Even though recreational marijuana is now legal in multiple U.S. states, starting a dispensary is incredibly difficult. Most banks still won’t work with marijuana-related businesses, and the paperwork required to start a shop is onerous, to say the least.
Now a company called Medbox is making a business of dealing with the bureaucratic and design work required to start a dispensary–and then partnering with others to open them.
Medbox is, in other words, something of a marijuana dispensary factory, churning out custom-made storefronts for anyone interested in getting in on the weed revolution (and with retail cannabis sales expected to rise from at least $2.2 in 2014 to up to $8.2 billion in 2018, it really is a revolution). The company’s latest dispensary: Stem, a 3,000-square-foot storefront in Portland, Oregon, where recreational marijuana is newly legal.
Medbox, which is now led by Guy Marsala, a former Army captain who has worked with Fortune 500 companies, didn’t start out in the dispensary business. When the co-founders created the company, then called Mindful Eye, the idea was very different: to create a machine that allowed people to download movies from a flash drive.
In 2010, seeing an opportunity in the marijuana sector, the business morphed into Medbox, which launched with marijuana vending machine as its first product. The product, described by Businessweek as looking like a Redbox DVD dispenser that’s “black, refrigerated, and armored,” still exists. But now it’s one of a number of offerings for super-secure products for marijuana storage and sale–all of which can be integrated into Medbox’s dispensaries.
“We partner with operators from A to Z. We go all the way back to applying for a license, obtaining a lease for the property, building out a space, then turning over a turnkey operation, partnering with operators to provide management, training, oversight, and compliance,” says Marsala, chairman and CEO of Medbox.
Marsala just joined over the company this past July. Before he came onboard, Medbox would obtain a license for a dispensary, build out the space, sell the license, and be done with it in exchange for a one-time fee. Now, the company works with its dispensary operators on an ongoing basis.
Medbox has helped over 400 clients navigate the dispensary licensing process in the US, and it has 36 license applications for dispensaries and marijuana cultivation in various stages of approval in Illinois, Nevada, California, Oregon, and Washington. There’s a decent chance that when you visit a dispensary in the near future, Medbox will have had something to do with it.
The company hasn’t made inroads in Colorado, even though the state is the furthest along in the recreational marijuana legalization process. “There are lots of people trying to open recreational retail stores there. It’s crowded in terms of people trampling each other for those opportunities,” says Marsala. He believes that Medbox’s services could still be useful there: “There’s a difference between opening a mom-and-pop shop versus one in a professional systemized environment.”
The growing recreational marijuana movement doesn’t seem to be slowing down, but it could easily be derailed by a more conservative federal government. Still, Marsala is confident about the company’s future. “This is the biggest growth industry since high tech,” he says.