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Tommy Truong: It sucks though because now the hemp industry will have the same problems as the cannabis industry.
Jeremy Berke: Look, I, I think you hit the nail on the head and the broader point here is that there needs to be coherent regulations, right? Hemp and flower is a legal distinction. It's not a scientific distinction. The smart thing to do would be for Congress and look, I know Congress is Congress, I, I.
I'm sitting here telling the federal government what to do. Of course they're not gonna listen to me. but the smart thing to do would be to regulate THC as THC.
Intro: Welcome to the Kaya Cast the podcast for cannabis businesses looking to launch, grow, and scale their operations.
Tommy Truong: Jeremy, thank you so much for joining me today.
Jeremy Berke: Yeah. Thanks. Thanks for having me on. I'm excited to be here and get into the discussion.
Tommy Truong: So Cultivated News. When, and why did you start that?
Jeremy Berke: Yeah. Yeah. So I'll get, I'll make the sort of elevator pitch as, as pithy as possible. I've been a journalist on the cannabis beat for [00:01:00] quite a long time. I worked at Business Insider and launched and led the cannabis vertical there way back in 2017, which makes me ancient in terms of cannabis years, I think.
So I had a wonderful experience at bi. And I, eventually. Made a decision in late 2022 that I wanted to expand out and capture some of the value for myself. And I let, this is I turned 30 in the middle of the pandemic and was like, what's next?
Kind of one of those moments, so I left bi and I went to business school to pursue an MBA. And so during business school, I just missed writing and reporting a little bit. It's hard to let go of that muscle to unclench it once you've been in a newsroom like Business Insider for so long.
And so I had a bunch of story ideas. I started writing on a substack. this was like early 2023. And the substack got a lot more. Followers and interests. I thought it was gonna be a fun side project basically beer money while I was in grad school. It quickly snowballed past that.
And so it, it started taking up like 30% of my time and 50% of my [00:02:00] time. And then I was skipping class to work on it. In the late 2023, my now business partner, Jay Rosenthal, approached me and said, why don't we take what you have with your Substack and really build a full media platform, meaning a daily newsletter daily live streams, and really build that muscle up.
And it was credit to him for really seeing the vision of the business. And so we officially launched from my Substack in November of 2023, and we've been growing really well ever since. And I think that as. From what we were discussing a little bit before we started, as some of the big incumbent cannabis media companies start to pull back a little bit, we see that as a big opportunity.
Tommy Truong: That is so cool to do something out of passion and seeing it grow and flourish.
Jeremy Berke: Yeah it's, it's very cool from the outside and I would say on the inside I go up and down a lot, right? And I think not that cultivate is the same scale as a lot of other businesses people have founded. But managing emotions is a really, I. Hard part of being a founder.
Some days are really good. I'm writing really good stories. I'm getting great reader [00:03:00] response and partnership money is flowing in and some days it's all the opposite. There's a mistake in my story. People are yelling at me on the internet. A partner wants to pull back. And it's just making sure that you're taking those ebbs and flows, but it's a steady, it's a steady growth upward, I would say.
Tommy Truong: You definitely have to be even keel, right? Nothing is, if it doesn't kill you, it's fine, but
Jeremy Berke: That's right.
Tommy Truong: it's, it's, you can't be over the moon with something forever,
Jeremy Berke: that's exactly right. Like I, I think you know, Jay, my partner, he is, he's older than I am and he manages that. He said, okay just stay even, don't get don't get too excited. Don't get too low. Like we just, this is, we're in this for the long game. It's funny, like I, i'm a big basketball fan and, Kawhi Leonard is the guy I try and emulate. He's very even keel, never celebrates after a basket, always gets back on defense. So I try and bring that mindset into the business
Tommy Truong: You're from Brooklyn. Why you follow Kwai?
Jeremy Berke: I'm originally from Toronto. I live in Brooklyn.
And so that's yeah that's where like that one season that choir was on the rafters was forever imprinted on me.
Tommy Truong: Yeah. 2019 was a [00:04:00] fun year,
Jeremy Berke: It was a great year. Yeah.
Tommy Truong: Oh God, it, so you moved to Brooklyn, I'm guessing, for school. And how do
Jeremy Berke: No, so I moved to Brooklyn. I've been in Brooklyn for nine years. So I moved to work at Business Insider for my first job, and I stayed, and so I'm a dual citizen now, so I am from Brooklyn, but my, being born and raised in Toronto, my sports allegiances are still to my hometown.
Tommy Truong: Since we're talking about New York and you're right there, what's happening right now in that market?
Jeremy Berke: Yeah. New York has been an interesting market to cover for many reasons. And, I think it's important to give context for how New York developed its cannabis rules and regulations. New York's, the MRTA, the law that legalized cannabis in New York was passed in 2021, right?
And It doesn't seem like that long ago, but we were really in a different world in 2021 than we are now. It was, the middle of the pandemic. New York especially, was still very much shuttered. When this was going on. It was at the height of the George Floyd protests. And so [00:05:00] social equity and sort of the broader DEI push was very top of mind, especially for cannabis legalization, which sort of intersects with, those trends in, in, in various ways. The result of that, which I've covered a lot and we're still unwinding is good intentions meeting economic reality. And it's interesting because New York right now, if you. There's multiple dispensaries in my neighborhood I live in Borum Hill in Brooklyn.
If you walk into any one of them at six, 15:00 PM on a Thursday, it's gonna be packed, right? There's plenty of people in there. The brands are awesome. People love buying and consuming cannabis here. What that masks is that the regulations are very unfavorable to a lot of industry operators.
They're taxed really heavily. It's really burdensome to comply with all the various rules and restrictions about where you can locate, how you can sell, who you can sell to, who gets a piece of the revenue. And what you have is an industry that is growing like gangbusters, but is not very profitable for many people in the space.
And the reality is tough, [00:06:00] right? There's a lot of. Awesome brands being created. Like I said, it's New York. There's a ton of energy, there's a ton of talent but there's not a lot of people making a lot of money, and so it's a difficult market for operators. That being said it is an interesting market to cover as a journalist, and not that I want to dance on graves or celebrate the downfall of anything, but it does keep it interesting.
So one, I'll wrap this up with a little anecdote. One, one story about that front is. New York set these rules where dispensaries could locate. That had to be, a certain distance from schools, a certain distance from places of worship, churches, synagogues, whatever it may be.
A couple months ago, they realized that all these dispensary locations were actually violating the rules and the law, and no one really noticed until people had opened their doors, had taken leases, had taken on debt to start their businesses. And so it's another thing, it's just like a wave. Crashing over the bow that you're always sitting here waiting to see what happens next.
And that's really been the story of New York cannabis. But look, it keeps it an interesting market to cover. It's still exciting. [00:07:00] I'm very bullish on the future of it, but there's been a lot of twists and turns to get this market open and online.
Tommy Truong: So where are we with that? I know that there was an injunction and has anything moved over the last month?
Jeremy Berke: Yes. So it has, there was an injunction they can't enforce it at, per the last meeting. And this, there's another one coming out next week. So what I say now might be not true in a week, so I wanna be careful. But per the last meeting they're gonna. Create rules to allow the stores that are in violation of those proximity restrictions to stay open while they iron out the rules.
And so ultimately what's gonna happen is this will go back to Albany, the legislature, and they'll have to figure out like. Are they gonna grandfather them in? Are they gonna rewrite the rules to allow 'em to stay? That's all unclear at the moment, but as of right now, they're allowed to continue operating.
So it's not like you're gonna have to close their doors tomorrow. I think, the state understands how much risk went into opening these businesses. And just how profitable locations are, right? Because. It's New York City. There's not a lot of real [00:08:00] estate, right? And there's not a lot of real estate that's far from schools.
There's schools all over the place, right? And so these businesses have to be somewhere. And I think there is that understanding now. And by the way, the Office of Cannabis Management, the chief regulatory agency governing industry in New York. Fully changed over, right? There's totally new people in there than there were in 2021.
And they are unwinding all the confusion to the best of their ability right now.
Tommy Truong: When I heard, because I have friends in New York and we're talking, when I heard that they were initially saying, Hey, we'll compensate you, you can apply for $250,000, and knowing how much some of these doors cost to open, that's not gonna fly.
Jeremy Berke: No. No. And they're, look, they're in it for a lot more than $250,000. And so it's, look, it's sure it's a nice gesture but it doesn't really paper over the losses that some of these stores we're gonna have to suffer for moving. That being said even though they're allowed to continue operating still a very difficult.
Market to be in when the regulations are so uncertain, you're expecting [00:09:00] something else to change. And they're to use a terrible metaphor, like a sword of Damocles swinging over your head because you think, oh shit, sorry for swearing, but maybe I'm gonna have to sell this real estate or get outta this lease and move in 365 days.
That's a really hard way to run a business. And ultimately yes, the people. The entrepreneurs opening, these businesses are gonna suffer, but also their frontline employees, right? All the people they hire they're gonna have to pivot and change. And I think a lot of the operators here in New York really just want to be have or to have predictable regulations, right?
To be assured that their business can continue to operate because the last four years have been topsy turvy.
Tommy Truong: Yeah. Certainty is needed for sure. You can't operate and invest. It's, I would imagine that, and we see it on our side too because we service the industry.
There's a lot of uncertainty on are we out of pocket?
Jeremy Berke: right,
Tommy Truong: So every, so what happens, and so the collateral damages is tremendous.
Jeremy Berke: That's totally [00:10:00] right. It I think your point about collateral damage is really good. It ripples out, right? It's not just the dispensaries who suffer, it's all the service providers as well. Anyone who follows this industry closely knows accounts receivable is a very difficult issue, right?
And when he throw more stones into the gears or wrench into the gears. Whatever the phrase is it gets harder and hard, harder and harder to operate. and all this breeds uncertainty, right? This is an industry that does need capital. It needs investors to want to be excited about and interested in it.
And when they look at these headlines. They're probably like I don't wanna touch that until this is ironed out. And the result of that is gonna be, businesses will fail. And so that's the sad piece of this, is that without these certain, without certainty, with the regulations, businesses will fail.
And that affects everyone.
Tommy Truong: So where we are today is they're, these doors are allowed to stay open. Are they allowed, when their licenses expire, can they renew until a final decision's had or has that come out yet?
Jeremy Berke: They as far as I know they will have to [00:11:00] under undertake a special process to renew their licenses until the decision's made. And so all the dispensaries that are in these restricted locations. Have a separate license renewal process that they can go through. I imagine that the hope is that they will iron out these rules before their licenses expire.
You never know. And I would guess, I, yeah, it is a guess. I'm guessing that they're gonna figure this out before that happens. But if they don't it's gonna be a big problem.
Tommy Truong: That's I, I don't envy operators. They go through so much, right? And at the end of the day, they're the front lines. They're where you get your product and they're taking on a lot so that it is just it's unfortunate.
Jeremy Berke: Yeah. Yeah. I think the last piece I'll say on that is, is you know, to tie the whole story together, right? Like these operators are the ones that the original law was designed to help. Many of these are social equity operators. And so the intent of the law was designed to help these folks, right? Some of whom have [00:12:00] convict convictions, cannabis related convictions, excuse me, themselves, some of whom have family members convicted.
And so when they're thrust into this. Almost debt trapped by opening these stores it's actually hurting them. And so I think that's the sort of broader injustice that we see here, is that, these really good intentions met with economic reality and met with the thicket of laws guiding New York City and Albany.
And the result is that the people that the policies were designed to help are actually gonna get hurt. And so that, that to me is where, good reporting, like hopefully what we do can help move the ball forward and create better policy for everyone.
Tommy Truong: Speaking about uncertainty, what is going on with hemp?
Jeremy Berke: Yeah. So look I think New York's MRTA law, this whole hemp issue is just a result of the haphazard policymaking on the federal government's part in terms of cannabis, right? There were so many opportunities. In the last few [00:13:00] years that Congress could have stepped in and created some sort of coherent regulation around hemp, around THC, around cannabis more broadly.
And look, the politics are what they are and they were unable to do and so what happened last week? There was a ban. I, I think people are gonna take issue with the word ban, but it effectively is a ban of most hemp derived products. All hemp derived THC products, right? That ban was snuck into the funding bill to reopen the government, and it was, both a masterclass of politicking from Senator Mitch McConnell and also really symbolic of how broken America's cannabis policy is right now.
Senator Rand Paul tried to, at the 11th hour get it struck. He was unsuccessful and so effectively. Any hemp derived THC product is gonna be illegal by November 12th, 2026. So it's a little less than a year now. There, there's a few reasons why. In my view I think this is bad.
I know a lot of people in the industry might disagree with me. Number one is that the hemp [00:14:00] derived THC space is, particularly with beverages, has been exploding. It's created a lot of consumer adoption. These products ended up in stores like Circle K, like Target, like total wine, this normalization wave.
They were the tip of the spear of, and second it was where all the investor energy was flowing, right? The only. Cannabis companies, maybe not only, but some of the few cannabis companies that have been successfully able to raise venture capital were these hemp derived THC brands, right? So all of a sudden you have investors interested in the space.
You have consumers seeing it normalized, sitting, on store shelves alongside Miller Light and whatever else you can get at Circle K. And then the rug has been pulled out, right? And so at the end of the day, the consumers in non-legal states aren't gonna have access to cannabis. The cannabis products they love many businesses are gonna have to lay off people.
And they're also not to mention sitting on, in some cases millions of dollars in inventory that is gonna be illegal in, in, less than 12 months. And so again. [00:15:00] Like the operators in New York, that is a very difficult environment to start a business in, to create jobs in and to bring all the economic benefits that cannabis can bring into various states.
And I think, again, it's cannabis. What's true today may not be true tomorrow. I think a lot of lawmakers are trying to create carve outs for THC beverages and hemp drive, THC products. We'll see what happens there. But it's certainly emblematic of very haphazard federal policy making and the conflict. Between state law and federal law and cannabis. It's just, in the seven years since the farm Bill has passed that created this industry nothing has gotten better. And in fact, it's gotten worse.
Tommy Truong: So you mentioned all hemp products are illegal too.
Jeremy Berke: It's, yes. With a caveat. So the intent of the language in the Senate bill. Says that any cannabis product containing more than 0.4 milligrams of THC is illegal. Cannabis is a naturally occurring plant. Hemp and cannabis are the same plant. Scientifically. [00:16:00] It's a legal distinction just to make that clear.
And THC occurs along with C, b, D and all the other desired can cannabinoids in the plant at various quantities, meaning that. To get under that THC threshold is gonna create, make a lot of products illegal. And a lot of products that are marketed as CBD products do contain CBD in them, especially when they're full spectrum, right?
Meaning they, they take the whole plant and create the product. And the language did not intend to ban CBD. The effect is that it's banning most CBD products from the market as well. And so look I always like to judge policy on the effect, not the intent. And that is the effect.
It's the effect is a blanket ban on 99.9% of hemp products that you see out there.
Tommy Truong: Yeah, and you made a really good point. All of the cannabinoids are hemp-derived.
Jeremy Berke: Yes. Yeah. And they're all in the plant. That's how, I'm not a biologist, but I, it's okay if you buy in high school, like that's how plants work, right? If you're gonna take a plant and grind it up or convert it into oil and turn it [00:17:00] into a consumer product, like those comp, those chemical compounds are gonna be in there.
And to ensure that they don't rise above that threshold that, being hot, like all of a sudden, like some shipments are gonna just be illegal right off the bat if they're tested because it's 0.5% or it's 0.6% THC, and that's not gonna get anyone intoxicated. You're not gonna feel high from that.
But if you know by chance a regulator or the law decides to test it then that company is screwed.
Tommy Truong: Do you, because I know a lot of states are looking to implement. Legislation for either to approve hemp or land hemp. Particularly states with cannabis that are, is legal, that are legalized. What's that? Now that federally hemp is effectively illegal? Have you heard anything from the state level?
Jeremy Berke: Yeah, so it's actually really interesting what's happening. Just last night in Ohio, there was a big fight about in the state legislature. I think they were in [00:18:00] session till two or three o'clock in the morning, battling over this Mike DeWine, Ohio's Republican governor has not been a friend to the cannabis industry, but to his credit, basically made a statement saying. Ohio voters voted for this, I'm gonna do my best to implement the law in a safe way as possible. To his credit, that was the standpoint. But him and Ohio Republicans have basically looked for any avenue possible to roll back legalization in the state, or at least tighten restrictions and tighten regulations around it.
And so they're looking at this hemp ban and saying, let's harmonize Ohio's policy with federal policy. Makes sense on its face. Sure. But at the same time, there's a lot of consumer demand for these products. And it's gonna be interesting to see the result of that fight. I believe, and I have to double check because I haven't looked at the news today, but I believe that the hemp ban was ultimately struck from the bill in Ohio.
I imagine that Kentucky where Senator Rand Paul is from, who's been a friend in the hemp industry and where much of. The hemp is grown frankly [00:19:00] in, in the US right now. I imagine they will create some carve outs. Those carve outs might be age gating and pesticide testing.
The other sort of, pretty common sense regulations that, that they may put on it. Texas is another interesting state. Texas tried. Very hard. Texas Republicans tried very hard to ban hemp in the state. The governor ultimately looked at it as a futile effort. It failed in the house three times.
And he said, look, if we're not gonna able to ban it, let's create regulations around it. So I imagine that's what's gonna happen in most states. The products are already there. States are already getting comfortable and getting used to being in direct violation of federal law on the cannabis issue.
So why would that be different than hemp, I think is what a lot of. Policy makers are saying and look like they all want the tax revenue. They all want the job growth. They all want to be able to look at their constituents and say, look at your job. Do you like your job? Do you like the products?
Do you like the shiny new road that, that we paid for out of this hemp revenue? And so ultimately I think that's gonna be the forcing factor. But we'll see. I think it. Anytime cannabis policy [00:20:00] hits the federal sphere, it breaks containment. And, parties on both sides want to use that as a springboard to getting their own version of policy passed.
And we will see. But I imagine that most states will try at least to carve out, what they see as the responsible actors versus the irresponsible actors. Maybe saying that low dose hemp derived THC beverages can stay on. Circle K shelves. But Delta eight synthetic products can't be sold in gas stations or something like that.
I imagine that's where regulations are headed.
Tommy Truong: It sucks though because now the hemp industry will have the same problems as the cannabis industry.
Jeremy Berke: Look, I, I think you hit the nail on the head and the broader point here is that there needs to be coherent regulations, right? Hemp and flower is a legal distinction. It's not a scientific distinction. The smart thing to do would be for Congress and look, I know Congress is Congress, I, I.
I'm sitting here telling the federal government what to do. Of course they're not gonna listen to me. but the smart thing to do would be to regulate THC as [00:21:00] THC. And I'm not sure what that means. They're gonna have to debate that and negotiate over it, but it could mean, let's let states set their own policies when it comes to THC.
And some states will say no. They'll be dry effectively. Some states will say, we only want low dose beverages, and some states will go down the pathway of having regulated cannabis dispensaries like New York or California, Colorado, et cetera. And so I think that would be the smart thing to do. But right now hemp has now been put.
Hemp, I guess hemp derived THC has now been put back on the same playing field as cannabis. And I think there's a lot of people in the traditional cannabis industry, the state regulated cannabis industry, that, that wanted to see that. And I do see their point, like there is a level of fairness that they want in terms of taxation compliance and all those things at the same time it certainly is gonna make investors shy away from the cannabis industry again.
It's certainly not favorable for consumer adoption and I just can't really sit here as a journalist who's covered the space for so long and see any sort of prohibition on [00:22:00] THC being a good thing for the progress of cannabis legalization.
Tommy Truong: Yeah. Speaking of states I'm on your, I'm on Cultivate right now, and you guys have an article on. The 26th ballot in Florida.
Jeremy Berke: Yes. Florida has had a, again I think this is a common theme of discussion, a very haphazard progress towards cannabis legalization over the last few years. Amendment three was on the ballot last November in the presidential election that would've legalized cannabis in the state.
It actually received a majority. Approval by Floridians. I think the number came in around 56, almost 57%. But Florida has a 60% threat, 60%, excuse me, threshold for ballot measures to pass. And so ultimately it failed. The campaign behind Amendment three. Smart and Safe Florida has been funded by big cannabis companies like Tru Leave and others.
They're trying again, right? And they have. Now collected enough signatures to get the ballot to a Supreme Court and financial review, which is basically a key [00:23:00] stepping stone to getting it back on the ballot in 26. But 26 isn't a presidential election year. The midterms see lower turnout.
And it's gonna be interesting to see what happens. I think clearly Floridians want this also. Clearly, Ron DeSantis, the governor of Florida, did not want this. He fought tooth and nail against it. And in a midterm election year. With the governor's disapproval of the ballot measure I wouldn't bet on my chances of it passing at the same time, for any ballot measure to get 56, 50 7% support.
It, it is a big accomplishment and so clearly it is a popular issue. And personally, I don't know what to expect but for the industry in terms of the market it it creates a lot of new potential cannabis consumers in Florida, which has an aging population, millions and millions of people, and millions of people who have, enough discretionary income to spend on cannabis.
And so I think the industry really wants it to happen.
Tommy Truong: Do you know of other states? There's what 30, there's what, 34 states right now or ish? That what about the states that don't have [00:24:00] medical or legalization?
Jeremy Berke: Yeah it'll be interesting to see. I think that, I'm trying to choose my words carefully here because. The states, by and large, that don't have medical or adult use. Recreational legalization are red states at this point. And I don't see cannabis legalization becoming a winning issue in heavily red states anywhere.
They may get support, they may get close to 50% support, but ultimately the majority is going to vote against cannabis civilization. And getting legalization passed via ballot measures, I think is probably not the pathway in a state like, I don't know, Texas, let's say.
Tommy Truong: What about a state like Pennsylvania?
Jeremy Berke: Yeah. Look I, I am I was strictly being coy about Pennsylvania because look like it's a purple state. Josh Shapiro, the governor is. Very pro legalization, but it's also been extremely difficult for the legislature to come together and [00:25:00] actually deliver a bill to his desk. I don't know enough about the nuances of Pennsylvania's legislature.
I would put the handicap much higher on, on Pennsylvania than. Oklahoma switching from medical to recreational, right? but ultimately, like when it's a legislature passed bill versus a ballot measure, it becomes political and it's a football that gets negotiated against. And so the will has to be there for lawmakers, and I think Pennsylvania's will maybe there, but I expected it to happen.
Last year and it didn't. And I don't wanna be held accountable to make it a prediction that may not be true. I think another interesting state is Virginia the incoming governor has said, Virginia did pass legalization. It's effectively decriminalized the incoming governor wants to regulate the industry.
And it'll be interesting to see what regulations Virginia delivers to her desk because the previous, or I guess he's still the governor, but the current governor has. Vetoed twice now legislation to legalize cannabis in the state. And it'll be interesting to see what happens. I think the last piece I'll say on this is that I do see, in terms of [00:26:00] Texas, I don't ever see Texas putting cannabis on a ballot as a straight up and down vote.
I don't really see the legislature deciding to regulate dispensaries. But what is happening now is the governor is directing. The state to come up with regulations around cannabis beverages. And so I think the hemp ban is gonna force states to come up with regulations or products that already exist and are already there.
And so that model may be something that red states do. And, they may never have dispensaries, but they may have, cannabis beverages and gas stations or something like that, that's certainly a model that could happen.
Tommy Truong: It's like a silver lining,
Jeremy Berke: it could be, I don't know but look like, if you can go to Dallas, Texas or Houston, Texas and buy a THC beverage, I think that that's a world that no one would've ever expected.
We'd be in 25 years ago, let's say. I.
Tommy Truong: Yeah. Who would if that happens and they're at the forefront of the, legalizing hemp to a certain degree, who would've thought.
Jeremy Berke: Exactly. Who [00:27:00] would've thought? And I think that's the thing about covering ation is it looks like, I think. It looks like this is a settled issue, right? Canada legalized cannabis and the sky certainly has not fallen in Canada. It's a vastly popular issue on both sides of the political spectrum, although support has declined for republicans recently.
But it really isn't. And legalizing cannabis is really complex. It's really nuanced and. Attitudes and ideas do change once cannabis is in people's communities. Some people like it, they see the skies and fallen, and some people don't like it. And those, some of those reasons are good reasons, and some of those reasons are stuck in the 1980s.
And it I think it's a fascinating policy area to cover because, it's always surprising, right? I think prior to the farm bill passing, no one ever expected there to be, like you said. THC beverages in Texas until there were, and now there are, and now it's effectively normal.
And the governor's throwing his hands up and saying, if we can't beat him, join him. Let's regulate this. And so that's a fascinating process.
Tommy Truong: Is there [00:28:00] any news or movement on rescheduling.
Jeremy Berke: YY i, again I laugh because the last news, substantive news we got on rescheduling was in August when President Trump made an offhand remark saying he's gonna make a decision in the next few weeks. It's now November 20th. A few weeks has certainly expired. I don't know.
And, I really wish I did know. I don't know. I think the. Political undercurrent that makes rescheduling good policy for Trump and the Republicans right now certainly exists. They're losing support among young people post the elections. Earlier this month, like it, it's looking like the midterms are gonna be very tough for the Republicans.
There's a lot of seats in play in the house and potentially in the Senate that they didn't think were gonna be in play. And so doing something popular like rescheduling may help them. It could also be something that they run in the midterms on saying, look we're gonna do this if you, if we can keep our majority.
I haven't really seen much of that. So the poli the political underlying current is certainly there. [00:29:00] That being said, Trump is a Republican. He's, I think he's 80 years old or 79 years old. I don't think this is his issue. And if it's not his issue he's got his hands full with a lot of things.
It's very complicated to do. I don't know. And I'm saying this I just really don't know. The other piece I'll say on that, Sarah Carter who is gonna take the O-N-D-C-P office, which is basically the White House drug star. She has a confirmation hearing coming up where these questions will come up.
And so we'll get a little bit more clarity both about her thinking and the administration's thinking through those confirmation hearings. But I haven't seen anything. say, oh, it's coming around the corner. I think it's possible that we go through all of Trump's administration and we have no substantive movement on federal cannabis reform other than this hemp ban.
And that's the wrong direction. But look, the president is Donald Trump. He could wake up tomorrow and say, let's do this. And so that's why when I say, I don't know. I really don't know
Tommy Truong: That's what I think too, because [00:30:00] although he is Republican, he's more of a moderate in terms of his policy.
Jeremy Berke: He is, and he wants young people. And I think, I do think there's a world and this is not based on my reporting. This is really my own thinking. There is a world where he says, I'm gonna reschedule medical cannabis. Not recreational. And I think, he's probably hearing it from other seniors on the golf course in Florida where like they, they use edibles for the joint pain.
It helps 'em golf in the morning, et cetera. Like he, he is getting that input. but I just, I think he's surrounded by people that, that look at cannabis as a drug. Don't like drugs, think drugs are bad. So it'll be interesting to see. But I do think there's a world in which they rephrase rescheduling to be just for medical cannabis.
That being said, I think my earlier point still stands that the politics for him are very favorable to move on this issue. And it's just a matter of doing so.
Tommy Truong: Yeah. What else is in the news?
Jeremy Berke: That. Yeah. What else is in the [00:31:00] news? I think that's about it, right? I think the rescheduling story, if it heats up, is gonna be the biggest one. New York is always a fascinating market. The hemp ban we're gonna be unraveling the effects of this hemp ban, I think for the next 360 days or, what is it, 3 57 days now.
So to me those are the most pertinent issues. I would say, some of the other issues that I think are interesting and this is a little bit particular to New York, are, product inversion. New York had a big scandal around product inversion, meaning basically out-of-state cannabis being laundered as in-state cannabis and sold in dispensaries.
So I think a lot of compliance issues are gonna come up in New York as a result of the scandal. That'll be interesting to watch. In California, I would say some things that I thought were interesting. San Francisco, I think it was yesterday or possibly on Tuesday, San Francisco City Council decided to push out implementing a municipal tax on cannabis dispensaries.
And so I think that was an interesting realization that [00:32:00] maybe, huh, this industry is wildly overtaxed. And all these policy goals that, that they wanted from cannabis utilization, tax revenue for education and roads. Eroding the illicit market consumer safety, all those things don't work when consumers are still buying from the illicit market.
And so I think there was some sort of interesting realization there from, municipal, policy makers in San Francisco as well as the California government that like. Maybe this isn't working. And that's honestly and I'm not saying this lightly, like that's the first time I've seen that from the state of California because it really should be a leader in the industry.
And it's absolutely not. And because it's just so heavily taxed, compliance is so difficult. And so I'm interested to see if, I'm being wildly optimistic and things will change or they're gonna fall back into the same pattern.
Tommy Truong: California is. I feel like sometimes when I think about California, I feel as though I'm living in the upside down world. That makes sense.
Jeremy Berke: [00:33:00] A thousand percent. Yeah. It makes sense. It, look it's what happens like. I, I'm a journalist. I'm not supposed to be political. Like I, I am, I'm very progressive in my politics, right? But the story of California's cannabis industry to me, as someone sitting on the opposite coast, you can, correct me if I'm wrong but it's what happens when progressive ideas meet a progressive economy, right?
So you have a very progressive idea, like legalization to create economic growth for criminal justice reform. But then it meets California's taxes, California's compliance costs, and all the sort of local. And state laws layered on top of each other that basically make doing business impossible. And so that, that to me is the story.
And I hope that I hope there is some industry friendly reform and I think what we saw out of San Francisco this week may be a positive step in that direction.
Tommy Truong: Definitely. Before I let you go, Jeremy, actually I should ask you if you were, knowing what you know, if you were to open up a cannabis business today, what state would you choose?
Jeremy Berke: Oh God. That's [00:34:00] a really good question. I'm gonna take the terrible answer and say I probably wouldn't open a cannabis dispensary knowing what I know. I think, yeah. Yeah. I think there's a lot of other businesses that I might be better off operating in. That being said, I would open. Not Michigan because Michigan is having a lot of price compression issues. I would look. To open right on the border of a state that does not have legalization. So I would say, and this is, I dunno if this is a common answer but maybe like Colorado on the Utah border or something like that.
So I, my addressable market becomes very big and I know Colorado has its own challenges every state does. But at least you can get. Those out-of-state customers. I think those are often the highest performing dispensaries. Maybe Missouri I think would be another choice. But look, this is a very difficult industry to operate in.
I certainly would not choose New York or California. Let's put it that way.
Tommy Truong: Yeah, I say it all the time. I do not [00:35:00] envy. Operators, they do such an amazing job. They're you have to be so persistent and so okay with uncertainty to be successful in this industry that, it's, I we just have to support them as much as possible.
Jeremy Berke: I, I agree. Look I totally agree and, operating any business is very difficult. But cannabis is super, super hard. It just contends with challenges that no other business. I think I can, I. Think of in my head face. They compete with the illicit market, the product.
There's a lot of substitution with what cannabis is. And so you can easily get the same product for cheaper. On the illicit market. There's really heavy compliance costs, really heavy regulations. The laws are very difficult. There's a lack of capital. There's all these things that make this such a difficult business, and I think to your point, you really have to be passionate to to want to do this.
Tommy Truong: Yeah, I make it a point to always buy legal to do.
Jeremy Berke: Me too. Even though it doesn't, it hurts my wallet a little bit, but I, I always buy legal, especially in New [00:36:00] York.
Tommy Truong: Take it the state. We have a segment called Rolling Out Where I'll there's rapid fire questions on cannabis.
Jeremy Berke: Okay.
Tommy Truong: You ready?
Jeremy Berke: Yeah. Let's do it. Yeah.
Tommy Truong: Okay. Are you a daytime or a nighttime person?
Jeremy Berke: Nighttime.
Tommy Truong: flower Edible or vape?
Jeremy Berke: Edibles only because I I'm in my thirties now and I'm getting a little worried about my health. I think my favorite consumption method is a big joint.
Tommy Truong: What's your favorite strain?
Jeremy Berke: I like things that lean a little bit heady. Hybrids, I dunno if I have a favorite strain, but I think the og like headband blue dream that used to get in the late 2010s. Like I, I haven't really been able to. Find stuff like that in the legal market yet, although maybe I'm not looking in the right places because most of my consumption is, has been edible these days.
But I would say yeah, headband Blue Dream. I, I. Used to smoke a lot of sour diesel in college just because we had a [00:37:00] grower who had that, that strain and it was awesome. But yeah, I like it to be a little bit headier more than like just a straight body high. That being said, like the purpley indica, like any sort of purpley indica, that's like taste delicious is something I'll go for too.
Tommy Truong: New York or Toronto in terms of cannabis.
Jeremy Berke: That's a hard question. Damn. I, I wanna say, I wanna give the tip to Toronto for only because it was, it moved way ahead of New York, right? Cannabis was legal in Toronto, years ahead of New York. I think there's a lot of, especially pre legalization, there's a lot of interesting growers even in Ontario, but especially.
The cannabis we got from BC was really high quality. So I'm gonna give the slight edge to Toronto. That being said, I think New York has a really interesting, micro growing scene going on right now. And it's only getting better.
Tommy Truong: Yeah, and New York is just getting started.
Jeremy Berke: It's just getting started, right? So I [00:38:00] maybe ask me in a year and I'll have a different answer.
Tommy Truong: What was your first experience with cannabis?
Jeremy Berke: I was way too young. I didn't know it was gonna be a career path. But I was 14 years old at a house party with my older brother and his friends who were 17, and they thought it was funny to get me high, and I did too.
Tommy Truong: Hope. Hopefully your parents are not listening.
Jeremy Berke: They knew about it. They were not happy.
Tommy Truong: Your worst experience,
Jeremy Berke: I don't I don't have bad experiences. I love weed.
Tommy Truong: your best memory.
Jeremy Berke: Okay. I don't know if this is my best memory but it's a good one. So I quit smoking weed for a little bit because of a prior job drug tested me. And then as soon as I, I passed the drug test, it was right when the first mad Max movie came out. I don't know if you've seen it, it's.
Really awesome. One of my favorite movies ever. And so I got really high with one of my friends. We went to the premiere in Brooklyn, and it was like the first time I've gotten high in a few months and the movie absolutely blew my mind. It just sticks out in my head as just that was the best night ever.
Tommy Truong: That reminds me an opposite [00:39:00] experience. Have you seen the movie Inception?
Jeremy Berke: Oh, of course. Yeah. Yeah, of course.
Tommy Truong: I'm sitting there for the first 20 minutes. I'm like, I am way too high for this. What is going on?
Jeremy Berke: What is going on?
Tommy Truong: What the heck is going on in 30 seconds, can you explain what is Cultivated News?
Jeremy Berke: Cultivated News is the daily cannabis industry briefing for professionals in the cannabis industry. We have a daily newsletter, daily live streams, and we try and surface the best reporting possible about the industry.
Tommy Truong: If our listeners wanted to get in touch with you, how can they?
Jeremy Berke: Yeah. So first off I'll do a plug, subscribe to Cultivated. You'll enjoy giving it's space in your inbox, www Cultivated News. You can find me on Twitter x Jeremy Burke and LinkedIn is probably the best place to find me.
Tommy Truong: Jeremy, thank you so much for joining me today.
Jeremy Berke: Yeah, thanks so much. This is a blast.
Outro: Thanks for listening to the Kaya Cast Podcast. We hope you enjoyed the show. Don't forget to subscribe to our [00:40:00] podcast in your favorite podcast or visit our website.
