MJBizMag January 2022 - 33

Cannabis companies prepare for launch of new
markets potentially worth a combined $2.5 billion
W
ith at least five states poised
to launch recreational
marijuana markets and
one introducing a medical program
in 2022, thousands of opportunities
exist for cannabis and ancillary
entrepreneurs.
Between them, the five states readying
adult-use programs-Connecticut,
Montana, New Jersey, New Mexico
and Vermont-are home to 17 million
residents and welcome tens of millions
more tourists annually. MJBizDaily and
other sources estimate that by 2025, the
cannabis markets in those five states will
collectively be worth $2.5 billion.
" We see a big expansion of
opportunities happening because
of rec, " said Patrik Jonsson, regional
president for Northeast operations
at Massachusetts-based multistate
operator Curaleaf.
FEW LICENSE CAPS
Plenty of licenses are expected to be
available. There are no state-imposed
caps on the number of licensees in
most of the coming markets, though
Connecticut and New Jersey's cultivation
sector are exceptions.
In New Mexico, any complete and
competent application will get a
license, according to Ben Lewinger,
executive director of the New Mexico
Cannabis Chamber of Commerce.
That said, in some states, local
municipalities will have the right to
limit licenses.
The only state launching a medical
marijuana program in 2022, South
Dakota, has also left licensing caps
up to municipalities. While some
municipalities have been restrictive, no
South Dakota town can outright ban all
medical marijuana businesses.
REGULATIONS AND SECTORS
Observers see opportunities in every
plant-touching category and for
ancillary companies.
" Anytime you've got a new market,
you're going to need certain industry
expertise, " said Ned Horsted, executive
director of the Cannabis Industry
Association of South Dakota.
While all five recreational states
are hammering out their final
regulations-even as this issue goes
to print-one key trend is a greater
effort by regulators to provide
more opportunities for smallbusiness
owners and social equity
entrepreneurs to break into the
market. These efforts include:
* Lower application and
licensing fees.
* Creating microbusiness and
small-business license classes.
* Restricting vertical integration or
limiting the number of licenses
an operator can hold.
* More robust social equity
programs.
Whether these regulatory
innovations will make it easier for such
businesses to succeed remains to be
seen. Medical operators in these states
have been given head starts and other
advantages, which observers fear will
allow large operators to dominate the
markets-something regulators hoped
to avoid.
Observers acknowledge that only
time will tell if regulations have done
enough to allow small businesses
to be competitive, but at least some
marijuana activists are hopeful.
" The regulations facilitate an
environment where small businesses
have a chance to compete, " said
Edmund DeVeaux, president of the
New Jersey CannaBusiness Association
in Trenton.
If measures that New Jersey
and other states have taken to facilitate
small-business success bear fruit-and
are adopted and expanded in other
markets-2022 could be remembered
as a pivotal year in cannabis.
In the following pages, MJBizMagazine
looks at six state markets launching
this year and the key criteria that
will help determine where there is
opportunity for you and your business.
Established and new cannabis
entrepreneurs are expected to find
thousands of opportunities among
the six states that are launching
recreational and medical marijuana
markets in 2022. Efforts have been
made to help small businesses, but big
players might still dominate. Important
considerations and insights include:
* Many of the new markets have
lowered barriers to entry for small
businesses by decreasing application
and licensing fees, reducing or
eliminating capital requirements and
removing licensing caps.
* Depending on the state, local
municipalities have varying degrees
of control over how many marijuana
businesses they will allow, if any.
* More states are making
microbusiness, craft and smallbusiness
licenses available, which
likely will increase opportunities for
entrepreneurs with limited capital.
* Most of the new state markets have
social equity programs.
* Some states have eliminated or
restricted vertical integration as a
way to curb domination by large
companies.
mjbizdaily.com | January 2022 33
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MJBizMag January 2022

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