A2C and Show-Me Organics partner to help microbusiness applicants and winners
Amendment 2 Consultants (A2C) has launched a host of new lottery license application and comprehensive business planning services focused on Missouri’s microbusiness industry. The first step in A2C’s effort to help microbusiness applicants ends today, with the last stop in a series of microbusiness-focused panels across the state. Targeted at educating potential applicants, the panel has made stops in Columbia, Kansas City, and Springfield and finishes today in Kirkwood.
Now A2C is partnering with Show-Me Organics (SMO), to help applicants take the next step in the process.
“We are proud to team up with Amendment 2 Consultants to provide a best-in-class service on the application side, while we focus on providing microbusinesses with operational consultation in cultivation, manufacturing and marketing. We learned a tremendous amount launching Vivid in the infancy of Missouri’s medical market, and want to share those learnings to help this program succeed,” Boston Dickerson, CEO of Show-Me Organics, told Greenway.
“We’ve worked a great deal with the team at Show-Me Organics since 2020, and they are a great patient and consumer-focused organization, so when we saw that they were planning to offer support services for microbusinesses, it seemed like a natural fit,” A2C’s John Payne explained. “A2C offers a number of backend services for licensees such as compliance, government affairs, and strategic consulting, but Show-Me Organics can provide more hands-on operational expertise. We’ve partnered with a number of different organizations that each has its own industry niche, so that collectively we can provide a full suite of services to successful applicants, and the experience of successfully operating in the Missouri cannabis market that Show-Me Organics brings to the table will be crucial to the success of new microbusiness licensees.”
The partnership combines A2C’s years of experience in navigating the complex regulatory landscape of legal cannabis with the institutional knowledge provided by one of Missouri’s most successful licensed operators in the form of Show-Me Organics.
“The way the microbusiness market is set up is unique to Missouri,” Payne said. “We have largely followed the well-traveled path from Medical to an Adult Use Market, but we do not have another microbusiness market in the US to look to for clues to how this separate market may develop. For this reason, we believe it will be very important for these new licensees to seek out consultants and service providers with experience in cannabis to ensure their success, and perhaps more importantly experience in the Missouri cannabis market. There will not be a lot of room for error in what is already a competitive and crowded Missouri market.”
While the Missouri marijuana market itself is crowded with hundreds of licensees and brands, microbusinesses benefit from the creation of a submarket. There are two microbusiness license types, wholesaler and dispensary. A microbusiness wholesaler license and a microbusiness dispensary license.
A micro dispensary may retail marijuana products for medical patients or adult use consumers, or both – similarly to Missouri’s established comprehensive dispensaries. Micro wholesale licensees may have product sold to either medical patients or consumers, but unlike the comprehensive licensees, micro wholesalers in the state will be allowed to both cultivate and manufacture marijuana under one license. Wholesalers are also limited to a plant count of 250 flowering plants.
The “micromarket” is created by regulations that dictate that micro dispensaries can only purchase from micro wholesalers and micro wholesalers may only provide product to other microbusiness licensees. The benefit to this rule is that new operators aren’t forced to compete for shelf space with established brands, creating a truly unique market. Shoppers will be able to find products at microbusiness dispensaries that they aren’t able to find anywhere else in the state.
While that gives microbusiness winners a chance to start fresh, and grow organically, marijuana – in general – is a tough industry full of potential missteps and obstacles unique from other businesses.
Payne says there are three key things for potential applicants to consider before applying.
“First, is the cannabis industry right for them? There is a common misperception that if you win a license, you are automatically guaranteed success and wealth, but this is a very challenging industry with constantly evolving rules and painfully high effective tax rates because of marijuana’s Schedule I status federally. It’s not for everyone, so make sure it’s something you really want before jumping in.
“Second, are you eligible to be a majority owner of a microbusiness license, and, if not, do you know an individual or individuals who are that you would feel comfortable partnering with?
“Finally, they should consider their proposed location and its suitability as either a dispensary or wholesale facility. It is of course possible to move your license within that congressional district post-licensure, but that can be both costly and time-consuming, so it’s better to get that right at the front end.”
The team at A2C helped clients win nearly 20 medical marijuana licenses in Missouri’s initial application process in 2019, while Show-Me Organics has successfully run dispensary, manufacturing, and cultivation operations in the state – birthing brands like Blue Sage, Buoyant Bob, Missouri’s Own, and Vivid, along the way.
“A2C and our partners are assisting microbusiness applicants by managing the overall application process for them.”
“We played a similar role for numerous applicants in the medical marijuana licensure period in 2019, and although the requirements for entry to the lottery this time are greatly pared down, there are still a number of items that even an experienced operator may want assistance from a consultant. Those are primarily related to assistance procuring required documents such as floor plans, zoning regulations, and ownership documentation, and then assessing those documents to the compliance standards in the rules,” Payne said.
For microbusiness applicants, the ability to work directly with the team at A2C ensures that their opportunity to apply for and operationalize a lottery license isn’t bogged down in red tape.
“This process is straightforward enough that people can likely do it on their own, if they want to invest the time and energy to familiarize themselves with the rules and source the documents without any assistance. Similarly, people can prepare their own tax returns, if they are so inclined, but many people (myself included) prefer to hire a professional to do that work, because it saves them time, and they can rest easier knowing that the documents were prepared by someone who spends all their time thinking about that particular set of rules,” Payne explained. “The cost through July 10 is $4,000 for the first application and $2,000 for subsequent applications from the same client group, if they have multiple qualifying individuals who are submitting separate applications. After July 10, that cost will increase to $5,000 for the first application and $2,500 for subsequent applications from the same group. We can also charge on a sliding scale for individuals who have hardships of one type or another (e.g. disabled veterans, low-income individuals).”
Aside from experience in Missouri, A2C has provided application support services to clients for lottery-based applications in Ohio and Connecticut and has never been denied for submitting an application that did not meet the required criteria, the company stated.
With the first microbusiness license lottery deadline rapidly approaching on August 10, A2C is working to make sure that everyone who wants to apply for a microbusiness license has the ability to do so. A2C’s application support services include helping clients determine their qualifications as Social Equity Applicants, developing and assembling the application components, and providing a final review and submission of the application. A2C provides a dedicated account manager to take the stress and guesswork out of the application process and give assurance that a compliant and timely application will be submitted.
“We carefully vet all the required eligibility documentation for each applicant, utilizing our knowledge of the amendment, the rules, and direct experience with the Division of Cannabis Regulation (DCR) over the last four years. If there are questions that fall into a gray area, we interface with the Division on behalf of the client to nail down the answers.
Payne detailed how A2c ensures that applicants aren’t denied, due to a mistake in qualification. “We carefully vet all the required eligibility documentation for each applicant, utilizing our knowledge of the amendment, the rules, and direct experience with the Division of Cannabis Regulation (DCR) over the last four years. If there are questions that fall into a gray area, we interface with the Division on behalf of the client to nail down the answers.”
“First, we provide the client with a checklist of all required documents and meet with them to discuss which ones will be easiest to obtain and which will be more difficult or take more time. Then we prioritize obtaining the documents that require the most lead time and set up a document management system for all documents the client sends to us.
“As documents are obtained, we review them for compliance to rules for the application process, Division of Cannabis Regulation operational rules, local ordinances, etc. If a document is found to be deficient in one or more ways relative to the rules, we advise client on how it could be amended to comply or how we could pursue a different avenue for satisfying that requirement (e.g. finding a different property if the original one proposed is not compliant to state or local rules).
“Once all documents are collected and organized, we conduct a final review with the client to identify any final issues, remediate those if necessary, and then submit. We also serve as the point of contact for clients in case DCR reaches out for further documentation. Those requests have a mandatory three-day turnaround time, so it’s important to have someone identified as the point of contact who will be watching their email carefully for these notifications.”
“We launched A2C at the beginning of 2019 to help clients in the medical marijuana application process, so these services have been a core function of the firm since day one. We also worked with a lot of smaller applicants and people who had never been part of the cannabis industry before, so we have a specialty in helping smaller and newer operators get their cannabis businesses licensed and off the ground. This process is a natural fit for us, and we will be offering, along with our partners, a whole host of services to those selected for licensure in the microbusiness lottery,” Payne said.
For Dickerson and the team at SMO, their ability to help applicants comes from their experience and their willingness to help guide partners.
“There are some applicants who need specific help in one area, and we plan to meet with each applicant to develop a plan for bespoke support that meets their needs,” Dickerson said.
“The potential success of the microbusiness program is in the hands of application winners, and we believe that a healthy program will uplift the industry overall. Microbusinesses will have to find their niche, and create products and services that existing cannabis businesses aren’t delivering,” he continued. “We have ideas we want to see come to life, but the support we provide is dependent on the needs and ambitions of the prospective microbusinesses.”
SMO has been an active leader in the industry since the company’s inception and Dickerson says that helping microbusiness winners navigate the space is part of the company’s desire to remain proactive, pushing for progress, and remaining involved in the community.
“We take pride in driving innovation both for the Missouri market, but also for the industry overall. The microbusiness program is an innovative idea that’s being executed uniquely in Missouri, and this opportunity to provide access to the industry while making Missouri a best-in-class market aligns with our mission.”
“Show-Me Organics is Missouri owned and operated, with a leadership team that has been intact since the infancy of the medical market here. We are proud of what Missouri is building and are working to make it the best cannabis market in the country,” Dickerson said.
For A2C the work doesn’t start after applications are submitted either. The team has been laying the foundation for a full suite of services to assist applicants who win licenses, forming a network of approved service providers and cannabis operators to work with new licensees to equip them with valuable resources and expertise and help ensure their success in the developing Missouri microbusiness market.
“A2C and its partners will have support for really everything a cannabis business would need to succeed. Unlike the current licensees, the microbusinesses will be coming into a competitive and saturated marketplace. We have positioned ourselves to help people overcome the steep learning curve that new cannabis operators often contend with. A2C has compiled some of the best partners in Missouri to help microbusiness licensees with compliance, training, security, dispensary operations, cultivation and manufacturing operations, Engineering, Design, & Equipment for cultivation/manufacturing, Insurance, real estate, cannabis legal services, and seed money under the right circumstances,” Payne stated.
“Between A2C and our affiliates, we have worked with nearly every licensee in the state, and the services we collectively offer range from compliance, marketing, and operations to security, legal, and facility design. The depth and breadth of our experience in this market is unparalleled, and we look forward to providing the new microbusiness sector best-in-class knowledge and tools to help them succeed in what can be a competitive and challenging environment.”
You can find more information about A2C microbusiness services at https://momicrolicense.com/.