The two co-founders of cannabis lifestyle brand Happy Munkey, Vlad Bautista and Ramon Reyes, became two of the latest winners of conditional adult use retail dispensary licenses in New York City just last week, with Bautista landing a Manhattan permit and Reyes one in Brooklyn.
While the two have for six years successfully run Happy Munkey together, they say they’ll be developing their respective marijuana shops individually, at least for now.
That’s not to say the Happy Munkey clothing and lifestyle brand is going away, but the pair’s former consumption lounge is defunct, a casualty of the COVID pandemic. And both Bautista and Reyes agree that the brand – along the lengthy cannabis rolodexes the two have compiles – positioned them to raise money and find store locations independent of the $200 million social equity fund being run by the Dormitory Authority of the State of New York.
It’s also not yet clear, the pair told Green Market Report, what role – if any – Happy Munkey will play in their respective retail endeavors going forward. But the pair was happy to talk business plans and about the New York market in general.
“We’ve got to climb the tallest mountain, but it’s worth it,” Bautista said.
So you both won CAURD licenses, which means that between the two of you, you can open as many as six dispensaries, correct?
Bautista: That is correct. The most important thing is what it means for the community and for legacy people. Because the big term here in New York is “legacy to legal.”
There have been very few people that actually have been able to go from being a legacy brand and a legacy organization to actually legal, up to obtaining a license. And now we hope to be the beacon of inspiration for every other person out there in the legacy market.
We believe that we can do it better than some of the corporate folks. We just need our fair shot.
Do you have locations already? Or are you still looking?
Bautista: We don’t have locations yet, but we have been preparing for this. We’ve been looking at a lot of different locations in Manhattan. (Reyes has) been looking in Brooklyn. And now we’ll just narrow down as to what makes sense.
We had to wait until we had the license in our hands, because landlords won’t really allow you to really commit until you have the license in your hand.
Reyes: You can’t move on unless your first store is successful anyway. So the plan is just make sure that we’re good, and we have some sort of foundation, and then we can just move forward from there.
A lot of other licensees have talked about financing and capital being a really big hurdle, in terms of attracting investors and finding locations that they can afford on their own, independent of the the DASNY loans. Where are you at capital-wise? Is that going to be a hurdle?
Bautista: I think that’s a hurdle for everyone. I don’t think it’s just a hurdle for us. That’s just in general, because this is a brand new thing for everyone.
We’re more focused on the general situation, that guys like us were able to even get the license. I think the money will come. But for us, it was just more about getting the license and just proving to the world that as long as we get our shot, we can move forward.
How easy or how difficult do you expect it to be to find locations in Manhattan and Brooklyn?
Reyes: People need to prepare for a nice little journey of looking for real estate. It’s not just simple, quick, easy, commercial storefront anywhere, right? This is a little bit more difficult. You have a little bit more loopholes to go through.
Are you guys thinking about taking a location – or multiple locations maybe – from DASNY and the loan agreements that they have available for CAURD licensees? Or is that not really of interest?
Bautista: In the last six years, that’s the one thing that we’ve been fortunate with. We’ve been really building a rolodex when it comes to financially savvy people and investors and family offices. So we’re fortunate enough to have options, and we feel that we won’t have to go that route.
We want to have our destiny in our own hands. And we don’t want to be bound by more regulations and more compliance.
You guys have had the Happy Munkey brand going since 2017 now with clothing and other sorts of goods, right?
Bautista: Yes, sir. Six years, we’ve done that. That’s what’s made us. A good friend of mine broke it down to me the other day. He told me, “Vlad, you guys are gonna do really, really well.” I said, “Why?” He said, “Because you guys are like the New York Yankees of cannabis. You guys represent the city.”
So now that the Green Rush has gotten here, we’re not looked at as the vultures and the carpetbaggers that are coming along now because it’s legal.
What’s the latest with the Happy Munkey consumption lounge?
Bautista: That’s how we got our big start. Pre-pandemic, we started the lounge, and we started doing events once a month, then once a week, then seven days a week, towards 300 people a night. Forbes in 2019 called us the Studio 54 of cannabis.
Then COVID hit, and we had to restructure everything. No more in-person events. We had to hit all the other buckets we created.
When COVID was over, we also created the model of having compliant events, destination events, through sponsors and not having cannabis for sale. We have been maturing with the market and revolutionizing the industry and showing people what the different possibilities are of consumption events and lounges.
Is that something you guys might bring back at some point?
Reyes: The only reason (the New York Office of Cannabis Management) even mentioned and then put consumption lounge on those licenses was because of us. Because that was the only space in the city where you could do that. So the fact that it’s now legal and we can actually obtain a consumption lounge license, absolutely.
Bautista: If anybody can figure out how to do it compliantly I think it’s us. We are sort of like the pioneers of that here on the East Coast. We can crack the code to do it in a legal compliant way, and we will give it a shot.
From my understanding is, once you have a retail license, you can also attach consumption, you can also attach delivery to it. The mistake a lot of people make is they try to do things just because they can.
We’re sticking to what we know, what we’ve done, from legacy to legal, in retail, consumption, delivery. We don’t feel like we should change the wheel now, because we went legal. We’re going to do what’s always worked for us, we’re not going to try to do other things that we’re not experts at.
How does it feel, moving from the original legacy market and getting busted by the cops to now having a license to run a legal marijuana store?
Bautista: The day that we both received it, it was such a full circle moment for me. I am from Harlem, and to have been arrested 22 times, to have bought my first ounce in 1998 and selling dimes and twenties, to 25 years later, after all the blood, sweat, and tears, after all the persecution or demonizing, there is some type of reparation, and some type of light at the end of the tunnel.
I even shed a tear when we first got the notice.
Somebody said, “What is the best one word to describe legacy, real legacy?” And the best way to describe legacy is pain. So after all that pain, to see light at the end of the tunnel, now to be able to create jobs in community, I’m able to create generational wealth for my family, it’s a full circle moment.
Reyes: This is this is definitely an emotional roller coaster. Because even before the licensing, it was kind of difficult for me to even accept that I can smoke in public.
It’s almost unreal. It’s an exciting moment. It’s a proud moment. It’s very emotional. And it’s not like I’m thinking unrealistically, where it’s like we’re rich, we’re set for the rest of our lives. No, we’re ready to get to work. We were preparing for months, what do you need for all these dispensaries, for consumption, for delivery. It feels good to take in a win for once.
What are you anticipating business-wise as some of the biggest hurdles that you’re going to have to overcome?
Bautista: Real estate, definitely a big hurdle. And we’re not dreamers; we’re practical and realistic. I know that, even though we have all this experience from legacy, all the experience from the lounge, that 25% of businesses in cannabis fail.
So we just got our shot to play in the major leagues. Doesn’t mean we’re going to win the championship.
Are you confident that your new companies are going to be able to compete effectively with unlicensed operators, given the immense gray market across New York?
Bautista: I feel confident because we have the fortune to have really created a big fan base during all these years. We already have a big following.
Aside from that, I’m not against legacy. What’s happening here is, like 20%-30% of these stores are legacy, and 70%-80% are just carpetbaggers that used to call the police on me when I was selling dimes and twenties, and they just came to capitalize off of this two-year window after legalization.
I’m not for those people, but legacy is what made me who I am. And it’s what built this $5 billion industry.
When do you think your first stores might actually be open for business and open to the public?
Bautista: I estimate more or less like six months from when we actually nail down a piece of real estate. First quarter, 2024.
Are you new stores going to be separate from Happy Munkey? Will they have any formal relationship to Happy Munkey?
Bautista: Right now, that’s to be determined. Right now (I have my) company, and Ramon has his. Everything else is to be determined. We just got it a few days ago. You gotta give us a minute. We’re still processing. It’s still surreal. We still haven’t figured it out.
Reyes: Literally just this morning I was walking to the train, and I bumped into my dad. And he’s still trying to figure out, what did this mean, right? Because I have to now explain it to him, “Look, I can do this. Legally. Now I can go put up a store and sell this legally now.” Right? So we’re still trying to get over it.
This interview has been edited for length and clarity.