the world of cannabis, but at the same time, stay true to our brand and who we are. We classify ourselves as a cannabis concept space; it’s more than just a dispensary.

Anything surprising?

Wilson: The one thing that I did not expect is the lack of the law taking out the illegal stores. They’re everywhere. There’s anger particularly among parents. There’s the lack of the state distributing that information out to the public through PSAs or conversations or advertising or media. I don’t think that I thought that my biggest competition would be the illegal market.

Why is it so important that NYC has welcomed dispensaries?

Wilson: If you look at the data for New York State, which appears to be the largest group of smokers in the country, how much revenue will be driven into this state because of cannabis. That includes jobs, social equity, all the things. As a dispensary owner, because of all of the history, we feel we’ve done the right thing, we have a very diverse group of people at the top and in the store. Everyone who is full-time in New York, that’s 30 hours or more, you get full-time health care, you don’t have to buy into the system. And we’re doing in-house training to teach people about finance for their own personal needs. So all of these things that I will hope that other owners of businesses do in our future. And I think it’s just good for New York State.

Hessler: So much damage was done with the war on drugs. By making cannabis legal in New York, it allowed people to consume. It’s so important. It’s a plant, it’s not a drug. Cannabis being legal is another step in the right direction.

What would you change about the process?

Wilson: I would change the way the whole thing was set up. The Office of Cannabis Management is set up in a way that there’s oversight on so many different angles that I’m not so sure they should have oversight of. I think that it has been too heavy-handed, that there hasn’t been enough power from the governor, or even different entities that usually get involved in that. So they have a tremendous amount of responsibility in a brand new industry, which is heavily regulated by the federal and the state governments. I think that that has created some of the laws that were made around it and the slow rollout of how this works, even where things are located, who gets the licenses. I think they all had good intentions and still have good intentions, but we could have learned a lot from other states in how we went about this.

How are you doing your dispensary differently?

Wilson: It’s a lifestyle, it’s a concept store. We source in Europe, we source in Japan, there are things in our store you can’t buy anywhere else. Our people are insanely well-versed and we hear that from everyone that walks in the door. They have to go through a very rigorous program that is taught internally, so they really understand the product and how they’re selling to whatever the needs are on the other side. It’s a store that has also created community. We have events all the time and we see people return to the events. It’s a place where you just kind of want to hang out. It feels good, it doesn’t feel transactional. 

What are your most popular products?

Wilson: There’s always new products, so it depends on the week. The Gotham private-label CBD balm blows off the shelves. We have a particular incense match we can’t keep in the store. We do really well with fragrances and candles. The products are pretty equal in sales of vapes, gummies, and pre-rolls. 

What is the most exciting part of your role?

Hessler: The campaign we launched in October was super exciting. It’s our “Say High” campaign, which leans into legalization in New York. “Say High” meaning come in and say hi at Gotham. “Say High” meaning it’s legal, you don’t have to hide what you’re doing anymore. In addition to that, when you say something out loud, you kind of take ownership of it. We are embracing this high lifestyle, this cannabis culture, this new way of cannabis existing in New York.

What is next for cannabis in NYC?

Wilson: One of the things the state should have done and still can do is they gave all these people golden tickets with no capital. I feel that New York state should have created a $400 million fund, that they backed every single loan at 5%. At that level, a bank would have backed it. And if they end up not succeeding, that license goes back to the state and they sell it at whatever the price is at that point. I think the state would make money back in spades. The amount of jobs that would create for multiple people and multiple success for business owner dollars is worth every single penny. And they didn’t do that. 

What about for Gotham? 

Wilson: We applied for two more licenses, and we hope that we get them and that we open.

What is your favorite way to enjoy cannabis?

Hessler: I have a lot of ways. I love edibles for sleep or just relaxing at home. In the summer, I’ll go for a long run and then crack open a cannabis seltzer. Tinctures are great for sleep. I do love pre-rolls; my favorites are the pre-roll mini packs.

Wilson: I’m old school. I still like to smoke a joint, and there is something communal about that, too.

Seafood Chowder

I love chowder. There is always a clam chowder on the menu around town in the summer out east. It has been cold in NYC, and I have been cooking on Sunday nights, so chowder seemed like the way to go. This was so good and easy.

  • 2 tablespoons unsalted butter
  • ¼ pound thick-cut bacon, diced (you could easily use more)
  • 2 leeks, tops removed, halved and cleaned, then sliced into half-moons
  • 2 carrots, peeled and halved, then sliced into half-moons
  • 2 parsnips, peeled and halved, then sliced into half-moons
  • 2 medium-size all-purpose potatoes (I prefer Yukon Gold) cubed
  • 1cup dry white wine
  • 3 sprigs thyme
  • 2 bay leaves
  • 2 cups heavy cream
  • 1/4 pound firm white fish fillets, cut into small pieces
  • 1 pound sea scallops, sliced into half
  • 1 lb shrimp, peeled and sliced in half
  • 4 cups fish broth or chicken broth

Add one tablespoon of butter to a large pot, melt, and then add the bacon. Saute until crisp, about 5-7 minutes; take out with a slotted spoon and set aside.

Add the leeks and saute until lightly browned (another 7-8 minutes). Add another tablespoon of butter, carrots, parsnips, potatoes, and wine. Boil down the wine until it is almost gone. Add the thyme and bay leaf ( I like to put the herbs in a small herb pouch) and the four cups of broth. Partly cover the top of the pot and simmer for about 10-15 minutes or when the vegetables become soft but not too soft.

Add the cream, and take out the herbs. Let this come to a simmer, and add all the fish. The fish should take 5-7 minutes. I stirred the pot a few times and added some pepper and salt for taste.

Voila! Serve with a good baguette!

Change Costs Money

I have read some stories about future changes that cost significantly, but the reward came back in spades.

For instance, a school district installed solar panels that saved enough kilowatts of energy through a $250k expense that generated almost $2m in surplus. That allowed them to raise teachers’ salaries. Someone is thinking.

Then I read about a downtown area that had not changed since the 50’s but decided to bring in greenery and walking areas. The entire area became so inviting that it changed the community, brought in businesses, and, in turn, tax revenue. Someone here is thinking, too.

We should all think like this: instead of cutting taxes, how about spending them wisely to create economies? I witness and work with too many Government agencies that have not changed but are layered with red tape, jobs that don’t need to exist, and costs that make zero sense. The money that goes into many of these agencies is just enough to keep the seats in the chairs. It is time for people in local government to shake the leaves and look to the future.

When I read about these types of changes, it always brings a smile to my face. I have become so cynical from the white noise of absurd rhetoric that these changes represent a glimmer of hope. The future always wins.