In 2000, Colorado became one of the first states to legalize medical marijuana. Almost overnight, demand spawned an ecosystem of growers, sellers and buyers who had to figure out the basic market principles of a commodity that was still considered illegal by the federal government, which classifies cannabis as a schedule one narcotic. Nearly a decade later, as Timothy McDowell ’08 entered the industry, Colorado’s cannabis pioneers were still clueless.
After graduating from Johnson & Wales University Providence Campus in 2008 with a business administration degree (he’d earned an associate’s degree in culinary arts in 1999), McDowell moved to Boulder, Colorado. There, after a short stint with Whole Foods, he began working with the owner of a grow farm and dispensary who wanted to take advantage of McDowell’s food preparation experience to expand into edibles, a segment of the market that hadn’t been tapped, and promised an explosive yield. Plus, the cannabis industry was bound to be more exciting that sitting behind a desk at Whole Foods. “Corporate life was unfulfilling,” McDowell says. “I missed the action of working in kitchens for 16 years.”
McDowell and his partner rented a small kitchen across the back alley from a brewery and began watching instructional YouTube videos. They taught themselves how to extract tetrahydrocannabinol (THC) from plants using ethanol. They were evasive with suppliers wary of associating with a medicinal marijuana company, despite its legality. They tested the concentration of their offerings not in a lab, but by serving batches to their neighbors, the brewers. “Making drinks, labeling drinks, taking orders on the phone, putting them in my Kia, driving to Denver, selling them for cash, going to the grocery store, buying groceries, taking the rest and putting it into the business. That’s how it started,” McDowell says. “Nobody knew what was going on.”
Today, McDowell’s company — MarQaha (an Arabic word for bliss), which still manufactures gummies and other edibles, including drinks and tinctures barely resembles the makeshift business he patched together during the heady days of medical-use legalization. At company headquarters, now in Denver, 27 cameras survey the building because the state requires every inch of the facility to be monitored at all times. While outsiders might expect to find lava lamps lighting the halls and beanbag chairs piled in the corner, the 5,000-square-foot production space resembles a laboratory. Glass tubes and complicated-looking machinery sit on stainless steel tables; dozens of boxes filled with vials of tinctures stand ready to be shipped. Where in early days McDowell used a simple box fan to vent ethanol fumes, MarQaha today must install the materials necessary to render a room explosion-proof. The workers in the production space don hairnets, and a $25,000 homogenizer mixes tinctures and drinks at vigorous speeds to ensure the concentration of THC is consistent throughout products. No ingredient is used without being marked, dated and recorded. “Ninety percent of making edibles isn’t cannabis,” McDowell says. “It’s food safety.”
Colorado’s 2014 legalization of recreational marijuana accelerated regulation, and therefore professionalism, of the industry, McDowell says. To further illustrate that point, McDowell pulls up a program called Metrc on his computer screen. Colorado requires all licensed marijuana vendors to use the interface to track every seed of cannabis from farm to dispensary. (Each plant is tagged with a radio-frequency identification technology microchip.) If a sample tests positive for, say, high amounts of heavy metals, the entire batch of edibles it came from must be tossed.
In short: The marijuana industry doesn’t have much space for the Jeff Spicoli stereotype anymore — not on the business side of the counter, anyway. “[We’ve had to] take the magic of cannabis out of it,” McDowell says. “The industry needs trained employees.”
Soon, McDowell will be able to turn to his alma mater to find them.
Annual legal sales in the United States skyrocketed by 46 percent last year to $12.1 billion, according to the market research firm BDSA, and that increase isn’t a COVID-19-induced blip: Global sales are expected to more than double, to $55.9 billion, by 2026, and much of that revenue is bound to be made in the United States, where 36 states have already approved medical marijuana and 18 states have legalized it for recreational use; a few more are currently considering legislation that establishes some form of legalized adult use.
Having owned and operated a number of hospitality companies, Magnus Thorsson, Ph.D., ’94, an assistant professor in JWU’s College of Business, recognizes an entrepreneurial opportunity when he spots it. In 2018, Thorsson and Michael J. Budziszek, Ph.D., an associate professor of science in the John Hazen White College of Arts & Sciences, began writing curriculum for a degree tract that would examine both the business and science of cannabis.
JWU’s Bachelor of Science degree in Cannabis Entrepreneurship finally launches in fall 2021 on the Providence Campus, becoming the first degree program in the Northeast to provide students with a deep understanding of how to cultivate a business as well as the plant that will spur that business’ growth. “There’s nothing that has the potential that cannabis offers right now,” Thorsson says. “It was a sure thing to do.”
In many respects, principles taught in the Cannabis Entrepreneurship program will be useful to any businessperson looking to start and run their own company. Thorsson says students will enter the program with their own ideas — whether it’s to infuse chocolate with THC or develop health products using CBD, a non-psychoactive cannabis compound whose purported relaxation benefits have sparked a nearly $2 billion market in the United States. Professors will teach students how to spot a need, how to calculate the costs associated with filling that need and whether or not their company can operate within the margins. Administrators in JWU’s College of Food Innovation & Technology — an interdisciplinary college that launched in January and explores the economic, social and political effects culinary systems have on people — are looking to develop business classes that dovetail with the cannabis entrepreneurship program, Thorsson says.
Because the federal government continues to classify cannabis as a schedule one narcotic, institutions that receive federal support are not permitted to grow the plant, even for research purposes. Nevertheless, JWU is remodeling space inside its John J. Bowen Center for Science and Innovation to accommodate two grow labs. The school has applied for a license to grow hemp, which is classified as a cannabis plant but contains only 0.3 percent THC. In the meantime, students will cultivate tomatoes and other plants that mimic the growth pattern of cannabis. “We’ll teach how to grow the plant, a little bit of extraction, pest management, genetics and chemistry,” Budziszek says. “So students get a really well-rounded scientific view of the plant.”
And while the program is billed for entrepreneurs interested in starting their own businesses, the industry can’t wait to welcome trained talent to their workforce. “I have a lot of respect for Johnson & Wales getting in front of this thing,” says Derek Ross, CEO of Nova Farms, one of the largest cannabis producers in Massachusetts. “They’re blazing the path.”
Ninety percent of making edibles isn’t cannabis — it’s food safety.Tim McDowell ’08
Mark Ainsworth ’96 struck out on an expected course for someone with a Pastry Arts & Food Service Management degree from JWU. Starting in a small pastry shop after graduation, Ainsworth began a culinary career that witnessed him rise to become the executive pastry chef of the California-based Pebble Beach Company. From there, Ainsworth launched Pastry Smart, which disrupted the market by using ingredients from certified-humane farms to create its breads, chocolates, and crisps. Thanks to effective investment, Ainsworth managed a 40,000-square-foot production facility that kept national retailers such as Whole Foods stocked.
But after selling the Pastry Smart brand in 2013, Ainsworth received a call from a friend who was interested in entering California’s burgeoning cannabis industry by starting an edibles company. “I just thought it was a great opportunity to go into an industry that had yet to be professionalized,” Ainsworth says. “It was kind of coming from this prohibition-style of manufacturing, and I really wanted to be involved in trying to bring consumer safety.”
Ainsworth helped launch and guide that company, Indus Holdings, to a 2019 initial public offering and, in February 2021, the $39 million purchase of Lowell Herb, a California rival backed by celebrities such as Miley Cyrus and Chris Rock. The acquisition allows Ainsworth’s company, now called Lowell Farms, to further scale its vertically-integrated cannabis operations. From only a handful of staff, the Salinas, California-based business today employs 350 people across a 10-acre farm, an extraction area and space dedicated to edible manufacturing. In 2020, Lowell Farms reported $42.6 million in revenue, a 15 percent increase year-over-year. “To think that a guy who went to culinary school would one day be CEO of a publicly traded company — I’m kind of not sure how I ended up here,” Ainsworth says. “But my role in the company is to focus on people and process.”
Helping Ainsworth manage growth is another JWU alumnus, Anand Menon ’98, senior vice president of cultivation. Menon arrived at Lowell Farms after spending nearly two decades in hospitality, his last stop as chief operating officer of a global events services company based in Monterey, California. “I’m not the person who’s going to look at a flower and say, you know, this flower comes from this origin, these are its genetics,” Menon says. “My role is to bring all the correct resources into play, whether it’s the human capital or technology or physical infrastructure. I bring all the right players to the table and allow them to do what they do best. That part transcends any one industry.” And those are the skill sets that will fuel cannabis’ growth.
McDowell’s MarQaha is expanding to new states through both consulting — using its institutional knowledge to help startup cannabis ventures in newly legalized markets — and licensure of its edibles formulas. The industry is hungry for data mining and analytics, Menon says, which could help growers optimize their crops. Investment money is beginning to pour into cannabis, highlighted by Green Thumb Industries, a multistate operator based in Chicago, which raised $100 million from a single institutional investor, and the greater financial sector might soon follow suit: The Secure and Fair Enforcement Banking Act (SAFE), a federal bill aimed at lifting restrictions on banking cannabis profits, has passed the U.S. House several times. With Democrats in control of the U.S. Senate in 2021, SAFE might soon finally become law.
With so many potential strains of the cannabis sector set to accelerate, it’s no wonder that JWU’s Cannabis Entrepreneurship program will aim to seed a diverse set of skillsets — from law and policy to business management to hydroponics and genetic manipulations. This is a strategy informed by the experiential learning that JWU embodies across its programs.
Before the first class has begun, the strategy is already drawing plaudits from the industry: In preparation for the program’s launch, Thorsson met with Ross, CEO of Nova Farms, to discuss how the company and the school might work together. “They said, ‘We were so excited to see you’re actually going to be teaching regulatory framework, how to build up scaleable product, accounting,’” Thorsson says. “‘Those are the things we need.’”
And many prospective students, it seems, are eager to learn about them. JWU unveiled the Cannabis Entrepreneurship program last year on November 30. By April 2021, Thorsson was closing in on 156 applications, which is sure to make grabbing one of the as-yet-undetermined number of initial spots competitive. In return, those who complete the degree will enter one of the fastest-growing industries in the world equipped with the tools necessary to succeed in whichever path they take. “We’re cognizant that we will create competent managers who are ready to assume responsibilities in the relevant industries,” Thorsson says. “That’s our product: A fully-formed manager or employee who is ready to hit the ground running.”
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