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Arcview Group’s Jeanne Sullivan on Diversifying the Industry, Innovation News, and Partner Spotlight | The Latest from Azuca
From tech veteran to cannabis advisor, investor and legalization activist, Jeanne M. Sullivan is on a mission to revolutionize the industry. As part of The Arcview Group, the first and largest group of high-net-worth cannabis investors, with more than $280 million invested so far, Jeanne is on a quest to advocate for inclusion and diversity in the industry. Learn why Forbes cited Jeanne as “one of the women VCs changing the world,” how she opens doors for female entrepreneurs, and her take on the industry as legalization comes to the East Coast. This issue features Azuca’s latest product release, our high-capacity TiME INFUSION™ ACTIVATOR, plus updates on upcoming events, partner news, and a review of recent legalization efforts across the nation.
8 Questions with Jeanne M. Sullivan, Chief Inspiration Officer of The Arcview Group and cannabis activist
Q: Prior to getting involved in the cannabis industry, you were a tech investor. How did you first break into the cannabis space and what drew you in?
I love sharing the story. I am VERY accidental and gave my kids “hell” for smoking when they were in high school. They think I am the coolest mother in the world as I fill their Christmas stockings with cannabis goodies (they are adults now with kids!). In 2014, New York passed the Compassionate Care Act – and we became investors in one of the TEN license owners in the State and my husband joined the operating team. Around the same time, I read cannabis rights activist and Arcview partner Steve DeAngelo‘s book, The Cannabis Manifesto, and was appalled to learn that we still arrest 600,000 Brown and Black men and boys for mere possession of cannabis. WHAT? Being a long-time VC in tech, I could see “this is the next big thing.” I said, “I better learn this stuff” and started immersing myself in the industry by going to MJBizCon in Las Vegas. Troy Dayton, co-founder of The Arcview Group found me and put a net over my head. He liked my many years as a classical investor and I helped curate, manage, moderate and speak at more than 20 Arcview events in the next several years.
What I love the most about working in the cannabis space is the opportunity to change the game on the draconian social justice issues. I love the opportunity to be part of a nascent industry that creates wellness and wealth. I also love the technology, the science, and extraordinary entrepreneurs and business owners who are building this sector. I have never been so professionally fulfilled.
Q: You have said in the past that one of your primary goals is to support cannabis entrepreneurs as the industry develops, what are some ways in which you do this?
We have built an investment platform under the Arcview umbrella and we will be building more opportunities for investors. Every week I meet with entrepreneurs to take a look for our fund. But if I meet someone – especially a woman-founded company, I will go out of my way to connect her, to support her, to invest, to advise. I want to build the ranks of successful women-owned companies in the cannabis sector. I want our sector to invest more than the 2.2% that goes to women in traditional venture capital. I want our boards and our executive committees to be filled by the dynamic and experienced women that I meet every week.
Q: From the mind of an investor, what do you think are some of the most important financial considerations lawmakers must take into account when crafting cannabis legislation in order to encourage entrepreneurs to get involved and make that initial investment?
I remain hopeful that New York will set the gold standard for supporting entrepreneurs who are in pursuit of licenses. There is consideration for funding sources slated for social equity applicants. The current MRTA statute has left it vague on the investment amounts directed towards a cannabis entrepreneur seeking a NY license, but we do NOT want this limited. We would like to set aside a fund and invest in many entrepreneurs for opportunities in the Northeast. We would also like to see legislation that helps a start-up entrepreneur secure a lease for real estate. Another major issue: We want to see fairness around the tax structure. If the taxes are out of balance, the “dual market” will thrive.
Q: Give us your biggest hot take on the current state of the industry.
The industry is growing up. Investors are smarter – entrepreneurs are more seasoned and experienced. It is painful to me that we, as a country, have not taken the steps for SAFE banking, for descheduling cannabis, for dismantling the 50-state fiefdom that we have created. We have a long way to go: We need research to solve important medical/health issues; we need to understand the efficacy of the products, we need to make FDA oversight an easy and frictionless issue.
Q: After years of the cannabis scene being concentrated on the West Coast, we are now seeing an “east coast wave” with states like New York legalizing cannabis for adult-use. What is the significance of this gravitational shift in the industry and what do you think are some obstacles still facing New York’s adult-use rollout?
The wave is rolling towards the Northeast. New York is finally writing the regulations and will issue the applications for cannabis licenses this year. It’s an exciting time because I believe New York will become the global center of the cannabis world over time. However, we must be mindful of the lessons from California and other states that created regulatory messes and a large dual market. We are concerned about high tax rates, and about regulatory barriers. We need to make funding of enterprising entrepreneurs and business leaders easier and open. We want a thriving entrepreneurial culture to prevail.
Q: What are 3 tips you would share with a cannabis company seeking investors?
- Surround yourself with smart, experienced people who know “what to do and how to do it.”
- Understand the focus, stage, strategy and geography of the investor – do they want what you are building?
- Understand the numbers – capital needs over time, OpEx and CapEx in the first 18 months, reasonable revenue plans
My favorite proverb: “If you want to go fast, go alone. If you want to go far, go together.”
Q: From an investor’s perspective, what are the most important things to consider and look for when selecting brands to support?
- The go-to-market strategy is critical – Does this CEO and team know how to build market momentum and customer acquisition?
- What is the state expansion plan and how will they achieve that plan? Does this team understand the best practices to create the greatest margin?
- What is the TAM (total available market) for this brand: Who is the target customer? What is the future for this product over the next 3 – 5 years?
Q: How can more women enter the cannabis entrepreneurial space? Are you seeing more women get involved in the industry?
Long before cannabis, I have had a focus on supporting women-founded companies. I am still on the Board of Trustees of Astia, where we have funded more than 100 rounds of financing for women-owned companies and built a fund with that strategy.
We want our cannabis industry to be diverse and not the “bro” culture of the tech industry. How do we achieve that? By bringing in women from finance, health care, marketing, technology, and encouraging them to join our sector. We need men and women supporting women to join our industry. Companies led by men must have an eye towards diversity and inclusion – on their boards and in the C-Suite.
Jeanne M. Sullivan is an advisor, investor and sought-after speaker in the cannabis sector. She is the CIO of Arcview Ventures and co-founder of the Arcview Collective Fund. Formerly, Sullivan co-founded a NYC-based tech venture capital fund with $400 million under management. Sullivan has been a member of the Women’s Leadership Board at the Harvard Kennedy School and is an Athena Entrepreneur Fellow for Barnard College. She also serves on the Global Board of Trustees of Astia, funding high-growth women entrepreneurs. The New York Hall of Science honored Sullivan for her work inspiring girls and women in science, technology (STEM) sectors. Sullivan also serves on its Board of Trustees.
News from Azuca
Introducing TiME INFUSION™ ACTIVATOR FORMULA D2
The next generation of AZUCA TiME INFUSION™ is here!. In January Azuca launched its newest fast-acting infusion formula for edibles manufacturers, TiME INFUSION™ Activator Formula D2. Azuca’s new patent-pending infusion process is now available with 3x higher cannabinoid capacity than the original D1 formula, and is the most simple and scalable manufacturing solution for fast-acting gummies, beverages, baked goods, pressed tabs, syrups, and more. Learn more here.
Catch Azuca at Lucky Leaf Albuquerque
Azuca Co-Founder and CEO Kim Sanchez Rael and Founder and Chief Creative Officer Ron Silver will be featured speakers at the 2022 Lucky Leaf Cannabis Expo and Convention in Albuquerque. In addition to their roles as speakers, Ron will be conducting multiple cooking demonstrations on the show floor, walking attendees through the best practices in crafting chef-quality edibles using infused ingredients. If you’re in town, catch the full team at Booth #403 and grab a CBD-infused treat.
Azuca Partner Spotlight
Indiva Introduces Wana Quick Midnight Berry Gummies
Sweet dreams, Canada! Azuca partners Indiva and Wana Brands recently introduced Wana Quick Midnight Berry Indica gummies powered by AZUCA TiME INFUSION™ technology. Made with a custom blend of CBN, CBD, and THC, these gummies are best consumed at night thanks to the proprietary indica terpene blend, which has over 30 specialized terpenes recommended for nighttime use. Wana Quick Midnight Berry is now available at Indiva locations in Ontario, British Columbia and Alberta, and will soon be heading to Saskatchewan and Manitoba. Learn more here.
Federal: As more states legalize the medical and recreational use of cannabis, Senate leaders plan to introduce a bill that approves use at the federal level, which is typically where legalization efforts are hindered. The proposal also addresses the decriminalization of marijuana by allowing people to petition for resentencing and giving states the right to set their own criminal policies.
Mississippi:The governor of Mississippi signed a bill to legalize medical cannabis earlier this month, making the state the 37th to enact the policy change in the country. The original bill allowed people with debilitating health conditions to purchase up to 5 ounces of cannabis per month. However, the state Senate reduced that number to 3 ounces. Under the new law, dispensaries are set to be licensed in about six months, meaning Mississippi’s medical cannabis program could be up and running, at least in limited form, by the end of the year if all goes smoothly.
South Carolina: South Carolina Senate has approved a medical cannabis legalization bill for the third time, sending the reform measure to the House of Representatives for consideration. As amended and passed in the Senate, S. 150 would allow patients with qualifying conditions to possess and purchase cannabis products from licensed dispensaries.