Debra BorchardtOne cannabis group in Illinois has decided to take social equity matters into its own hands. The 1937 Group launched a new social equity incubator to address the very unequal distribution of cannabis licenses in the state.
“Currently, just 2% of current Illinois dispensaries are majority BIPOC owned. This statistic is more than just disheartening – it’s disgraceful,” said Ambrose Jackson, CEO of The 1937 Group.
The group noted that the application process is challenging even for those with years of experience in the cannabis industry. “It’s extremely daunting for those who are not in the industry. Accordingly, we established this program to help others take advantage of this small window of opportunity to join the legal cannabis industry, and give them the assistance they need to establish a successful cannabis business.”
The group said, “This dispensary application process is unlike any other round of licensing established by the State. Experience has taught us that many people who qualify as Social Equity Applicants may not be aware and/or lack the resources and experience to apply successfully. With just a two-week window for applicants to apply, there is too much at stake to sit on the sidelines. It’s in our DNA to do something to help.”
Ambrose Jackson, CEO, The 1937 Group.
“Illinois has already recorded over $3 billion in recreational cannabis sales with almost zero minority representation,” he added. “As a leading minority-owned cannabis company, our mission is to help change this paradigm and drive the betterment of our communities through representation and ownership in this privileged, corporate-dominated industry.”
The Cannabis Incubator will offer a wide range of resources and assistance in collaboration with The 1937 Foundation and Parkway Dispensary. Assistance includes:
- Business formation
- Legal templates/agreements
- Documentation review
- Dispensary site selection
- Standard operating procedures (SOPs)
- Investor connections
- Marketing planning and development
- Supply chain strategy
The announcement came as the state said it would begin accepting applications for 55 conditional cannabis dispensary licenses on Jan. 30. The licenses will be distributed across 17 Bureau of Labor Statistics regions.
This round of licensing follows the release of 192 conditional dispensary licenses, all to social equity applicants.
The state has been sensitive to criticism that the biggest players are corporate cannabis companies, many with little minority representation in the C-suite. In August, Governor JB Pritzker and the Illinois Department of Commerce and Economic Opportunity announced that $8.75 million in direct forgivable loans fully financed by the state would be made available to all conditionally approved social equity loan applicants in order to provide immediate access to capital.
That plan came after a previously announced loan program seemed to struggle to find lenders willing to take the risk, which pushed the state to put up some of its own money. The loans though still weren’t enough for the social equity applicants.
While capital is a big hurdle for many social equity applicants, the process of just applying for a license can be overwhelming. The incubator seeks to guide applicants through the process, they won’t be making any loans themselves.
Oakton Community College offered some webinars, but The 1937 Group felt there was a need for more assistance.
As an aside, the name “The 1937 Group” is inspired by the Marihuana Act of 1937, which fueled racial discrimination against Mexican-Americans and Blacks and widespread imprisonment for what is now a legal activity in the majority of the United States.
