Episode 101

Karim Webb Brings Sauce to Social Equity

Mar 23, 2020 | Length: 37m 41s

Karim Webb is best known for opening California’s first Buffalo Wild Wings. In February, the restaurateur sat down with Alex and Donnell to explain 4thMVMT, his answer to what’s been ailing social equity.

4thMVMT
www.4thmvmt.com

Karim Webb on Instagram
www.instagram.com/karimwebb/?hl=en

Alex Halperin’s Cannabis Dictionary
weedweekreports.com/the-cannabis-di…-alex-halperin/

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This transcript has been lightly edited for clarity.

Podcast transcript

Alex Halperin (00:10):
Welcome to WeedWeek. I’m Alex Halperin.

Donnell Alexander (00:11):
And I’m Donnell Alexander.

Alex Halperin (00:14):
This is the WeedWeek podcast. You can subscribe to our free newsletters, WeedWeek, WeedWeek California and WeedWeek Canada all at weedweek.net and you can find us on Twitter and Instagram @weedweeknews. Got any feedback? Write to us at hello@weedweek.net and you can also subscribe and review or like this podcast on SoundCloud, Stitcher, and especially iTunes, which helps new folks find it.

Donnell Alexander (00:37):
Joining this week is Karim Webb and we’ve had some social equity people on here. He’s a different kind of cat. I mean we’ve had people on with money before. I’m always glad to have that, but Karim comes from, well, you’ll hear his story. I don’t like to blow up stories because they’re kind of funny. What’d you think of him?

Alex Halperin (00:53):
I think he’s a really sharp guy. I have sometimes criticized that sometimes I think people’s hopes and plans for equity and accompanying generational wealth have a little bit of a pie in the sky feel to them and Karim’s plan I think is very grounded in impossibility. He really has a lot of the expertise needed and I think his ideas are really sharp.

Donnell Alexander (01:22):
Ideas are one thing. Generational wealth is another, that is important, right?

Alex Halperin (01:26):
As a franchisee of Buffalo Wild Wings, he knows how to run a business.

Donnell Alexander (01:32):
Well, he knows how to run a business. And again, we don’t want to give away stuff, but that’s like the second major business that he had exposure to. And I think there’s a conversation within minority communities about people who have that kind of money getting in the mix. And he’s almost a role model for people who don’t need the money but for the people who have the money, he talked a little bit about the stigma of getting in initially and it’s a very real thing.

Alex Halperin (01:53):
But first we should probably talk about…

Donnell Alexander (01:57):
The bigger, broader problems?

Alex Halperin (01:58):
Well, this virus, right?

Donnell Alexander (02:00):
Let’s talk about Spannabis and some of the other places that have been affected by the virus.

Alex Halperin (02:06):
You know, the Coronavirus seems to be shutting down the country and shutting down the world and in a lot of ways and shutting down all kinds of large gatherings and that applies to the cannabis industry as well. And it’s everything from cannabis conferences in Israel, then called CANNAtalk, one in Barcelona called Spannabis, as well as things closer to home, Hall of Flowers in Cathedral City.

Donnell Alexander (02:32):
What are the echoing effects of closing down these events?

Alex Halperin (02:35):
I’m not exactly sure. Certainly, for the people hosting these events, they’re gonna lose a lot of money. What the ripple effects are through the industry. It’s harder to say because he got to figure that people being forced to spend a lot more time at home, with not that much to do, that’s gotta be good for cannabis sale.

Donnell Alexander (02:57):
Yes, that’s true. Well, I’m thinking more like, are we in a postponement situation for Hollow Flowers or are we canceling? I know I’m asking you to speculate, but what do you see down the road? Like in the summer?

Alex Halperin (03:08):
I mean, I have no idea what’s going to happen to the virus, I mean, I’m sure the companies putting them on are eager to reschedule them and host future events they’ve been planning and stuff like that. We were very lucky. We really got the Weedies Awards right under the wire.

Donnell Alexander (03:28):
I didn’t even think about that. Okay, I’m gonna put you on the spot then. We know what the value is to the people who put them on and they’re gonna take bad obviously. But in terms of what actually happens at these cannabis events, what is the value of them? I mean, do we miss them if they don’t happen?

Alex Halperin (03:42):
That’s a good question. I’ve been going to cannabis events for more than five years. What is the value for them? I think it really depends on who you are and what you’re trying to get out of them.

Donnell Alexander (03:56):
Who’s it good for?

Alex Halperin (03:58):
If you’re selling, it’s a great place to get in the same room with a lot of the people you’re selling to. If you’re a journalist, it’s good to just sort of catch up with people and sort of see what’s going on with them. And you know, potentially it leads to stories, but journalists can find stories elsewhere and presumably salespeople can find stores elsewhere.

Donnell Alexander (04:21):
Well, one last question. I’m not saying worst case scenario, but bad case scenario. Say we don’t have six months of these cannabis events and conferences. Does anything change?

Alex Halperin (04:31):
I don’t know. And it’s not just cannabis events of course. Their audits are to cannabis adjacent events like South by Southwest has been canceled, the Ultra Music Festival in Miami, that’s an electronic music festival.

Donnell Alexander (04:44):
We’re looking forward to the big event in San Francisco at Golden Gate Park, the Big Music festival that just got licensed for cannabis.

Alex Halperin (04:52):
Is it Outerlands?

Donnell Alexander (04:53):
Outside Lands.

Alex Halperin (04:55):
So that’s a summer event.

Donnell Alexander (04:56):
You got to believe that the vendors and the people who put on that amount are thinking about it.

Alex Halperin (05:00):
Right. So you know, there’s clearly a lot of lost money. However, I think for the people actually buying cannabis, cannabis to a degree is recession proof and virus proof.

Donnell Alexander (05:12):
I’m not going to say any names, but I ran into someone a couple hours ago who was getting a bunch of pot to put in the freezer right now. So we might see a spike.

Alex Halperin (05:20):
Yeah, I mean is there going to be a pot shortage. If you have COVID, if you are tested and have it, you should certainly consult with a medical professional before using it. But it’s hard to imagine somebody saying, “I’m not going to buy cannabis because of this.” I think people are gonna buy more cannabis because of this.

Donnell Alexander (05:40):
We don’t give stock tips, but I’m imagining edibles will do really well right now. This is almost morbid, and we should probably stop talking about it because all of this is guesswork at this point. We should probably talk to someone with really concrete ideas right now and introduce Green Web.

Alex Halperin (05:54):
Alright. And just to be clear, we spoke with him before the scope of this problem was really unfurling, so we don’t really talk about that.

Song (06:03):
Back and forth then pushed stop on the tape. Then down the street, to 81st, place the kid. With the fat face with the fat case for sale. Ten dollars, if you were known. I put the turntable down for the microphone. I used to sell, mix tapes, but now I’m an MC. I got the rhymes and beats, I used to rock them tapes.

Donnell Alexander (06:33):
Karim Webb, welcome to WeedWeek.

Karim Webb (06:34):
Thank you for having me. I’m really grateful to be here and I appreciate the platform which you guys have developed.

Donnell Alexander (06:40):
And we’re working on it. Well, you’re developing a platform. That’s why you’re here. I guess we’re birds of a feather right here. Before we talk about 4thMVMT and how that’s different from all the other things we talked about in social equity, I wanted to get a little background from you. Just tell us about your father.

Karim Webb (06:55):
So I’ll tell you about my father and my mother really, which is the foundation of 4thMVMTand everything else that’s going on. They say that you return to which or from which you come. So my parents are both, you know, Los Angelenos mostly, both went to high school here, the South LA, both raised by single women. My father by his grandmother and my mom by her mom and both grew up without a lot of money. You would say that they grew up poor in one sense, but with a lot of love. And then my old man was in the military. He got out of the military in the early seventies, right place, right time. Got a job at an exploding retail concept as an assistant manager a concept called McDonald’s. And he started as an assistant manager at a McDonald’s in La Puente, California. And you know, several years later had become a vice president of the company and was responsible for all of Southern California. When I was 11 years old he came in my room and he said, “Son, you know, you could never inherit my job, but one day you might be able to inherit my business.” And so it was that corporate job that…

Donnell Alexander (08:18):
I got to stop you for a second. What did you take that to mean in the moment? Does that make sense to you as a kid?

Karim Webb (08:24):
Well, my dad was a hard driving man, at 11 years old what it meant was he’s about to stop being on the road with his corporate job. When I could get away with more, he’s going to be around the house a little bit more. So that’s what it meant to me at 11. But you know, I kind of matriculated through junior high and high school, and he had a sense of pride about your dad was the guy, your parents were the people that own McDonald’s, like his parents own McDonald’s or my friends would be spending the night at the house and if you spent night at my house, all went to work at McDonald’s on the weekends. I had friends in the drive through with me or sometimes he would have us washing windows. So you get your windows washed for free when you went through the drive through at McDonald’s at Pomona. So my business partner now in Buffalo Wild Wings can share stories about going to work at McDonald’s on the weekends because he was spending the night at our house. So we weren’t playing ball or playing basketball on the weekends or in the summers we were in the stores.

Donnell Alexander (09:31):
So is he the reason, you can talk about your mother too but are your parents reason that 4thMVMTis your thing.

Karim Webb (09:37):
Yeah, I mean, in terms of my father and his business acumen around franchising and the restaurant business for sure. And my mom, in terms of her steady approach, she was the accountant, she was an accountant. So she ran the office and did all the admin and the HR and the payroll and all the accounts payable. And my dad ran the operation. So it was a family business. They were both in it together. It was conversations at the breakfast table, the dinner table, on vacation. Driving to church. You know, because McDonald’s is a 24/7 business. And so the phone is always ringing. There’s always issues and you’re always at the foot of that learning about operating business and the importance of the PnL and how to drive profit and loss statement in your business and how to drive profitability and how to be community connected. So they were always very philanthropic and engaged not only in church but in all in community and schools in and around Pomona.

Donnell Alexander (10:39):
Okay. So take us to 4thMVMT. How does that background and your Buffalo Wild Wings thing? Because we need to talk about what takes you to this specific project.

Karim Webb (10:47):
Well I opened up a second Buffalo Wild Wings, this was in the Crenshaw District.

Donnell Alexander (10:55):
You just started one. What’s the origin of the Buffalo Wild Wings? How does that happen?

Karim Webb (11:00):
Well, I was in real estate. I had a client that was a former basketball player in Missouri. There were no Buffalo Wild Wings in Southern California and I was sworn out at a restaurant business having grown up in it and done it in my early twenties. I was in the real estate business and this client of mine, I had been approached about investing in a Buffalo Wild Wings and reached out to me and he was like, “Man, I know you know this business, would you check it out.?” And I was like, “Man, I’ll check it out. I don’t want to do it.” And I went to Vegas, I saw Buffalo Wild Wings. We were in the middle of Kobe and Shaq three peat and we were going to nightclubs in LA in order to go watch the games because there really wasn’t a sports bar culture here. So I went to Vegas, I saw Buffalo Wild Wings, I was like this is a home run. And the thing about McDonald’s I didn’t enjoy was my friends wouldn’t kick it with me. They were like, we are going to call you and be like, man, come up to McDonald’s and let’s hang out. So, I’m working 60 hour work weeks and not a place that I enjoy. And to this day a Buffalo Wild Wings there’s no day that goes by where I don’t have a friend call me saying like, what store are you at? Somebody’s looking for free chicken somewhere and a beer. So, it’s a place that I would go even if I didn’t own it, because I love the Lakers and the Dodgers and I’d hang out, eat wings and drink a beer. So, and it lent itself to my core competency. So, we got open our first store at Torrance, the second store was in the Crenshaw District at the Crenshaw mall and it lent itself to getting engaged philanthropically differently. I taught a class at Dorsey high school, entrepreneurial class, fell in love with that process. For an entire semester taught kids how to open up a pop-up restaurant. And then I got invited to be on the board at Southwest College, became the board chair shortly thereafter. Southwest college is in the middle of South LA. It is the Community College that really serves the core of South LA.

Donnell Alexander (12:53):
I have a friend who teaches there and it’s on a famous rap song. Maybe not a famous rap song, but remember that song I used to sell mixed tapes, but now I’m an MC, they talk about Southwest College.

Karim Webb (13:07):
So I was a board chair there for years. I’m still officially on the board and that lent itself to getting involved with loan. So it’s building lives of opportunities and options for men, black boys 12 to 18, who had had a brush with probation when we knew it was that 40% of all black males in California don’t graduate high school, and 90% of them go to prison. How could we reduce recidivism?

Alex Halperin (13:36):
You said 40% of black men in California don’t graduate high school?

Karim Webb (13:43):
Black boys, 4 out of 10 don’t graduate high school.

Alex Halperin (13:47):
And of those 90% will end up in prison.

Karim Webb (13:50):
And of that 40% that don’t graduate high school, 9of 10 will end up in prison by 23 years old.

Alex Halperin (13:55):
That is just crazy.

Karim Webb (13:57):
And so if they graduate from high school, only 10% go to prison. So like it’s this whole thing about opportunity and being locked out and kind of the weeding out process of life. And I was able to see like how little love it takes. I thought mentorship was this intense thing. You had to be somebody’s godfather or something in their life multiple times a week and checking out. It’s like no, human beings who are disenfranchised and through no fault of their own have been born into some of these loveless situations just need a glimmer of hope. There are so many human beings that are born in situations where if they look at their Instagram and see how everybody else is living, and then they see their set of circumstances, it’s easy for them to believe that God doesn’t love them. And if you believe that, then it’s hard for you to put your best foot forward every day.

Donnell Alexander (14:51):
So tell us how 4thMVMT is changing the worst parts of the situation.

Karim Webb (14:55):
Well, for us when we were reached out to, and I was a chief of staff of one of our City Councilman who called me and said, “Hey man, we love the way you do retail in the food business. We’re creating this opportunity around what we’re calling social equity and two thirds, all these licenses are going to go to folks from these communities, from communities that have been wronged by the war on drugs in a disproportionate way, cannabis arrests.” And to me it was fascinating.

Donnell Alexander (15:25):
When was this? How long ago was this?

Karim Webb (15:26):
This was like October, late October. I’ll never forget to call because I was sitting at a friend’s house in Portland. I was supposed to be there for an extra day and the guy called me and said, “Hey, would you come testify tomorrow at City Hall on behalf of local ownership?” And you know, people, when you’re entrepreneur, people know you, they call you and say, man, will you invest in this growth or I’m doing this. I’m like, man, look, I sell chicken and beer. I’m not interested in cannabis and really didn’t want to lend my name and my family name to it.

Donnell Alexander (15:55):
So let’s stop there for a second. Because when I thought you were interested in it, it seems like a world colliding situation. You were favorable to it? What was the process of you deciding?

Karim Webb (16:06):
I think I smoked a lot of weed in college. Morehouse College. I went to school at 1992 the chronic outlet dropped. I was popular on campus because we had to bomb like the LA cats.

Alex Halperin (16:19):
But was in Georgia? I mean that was pretty risky.

Karim Webb (16:22):
Yeah, I guess. But everybody’s smoking weed. I mean everybody, they were smoking dirt weed, and we had to bomb. So we were pretty popular. But I grew up, consuming wasn’t part of my regimen, you know what I mean? And I was focused on community development and being what I consider entrepreneurial activist, like leveraging entrepreneurism to give jobs to people who otherwise might not get them and to be able to you know, help change mindsets and kind of way of being and behaviors. So I was fascinated by this idea of social equity. Because to me it was like, all right, we’ve had specifically like African American policymakers in the city of LA and then as a businessperson, you really look at results like line items in a profit and loss statement. So if you looked at like household income, educational attainment and health outcomes, we’ve been doing worse, not better through the years. And the reason is because access to resources. In America, you got to have bread and the right morals and values and behavior to be able to consistently build wealth and which will reverse the trajectory of communities. So I said, well this is interesting it’s enough. Is the opportunity and maybe we can surround, take all the barriers away from exercising that opportunity at its highest level. So it’s like getting the license to me is not social equity. Social equity only happens when somebody gets the license they’re capitalized in a way and have the information to turn that license into a thriving business. Then they get the money and then they do the right things with the money and people actually live equitably in America, then you’ve got social equity. Otherwise what you have is you’ve got set aside licensing that will more than likely become distressed assets that people will sell for little amounts of money and be out of business and spend that money. And we won’t get improved results in community.

Donnell Alexander (18:41):
So, tell us about what you do.

Karim Webb (18:43):
So, our business 100% finance people.

Alex Halperin (18:47):
Just to be clear. 4thMVMTis a business. It’s not a nonprofit. It’s an investment fund?

Karim Webb (18:52):
No. We raised 15.2 million bucks up to this point. Our investors expect a return on investment.

Alex Halperin (18:59):
So who are your investors like? What kinds of people? if you can say specifically.

Karim Webb (19:03):
Oh, they’re celebrities. We are really supported, especially at the very beginning by the Los Angeles Venture Capital Community. Almost all VCs and some family office. There are some impact investors and then there’s individuals. So what we do, 4thMVMT does is it goes out and it recruits people that may qualify for the program. So like in LA we talked to 700 people I talked to personally in groups of 50 and talk to them about what social equity is and how you could qualify for social equity. Then we developed a software that would allow people to kind of submit their information so we could vet that they really qualify. Then we interview people and kind of brief interviews to kind of determine, even our base line of acumen and, is this person reasonably with some training, might be able to operate at a high level? And then we trained 120 people for over a year here in LA and we send everybody to the Landmark Forum, which is like a three-day personal development seminar. And we do all of this training like 10 hours of homework every week, because people don’t put any money in, so it was not asking you for money for the training, but I need to see that you’re personally committed and we need to measure because we want to give the people the opportunity first who show up the best because that’s what’s most likely going to produce the best outcomes, so the people that are the most committed and show up the best. That’s what we did. And in LA it ended up, so we were training people while policy was still being tweaked. It ended up that you had to have real estate in order to apply. So we spent $5.2 million. We acquired 32 leases and some of the best parts of the city. We don’t really believe in operating in the inner city.

Donnell Alexander (20:54):
Why not?

Karim Webb (20:55):
Because we’ve seen liquor stores and like people from other communities come into South LA and the poor parts of LA and make money and then they go to other parts of the community with that money, other parts of LA with that money. And they build up those parts of LA, even though they’re selling alcohol or wherever else they’re selling in South LA. And then they go to other parts of Greater Southern California and live great lives with themselves and their kids. And I’m saying, no, we want to go to where this is the highest volume, the most traffic, which might be Brentwood or it could be Sepulveda and Pico or Beverly and Pico.

Donnell Alexander (21:40):
This whole wide world of listeners knows where none of those places are.

Karim Webb (21:43):
I’m talking about like high traffic, the best retail areas of LA. Go get this bread and then let’s go back to our community that’s rapidly gentrifying and people are being displaced. And let’s buy shopping centers. Let’s do all the right things with the money so that we can improve outcomes. Because that’s how we get social equity, not just for ourselves and not just for the people who are licensed, but also improve these communities that were ravaged by the war on drugs.

Donnell Alexander (22:16):
Where are you now? What retail operations are moving forward?

Karim Webb (22:20):
Well, you know, the city of LA.

Alex Halperin (22:25):
Just to give a little background.

Alex Halperin (22:28):
So basically, there was a process to determine who was eligible to apply for these licenses. And that was in roughly spring of last year?

Karim Webb (22:39):
Yes. Something like that.

Alex Halperin (22:43):
To qualify for these equity retail licenses, it’s not just based on race, which would be illegal by California law. But can you just give us a little bit of an idea of how they’re picking out who is eligible?

Karim Webb (22:55):
Yeah, certainly. So they had different tiers of criteria which were supposedly presenting different preferences. So a tier one would be like, you get to most preference and to be tier one, one of the ways you would qualify for tier one is you had to prove that you’d lived in South LA or in East LA or one of these zip codes that had experienced the top 10% of arrests for five years. And you could prove that a number of ways and that you were low income, so that your tax returns over the course of a year to a couple of years, was below the threshold that the city of LA considers low income. At some point it’s like 42 something. And so that will qualify you for tier one, which is the criteria that all of our candidates or our social equity partners qualified under. There were other loopholes by which the results ended up not looking like the city intended for the results to end up looking for our 120 people that we trained and the 90 some odd people that were qualified as social equity eligible applicants in our group. That’s how they qualify.

Donnell Alexander (24:09):
You know, I have to ask, because it was in the papers. Did you guys get an early advantage into the pool of people who would be selected?

Karim Webb (24:18):
No, and I don’t think there was ever an insinuation that we were, that there were other people who did. So people who, I think there were two people that might’ve been in a portal early that was proven. The Mayor slowed the process down in order to allow for an audit to give the public some trust in whatever was found and then they’ll move forward. And so I think they’re in the middle of that process now.

Alex Halperin (24:42):
So now the audit has been going on for a couple months and nobody has been able to obtain these licenses, so what’s going on now?

Karim Webb (24:50):
There were issued invoices after the application process, which indicated licensure, assuming there’s nothing funky going on with your stuff and they move forward with the program. After the audit we received of our group, that 32 that we applied, we received 13 of those which is not as good as I would have liked to have done, but it’s 13 and they’re 13 great locations, we’re going to help change 13 lives. That’s where the city is. I think the audit is, it didn’t start exactly when the city wanted it to start. I’d be surprised if it wasn’t done and the findings kind of announced by the end of March.

Alex Halperin (25:34):
There was a story that we’ve referenced in the LA Times a couple of times about, it sounds like your organization has attracted some resentment from the community. Can you just give us an idea of what’s going on there? Why has it attracted resentment?

Karim Webb (25:52):
I think first of all let me just say this, out of the 100 licensed people I think the intent or that the assumption, even though a Prop 209, to your point, you can do set asides based upon race or culture, ethnicity. The idea is that black and brown people got screwed by the war on drugs. And I think of both of the 70 licenses, there would be about 30 people who would be considered black and brown that got those 30 invoices. So, and then of those 30, 13 are Forest Movement partners. And through no fault of the many people from the Armenian community and others who qualified for social equity based upon zip code and income or however they qualified, they understood. But it was going to take to compete in that space and file the application first come first serve. Like all of the things that needed to happen in order to compete at that level. And it was not unsophisticated and you couldn’t take it for granted and think you were going to show up on September 3rd at 10:00 AM and just get on your computer and just do what you wouldn’t normally do as you were doing something else. We had folks practicing for two weeks.

Donnell Alexander (27:12):
But it was a lot of people that were doing, everybody was lined up on that night.

Karim Webb (27:16):
I don’t know what everybody was doing. I know we had a war room and we were practiced, and we were ready and we had a year and a half worth of really hard work and development and on the line. And so we were doing everything that we could and we weren’t as successful as we would have liked.

Donnell Alexander (27:33):
Can I ask you about, just because I want to make sure people understand. Fourth movement is not spelled out. It is abbreviated. Can you spell it and explain the proverb idea that’s behind it?

Karim Webb (27:43):
So it’s 4thMVMT. Dr. King was describing the existence of African Americans and said, if you were to describe it in the form of a symphony, the first movement would be the abolition of slavery, the second would be civil rights. The third would be voting rights, and the fourth would be economic equality, hence fourth movement. And our retail concept, which hopefully you’ll start seeing in May or June around town and then several, it’s called 64 and Hope. So Prop 64 legalized cannabis in California. It’ll be the same prototype and concept for all of our social equity partners.

Donnell Alexander (28:21):
When you got all this property, were you renting it or buying it?

Karim Webb (28:24):
No, we leased everything.

Donnell Alexander (28:25):
Okay. Are you still paying for it?

Karim Webb (28:26):
Some of it, but we’re already in the process of divesting. So we have partner meetings. I had three yesterday where I had to look people in the face and say, yeah, we lease these properties on your behalf. You weren’t one of the 32. And were holding on as long as we could. The landlord’s not working with us and we can’t afford to continue to hold on to it. And whatever they do in the next round well either reapply or whatever the city is going to do, we’re with you and our motto is “We’re starting in cannabis, but we intend to do social equity in non-cannabis retail too.” So, where we’re committed to all of our partners.

Alex Halperin (29:07):
It sounds like a total mess in that these 13 who did get the invoice, they’re the ones who are supposed to be benefiting from this process. Instead, they’re paying rent on properties. They can’t even open it. They don’t have licenses for it.

Karim Webb (29:22):
Yeah. Well they’re not directly paying their rent. They’ll end up paying for it because we’re 100% financing the opportunity for them. So the money’s not coming out of their pocket until the time that they’re cashflow positive.

Donnell Alexander (29:33):
I have a question in that vein because we had a guest last week of a person of color who comes from generational wealth and she’s doing okay, and you have an inordinate amount of backing. You have financial resources. What’s it like for you coming in and being an entrepreneur with all these other people who don’t necessarily have it? Are you mindful of what they’re going through in a different way? Or is it all just similar? This business, it’s just how business works.

Karim Webb (29:58):
No man, I’m very sensitive to anybody who is harmed in this process. There’s 800 people who applied in this process, 800 people who went out and got leases. And so, there were people who paid companies that were professing to do things like my company is doing, even some of the haters or some of the people who have come out against us. Some of the people that were quoted in the LA times article that you’re talking about won’t say any names, Donny. And then took money from people in order to kind of ensure that they were going to be successful in this process. And then people who weren’t. So people are incentivized to kind of hate on us for all different kinds of reasons who are totally unfamiliar with all of the training and what we’ve done to improve the quality of life of people and broaden people’s horizons who were successful in the process. And the folks who were not.

Alex Halperin (30:55):
It sounds like of the hundred who got sort of through the first gate, the implication is that about 70 of them are not sort of the intended beneficiaries. And they’re sort of being short handed as being called Armenians.

Karim Webb (31:11):
Yeah, and so I know that there are some people, and listen, I don’t think it serves us to be disparaging about any group of people who saw an opportunity and took advantage of an opportunity. What it means is that we didn’t legislate it well enough if we didn’t get the intended result, bottom line. And now there’s an opportunity with more licenses that’ll come down at round two to tweak that. And I sent a letter to the Mayor and to our City Council president and to the chair of the Cannabis Commission and to DCR just today with what 4thMVMT’s recommendations are.

Alex Halperin (31:50):
I mean, I have to say, I really like what you’re doing. I think it’s really smart and I think it’s addressing one of sort of the fundamental aspects of the equity problem that a lot of other jurisdictions and organizations aren’t necessarily catering to, which is we have the licenses now what? How are you going to compete with the major players, the very well capitalized companies. How do you plan to compete with sort of the bigger players, which probably are better capitalized than you and have a big head start?

Karim Webb (32:32):
Better ideas. So be capitalized enough, hire the best talent, understand what it is that we’re trying to do in the long term and create the best customer experience, the best technology experience, the best, compete at the very highest level and have a no excuse environment around execution and the culture of our company. And that’s what we do. And we leveraged the stories. That’s one thing that our MSL competitors cannot do. Now and when federal legalization happens and we get more consolidation, they cannot tell the story of social equity. They can’t leverage that story of entrepreneurs who if not for this opportunity would not now be the patriarch or the matriarchs of their family and what’s going to happen. And so I’m glad to say we’ve got documentary deals with some of the best of the best. We’re working on unscripted. We’re going to story tell, we’re going to engage the community in a different way around our merge and what’s in the stores. We’re going to be innovative because we have permission to do things from local artisans and community that are some of our bigger competitors or maybe better capitalized competitors won’t be able to do. And I don’t think the customer is going to be able to tell the difference from our experience, from a degradation perspective. It’s not like you’re under the 64 and Hope and say, you know, this feels mom-and-pop, that’s not gonna be the case. We think you are gonna be in the best retailer there is in the space.

Donnell Alexander (34:01):
You’re in the mix. You talk to a lot of different people in social equity. Have you come upon ideas like yours that you think, Oh, that’s actually novel and innovative? What’s interesting to you out there?

Karim Webb (34:11):
I had a dinner a couple of weeks ago with Steve DeAngelo and Steve broke down something that he’s working on in San Francisco. I don’t know if I have permission to share, but if that’s the question, like, tell me what the innovative ideas are. Steve shared something with me, and I was like, Steve, that’s super dope. I’d love to be able to, in addition to what we’re doing, figure out how to do something like that in LA or we just duplicated our LA process in Illinois. So we are surely about the licenses there and we’re preparing for New York, but Steve has a really good idea.

Alex Halperin (34:45):
So how are things going in Illinois? Is the process smoother?

Karim Webb (34:47):
Oh yeah, it’s been way smoother up to this point except for the 600-page application, which was tough. That’s a weeding out process in and of itself. But we applied at 30 people and the state is going to start issuing licenses. They say in May, we know how it is in this business. That might mean November, and then once they’re issued, we will begin the kind of property acquisition entitlement process and look forward to start to get units open in Illinois in 2021.

Donnell Alexander (35:17):
Excellent. Thanks for coming through.

Karim Webb (35:20):
Man, I’m grateful that people are having conversations about this industry that is inclusive of what it has the possibility of doing on behalf of people who were harmed by the application of criminal justice and not just about the plant or not just about the medicine. There is a human capital conversation here and we have the ability to really leverage cannabis the same way that it’s going to revolutionize wellness and health. It has the ability through innovative social equity programming to kind of revolutionize capitalism in our country.

Donnell Alexander (35:59):
Everything you’re saying is amazing. And when you come in and people like Amber are on the phone, the woman from Sacramento we had, it’s a bottomless conversation. It just never stops being interesting. Its impact on capitalism potentially and all the social impact. So we should say goodbye man.

Alex Halperin (36:14):
Thanks so much.

Karim Webb (36:16):
Thank you, guys. Appreciate you.

Donnell Alexander (36:16):
Yeah, appreciate you.

Karim Webb (36:16):
God bless.

Donnell Alexander (36:18):
And that’s our show for this week. As usual, Alex has a tweet.

Alex Halperin (36:23):
All right, so this comes from Wondering jews @JewsWondering friends of the pod: “The only thing better than finding a long lost nug in your stash, is getting a shout-out for #WonderingJews on a podcast you admire! Thanks @donnyshell @alexhalperin @WeedWeekNews for the love!”

Donnell Alexander (36:41):
I can’t give it away, but Jews Wondering among our better fans. We’re going to do something with them soon. I can’t say what it is yet but look forward to that.

Alex Halperin (36:51):
Passover’s coming, all that. Maybe we will tie that in somehow.

Donnell Alexander (36:56):
As always, you can find us on Instagram and Twitter. We are @weedweeknews or you can email us hello@weedweek.net. For more weed news you can sign up for the WeedWeek newsletter, weed week Canada and weed week California all at weedweek.net and if you’ve gotten this far into the episode, as we always say, you’re going to want to subscribe and review, especially on iTunes, five stars, also SoundCloud and Stitcher or we any place else.

Alex Halperin (37:18):
Wherever you get your podcasts, but especially, especially iTunes.

Donnell Alexander (37:21):
I’m Donnell Alexander.

Alex Halperin (37:23):
I’m Alex Harperin. Our show is produced by Donny Alexander and engineered by Larry Buhl. Alicia Byer wrote our theme music. See you again here next week.