The parents hadn’t smoked marijuana since the 1970s, but when their son suggested that the family start a cannabis business shortly after pot became legal in Massachusetts, they decided to give it a try.
They were hesitant at first, said the mother, Kim Gibson. “We had to pass the stigma of an illegal substance,” she said.
Nearly three years later, Gibby’s Garden in Uxbridge this week became the first cannabis microbusiness licensed to open in Massachusetts, a milestone in the state’s efforts to foster an industry where small businesses can succeed.
The Massachusetts Cannabis Control Commission has taken steps to encourage mom-and-pop businesses. But so far, most of the state’s licensed pot companies are those backed by large corporations or wealthy investors.
Microbusinesses like Gibby’s say they can provide consumers with small-batch cannabis flower and products that are superior to pot from bigger operators — akin to the difference between craft beer and Budweiser. They can’t open their own stores, though, so Gibby’s plans to sell its first marijuana flower wholesale Monday to Caroline’s Cannabis, a store that is also in Uxbridge, near the Rhode Island border, and run without corporate backing.
“We’re going to have the highest quality product,” said Joe Gibson, 29, who pitched the business idea and is now head cultivator at Gibby’s. “The people of Massachusetts want to support the little guy.”
Gibby’s prices won’t be higher than other operators’ for now. But in the future, if overall prices drop, Gibby’s hopes consumers will shell out a few more dollars for its buds.
Microbusinesses must be locally owned and can grow up to 5,000 square feet of mature cannabis plants at any time, compared to other cultivators that can reach 100,000 square feet.
So far, only four of 227 cannabis licenses awarded in the state are microbusinesses. Another 11 have submitted applications. These companies’ licensing fees tend to be $3,000, records show, lower than larger businesses’, which can range from $5,000 to over $25,000.
This fall, the commission granted microbusinesses and others faster reviews. Microbusinesses owned by people who were affected by the war on drugs or who are helping those communities will be among those with exclusive access to delivery licenses.
Commissioner Shaleen Title said she believes more microbusinesses will become licensed to operate soon. Although the state wants to help certain types of applicants, she said, everyone must comply with the same health and safety regulations for marijuana establishments. She said microbusinesses often face hurdles raising capital, securing real estate, and navigating local government approvals called host-community agreements.
“It’s ultimately up to all of us to get involved in our local host-community process to decide what the legal cannabis industry will look like in Massachusetts, because the decisions to choose which qualified businesses will move forward are made at the local level,” Title said. “If more municipalities join the state in supporting smaller, local cannabis businesses, then more microbusinesses will open.”
While many parts of starting up a business are outside the commission’s control, several microbusiness applicants said the state licensing process was opaque and slow, stretching for months without explanation while they paid thousands of dollars in rent. They described repeated instances of commission staff asking for more information, sometimes with a month between questions.
Ed “Big Ed” DeSousa said he took out a new home mortgage to afford $6,000 in rent for an empty warehouse for his and his son’s aspiring Newburyport microbusiness, River Run Gardens, without knowing when they may move forward. He said the state should reconsider its real estate requirements and speed licensing to shorten the time that applicants must pay rent before they can make money.
“The microbusiness [category] was supposed to help small businesses, but it’s still unattainable,” DeSousa said. “Almost all the applicants can comply with all the regulations, but it’s the application process itself that is very difficult and cumbersome.”
A commission spokeswoman said the agency has to comply with a slew of requirements under state law, such as conducting multiple inspections, collecting fees, ensuring employees and inventory are correctly registered, running background checks, verifying local compliance, and reviewing applications, which are often incomplete. The commission requests the missing information multiple times rather than rejecting applicants, she said.
It took Gibby’s a year and a half from the time the Gibsons applied with the state to being cleared to start selling cannabis. They said they were elated that their long road of sleepless nights worried about finances was finally ending with revenue coming in.
“My stomach gets tight” just thinking about the rent payments over the past year, Kim Gibson said. But now that the company can sell, she said, “We really don’t anticipate a problem being financially successful in the long run.”
She and her husband, Fred Gibson, still work full-time in other jobs. She is a project manager who builds computer data centers; he is a longtime carpenter and nurse who provides health services for seniors.
The family hopes Gibby’s will become known for its quality and that consumers will request it at stores across Massachusetts and eventually in other states, if marijuana is eventually allowed to be transported nationwide. That quality, the Gibsons hope, will protect the business when the industry’s prices eventually fall.
“We’re going to stay in the niche market where we can keep our price high,” Joe Gibson said. “That should keep us afloat.”
Fred Gibson said cannabis start-ups take far more money than anticipated.
“If you have a price in mind,” he said, “double it, and then double it again.”