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Monday, May 16, 2022

Celebrities Embrace Commercial Cannabis Opportunities

When Seth Rogen’s website for cannabis and related paraphernalia opened to shoppers in Los Angeles last month, it crashed almost instantly from a surge in demand.

“We expected a lot of interest and admiration and traffic, but I would say the reality totally surpassed what our expectations were in a very positive way,” Houseplant Chief Executive Michael Mohr said.


Founded in 2019 by Rogen, Mohr, screenwriter Evan Goldberg, and producers Alex Mcatee and James Weaver, Chino Hills-based S49 Ventures, which does business as Houseplant, was exclusively offered to consumers in Canada until its Los Angeles debut on March 11. The website sells indica and sativa strains packaged in pink and orange tins, as well as ceramic ashtrays, lighters and vinyl records.

 
Rogen hails from Canada, but Mohr said the company’s plan from the get-go was to eventually enter the U.S. market through Los Angeles.


Now Houseplant is moving beyond ecommerce. The company announced last week that three of its cannabis strains will be sold at dispensaries on Melrose Avenue, as well as in Westwood, downtown’s Arts District and Studio City, along with 13 other California locations, starting April 15.

 
“This is just the beginning,” Rogen said in a video announcement from his Twitter account. “This is honestly my life’s work, and I’ve never been more excited about anything.”


Andrew De-Angelo of Andrew DeAngelo Consulting said celebrity investment in the cannabis industry is blossoming.


Goop Inc. Chief Executive Gwyneth Paltrow has called cannabis a “hero ingredient of the future” of wellness and in 2020 made an investment in Cann, a cannabis-infused beverage company based in Venice.

 
In February, former National Basketball Association player Chris Webber partnered with New York-based JW Asset Management to launch a $100 million private equity cannabis fund to invest in underrepresented entrepreneurs. That same month, Ice Cube announced a partnership with Caviar Gold on a new line of cannabis products called “Fryday Kush.”


At Belushi’s Farm in southern Oregon, actor Jim Belushi grows marijuana plants on 93 acres along the Rogue River. A handful of strains, along with a few products made from his crop and labeled under various brand names — including “The Blues Brothers”— are sold in Oregon, Colorado and Illinois.

 
Willie Nelson launched Willie’s Reserve in 2015, and the brand’s products — including packaged flower, pre-rolled joints and edibles — are now sold in dispensaries in several states, including California.

 
Monogram, a cannabis brand owned by San Jose-based TPCO Holding Corp. and developed by rapper Shawn “Jay-Z” Carter, sells its hand-rolled joints and flowers exclusively in California, including through delivery companies.

 
With recreational use of marijuana now legal in 16 states and Washington, D.C., De-
Angelo said he expects more celebrities to try to turn a profit on an industry that’s becoming less controversial.

 
“This changes the game for celebrities,” DeAngelo said. “Their reputational risk is not as exposed, and cannabis is just a world where people can define themselves in lots of different ways.”


To be successful, celebrities will need to be involved beyond just the marketing level, he said.


“I think the ones that work better are a little bit more authentic, like Seth Rogen and Jim Belushi are doing, where they’re actually involved in the business themselves in an authentic way,” DeAngelo said. “They actually care about the products, they care about what they’re producing, they’re connecting with the customers, they’re leaning into it.”


Houseplant Chief Consumer Officer Melissa Greenberg said the company took a slow approach toward expansion. It spent time, for example, building a website with detailed information on the strains its sells and how to ingest cannabis. It also developed a social impact statement that touches on racism in cannabis laws and its desire to contribute to the widespread decriminalization of cannabis.


“Houseplant could have put Seth’s name on a jar and called it a day a long time ago,” Greenberg said. “But we’ve taken a lot of time and effort and really thought through the product that we want to present to consumers.”

Keep reading the 2021 Business of Cannabis Special Report.

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