I just finished reading the book The War Within A War: The Black Struggle in Vietnam and At Home. This book illuminates the history of Black men in the military, highlighting the Vietnam era, when they were fighting a white man’s war overseas, and at the same time, back home. I am not sure how we are teaching Vietnam in school, and if we are, but certainly, the Black man’s history is not the top topic. It is an excellent read and a worthy education.

We continued fighting a war that we were not going to win. The government knew it, but large corporations were benefiting from the economy of products shipped into Vietnam, from Coca-Cola to equipment. Black men were disproportionally being recruited and were beneficial to combat, but when they came home, they were still living in a racist society that would not hire them.

Nixon was a racist. After knowing how the Black communities were faring in war and at home, he found another way to keep them at bay by criminalizing marijuana. John Ehrlichman, a domestic policy advisor to Nixon, who went to prison for Watergate, spoke to Harper’s Magazine about Nixon’s War on Drugs(which Nancy Reagan leaned into as well). I already knew this info, but reading it in the book drives it home. He said that the Nixon campaign and White House had two enemies. The anti-war left and the Black people. They knew that they couldn’t make it illegal to be against the war or be Black, but to get the public to associate the hippies and Blacks with marijuana and heroin by heavily criminalizing it would disrupt both communities. They could then arrest those leaders, raid their homes, and break up their meetings. Did we know we were lying about the drugs? Of course we did.

Of course, we did. The nonsense continues, and that acknowledgment is from 1994, but the Controlled Substances Act was signed into law in 1970. This is almost sixty years later, and state governments have worked to turn the lies around, and the federal government will eventually get there. The issue is that it is not that easy to flip a switch, particularly when taxes, economics, and money are involved.

The unions have strong-armed the industry; the other vice industries have money, such as the alcohol industry, so they have the strongest lobbying efforts, and cannabis is on the opposite end of that spectrum because nobody is making money. Many of the early licenses to multi-state operators that went public on the Canadian stock market, including the large privately held ones, are all playing a game of Risk. It defines capitalism.

Many wanted to do the right thing by those who were affected by the War on Drugs, but not one state has figured it out. Once again, we find ourselves disenchanted with the leaders in government. No wonder we are where we are after 250 years.

Everyone should be civic-minded. It is a social responsibility to participate in one’s community.

The first organization I chaired was MOUSE (that still exists today, and I was the first chair). I remember our first fundraiser (I hate those things, but you gotta do it), and we raised $1m. I raised $750K myself! That night, I gave the opening speech and spoke about the importance of technology and how we all need to give back to those less fortunate than we have been. It was 1998, and now look at the tech titans, shame on so many of them.

This past week, I attended the Hot Bread Kitchen fundraiser, the second organization I chaired (and was its first chair, too). They celebrated Christina Tosi, who sat on the board when I chaired the organization. It was really nice to see her.

I have had the pleasure of meeting many NYers involved in nonprofit organizations over the years. I have met many more through my friend Liz, and also because I chair the Public Housing Community Fund (their first). Each of these people cares deeply about our city, the people who live here, the laws that are made, the organizations that make an impact, and the helping hand that helps many have better lives, from food to jobs.

I happened to meet with Strive last week, too. We have made an impact on countless lives through their stellar program, and that feels insanely good.

Back to the event this past week, I met a gentleman who worked for Neighborhoods First Fund. They help neighborhoods that I fear will evaporate. NFF promotes equitable and accountable development in NYC. They also help those in need with education, strategies, loans, and more to make sure they keep a roof over their heads and to build more low- and middle-income housing.

I had no idea this organization existed until meeting this man at the event. I really like what they do. What struck me was the vast difference that night from the civic-minded people in the room, who care about people and their community, vs the hate, anger, and viciousness coming out of the White House, and the Republican party, and perhaps a few in the Supreme Court, who are obviously on that bandwagon too. It makes me so sad and angry.

Looking around the room, all I kept thinking was, we are all in this together, each taking our own path in life. What a better world it would be if we could embrace and help, rather than dismiss and ignore, rather than pull the carpet out from beneath people’s feet. It makes zero sense.

We all should be civic-minded.

Gotham finished up our first cohort of Black founders, called the Gotham Growth Project, who are building CPG brands in the cannabis space. It was a six-week curriculum with an incredible group of people from multiple industries that came to speak about building a brand, leadership, operations, legal, finance, etc.

At the next The Highrise event on October 22 (info coming soon), each founder will take the stage and talk about their brand. Yes, we are following the models of Techstars and Y Combinator, but in the cannabis industry, there is no money, and we don’t take a stake in their business. We do this to do the right thing, for a community that deserves to shine in this industry. We are sharing our skills and knowledge and educating them through leaders in different industries.

I read this week that Everlane was sold to Shein, another brand that was built over the last two decades. Everlane struggled for 15 years to achieve consistent profitability, whereas Shein, based in China, is very profitable. I think about all the brands built over the past fifteen years, fueled by capital, how much money went into them, and how many tanked after going public or were sold for pennies on the dollar.

Many of the investors in these new millennial brands leaned into growth mode, as if they were tech companies. CPG, wholesale, and retail businesses are very different. I hope there has been a learning curve and that investors come into the new CPG landscape with fresh eyes and expectations.

The cannabis space is wide open to new brands. The difficulty is that each state has its own set of rules, laws, and regulations, which means a founder must find a new farm to work with in each state and a new dispensary (sales) pipeline. It would be easier if a founder could replicate the model in each state, but that would be too easy, and nothing is easy in this industry.

Keep in mind that I am an eternal optimist, but I do believe federal legalization will happen this year, and that will open the door to investment. Very few investors have taken a leap of faith into this industry. Growing a CPG product in this space is not so different from Nike, read Shoe Dog. Phil Knight began by reinvesting profits in the business because he had no investors. But to grow without shipping gaps during periods of high demand, an infusion of capital was needed. During that time, Knight turned to the banks, which were not equipped to handle these amounts of capital; it was the 1970s, after all.

I am no longer investing, but if I were, I would look to the cannabis industry. There are some killer brands, such as Kiva, that deserve proper venture funding, not debt funding but equity funding. Debt is an unhealthy way to build a business, and it is time that these businesses have the proper funding that many of these dead CPG millennial brands received. There are also countless young brands with smart founders who have navigated a tangled web of roadblocks.

In cannabis, I hope a new group of investors comes in at the ground level and does so with realistic valuations. Many founders have a proven product that has bootstrapped in a highly regulated and disconnected industry. Every tech person I know who has dipped their finger into this industry is shocked. Federal legalization should change a lot of the insanity. Fingers crossed.

I hope that the many lessons learned over the past two decades will inform the next wave of CPG investors, who should take a hard look at cannabis. There will be winnings there.

When we made the big decision to get our family’s first dog, we decided to adopt. At that time, we were living in the suburbs, and I made a few calls to the pounds before we made the rounds. The kids were one, four, and six.

That Saturday, we drove over to take a look at the dogs, but none of them spoke to us, so we went home. The next weekend, we got a call to meet a dog that had just arrived. The manager suggested we get there soon, because if a dog is there too long, they become a pound dog. I got it. It is easy to conform in uncomfortable environments.

I spoke with someone this week, and we discussed the need for governmental change. Both of us noted a few bright notes, young politicians who are looking at the world with a new pair of eyes. Many are refreshing, although rhetoric always scares me; execution is what I want to see.

Whether you like Bloomberg or not, when he came into power, he changed the way government operated and got more done than most. He ran the office with a guiding light and hired the best and brightest, giving them the ability to execute on that guidance.

Fast forward, and Bloomberg has many deep scars from those days. Who wouldn’t? When you talk to him now, he will tell you that you won’t be able to change that because of the unions, or you won’t be able to get that accomplished because of the contractors. Whatever the reason, I thought, has Bloomberg become a pound dog?

I am following the next generation of politicians (I believe they are), such as Talarico in Texas. He is insanely articulate, and he has deep moral beliefs. Very impressive. There are a handful across the country, like a Talarico, and more will enter the political arena.

Unless we have a full sweep of the elderly representatives and the rot that has infiltrated our government, such as lobbyists and unions, and how they operate, I fear that many of these new voices and ideas will become another cog in the wheel. How do we need to make sure they do not become pound dogs?

I always have room to improve, don’t we all? I spent the last decade working on that and wondering about what makes me tick. It is not easy work. I can now embrace myself in ways that I did not expect.

As an entrepreneur, I am always thinking about how to zig and zag as we grow, change, and try to succeed. I can fix it. I can take that risk. I can, I can, I can. Over the years, I have worked with many entrepreneurs from the investment side, and I see too many who can’t let go. I get it.

At my age, perhaps wisdom, reality, and having proved myself to myself make it easier to let go in different ways.

Fred and I are at that point in our lives where our kids are getting married and having children of their own. Major milestones for sure. We are all moving on to the next chapter together, although in different ways. We are now the oldest in the room, and watching our kids navigate their lives. It is an insane joy.

I have been thinking a lot about how life-changing the next few years will be, and what that looks like. I want to be present in business and our kids’ lives, and that balance is hard, but at the end of the day, I have always been about family first. We might be the parents, but our role as grandparents will be guided by our kids.

Summer is around the corner, and I am sure I will be spending a lot of time thinking about all of this.

What happened to the meatpacking area? 

In the day, the meatpacking area was what it was called: a meatpacking area. Just as there was a fish market on Fulton Street that now exists in the Bronx, the meatpackers ruled the streets in the enclave known as the meatpacking district.  Where did the meat packers go?

There was a cool grit years ago that could feel scary depending on the block in the meatpacking area.  Sure, people got mugged, but rarely does anyone get killed. Just give up the goods, and you will be fine.  Scared but ok. Back in the day, the stores were cool, cutting-edge, and community-oriented.

The man who owned all this real estate and had a vision was William Gottlieb. He drove around in a beat-up Woody wagon with a broken glass taped up for the side window. He bought over 150 buildings and never sold. Some would say it was his commitment to preservation, although I am not so sure. His first move to upgrade the meatpacking area was Pastis. But then he died.  

Now in the meatpacking area is a Sephora, Restoration Hardware, and mediocre restaurants, except, of course, Pastis.  It’s the only gem among the boring big-box luxury stores. All of these stores cater to whom? Certainly not the people who live in the neighborhood, but perhaps the tourists or destination visitors. Unfortunately, real estate has become too expensive, and only large global luxury stores can afford the costs. It’s depressing.

When stock declines for these global brands, they generally close underperforming stores. We have seen that countless times in NYC. How long will this last? When is this wave of indulgence over?

Here’s what I noticed the other night. Lots of empty stores. Could this be a sign? Aren’t we all on edge waiting for the shoe to drop? Will the government allow the real estate people to leave places empty (bad for neighborhoods) or force them to figure out (with their banks) how to lower the rent to market?

It is time for the city government to rein in the real estate community’s power in this town. The cost of everything is insane, from rent to restaurants. Is it just me, looking around on the edge of my seat, wondering when this Great Gatsby era is going to implode? Or is everyone else wondering the same thing?

Come on in to Gotham, or get our delivery service, and become part of the loyalty program. It is worth it! You can track your points and soon see your ordering history.

What is the cannabis industry going to look like in five years? Let’s hope that the federal government has the wherewithal to federally legalize the plant. When that happens, then what?

Based on everything I am reading, it is not only our country that has been slowly leaning into this new industry. Brazil is leaning in, and I can’t imagine what chaos that will bring. The Brazilian government’s laws are a world unto themselves. Watch the Edge of Democracy; it sums it all up.

Then, of course, we have other areas of South America changing to legalization. Canada embraced the plant long before any other country; Europe is on the verge, and Asia will take some time. Will the US be able to buy products from other countries and distribute them in our dispensaries, as we do with wine and liquor?

Federal legalization will most certainly toss every state that has already legalized the sale of the plant into a tailspin. Doesn’t the federal government overrule state laws? What kind of nonsense are the conservative and misguided liberals going to stick in the bill? Each elected official will want to save their state and, of course, save their donors’ money, funneling it into their pockets to stay in office. Will it just be a cave to lobbyists?

There is plenty wrong with the cannabis industry, but we do not have the cash that other industries have, so our involvement and discussions with the elected officials are mostly coming from the MSO (multi-state operators). They are far from profitable, but they are fighting for change to get there. The rest of us are sitting on the sidelines.

Is everyone in the business now just too early to the game? Not one state has gotten it right, and I do hope federal legalization is coming, but that opens up a whole other can of worms and guardrails.

What comes next?

I have been privileged and old enough to have watched industry cycles. Think of all of the ISPs back in the day, Mindspring, MSN, AOL, Yahoo, Earthlink, Excite, and of course, Google. It took time, but eventually, there is no doubt that Google is the clear winner.

Putting my investor hat on, it is rare to see a new business created when no one else in the world is doing it. I have been thinking about this since I saw Mark Pincus’s rant about how nothing is new. I have known Mark since he was 22 years old, and he is the same now as he was then, just wiser.

Each genre of new businesses built over the past thirty years has followed different business arcs. I like to think about climbing a mountain. It takes time to get to the first mesa, where everyone unpacks, takes a look around, and tries to figure out how to take everything that has been learned, repack (reshuffle), and hike up to the next mesa. On the next mesa, there might not be as many competitors; you might run out of money, and one company could be leading the charge. It doesn’t matter the industry, this is the nature of growth.

When I look at the landscape of the cannabis business in NYS, it is time to tighten up the industry. Not that the OCM is listening to me, but unless they force parts of NY that have chosen not to allow dispensaries there, most of Long Island, they should not give out any new licenses.

The numbers show that few will break even, not pay themselves salaries, while others are selling cannabis from a one-man shop, and some are profitable. Given the amount of money invested in these businesses and the oversight required, it will take years for certain shops to become profitable or pay back the capital they invested.

There needs to be a check in the market. Let’s push the industry to clarify its direction so we can become more powerful rather than spread out. Everyone in the industry is waiting for the bottom to fall out as stores begin to sell or close. We need to get to another mesa.