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Medical Marijuana, Inc. Message Board

  • ciaobella617 ciaobella617 Apr 8, 2013 1:10 AM Flag

    USA TODAY CONT.

    For Amy Poinsett and Jessica Billingsley, who run Denver-based MJ Freeway, helping store owners keep track of valuable product from field through the cash register is a valid software market: They sell to about 400 legal stores in the 16 medical-marijuana states, making their 2-year-old company profitable.

    Wiggins was impressed enough to agree to invest in MJ this year. Its software illustrates that pot markets will behave like other markets — they'll get more capital-intensive, more concentrated and more professional, assuming legalization spreads, he said.
    "I'm definitely a capitalist,'' he says. "And the operations technology always tends to be where the biggest change comes.'"

    STILL A GAMBLE

    Nothing about the rapid growth of marijuana markets, or even the hands-off-the-pot business strategy, is an automatic winner.

    Clearly, the feds could cripple the business. Even the strategy of profiting from marijuana without touching it could run afoul of money-laundering laws, if those services are bought with drug proceeds, said UCLA professor Mark A.R. Kleiman, who is advising Washington's liquor board on regulating legal pot stores.

    There's also a good chance that a legal pot market won't expand consumption as much as entrepreneurs think, Miron said. Colorado and California have already seen a sharp consolidation of medical-marijuana shops opened by people who thought the market would take off faster. A referendum on the ballot in Los Angeles in May would limit the number of medical-marijuana shops to 135 that opened by 2007. Careful regulation could also hurt a business that, like the alcohol industry, stands to make most of its profits from the few people who consume too much, Kleiman said.

    "To the extent that there's money to be made, a lot of it is already being made,'' by illegal operations, Miron said. "The notion that there will be new wealth is exaggerated.''

    That uncertainty doesn't bother those lining up for a green rush.

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