Why you should care
Because he’s putting the “high” in high rollers.
In the fall of 2014, venture capitalist Larry Smith was hanging out with rapper-turned-entertainment-mogul Curtis “50 Cent” Jackson and comedian-slash-radio-host Jack Thriller when his smartphone went off. It was Shawn Holman, a childhood friend, who had just watched a news report that the state of Nevada was opening its doors for licensed marijuana dispensaries and cultivation sites. Tourists, 21 and older, would soon be able to buy pot legally on the Las Vegas Strip. It was an intriguing proposition: Smith and Holman, Nevada natives and business partners, cashing in on the state’s impending “green rush.”
“I remember it was 3 in the morning and Shawn was super excited,” says Smith, 44, with a laugh. “He’s calling me like, ‘They are starting a cannabis program in Nevada … I think we should get involved!’” Get involved they did, founding GFive Cultivation, a marijuana farm that will include a dispensary as soon as their “product” reaches maturity. What distinguishes GFive from its early competitors? Its sheer size — covering 3 acres, it’s by far the biggest among the other Black-owned outlets. Plus, once it opens as a dispensary — Smith and Holman already have the license — GFive will be the first Black-owned and -funded marijuana farm and dispensary.
The legalized cannabis industry is still largely a white man’s game, where minorities are often priced out by the $250,000 entrance fee.
Since Nevada voters gave the OK to legalize weed for medicinal purposes in 2000, the race has been on to get in on the lucrative marijuana market in Vegas, the world’s ultimate pleasure hub. Since 2014, when recreational use was given the green light, 50 dispensaries (and counting) have opened, permitted to sell up to 1 ounce of cannabis plant and 3.5 grams of cannabis concentrates.
State Sen. Tick Segerblom has been an outspoken advocate for legalizing weed in Nevada, and he believes the robust figures that have come in thus far from recreational sales (which are taxed) are just the tip of the iceberg. “In August alone, marijuana sales reached $33 million, which is about 50 percent more than what we projected,” Segerblom says. “Right now it’s about a million dollars a day in sales … more than $350 million a year. I could easily see Nevada doubling that by next summer.”
And with nearly 43 million revelers flocking to Sin City last year, according to the Las Vegas Convention and Visitors Authority, Holman did the math. “As soon as Gov. [Brian] Sandoval announced that the state of Nevada would allow for dispensaries and cultivation and processing, I reached out to Larry,” says the 46-year-old. But his friend was cautious at first. “To be honest, I was not very interested in jumping in that industry,” says Smith, GFive’s CEO.
So what changed Smith’s mind? “I started thinking back to my childhood and my grandmother having cancer,” he recalls. “I was thinking how great it would have been to take my grandmother’s pain level from a 10 to a 3 and her having a better quality of life for those remaining days with the help of marijuana.”
Smith did his homework. He spoke to attorneys to learn the pros and cons of getting into the legalized weed business, which today includes 29 states, among them Colorado, Washington, Oregon, Alaska and Hawaii. “We did the research and traveled to California and Arizona to see other [cannabis operations] that were up and running,” says Holman, GFive’s chief operating officer. “Eventually we decided cultivation would be the route we would go.”
GFive opened its doors this past September. At the 8,591-square-foot building, Smith and Holman oversee an operation that includes 12 canopies holding cannabis plants, massive air conditioners to counter Vegas’ triple-digit heat, ultraviolet lights and a carbon filter system to help destroy bacteria. Damon Dash, who co-founded Roc-A-Fella Records alongside Jay-Z, is among GFive’s investors.
Yet as an African American-owned and -operated marijuana business in Nevada, GFive has experienced pushback. The legalized cannabis industry is still largely a white man’s game, where minorities are often priced out by the $250,000 entrance fee for securing a license. “And then if you have any type of tax issues or felonies,” adds Holman, “that stops you from even getting through the door.”
GFive Cultivation could afford the license, and still roadblocks appeared. “There were white-owned facilities that were built after us that got their power cut on before us,” Smith says. “But knowing that there’s not a lot of us in this business, Shawn and I understand that we represent the urban Black youth of America.”
So far, Nevada’s green landscape has yielded big profits. In July 2014, the first month of sales, dispensaries pulled in $27.1 million for recreational cannabis use, and demand for legalized weed was so high that supplies sold out. But despite the country’s sky-high support for medical marijuana use (94 percent), legalizing pot for recreational enjoyment has plenty of vocal critics, like Attorney General Jeff Sessions, who see weed as a “gateway drug” threatening the health of America’s kids.
Will the Trump administration come after facilities like GFive? Smith’s not worried. At 5-foot-9, the former point guard who attended Arizona’s Yavapai College on a basketball scholarship is used to facing off against bigger, stronger competition. When he realized the odds were low that he’d make the NBA, he used his marketing degree to set himself up in business instead. In addition to Square Biz Management, which buys homes in Smith’s old Vegas neighborhood and sells them to low-income families, his portfolio includes GFive Medical Consultants and a company that refurbishes brass casings for use at shooting ranges.
But for now, it’s all about GFive Cultivation. The plants are growing at a strong rate, Smith reports proudly. And down the road? “We are sitting on 3 acres, so we will be able to expand the operation. So far, so good.”
And he’s not just blowing smoke.