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Racial diversity in the marijuana industry

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Racial diversity in the marijuana industry

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Lack of Racial Diversity in the Marijuana Industry

Christina E. Bachelor

Rossier School of Education
University of Southern California
A dissertation submitted to the faculty
in partial fulfillment of the requirements for the degree of
Doctor of Education

December 2022

© Copyright by Christina E. Bachelor 2022
All Rights Reserved

The Committee for Christina E. Bachelor certifies the approval of this Dissertation

Monique Datta
Melanie Brady, Committee Co-Chair
Alan Green, Committee Co-Chair

Rossier School of Education
University of Southern California
2022

iv
Abstract
Black marijuana business owners are disproportionately excluded from the marijuana business
ownership. The evidence highlights that the racial disparity existing in general business
ownership also occurs in the marijuana industry. Four research questions guide the study: How
have Black business owners accessed resources to support business ventures? How do Black
business owners perceive their status as business owners? How do Black business owners
navigate the opportunities available to them in the marijuana industry? What resources would
benefit Black business owners and lead to sustainable business operations? The key findings of
the study are the navigation of the regulatory environment, access to financial capital, predatory
business environment, access to information, and marijuana stigma. Based on the key findings,
the study presents three recommendations. First, the creation of a networking and mentorship
program. Next, the creation of a business education program. Finally, the execution of
community events focused on addressing marijuana stigma.

v
Acknowledgements
I would like to thank and acknowledge my committee Dr. Datta, Dr. Brady, and Dr.
Green. The encouragement that you gave me throughout the process, the feedback, and the
validation made my study stronger and my journey in academia more valuable. I gained so much
courage through this process and your dedication to my success fueled my passion for this topic
and my study that much more. Thank you
To my participants, thank you for taking the time to speak with me and create an
academic space for the marijuana industry.
There were no conflicts of interest impacting independence with respect to this research,
authorship, or publication of the study. No financial support was received for any part of this
study or authorship. Address correspondence related to this study to Christina Bachelor at e-mail:
cbachelo@usc.edu.

vii
Table of Contents
Abstract ............................................................................................................................................ 1
Acknowledgements ......................................................................................................................... 1
List of Tables ................................................................................................................................... 5
List of Figures .................................................................................................................................. 6
Chapter One: Overview of the Study .............................................................................................. 1
Background and Problem Context ....................................................................................... 2
Statement of the Problem .................................................................................................... 3
Purpose of the Research ...................................................................................................... 4
Importance of Addressing the Problem ............................................................................... 4
Research Questions ............................................................................................................. 6
Organization of the Study .................................................................................................... 6
Chapter Two: Review of the Literature ........................................................................................... 7
Minority-Owned Businesses ............................................................................................... 9
Black-Owned Businesses .................................................................................................. 12
Marijuana Industry ............................................................................................................ 30
Marijuana Business Ownership ......................................................................................... 33
Black-Owned Marijuana Business .................................................................................... 37
Social Equity Programs ..................................................................................................... 45
Limitations of Literature Review Recent Research ........................................................... 48
Summary ............................................................................................................................ 49
Conceptual Framework: Levels of Racism, Critical Race Theory, and Black Marijuana
Business Ownership .......................................................................................................... 49

vii
Conclusion ......................................................................................................................... 58
Chapter Three: Methodology ........................................................................................................ 59
Research Design ................................................................................................................ 59
Sampling and Recruitment ................................................................................................ 61
Data Collection .................................................................................................................. 64
Interview Process and Protocols ........................................................................................ 65
Interview Design ............................................................................................................... 66
Data Analysis ..................................................................................................................... 67
Chapter Four: Results and Findings .............................................................................................. 74
Participating Stakeholders ................................................................................................. 75
Participant Demographics ................................................................................................. 76
Theme 1: Navigating Regulatory Environment ................................................................ 78
Theme 2: Financial Capital ............................................................................................... 91
Theme 3: Predatory Business Practices ............................................................................. 94
Theme 4: Information Access ........................................................................................... 97
Theme 5: Marijuana Stigma ............................................................................................ 103
Summary .......................................................................................................................... 106
Chapter Five: Discussion ............................................................................................................. 108
Key Findings ................................................................................................................... 108
Discussion of Key Findings ............................................................................................. 109
Limitations of the Study .................................................................................................. 119
Recommendations for Leaders and Practitioners ............................................................ 120
Recommendations for Further Study ............................................................................... 125

vii
Summary .......................................................................................................................... 125
Conclusion ....................................................................................................................... 126
References ................................................................................................................................... 127
Appendix A: Marijuana Policy .................................................................................................... 158
Appendix B: Marijuana Arrest Rate ............................................................................................ 167
Appendix C: Marijuana Laws for All U.S. States and District of Columbia .............................. 169
Appendix D: Protocols and Interview Guide .............................................................................. 171
Appendix E: Informed Consent ................................................................................................... 173
Appendix F: Recruitment Letter .................................................................................................. 174
Appendix G: Interview Questions ............................................................................................... 175
Appendix H: Social Media Ad Approved by IRB ....................................................................... 178
Appendix I: Initial Codebook and Code Frame .......................................................................... 179
Appendix J: Final Codebook ....................................................................................................... 181

viii
List of Tables
Table 1: 2012 Business Owner Demographics in the United States ............................................. 14
Table 2: Liquid Assets and Equities by Race in 2019 ................................................................... 22
Table 3: States With and Without Social Equity Programs .......................................................... 46
Table 4: Data Sources: Interviews ................................................................................................. 60
Table 5: Study Participants’ Pseudonyms ..................................................................................... 76
Table 6: Summary of Participant Demographics .......................................................................... 77
Table 7: Social Equity Businesses ................................................................................................. 78
Table 8: Sources of Financial Capital ........................................................................................... 91
Appendix A: Marijuana Policy Project ....................................................................................... 158
Appendix B: Marijuana Arrest Rate ........................................................................................... 167
Appendix C: Marijuana Laws for All U.S. States and District of Columbia .............................. 169
Appendix G: Interview Questions ............................................................................................... 175
Appendix I: Initial Codebook and Code Frame .......................................................................... 179
Appendix J: Final Codebook ....................................................................................................... 181

ix
List of Figures
Figure 1: Racial Disparities in Marijuana Business Ownership 8
Figure 2: Entrepreneurs by Race From 1980 to 2004 13
Figure 3: Percentage of Adults Over 25 in United States With a High School Diploma
by Race 19

Figure 4: 1967–2014 Racial Wealth Disparity in Median and Mean Net Worth 23
Figure 5: United States Marijuana Use Legalization 32
Figure 6: Marijuana License Application Fees and License Fees 34
Figure 7: Banks and Credit Unions Providing Banking Services to Marijuana Related
Businesses 36

Figure 8: Black and White Marijuana Possession Arrests Between 2010 and 2018 39
Figure 9: Illustration of Critical Race Theory 51
Figure 10: Illustration of Levels of Racism Theoretical Framework 54
Figure 11: Conceptual Framework—Integration of Levels of Racism and Critical Race
Theory 57

1
Chapter One: Overview of the Study
In the marijuana industry, racial ownership disparities exist between Black entrepreneurs
and members of other races. Although few nationwide data exist, a report by a marijuana
industry data company found that racial minorities hold few upper management positions.
Further, similar inequities exist in marijuana business ownership (New Frontier, 2017).
Specifically, New Frontier (2017) identified that 47% of participants’ businesses had no minority
owners and 59% of businesses had a racial majority ownership team.
Preliminary data indicates a lack of racial diversity in ownership exists at the individual
state level. In Maryland, 66% of owners and investors are White males (Thompson, 2020), and
minorities account for 10% of marijuana business investors (Maryland Medical Cannabis
Commission, 2019). Additionally, Maryland’s rate of 10% minority investors is consistent with
the McVey (2017) survey identifying 10% of marijuana business owners as a racial minority.
Further highlighting the racial disparity, Maryland’s initial 15 cultivation licenses included no
minority-owned businesses (McVey, 2019). In Massachusetts, Whites registered 75% of
marijuana businesses (Cannabis Control Commission, 2020b). Conversely, McVey (2019) found
racial minorities accounted for 1.2% of marijuana business in the state, thus demonstrating a
White-dominated industry in Massachusetts.
Local municipality data mirror the state and national disparities. The evidence highlights
84% of dispensary owners in Denver, Colorado, are White. Further, Whites hold between 70%
and 88% of marijuana licenses in the city (Analytic Insight, 2020). In 2018, Blacks accounted for
only 3% of key license holders, 2% of associated key licenses, and 6% of support licenses in
Colorado (Colorado Marijuana Enforcement Division, 2018). In November 2021, reports found
2.7% of marijuana business owners in Colorado identified as Black and 83.7% of business

2
owners identified as White (Colorado Marijuana Enforcement Division, 2021a; Stelton-
Holtmeier, 2021). As the racial disparity in general business ownership is widely documented
(Association for Enterprise Opportunity, 2017; Fairlie, 1999; Fairlie & Meyer, 2000;
Wainwright, 2000), the evidence demonstrates a similar racial diversity problem in the emerging
marijuana industry within the United States as well.
Background and Problem Context
President Nixon federally criminalized marijuana through the Controlled Substances Act
by classifying the substance as a Schedule 1 drug. Appeals for marijuana criminalization often
included hysterical and racist commentary about Blacks and Hispanics, therefore linking legal
marijuana with racism and Prohibition (Vitello, 2009). As Schlussel (2017) demonstrated,
White-based framing of marijuana legalization resulted in policies benefiting White
entrepreneurs and promoting unjust bias on minorities, a 2017 industry survey found most
participants joined the marijuana industry to create change, access opportunity for wealth
creation, and empower others (New Frontier, 2017).
Public and private sectors acknowledge the racial diversity gaps in the marijuana industry
(Harris & Martin, 2021; New Frontier, 2017). Harris and Martin (2021) found most initial
marijuana reformations excluded social equity provisions. However, some legalization
reformations included social equity programs to address inequities in legal marijuana
participation and disparities caused by the War on Drugs (Harris & Martin, 2021). Further, an
industry report found 74% of participants believed businesses need more proactive diversity
approaches (New Frontier, 2017). Participants’ responses cited limited knowledge about
integration of diversity into corporate culture, lack of commitment to diversity from leadership,
lack of diversity-specific recruitment targets, and ineligibility due to criminal backgrounds as the

3
main barriers to marijuana industry workplace diversity (New Frontier, 2017).
With 45% of non-minorities and 62% of minorities viewing racial discrimination as a
problem in the marijuana industry, most industry participants recognize the opportunities created
by marijuana legalization including the ability to address social issues resulting from the War on
Drugs and facilitation of access to medical marijuana. However, only 32% of marijuana
businesses proactively implement diversity recruitment and retention policies (New Frontier,
2017). Thus, highlighting the marijuana industry’s inaction with racial inequities.
Statement of the Problem
A racial diversity gap exists for Black participation in the marijuana industry, specifically
business ownership (Colorado Marijuana Enforcement Division, 2021a; Maryland Medical
Cannabis Commission, 2019; McVey, 2017, 2019; New Frontier, 2017; Thompson, 2020). The
marijuana industry inadvertently excludes Black people from sustainable entrepreneurship
through differential access to financial capital (Bates & Robb, 2013; Bhutta et al., 2020; Fairlie
et al., 2021; Federal Reserve of Banks, 2021) which amplify the marijuana industry’s high start-
up cost barrier to entry (Stelton-Holtmeier, 2021) and banking difficulties (FinCEN, 2021),
human capital disparities (American Civil Liberties Union, 2013, 2020; Bento & Brown, 2021),
and disproportionate industry knowledge and political capital (Cannabis Control Commission,
2020b; Hudson, 2019), thus highlighting the disparities within existing economic systems and
U.S. society. Black business owners experience unique barriers to entry and encounter
challenges with business launching, maintenance, and growth.
The diversity problem impacts Black wealth (Association for Enterprise Opportunity,
2017) and the viability of Black-owned marijuana businesses (Andrewvski et al., 2014; McVey,
2021). Researchers previously studied Black business inequities and disparities (Association for

4
Enterprise Opportunity, 2017; Hipple & Hammond, 2016; Reuben & Queen, 2015); however,
little research exists specific to Black businesses in the marijuana industry. Through exploration
of marijuana business owners’ lived experiences, the problem of practice examines the
challenges and best practices of Black-owned marijuana businesses, the development of Black
marijuana businesses, and the navigation by Black entrepreneurs of the marijuana industry.
Further, the research investigates the perception of Black marijuana business owners, industry
barriers, and racial business challenges.
Purpose of the Research
The purpose of the project is to analyze the challenges, available resources, and best
practices of Black marijuana entrepreneurs to understand racial inequities within the industry and
the persisting inequities influencing Black entrepreneurial success. The study utilizes qualitative
analysis to explore Black marijuana business owners’ navigation of the marijuana industry and
the development of business presence in the United States through the lived experiences of the
business owners. As Black business’ disparities are documented, but little empirical research
exists in the marijuana business ownership space, the goal for the study is to explore the
experience of Black business ownership and the Black experience in the marijuana industry with
persistent historical business inequities. As such, the study seeks to verify the racial diversity
problem in the marijuana industry, understand the perspective of Black business owners, and
examine the navigation of racial challenges in launching and maintaining a successful Black
marijuana business.
Importance of Addressing the Problem
The lack of racial diversity problem in the marijuana industry is important to address
because diversity allows for increased sales through sustainable growth and exposure to new

5
markets (New Frontier, 2017; McVey, 2021). Andrewvski et al. (2014) demonstrated diverse
management increases a business’s ability to compete through recognizing opportunities for
development, increases creativity, and promotes innovation. Nielsen (2019) exhibited minority
consumers, who have a combined spending power of 1.3 trillion dollars, prefer seeing people in
advertising that share their ethnic background, thereby evidencing the role of diversity in
marketing and potential sales.
A marijuana industry report identified improved segmentation creates additional sales
opportunities (New Frontier, 2017). Further, McVey (2021) found that states implementing
diversity and social equity programs projected higher annual sales in comparison to states
without such programs; specifically, the study identified 2022 projections of $12.7 billion in
comparison to $4.1 billion, respectively.
The lack of diversity in the cannabis industry impacts Black entrepreneurs and the Black
community. Racial inequities impact not only those interested in ownership or employment
through barriers to entry (McVey, 2019) but also those affected by the criminalization of
marijuana (American Civil Liberties Union, 2013). Studies prove Black communities who were
negatively affected by the criminalization of possession of marijuana are less likely to financially
benefit from legalization (American Civil Liberties Union, 2013, 2020). As Black business
owners often hire Black employees (Fairlie & Robb, 2008), studies demonstrate Black
entrepreneurship increases Black job creation (Association for Enterprise Opportunity, 2017;
Bates, 2006; Coyne et al., 2010). Further, evidence shows business ownership as an opportunity
to grow wealth and address the racial disparities in the wealth gap (Association for Enterprise
Opportunity, 2017). As such, Black marijuana business ownership positively impacts the
marijuana industry and the Black community.

6
Research Questions
The study employs qualitative analysis to focus on Black business owners in the legal
marijuana industry within the United States utilizing critical race theory and levels of racism
theoretical framework. The study examines various Black-owned marijuana businesses including
operational business owners, business owners waiting on official licensure, and business owners
with failed operations. The questions guiding the study are the following:
• How have Black business owners accessed resources to support business ventures?
• How do Black business owners perceive their status as business owners?
• How do Black business owners navigate the opportunities available to them in the
marijuana industry?
• What resources would benefit Black business owners and lead to sustainable business
operations?
Organization of the Study
The five-chapter study starts with the discussion in Chapter 1 of the lack of racial
diversity in the marijuana industry regarding business ownership. Chapter 2 reviews the current
literature using critical race theory and the levels of racism theoretical framework to create a
conceptual framework to guide the study. Next, Chapter 3 details the methodology, interview
participants, data collection, and data analysis procedures. Then, Chapter 4 assesses and analyzes
the interview data and results. Finally, based on the literature and data, Chapter 5 provides
recommendations for addressing the lack of diversity in the marijuana industry and for additional
research.

7
Chapter Two: Review of the Literature
Significant racial disparities exist in the marijuana industry. As evidenced by the
historical ownership disparities between Blacks and Whites in multiple states (Colorado
Marijuana Enforcement Division, 2021a; Maryland Medical Cannabis Commission, 2019;
Thompson, 2020; McVey, 2017, 2019) and industry data reports (New Frontier, 2017), the
legalization of marijuana benefits White people more than other races (Rahwanji, 2019).
Recently, a 2021 study examining marijuana business ownerships in Colorado, Michigan, and
Nevada identifies Black owners in 2.7%, 3.8%, and 5.1% of businesses, respectively (Stelton-
Holtmeier, 2021). When compared to White ownership of 83.7%, 79%, and 63% in the same
states (Stelton-Holtmeier, 2021), the evidence proves the ownership disparities (see Figure 1).

8
Figure 1
Racial Disparities in Marijuana Business Ownership

Note. From “Women and Minorities in the Cannabis Industry,” by J. Stelton-Holtmeier. MJ Biz Daily, 2021
(https://mjbizdaily.com/wp-content/uploads/2021/10/MJBizDaily-Women-and-Minorities-in-Cannabis-Report.pdf)

9
The literature review examines current research related to marijuana business ownership
racial disparities and details the conceptual framework guiding the study. Due to the limited
existence of empirical studies regarding marijuana business ownership, the literature review
begins with a discussion of racial disparities in business ownership experienced by minorities
and Blacks in the United States. As the next closest comparable entity, the review uses the
existing literature on Black and minority business ownership to form a basis of understanding of
the previous research. Next, the review examines literature specific to the legal marijuana
industry, including the impact legalization and legislation have played in Black participation in
the industry. Further, the review explores the current state of Black marijuana businesses and
social equity programs. After an analysis of the current research, the review discusses the levels
of racism theoretical framework and critical race theory in relation to the study’s key concepts to
form a conceptual framework.
Minority-Owned Businesses
As the United States’ demographics change, minority businesses are increasingly
becoming a part of the United States’ mainstream infrastructure. As minorities increased from
23.6% of new entrepreneurs in 1996 to 40% of the new entrepreneur population in 2011,
minority businesses grew, as highlighted by Fairlie (2012). In 2012, minorities represented
29.3% of all firms in the United States with 7.95 million businesses (U.S. Small Business
Association, 2016). Further, Bates et al. (2018) evidenced 40% of new businesses formed in
2015 were minority owned, signifying the continued creation of minority-owned businesses. In
2021, the U.S. Census Bureau identified minority-owned businesses represent 18.7% of
employer businesses in the United States, with 1.1 million businesses (U.S Census Bureau,
2021a), and 8.7 million nonemployer businesses (U.S. Census Bureau, 2021b).

10
However, even with recent racial advances, minorities experience subjection to
stereotypes (Zapata et al., 2016), underrepresentation in corporate America (Park & Westphal,
2013; Zhu et al., 2014), and inequality of workplace power and status (Joshi & Knight, 2015).
Although Jones et al. (2012) demonstrates the lack of upward mobility pathways in established
businesses creates minorities’ attraction to entrepreneurship, business ownership does not
preclude minorities from experiencing racial inequities. Further, despite minority business
owners’ utilization of management skills and business education as success factors (Ayala &
Manzano, 2017), minority business owners experience increased business failure rates and lack
sustainability (U.S. Small Business Association, 2016). Thus, racial disparities present obstacles
to advancement for minorities.
Minority entrepreneurs encounter discriminatory hindrances impacting business success.
Bates (2011) examines minority businesses identifying issues with market opportunity
exploitation, mainstream network involvement, and capital financing. Further, an analysis of
start-ups and self-employment rates found significant racial differences in education levels,
income, work experience, and barriers to entry (Deskins & Ross, 2018). Additionally, Loftsrom
and Bates (2013) identify human and financial capital as two main barriers to entry for start-ups.
Specifically, the study indicates possession of appropriate human capital for operation, access to
markets, and assembly of financial capital impact minority business success (Loftsrom & Bates,
2013). Thus, racial barriers to entry impacting minorities, such as inequities in the minority
lending experience, are important to explore.
Minority Lending
Racial disparities exist with financial institution lending practices, impacting minorities’
access to financial capital. Studies have evidenced minority businesses’ diminished access to

11
bank loans (Blanchflower, 2009; Mitchell & Pearce, 2011), increased scrutiny, provision of less
assistance, and higher loan search costs in comparison to White businesses (Bone et al., 2014).
While the Association for Enterprise Opportunity (2017) identified a lower minority loan
approval rate of 28% in comparison to 67% for Whites, Morse et al. (2019) confirmed racial
disparities in lending application rejection rates. Through a comparison with FinTech algorithmic
lending from 2009 and 2015, the study evidenced minorities experience a 6% higher rejection
rate due to discrimination (Morse et al., 2019), thus verifying inequities in minorities’ inequitable
experience with traditional financial institution lending.
Although financial institutions are not the only available source of financial capital, other
sources of financing are similarly problematic for minorities. Bates and Bradford (2017)
examined racial disparities in private equity financing. Despite higher returns on minority
investments in comparison to other investments, the study found White-owned businesses
receive preferential treatment from private equity firms. Similarly, Gutierrez and D’Mello (2019)
identify private equity firms’ increased willingness to invest in White businesses in comparison
to minority businesses.
Resulting from limited financing options, minority businesses often utilize credit cards as
an alternate source of capital financing (Robb & Morelix, 2016; U.S. Chamber of Commerce,
2005). As evidenced by a 2019 average credit card interest rate of 15.1% (Board of Governors of
the Federal Reserve System, 2020) and a 3.875% direct business loan interest rate (U.S. Small
Business Administration, 2019), credit card utilization increases financing costs. As the inability
to obtain reasonable external financing handicaps minority businesses, product market assistance
programs are examples of viable options for racial equity in business.

12
Product Markets
Similar to discriminatory minority lending practices, lack of access to product markets
creates an obstacle to minority business success. Studies confirmed a lack of access to product
markets as a key challenge faced by minority business owners (Bates, 2011; Shelton & Minniti,
2017). To measure the impact of programs created to address the product market inequities,
studies investigated government preferential procurement initiatives and commercial supplier
diversity programs (Cox Edmondson et al., 2008; Shelton & Minniti, 2017). The studies
determined programs such as minority supplier development programs provide opportunities for
economic participation, enable preparation for changing U.S. demographics, and assist with
rectifying past discriminatory actions (Cox Edmondson et al., 2008).
As such, assistance programs positively impact minority businesses’ growth and success.
Sonfield (2007) identified that 87% of incubator start-ups who received business assistance
survived for 5 years. Further, Shelton and Minniti (2017) identified that increased access to
information and incentives resulted in the rapid expansion and establishment of a viable
business. Through the encouragement of utilization of minority businesses, the creation of
opportunities, and an increase in self-employment rate, Fairlie and Marion (2012) demonstrated
affirmative action programs result in greater profits for disadvantaged minority businesses, thus
emphasizing the role of assistance programs in issues faced by minority businesses to ensure
equitable market participation.
Black-Owned Businesses
As Blacks experience a lower rate of self-employment in comparison to Whites and other
minorities (Hipple & Hammond, 2016), the examination of Black-owned businesses is necessary
to determine if additional barriers or support exist in comparison to minority businesses.

13
Although studies highlight similar motivation between Blacks and other races for self-
employment, Blacks are less likely than other races to own a business (Association for Enterprise
Opportunity, 2017; Reuben & Queen, 2015). Furthermore, only 5.1% of Blacks are self-
employed in comparison to 11.1% of Whites and 7.5% of Latinos (Fairlie & Robb, 2008). Figure
2 presents business ownership by race for Blacks, Latinos, Whites, and Asians (Fairlie & Robb,
2008).

Figure 2
Entrepreneurs by Race From 1980 to 2004

Note. From Race and Entrepreneurial Success: Black-, Asian-, and White-owned Businesses in
the United States (p. 16) by R. W. Fairlie, & A. M. Robb, 2008, MIT Press.

14
Additional data highlights the persistent low level of Black business ownership. In 2012,
10% of U.S. businesses were Black owned (U.S. Small Business Association, 2016). In 2020 and
2019, the U.S. Census identified 134,567 Black-owned employer businesses (U.S. Census
Bureau, 2021a) and 3.1 million nonemployer businesses (U.S. Census Bureau, 2021b). Thus,
demonstrating the historical and current diminished rate of Black entrepreneurship. Table 1
presents the business owner demographics for U.S. businesses in 2012 (U.S. Small Business
Association, 2016).

Table 1
2012 Business Owner Demographics in the United States
Demographic category of owner(s) Number of
firms
Share of
firms (%)
Number of
firms
All firms 27,626,360 5,424,458
All classifiable firms 27,179,380 100 5,136,203
Minority 7,952,386 29.3 908,800
American Indian and Alaska Native 272,919 1.0 26,179
Asian 1,917,902 7.1 481,026
Black or African American 2,584,403 9.5 109,137
Hispanic 3,305,873 12.2 287,501
Native Hawaiian and other Pacific Islander 54,749 0.2 4,706
Female 9,878,397 36.3 1,035,655
Equally male/female 2,456,386 9.0 764,977
Veteran 2,521,682 9.3 442,485
Publicly held and other unclassifiable 446,980 288,255

Note. From Black or African American-Owned Businesses in the United States by U.S. Small
Business Association, 2016 (https://advocacy.sba.gov/2016/05/01/black-or-african-american-
owned-businesses-in-the-united-states/)

15
Industries maintain varying levels of Black entrepreneurial participation. Studies
identified a higher Black businesses concentration in personal services, transportation,
communication, and public utilities (Fairlie & Robb, 2007), with 32% of businesses concentrated
in healthcare and social services industries (U.S Census Bureau, 2021b). Conversely, Black
business underrepresentation occurs in manufacturing, finance, insurance, construction, real
estate, and agricultural services industries (Fairlie & Robb, 2007). As demonstrated by the
COVID-19 epidemic, studies show the lack of business representation by Black businesses
increases the risk of business loss (Fairlie, 2020). Congruent with underrepresentation in various
markets, Black-owned businesses lack the sales success exhibited by businesses owned by
members of other races.
Black Businesses’ Sales
Fairlie et al. (2021) found that in comparison to other businesses, Black start-up
businesses stay smaller for the first 8 years following launch. Sonfield (2007) determined that
although sales increased by almost 2,800% from 1974 to 2004, the largest Black-owned
businesses were smaller in comparison to mainstream American companies. In 2004, the largest
Black-owned company, Worldwide Technology, had sales of $1.4 billion in comparison to the
largest mainstream company, Walmart with sales of $291 billion. Additionally, the 100th largest
mainstream company in the United States had greater sales than the 100 largest Black-owned
companies combined (Sonfield, 2007). Further, a 2008 study identified average sales of
$439,579 for White-owned businesses in comparison to $74,018 for Black-owned businesses
(Fairlie & Robb, 2008). As 86% of Black businesses reported decreased sales in 2020 due to
COVID-19 (Small Business by Federal Reserve of Banks, 2021), Black businesses consistently
display diminished sales.

16
Survival Rates
As expected, given their lower sales rate, Black-owned businesses experience a depressed
survival rate. Studies show Blacks are more likely to start a business than other races but less
likely to succeed (Koellinger & Minniti, 2006; Reuben & Queen, 2015). Specifically, although
Blacks are twice as likely to start businesses as Whites, Blacks exhibit higher failure rates
(Koellinger & Minniti, 2006). Additional studies verified a lower 4-year survival rate for Black-
owned businesses in comparison to other races (Kroeger & Wright, 2021; Lowery, 2004).
Investigation of the 2016–2018 2-year business survival rate found a 67% survival rate for Black
businesses, which is less than the average national rate of 71% (U.S. Small Business
Administration, 2021). Further, a 30-year study of the 100 largest Black-owned businesses
identified that only two of the companies selected for the list in 1974 were still listed in 2004
(Sonfield, 2007), signifying low long-term business survival.
From February to April 2020, Fairlie (2020) identified Black entrepreneurs suffered a
41% decline in business activity due to the COVID-19 epidemic. Additionally, the declines
continued in May and June 2020, with business losses of 26% and 19%, respectively (Fairlie,
2020). Although all demographics suffered business losses during 2020, Blacks experienced 3
times the business decline experienced by other races (Wilmoth, 2020), thus evidencing the
disparity in business sustainability. As Black entrepreneurs experience lower sales, profit,
employment, and survival in comparison to Whites (Fairlie & Robb, 2008), it is important to
explore Black-owned businesses’ best practices and obstacles to success.
Family Business
Studies identified common traits of successful Black-owned businesses. Popkin (1991)
exhibits factors such as business size, business age, number or locations, and wholesaling as

17
positively correlating indicators of business survival. Additionally, Valdez (2008) identifies
human and market capital as essential elements of a successful business. While the study found
social capital can have a positive or negative effect, Valdez (2008) determined social capital
generated through kinship or extended family ties such as business information, intra-family
loans, and unpaid labor increases the likelihood of success for a business (Valdez, 2008), thus
solidifying the role of familial support with Black business success.
Similarly, family businesses categorically experience increased viability in comparison to
Black-owned businesses. Fairlie and Robb (2007) demonstrate that intergenerational, inherited
businesses are generally more successful than start-up businesses. Children who work in similar
family industries may acquire industry expertise (Fairlie & Robb, 2008), and studies have
demonstrated that intergenerational transmission of Black businesses assists with the acquisition
of general business human capital and specific business human capital (Dunn & Holtz-Eakin,
2000; Hout & Rosen, 2000). Although studies show that prior work experience in family
businesses and other general business characteristics play a role in entrepreneurship outcomes,
Blacks still encounter human capital inequities hindering business sustainability.
Human Capital
Human capital is consequential to Black-owned businesses. Studies define human capital
as the combination of education level, work experience, professional development training, and
certification, highlighting that these aspects are positively correlated with business success
(Dodson, 2009; Valdez, 2008). In support of studies that prove Blacks exhibit diminished levels
of educational attainment (Fairlie & Robb, 2008; Ryan & Bauman, 2016), Bento and Brown
(2021) confirmed educational disparities contribute to the challenges faced by Black business
owners.

18
Racial Disparities in Education
In education, racial disparities are exhibited consistently throughout life. Ryan and
Bauman (2016) demonstrate a consistently higher White high school graduation rate in
comparison to Blacks. In 2015, Whites were more likely to complete high school than Blacks
with graduation rates of 93.3% and 87%, respectively (Ryan & Bauman, 2016).
Further, studies found the racial education gaps start prior to kindergarten and widen
during school years (Fairlie & Robb, 2008; Ladd & Goertz, 2015). Although the education
disparity persists, more recent studies identify a closing racial education gap (Ryan & Bauman,
2016). As demonstrated by Black’s high school graduation rate increasing from 27% to 88%
from 1964 to 2015, respectively, Blacks’ increased rate of matriculation from high school has
decreased the education gap (Pew Research Center, 2016). Figure 3 illustrates the change in
education gap by presenting the change in high school graduation rates from 1964 to 2015 by
race (Pew Research Center, 2016).

19
Figure 3
Percentage of Adults Over 25 in United States With a High School Diploma by Race

Note. From On Views of Race and Inequality, Blacks and Whites Are Worlds Apart by Pew
Research Center, 2016 (https://www.pewresearch.org/social-trends/2016/06/27/on-views-of-
race-and-inequality-blacks-and-whites-are-worlds-apart/)

Studies evidenced the racial disparity in college education by showing 23% of Blacks
attained a college degree in comparison to 36% of Whites and 53% of Asians, respectively (Pew
Research Center, 2016; Ryan & Bauman, 2016). Although college graduation rates for Blacks
increased from 1964 to 2015 with rates of 4% and 23%, respectively (Pew Research Center,
2016), the college degree gap between Blacks and Whites persists. Furthermore, the 2020 U.S.
Census (2021c) identified 28% of Blacks have at least a bachelor’s degree in comparison to
37.5% of Whites. As most business owners in the United States have at least a bachelor’s degree
(U.S. Census, 2021d), Blacks’ lower education levels create a human capital disparity in the

20
knowledge and skills acquired through formal education used in maintaining a successful
business (Fairlie & Robb, 2008). Furthermore, the lack of skills acquired through work
experience compounds human capital deficiencies.
Work Experience
Practical work experience deficiencies negatively impact Black entrepreneurs. Fairlie and
Robb (2007) identified human capital—specifically the lack of prior work experience of Black
business owners—as a primary contributing factor to Black business failure. Congruent with a
diminished likelihood of Black business owners’ exposure to a self-employed family member in
comparison to Whites, the study identified disparities in prior work experience. The disparities
applied not only to work experience in a family member’s business but also general industry
experience (Fairlie & Robb, 2007). Specifically, the study found in comparison to 23.3% of
White business owners, only 12.6% of Black business owners previously worked in a family
member’s business (Fairlie & Robb, 2008). As Black business owners employ 1/5th of the Black
workforce (Fairlie & Robb, 2008), the lack of access to effective human capital creates a
perpetual challenge for Black-owned businesses.
Racial Wealth Disparities
In addition to human capital deficiencies, racial wealth disparities disadvantage Black
owned businesses. Through examination of net worth assets, and equity, studies verify the Black
experience of racial wealth disparities (Bhutta et al., 2020; Pew Research, 2016). Thus,
impacting Black business sustainability.
Net Worth
Blacks experience significant racial wealth disparities, which impact business self-
funding and core business activities. Evidence shows the average wealth levels of Blacks is

21
significantly lower in comparison to Whites. Fairlie and Robb (2008) identified a median wealth
level of $6,166 and $67,000 for Blacks and Whites, respectively. Further, Bhutta et al. (2020)
calculated Blacks’ mean and median net worth as less than 15% of Whites’. Specifically, the
survey calculated the mean and median net worth of Blacks as $24,100 and $142,500. When
compared to Whites’ mean and median net worth of $188,200 and $983,400 (Bhutta et al.,
2020), the current and historical racial wealth disparity is evident.
Assets and Equity
In addition to net worth disparities, Blacks possess fewer assets and less equity in
comparison to Whites. Despite most Blacks maintaining some liquid assets, Bhutta et al. (2020)
found Whites have 4 times the liquid assets of Blacks, with an average of $8,100 in liquid
savings in comparison to $1,500 for Blacks. Further, 60.8% of Whites have equity in comparison
to only 33.5% of Blacks. Additionally, the study shows Blacks’ lower levels of equity, with an
average of $14,400 in comparison to $50,600 for Whites (Bhutta et al., 2020). Table 2 presents
the racial disparities in liquid assets and equity.

22
Table 2
Liquid Assets and Equities by Race in 2019
Liquid assets White Black Hispanic Other
Has liquid assets (percent) 98.8 96.8 95.5 98.8
Conditional mean liquid assets (thousands of 2019
dollars)
8.1 1.5 2.0 5.0
Has direct or indirect equity (percent) 60.8 33.5 24.2 53.8
Conditional median of equities (thousands of 2019
dollars
50.6 14.4 14.9 28.8

Note. From Disparities in Wealth by Race and Ethnicity in the 2019 Survey of Consumer
Finances by N. Bhutta, L. Dettling, J. Hsu, 2020, Board of Governors of Federal Reserve
System. (https://www.federalreserve.gov/econres/notes/feds-notes/disparities-in-wealth-by-race-
and-ethnicity-in-the-2019-survey-of-consumer-finances-20200928.htm)

In addition to overall wealth disparities, Blacks experience inequities in intergenerational
wealth transfers. Studies prove Blacks are less likely to receive money from other family
members through inter vivos transfers (Berry, 2006; Bhutta et al., 2020; Cox & Rank, 1992).
Specifically, Berry (2006) examined 17,996 households and showed that Black adults are 33%
less likely than Whites to receive inter vivos transfers from family members.
Additional studies verified White households inherit greater wealth than Blacks and
anticipate increased family support through future gifts (Bhutta et al., 2020; Williams, 2017) and
Black families are less likely to receive home down payment assistance from parents,
contributing to the homeownership disparities (Charles & Hurst, 2002). Goodman and Mayer
(2018) demonstrate the importance of home ownership to wealth building, suggesting that home
ownership inequities contribute to the overall wealth disparity. As such, differences in initial
wealth levels, decreased financial gifts, ownership of homes and other assets, equity, and lack of

23
inheritances contribute to the racial disparities in Blacks’ personal wealth. Figure 4 graphically
illustrates Blacks’ mean and median net worth in comparison to Whites (Pew Research, 2016).
Significant racial disparities exist at every age range in home ownership (Bhutta et al., 2020).

Figure 4
1967–2014 Racial Wealth Disparity in Median and Mean Net Worth

Note. Racial gaps in household income persist. Median adjusted household income in 2014
dollars. From On Views of Race and Inequality, Blacks and Whites Are Worlds Apart by Pew
Research Center, 2016 (https://www.pewresearch.org/social-trends/2016/06/27/on-views-of-
race-and-inequality-blacks-and-whites-are-worlds-apart/)

24
Effect of Racial Wealth Disparity on Business
Racial disparities hinder Blacks’ ability to adequately self-finance a start-up business. In
comparison to other businesses, Fairlie and Robb (2008) found Black businesses often start with
less financial capital. Additionally, Kim et at. (2021) identified the largest racial financing gap
occurs during the start-up phase, verified by additional studies showing that many Black
businesses start with little or no start-up capital (Bates & Robb, 2013; Valdez, 2008). Thus,
demonstrating the impact of racial wealth disparities on Black start-up businesses.
Fairlie (2013) identified the personal wealth gap, lack of home ownership, financing, and
liquid assets as contributing challenges to Black self-employment. Fairlie and Robb (2007) prove
that as entrepreneurs’ wealth can be invested directly invested in the business and assets utilized
as collateral, the importance of liquidity in business success since it constrains the negative
impact on business outcomes. Although the Association for Enterprise Opportunity (2017)
determined higher levels of net worth did not impact the likelihood of starting a business, the
report found higher levels of net income impacted the business owners’ ability to obtain
credentials and licenses and enter fields that require large start-up capital or investments. As
such, studies verify the barrier to entry resulting from racial wealth disparities on certain
businesses.
Commercial Financing
In addition to racial wealth disparities, traditional financial institutions exhibit racial
biases resulting in disproportionately adverse business effects on Black businesses. Although the
Federal Institutions Examination Council designed the Equal Credit Opportunity Act of 1974 to
prohibit discrimination with credit applications for individuals and small businesses (Federal
Institutions Examination Council et al., 2009), studies verify show bank discrimination toward

25
Blacks (Blanchflower, 2009; Pallia, 2016). Despite Black and White-owned businesses’ similar
loan default rates (Palia, 2016), Blacks experience more difficulty accessing capital funds at
financial institutions (Bates & Robb, 2013; Fairlie et al., 2021), including lines of credit, in
comparison to Whites (Henderson et al., 2015).
Credit Scores
Studies dispute the existence of racial bias in credit score determination. While studies
confirmed racial bias disadvantaging minorities and Blacks (Bates & Robb 2008; Henderson et
al., 2015), additional studies found no evidence of racial bias in credit scores (Robb & Robinson,
2017). However, studies concur regarding the existence of lower credit scores for minorities and
Blacks (Bates & Robb, 2017; Henderson et al., 2015). As lenders use credit scores for funding
and rate risk analysis (Spader, 2010), Henderson et al. (2015) demonstrated the resulting racial
disadvantage to Blacks in terms of credit lending decisions.
Loans
Racial inequities exist in bank loans. Studies demonstrated Blacks experience higher
interest rates, have a higher application rejection rate, and receive smaller loans (Anderson &
Gregory, 2012; Bates & Robb, 2013). For example, Palia (2016) exhibited banks rejection of
Blacks’ credit applications at a 30% higher rate than similar applications from Whites.
Blanchflower et al. (2003) identified a loan denial rate of 65.9% for Black-owned businesses
while more recent reports found Blacks are half as likely to receive full approval for loan, cash
advances, and lines of credit (Federal Reserve of Banks, 2021). In addition to an increased loan
denial rate, Blacks on average pay higher interest rates on business and personal loans (Bates &
Robb, 2013; Blanchflower, 2009; Chiteji, 2010).

26
The COVID-19 pandemic proved loan inequities to be a current problem. With the
Paycheck Protection Program, 43% of Black-owned businesses received all the funds sought in
comparison to 79% of White-owned businesses. Further, a significant disparity existed at varying
types of lenders, including small banks, large banks, and online lenders (Small Business by
Federal Reserve of Banks, 2021), thus impacting the success of Black businesses and
entrepreneurs.
Impact on Black Start-Ups
Inequities in capital financing create financial and nonfinancial consequences on Black
businesses. Neville et al. (2018) demonstrated Blacks’ socio-historical experiences led to
increased discouragement toward various entrepreneurial tasks, including obtaining capital from
mainstream financial institutions. Despite needing additional funding, 58.5% of Black
entrepreneurs do not seek additional commercial financing due to expectations of rejection by
the lender (Robb & Morelix, 2016). Further, most Blacks reported not seeking a Paycheck
Protection Program loan due to expectations of not qualifying for the loan or forgiveness (Small
Business by Federal Reserve of Banks, 2021). Even with good credit history and in areas where
strong banks encourage new business development, Blacks applied for fewer loans than Whites
due to bank perceptions and denial expectations (Fairlie et al., 2021).
Studies evidenced the general significance of securing financial on start-ups (Kerr &
Nanda, 2009; Simoes et al. 2016), demonstrating the effect on business survival and start-up
growth (Kerr & Nanda, 2009; Simoes et al., 2016). Specifically, Simoes et al. (2016) verified a
positive relationship between financial investment and self-employment. Conversely, Kerr and
Nanda (2009) identify financing constraints as one of the most significant factors impacting the
starting and growing of a business.

27
Capital financing impacts business growth, human capital, and business sustainability.
Fairlie et al. (2021) confirmed the business hindrances caused by unmet capital needs.
Specifically, 79% of Black business owners verified the lack of business financing’s effect of
restricting the business’s growth opportunities (Fairlie et al., 2021). Similarly, 73% of Black
business owners identified the financing environment as an impediment to hiring employees
(Association for Enterprise Opportunity, 2017). Conversely, Gai and Minniti (2015) associated
commercial financing with a 26.6% reduction in Black business failures.
Additionally, Robb and Morelix (2016) examined the impact of commercial financing on
business profitability. The study found Black businesses are 3 times more likely than White
businesses to experience a negative impact on business profitability by a lack of commercial
financing, with 28.4% of Blacks and 10.1% of Whites affected. Further, Blacks were twice as
likely to be negatively impacted by the cost of capital (Robb & Morelix, 2016), thus emphasizing
the disproportional cost of inequitable financing to Black entrepreneurs. As the consequences of
commercial financing disparities are significant, lack of access to local bank branches magnifies
the Black business capital financing problem.
Local Financial Institutions
Black entrepreneurs experience decreased access to local bank branches resulting in
negative impacts on lending and business success. As bank financing accounts for over 90% of
all small business debt (Bates & Robb, 2016) and interest rate ranges decrease with a closer bank
branch location (Ergungor, 2010), studies prove the importance of access to banking locations.
From 1993 to 2019, Atkug et al. (2020) identified a significant decrease in small banks led to an
overall lending decrease to small businesses from 67% to 14%. Further, Touissant-Comeau
(2020) found Black communities experience increased community bank closures, resulting in

28
decreased credit lending to small businesses. An examination of the relationship between Black
community banks and small businesses determined community banks create economic growth
within the community (Young, 2019), equal access to financial institutions, and equity with bank
branch penetration rates.
Black communities experience decreased bank penetration rates nationally and locally.
Magnify Money (2018), a lending report, examined branch penetration rates in majority White
and majority Black communities throughout the United States. The report demonstrated
majority-White communities contained 87,907 bank branches in comparison to 2,090 branches
in majority-Black communities (Magnify Money, 2018). Similarly, Hegerty (2020) examined
banking locations in Chicago identifying banking deserts. The study found banking desert areas,
defined as areas with decreased bank access, had lower income rates and increased rates of
minorities (Hegerty, 2020).
Additionally, statewide studies in North Carolina and Mississippi show a higher
percentage of Blacks negatively impacted the number of bank branches (Burkey & Simkins,
2004; Wheatley, 2010). Magnify Money (2018) corroborates the findings, further verifying that
as the percentage of White people within communities increased, the banking branch penetration
also increased. As historical evidence proves bank concentration promotes growth for younger
businesses (Cetorelli & Gambera, 2001) and Black communities experience lower bank
penetration rates (Burkey & Simkins, 2004; Magnify Money, 2018; Wheatley, 2010), a negative
effect on Black business success is prominent.
Lending Impact
Bank branch closures negatively impact lending in Black communities. Touissant-
Comeau (2020) explores the impact of bank closures on businesses in low-income and minority

29
neighborhoods. The study shows that bank closures lead to a decrease in cumulative small
business lending. Further, an examination of areas with lower bank concentration rates
associated bank branch closures with lending supply shocks (Touissant-Comeau, 2020), thus
evidencing the short-term and long-term consequences of bank closures and low penetration
rates.
Additionally, Touissant-Comeau (2020) quantified the impact of bank branch closure on
businesses. The study found due to local bank branch closure, businesses with revenue less than
$1 million dollars experienced decreases in their ability to obtain financing for up to 3 years.
Further quantifying the impact, Nguyen (2019) identified small business loans decreased
annually by $453,000 for 6 years. The study calculates that the loan decreases resulted in a
cumulative loss of $2.7 million (Nguyen, 2019).
Black entrepreneurs experience disproportionately negative business impact resulting
from a lack of bank access. As 68% of Black businesses obtained their start-up financing at
banks in minority neighborhoods (Bates & Robb, 2013), studies confirmed minorities experience
a higher percentage of lending declines after the closure of a bank branch (Nguyen, 2019).
Additionally, Touissant-Comeau (2020) proved the negative effect of lending declines on
business growth. Compounding the negative financial impact on business funding due to
inequitable banking, consumer discrimination also alters Black businesses’ profitability.
Consumer Discrimination
As Black businesses seek to grow, consumer discrimination influences sales and overall
business success. Becker (1957) explored the concept of consumer discrimination resulting from
consumers’ willingness to pay a premium not to purchase goods and services from members of a
certain group. Moreover, Becker found consumers reward businesses complying with consumer

30
discrimination. Similar to historical research, additional studies confirmed the existence of White
consumers’ belief in the inferiority of goods and services produced by Black-owned companies
(Ogbolu & Singh, 2019; Price, 2005).
Price (2005) categorized consumer discrimination as an entry barrier in business and
additionally quantified the consumer discrimination impact on Black-owned businesses.
Specifically, the study calculated in 1992, consumer discrimination resulted in a loss of $5.6
billion for Black entrepreneurs (Price, 2005). Additionally, as Whites exhibited a preference for
White businesses while Blacks did not exhibit a similar preference for Black-owned businesses,
Ogbolu and Singh (2019) demonstrated consumer discrimination benefits White-owned
businesses and not Black entrepreneurs.
Studies sought to identify remedies for consumer discrimination. While Becker (1957)
determined competition does not affect consumer discrimination, more recent studies concluded
by influencing the costs and benefits associated with consumer discrimination, business owners
can influence consumer discrimination inefficiencies (Coyne et al., 2010). Further, Liu et al.
(2020) found through consumer behavior examination and price bias identification, consumer
discrimination existed primarily in common goods and not with ethnic goods. As such, the study
identified minority businesses highlighting ethnic characteristics as a method of combating
consumer discrimination (Liu et al., 2020). In addition to general challenges encountered by
minority and Black businesses, Black business owners encounter additional disadvantages when
entering the marijuana industry due to the history and nature of the industry.
Marijuana Industry
The marijuana industry’s semi-legal classification as an industry prohibited at the federal
level hinders research and the development of uniform regulatory requirements. Although many

31
states passed legalization or decriminalization legislation in the recent years, federal legislation
guidance fluctuates with regards to federal prosecution of marijuana, resulting in unique
impediments to marijuana business ownership and research. President Nixon criminalized
marijuana through the Controlled Substances Act by classifying the substance as a Schedule 1
drug (Vitello, 2009), and marijuana is currently illegal under federal law (New Frontier, 2017).
However, 36 states and four territories have legalized medicinal marijuana. Further, 18 states,
two territories, and Washington D.C. allow recreational marijuana (National Conference of State
Legislatures, 2022). Appendix C details U.S. territories and states with the respective marijuana
legalization laws. Figure 5 presents current adult use legalization status of states and territories in
the United States in a map (National Conference of State Legislatures, 2022).

32
Figure 5
United States Marijuana Use Legalization

Note. From State Medical Cannabis Laws. National Conference of State Legislatures, 2022
(https://www.ncsl.org/research/health/state-medical-marijuana-laws.aspx).

Proponents of the federal legalization of marijuana emphasize the popularity of marijuana
usage, selective enforcement of drug laws, lack of association of marijuana use with violent
crime (Vitello, 2009), and benefits of regulation including restriction of access to youths and
promotion of the least harmful products, product risks, and marketing controls (Hall &
Kozlowski, 2017). Further, as appeals against legalization often included hysterical and racist
commentary about Blacks and Hispanics, marijuana criminalization is historically attributed with
racism and Prohibition (Vitello, 2009). Legislation such as the Marijuana Opportunity
Reinvestment Act of 2020 seeks to decriminalize marijuana by abolishing penalties for
marijuana possession, manufacturing, and distribution (Marijuana Opportunity Reinvestment

33
Act, 2020). The legislation removes cannabis as a federally controlled substance, establishes a
federal expungement process for marijuana convictions, and allows commercial banks to provide
capital for cannabis-related businesses (Marijuana Opportunity Reinvestment Act of 2020).
Marijuana Business Ownership
Through the implementation of industry best practices, marijuana business owners
maximize business profitability and sustainability. Kleiman et al. (2019) identified low overhead
costs and in-house skills as attributing factors of survival. Further, due to knowledge of
consumer demands, successful processors and producers focus marketing on budtenders instead
of end users. While smaller businesses cited consolidating product offerings, larger businesses
described the diversification of products as a contributing factor to sustainability. Despite the
conflicting views on product offerings, businesses agree majority of consumer demand exists for
dried marijuana flowers (Kleiman et al., 2019).
Business Hurdles
Despite the implementation of best practices, marijuana business owners encounter
industry-specific encumbrances. The barriers to marijuana business sustainability include high
start-up costs (McVey, 2019), banking regulations (Hill, 2021; Kamin, 2020; Tilburg et al.,
2019), and hostile business environments susceptible to market monopolies (Kleiman et al.,
2018). As such, marijuana business owners encounter unique challenges to sustainability.
Start-Up Costs
Marijuana business ownership requires a large amount of start-up capital, creating a
significant barrier to entry. Although start-up costs vary by state and business vertical, they are
on average are high. Industry information shows the average start-up cost for a vertically
integrated retailer, cannabis processor, and stand-alone retailer as $2.5 million, $500,000, and

34
$312,000, respectively (McVey, 2019). In addition to retailer fees, states with legalized cannabis
require a license for the cultivation, distribution, or sale of marijuana (Staggs & Wheeler, 2018).
Ajax (2019) found licensure fees as high as $300,000, while Stelton-Holtmeier (2021) showed
application fees as high as $210,000. Figure 6 graphically presents the median and range for
marijuana applications and licenses (Stelton-Holtmeier, 2021).

Figure 6
Marijuana License Application Fees and License Fees

Note. From “Women and Minorities in the Cannabis Industry,” by J. Stelton-Holtmeier. MJ Biz
Daily, 2021 (https://mjbizdaily.com/wp-content/uploads/2021/10/MJBizDaily-Women-and-
Minorities-in-Cannabis-Report.pdf)

35
Market Monopoly
If an entrepreneur obtains the high business start-up costs, market monopoly hinders
successful entrance into the industry. Corroborated by price decreases in Oregon (Cannabis
Benchmarks, 2018) and a 60% price decrease in Colorado (Colorado Department of Revenue,
2019), Kilmer et al. (2010) demonstrated marijuana production costs significantly decrease after
legalization. Further, Kleiman et al. (2018) identified that in Washington, larger businesses
possessed the ability to produce low-cost marijuana in reaction to decreased sales prices resulting
from marijuana legalization. Lacking the ability to compete, smaller businesses failed (Kleiman
et al., 2018), thus creating a business climate susceptible to market monopoly. As federal
prohibition laws discourage larger companies from joining the marijuana industry, federal
illegality allows smaller business to remain somewhat competitive (Hall & Lynskey, 2020).
Although federal law assists with preventing market monopolies, regulations create difficulties
with business banking.
Banking
Federal regulatory uncertainty increases banks’ resistance to provide services to
marijuana businesses (Hill, 2021; Kamin, 2020; Tilburg et al., 2019). Fewer than 7% of banks
work with marijuana businesses (FinCEN, 2021; McVey, 2021). Marijuana businesses owners
able to navigate banking obstacles and obtain a depository bank account pay high monthly fees,
have difficulty getting loans, and encounter problems accepting debit and credit card payments
(Hill, 2021). In addition to banking struggles, marijuana business owners encounter additional
impediments. Figure 7 graphically represents banks and credit unions actively working with
marijuana businesses (FinCEN, 2021).

36
Figure 7
Banks and Credit Unions Providing Banking Services to Marijuana Related Businesses

Note. From Marijuana Banking Update. FinCen, 2021
(https://www.fincen.gov/sites/default/files/shared/508_299423_MJ%20Banking%20Update%20
1st%20QTR%20FY2021_Public_Final.pdf)

Other Industry Difficulties
Marijuana business owners encounter industry-specific obstacles. Failed or struggling
marijuana business owners described hindrances such as the inability to sell direct-to-consumer
alongside higher than anticipated costs, price, and difficulty distinguishing brands (Kleiman et
al., 2019). Further, marijuana businesses’ inability to deduct all business expenses except the
cost of goods sold results in an effective federal tax rate of over 80% (Kamin, 2020). Additional
sustainability barriers included regulation complexity, obtaining real estate and physical
locations, training in industry best practices, and lack of access to industry information (Analytic
Insight, 2020). In addition to general marijuana business challenges, the exclusion of convicted
felons from obtaining marijuana licenses (Thompson, 2017), and the consideration of a prior

37
felony in the license application disproportionately disadvantage Blacks’ marijuana industry
participation (Rahwanji, 2019).
Black-Owned Marijuana Business
Due to racial inequities, most marijuana businesses are disproportionately White owned.
Studies demonstrate minorities face unique challenges to successful marijuana business
ownership such as lack of connections, industry-related education gaps, lack of community
support (Hudson, 2019), lack of capital financing (Harris & Martin, 2021), and historic
incarceration rates (Stoa, 2021). In Massachusetts, the Cannabis Control Commission (2020b)
study surveyed social equity program participants and interviewed key stakeholders. The study,
with the purpose of reflecting the lived experience of social equity license applicants, identified a
lack of access to funding, stigma, lack of training, and the effect of the War on Drugs as barriers
to entry into the marijuana industry (Cannabis Control Commission, 2020b). As such, the War
on Drug’s disproportionate impact on the Black community is important to explore.
Human Capital Availability
Due to racial disparities in drug arrests, the criminal background history criteria for
obtaining legal marijuana licenses disproportionately excludes Black applicants. Although
Blacks and Whites use marijuana at similar rates, the American Civil Liberties Union (2013)
reported in the United States, Blacks were 3.73 times more likely to be arrested for marijuana
possession than Whites. Additional studies examining arrest records found that in every state,
Blacks were more likely to be arrested for marijuana possession than Whites (American Civil
Liberties Union, 2020; Rosenburg et al., 2017). The American Civil Liberties Union (2020)
study discovered disparities as high as Blacks being 9.62 times more likely to be arrested in

38
Montana than Whites. Appendix B includes a table detailing the Black and White arrest rates by
state.
Following marijuana decriminalization, national marijuana arrest rates decreased;
however, due to legal restrictions with legislation and structural resistance to change (Harris &
Martin, 2021), racial disparities increased or remained consistent (American Civil Liberties
Union, 2020; Firth et al., 2019; White & Holman, 2012). Further in 31 states, arrest rate racial
disparities increased between 2010 and 2018 (American Civil Liberties Union, 2020). Additional
investigation of the disparity revealed municipalities legalizing marijuana without implementing
other social equity measures led to increases in racial disparities among marijuana arrests (Harris
& Martin, 2021), thus evidencing the persistent arrest disparity post marijuana legalization.
Figure 8 graphically presents the overall disparity in Black and White arrest rates between 2010
and 2018 in the United States (ACLU, 2020).

39
Figure 8
Black and White Marijuana Possession Arrests Between 2010 and 2018

Note. Rates by per 100k people. From A Tale of Two Countries: Racially Targeted Arrests in the
Era of Marijuana Reform. American Civil Liberties Union, 2020
(https://www.aclu.org/sites/default/files/field_document/marijuanareport_03232021.pdf)

Justice Inequities
While overall leniency for felony and misdemeanor arrests often benefits White people
(Americans Civil Liberties Union, 2013), Black people are 2.2 times more likely to be
prosecuted for drug offenses (Lyons et al., 2013). Further, Black people experienced higher rates
of criminal sentences resulting in incarceration and longer sentences (Rosenberg et al., 2017).
Further, Black people experience an increased arrest rate and lack of leniency in comparison to
other races (Gatson, 2019). As criminal records negatively influence the ability to receive a
marijuana business license (Adinoff & Reiman, 2019), inequal criminal justice severely impacts
the industry.

40
Licensure Roadblocks
Most states prohibit the employment in the marijuana industry or issuance of a marijuana
license to individuals with a criminal record (Adinoff & Reiman, 2019). Alaska restricts owners
with a felony conviction within 5 years or currently on parole from owning a business. Further,
employment is prohibited for felonies within 5 years and certain misdemeanors within 2 years
(Alcohol and Marijuana Control Office, 2018). Similarly, Massachusetts specifically excludes
people with distribution convictions from owning a business (Cannabis Control Commission,
2018), while New York prohibits anyone with a marijuana conviction from employment in a
dispensary (Drug Policy Alliance, 2017). Washington evaluates marijuana convictions utilizing
discretion and assigns points for felony and misdemeanor convictions, with eight or more points
resulting in a license application rejection (Washington Administrative Code, 2021). California
allows licensure denial for convictions; however, the state prohibits the use of a past conviction
as the only reason for denial if the sentence and probation are complete (SB-94, 2018).
Ahrens (2020) highlighted individuals most affected by the War on Drugs do not
experience the benefits of the legal marijuana industry. Due to the combination of current
licensure regulations (Adinoff & Reiman, 2019) and higher arrest rates (Firth et al., 2019; White
& Holman, 2012), Blacks experience increased inability to work and a lower probability of
marijuana business ownership. As Blacks are more likely to hire other Blacks (Association for
Enterprise Opportunity, 2017; Bates, 2006; Coyne et al., 2010; Fairlie & Robb, 2008) and prior
work experience deficiencies correlate with Black business failure (Fairlie & Robb, 2007), the
racial disparity in marijuana arrests negatively affects human capital available in the industry and
business sustainability.

41
Industry Knowledge and Political Capital
As Black entrepreneurs combat human capital issues, disproportionate access to
information creates additional challenges. Hudson (2019) showed the existence of an industry-
related education gap, highlighting minorities’ lack of cumulative marijuana industry knowledge.
The study recognized businesses connecting with individuals possessing specialized skill sets
and valuable networks as a common obstacle for minority marijuana entrepreneurs. Further,
Hudson emphasized the importance of partnership between professionals with technical
expertise, management skills, and fundraising capabilities for successful minority marijuana
business ownership.
As marijuana is currently federally illegal and a recently legalized industry in some
states, access to current compliance regulations and influence on future industry reform is
crucial. In the marijuana industry, legislation influences production, profit motive, regulation,
prevention and treatment resources, promotion, product type, product potency, licenses, law
enforcement, penalties, criminal records, and price (Kilmer, 2019). Regulators possess the
authority to create policies that prioritize industry equity (Stoa, 2021). Further, Hudson (2019)
evidences the importance of political influence for successful minority entrepreneurship in the
marijuana industry. Additionally verified by 58% of social equity applicants identification of
government regulations as a significant business entry barrier (Cannabis Control Commission,
2020b), Analytic Insight (2020) identified regulation complexity as a challenge to marijuana
industry participation. Further, Cannabis Control Commission (2020b) study participants
identified political navigational challenges as one of six obstacles faced by communities
disproportionately affected by the War on Drugs.

42
As exemplified by the majority White-male led U.S. Congressional Cannabis Caucus, the
inability to navigate politics is further amplified by the lack of diversity of regulators. In 2017,
four White men formed the only bi-partisan caucus to streamline federal marijuana reform
(Shuckerow, 2017). In 2019, Congressman Earl Blumenauer announced the replacement of two
former caucus members with one White man and one Black woman (U.S. Congressman Earl
Blumenauer, 2019), thus solidifying the control of future federal legislation by White men.
Social Capital
Neighborhood community support is essential to Black marijuana business success.
Studies evidenced the history of racial residential segregation creating highly concentrated Black
communities (Grogan-Myers & Hatch, 2019; Massey, 2015; Tehrani et al., 2019). Bates and
Robb (2014) showed 57.6% of minority owned businesses operate in minority neighborhood.
Additionally, Bates (2011) confirmed a pattern of minority businesses operating in minority
neighborhoods and conversely, White businesses operating in predominately White
neighborhoods. While analyzing minority business patterns, Bates and Robb (2014) found
targeting same-race customers has been a starting point for many minority businesses, therefore
demonstrating the value of minority neighborhood support.
While Gatson (2019) demonstrated racism embedded in neighborhood, procedural, legal,
and individual police practices, the study further identified racially subjective perceptions of
neighborhood disorder and crime as the cause of place-based police discrimination. Additionally,
resulting in specialized police strategies in Black neighborhoods (Gatson, 2019). Thus,
specialized police strategies created a negative association with the Black community and
marijuana related policing practices.

43
In the marijuana industry, Hudson (2019) demonstrated the importance of community
residents’ support of a marijuana businesses including the entrepreneurs’ identity and primary
goals to successful business operations. Further, the study highlighted the legitimate community
concerns preventing neighborhood support of a marijuana business (Hudson, 2019), which may
result in a significant business impact. The community concerns identified in studies (Boggess et
al., 2013; Hudson, 2019) mirror the Cannabis Control Commission (2020b) survey participants’
identification of marijuana stigma as a business obstacle.
Grogan-Myers and Hatch (2019) highlighted the motivation of community homeowners
to maintain or increase property values through positive community features such as low crime
rates and high-quality schools. Further, the review examined the perception of value changes,
identifying the significant impact and homeowner action against neighborhood changes
perceived to negatively impact property values (Grogan-Myers & Hatch, 2019). Thus, the
historically destructive effect of discriminatory police practices and the mass incarceration of
Blacks due to marijuana possession may result in the community’s association of increased
crime, drug use, and incarceration with a new marijuana business often creates problems among
community leaders (Hudson, 2019). Similarly, city planners and law enforcement view
marijuana business locations as problematic (Boggess et al., 2013).
Marijuana stores are typically in minority neighborhoods with higher crime rates and
lower household income; accordingly, Shi et al. (2016) found a correlation between Colorado
marijuana stores and neighborhood demographics. However, the study linked community
concerns of crime to unlicensed marijuana businesses, not licensed marijuana businesses (Shi et
al., 2016). A Los Angeles County study verified an increased crime rates associated with high
concentration areas of unlicensed dispensaries (Nicholas et al., 2019).

44
In contrast to the benefits of neighborhood support, lower levels of social capital possess
the potential to cause the failure of a marijuana business. For example, the City of La Puente
prevented the opening of a medical marijuana business citing safety and welfare concerns,
negative economic impacts, and adverse community results such as the attraction of criminality,
addiction, substance abuse, and discharge of firearms (City of La Puente, 2008). As 48% of
Blacks and 46% of Whites identified working with community members to solve problems as an
effective tactic to achieve equality (Pew Research Center, 2016), neighborhood support has the
potential to assist or harm a business.
Financial Capital
Studies identified a lack of access to capital resources as a significant obstacle to
marijuana business ownership (Analytic Insight 2020; Cannabis Control Commission, 2020b;
Kilmer, 2019). Most marijuana businesses are self-funded with supplemental investments from
friends and family, if needed (Harris & Martin, 2021; McVey, 2019), thus creating a racial
barrier, as Blacks are less likely to receive financial assistance from friends or family (Berry,
2006; Cox & Rank, 1992) or experience a disadvantage with self-funding due to the wealth gap
(Kochhar & Fry, 2014; Tippett et al., 2014).
Further, as Blacks experience diminished access to bank branches (Burkey & Simkins,
2004; Magnify Money, 2018; Wheatley, 2010), the hesitation for banks towards service owners
in the marijuana industry magnifies the obstacle (Hill, 2021; Kamin, 2020; Tilburg et al., 2019).
Harris and Martin (2021) examined the racial disparity in access to financial capital. The study
determined financial capital barriers lead to the exclusion of able and knowledgeable Blacks in
the industry (Harris & Martin, 2021), thus proving the necessity of social equity programs as a

45
mechanism to combat racial inequities in relation to Black entrepreneurship in the marijuana
industry.
Social Equity Programs
Despite the adoption of social equity programs with industry regulatory legislature, racial
inequities persist. Although Harris and Martin (2021) identified most early marijuana
legalization programs excluded racial equity programs, Maryland, California, Massachusetts,
Ohio, Pennsylvania, Missouri, Illinois (McVey, 2021), Vermont, Arizona, and New Jersey
(Marijuana Policy Project, 2022) created social equity programs. Currently, states such as
Mississippi, South Dakota, and Montana do not utilize programs to correct marijuana racial
equity.
Analytic Insight (2020) study identified the most common social equity needs as
community empowerment, a living wage for entry-level marijuana jobs, addressing racism and
lack of inclusiveness in the industry, and lowering entry costs; therefore, the differing programs
do not address the racial gaps. Currently, there is no uniform industry definition of equity or
performance goal (Stoa, 2021). In 2021, Colorado set a fiscal year 2021–2022 goal of increasing
minority business ownership from 15.2% to 16.8% by June 30, 2022 (Colorado Marijuana
Enforcement Division, 2021b), creating one of the first measurable racial diversity initiatives.
Table 3 describes the states with social equity programs as of 2020.

46
Table 3
States With and Without Social Equity Programs
State Social equity
program
No social equity
program
Alaska x
Arizona x
California x
Colorado x
Illinois x
Maine x
Massachusetts x
Michigan x
Montana x
Nevada x
New Jersey x
Oregon x
Vermont x
Washington x

Social equity programs lack uniformity resulting from state legislation variations and
differing priorities. To address inequities in funds, Illinois’s Cannabis Business Development
Fund provides grants and low interest rate loans, fee waivers, and fee reductions to social equity
applicants (Cannabis Regulation and Tax Act, 2019; Marijuana Policy Project, 2020). Similarly,
Massachusetts created a social equity program to benefit disproportionately harmed people
through free technical assistance and training programs to provide tools and training to obtain
licensure; prioritizes review and licensure of applicants who demonstrate economic
empowerment of disproportionately harmed people; and tracks and pursues meaningful
participation of women, minority, and veteran-owned businesses with no formal numerical goal
(Cannabis Control Commission, 2020a). The social equity program provides free training and
tools for entrepreneurship, managerial and entry-level workforce development, and general

47
business support; however, program completion does not result in or guarantee a license
(Cannabis Control Commission, 2018).
Further, states created social equity programs to reserve licenses for specific groups.
Colorado approved 37 social equity licenses as of November 1, 2021 (Colorado Marijuana
Enforcement Division, 2021b). Washington identified the 2012 legalization of marijuana did not
address the disproportionate effect of marijuana enforcement laws on communities of color. As
such, through 2020 state legislation, Washington reserved 34 marijuana licenses for social equity
purposes (Washington State Liquor and Cannabis Board, 2020). Ohio designated 15% of medical
marijuana licenses for minorities, resulting in 16% of dispensary license ownership by minorities
(Harris & Martin, 2021); however, the courts determined the provision illegal in Pharmacann
Ohio, LLC v. Ohio Dept. Commerce (2018).
Additionally, some social equity programs prioritize diversity in the licensure application
process. Maryland’s and Pennsylvania’s medical cannabis application include a social equity
consideration worth 15% of the applicant’s total score for licensure consideration (Marijuana
Policy Project, 2022). These social equity factors include a diversity plan, disadvantaged equity
applicant ownership status, and economically disadvantaged location (Maryland Medical
Cannabis Commission, 2019). Similarly, the licensure application process in Pennsylvania
includes 100 points for a diversity plan out of a total 1,000-point application score (Marijuana
Policy Project, 2022). The 2018 legalization of Marijuana in Michigan required the creation of a
social equity program. The social equity program provides participants from 19
disproportionately impacted communities with application assistance and coordinating resources,
a reduction of up to 60% of fees, and general and industry-related education resources (LARA
Marijuana Regulatory Agency, 2019).

48
In addition to state programs, smaller municipalities created social equity programs. For
example, Oakland, California implemented an Equity Permit Program to designate half of
marijuana licenses to people with marijuana criminal histories or in areas heavily affected by the
disproportionate arrests of Blacks (Bonde, 2020). Further, the program dedicated $3.6 million
toward financial assistance for minority individuals starting a marijuana business (Marijuana
Business Daily, 2017). The city of Los Angeles implemented a social equity license program
with licenses awarded on a 1:1 ratio basis of social equity to regular business applicants;
however, hundreds of regular business applicants were processed prior to the programs’
implementation (Nany & Slushy, 2019). Appendix A fully details each state’s social equity
program.
Limitations of Literature Review Recent Research
Due to the federal illegality of marijuana and the recent timing of state referendums on
legalizing marijuana, limited empirical research exists that is directly related to the marijuana
industry. Most of the research involves the legalization of marijuana and the impact of the War
on Drugs. Little empirical research exists regarding legal marijuana industry business practices
and diversity. For example, no studies exist specifically discussing the racial disparities in
marijuana-related lending, only general lending to Blacks in comparison to other races.
Additionally, there is no empirical studies regarding rejected marijuana license applications and
racial disparities. Although industry data reports and limited studies exist detailing the lack of
diversity, few empirical studies examine the causes of the racial disparities within the cannabis
industry. As such, the literature review utilizes empirical research to examine the Black and
minority business disparities and explores a combination of empirical research and cultural

49
artifacts to examine the marijuana-industry-specific racial ownership difference. The lack of
research demonstrates the importance of the study to further analyze and verify the problem.
Summary
The beginning of Chapter 2 reviewed literature related to minority businesses, Black-
owned businesses, the marijuana industry, and Black-owned marijuana businesses. The review
has also reviewed assistance programs, such as government procurement programs and social
equity programs designed to address racial inequities in business. Next, the chapter examines
racial inequities in business specific to the tenants of critical race theory and levels of racism
theoretical framework.
Conceptual Framework: Levels of Racism, Critical Race Theory, and Black Marijuana
Business Ownership
The study examines racial diversity differences in Black marijuana business ownership
through the utilization of critical race theory and levels of racism theoretical frameworks. The
theoretical frameworks inform the understanding of racially caused business inequities examined
through the study. Further, the established theoretical frameworks detail the influence, extent,
and outcomes of racism on Blacks. As such, using the levels of racism theoretical framework and
critical race theory in the conceptual framework provides insight into the racial impact on
business practices, economic systems, and entrepreneurs, and the conceptual framework guides
the review of existing literature through the identification of key business areas impacted by
racial inequities. Thus, the two theories guide the development of the research questions and the
examination of the current literature by framing the lens of the impact of race and diversity on
entrepreneurship and business through the matching of Black business and marijuana industry
data with the components of the theory.

50
In the conceptual framework, the levels of racism theoretical framework define the
critical race theory theoretical framework’s tenets to create the conceptual framework framing
the study. Specifically, institutional racism and internalized racism frame the critical race theory
tenet of racism as normal. As such, the conceptual framework includes an exploration of racism
as normal through the examination of institutional racism barriers to entry such as arrest
disparities (Americans Civil Liberties Union, 2013; Gatson, 2019), differential access to capital
(Palia, 2016) and information (Hudson, 2019), consumer discrimination (Harris & Martin, 2021;
Ogbolu & Singh, 2019; Price, 2005), and economic inequities (Koechlin, 2019).
Further, the components of critical race theory formulate the examination of the impact of
race on society, Black entrepreneurs, and policymakers. Through establishing avenues racism
perpetuates itself, the theory allows the specific examination of historical and current
manifestations in business. The key concepts of critical race theory included in the conceptual
framework involve Black business owner’s self-perception as identified by similarities and
differences between the marginalized individuals’ experience, peer views (Harris & Martin,
2021; Hudson, 2019; Pyke, 2010), enthusiasm for entrepreneurial tasks (Neville et al., 2018;
Robb & Morelix, 2016), and the voice of the Black entrepreneur (Haney-López, 2014; Harris &
Martin, 2021). Figure 11 illustrates the interactive conceptual framework intersecting the Levels
of Racism theoretical framework and critical race theory, which guides the study.
Critical Race Theory
The study utilizes critical race theory to explore the lack of racial diversity problem with
business ownership within the Black community. Delgado and Stefanic (2001) identified the
tenets of critical race theory: racism is normal or ordinary in U.S. society, interest convergence
or material determinism, race as a social construction, intersectionality and anti-essentialism, and

51
voice or counter-narrative as main components of critical race theory. Figure 9 illustrates the
critical race theory framework.

Figure 9
Illustration of Critical Race Theory

Critical Race
Theory
Racism as normal
Interest
convergence
Race as a social
construction
Anti-essentialism
V oice/ Counter
narrative

52
Racism As Normal
Ladson-Billings (2013) further explored the belief of racism as a normality identifying
racism as a common experience for minorities. Building on the racism as normal tenet of critical
race theory, Hochschild (1984) presents evidence for the historical and inherent reinforcement of
racism by society; specifically, the existence and growth of modern society due to racism’s basis
in slavery and continuation of the practice. Further, Haney-López (2014) evidenced Whites’
acceptance of racial disparity within major social institutions. As Black and minority businesses
encounter barriers in the form of industry opportunities, capital financing (Bates, 2011), and
human capital (Loftsrom & Bates, 2013), racism exists in various aspects of business and daily
life for Black business owners.
Race as a Social Construction
Ladson-Billings (2013) examined the construction of race in conjunction with modern
society as members of the scientific community and sociologists agree race lacks a scientific
basis. Further, people utilize genetic differences to create a hierarchy and ideology of White
supremacy, thus resulting in racial disparities due to society’s construction and understanding of
race (Ladson-Billings, 2013). Through symbolic association between minorities and drug crimes
(Schlussel, 2017), racism is embedded in the history of marijuana in the United States. Further,
propaganda (Schlussel, 2017) and discriminatory police practices (Gatson, 2019) create racist
rhetoric that contributes to the current social construction of Blacks and marijuana. In daily life,
the biased narrative includes the middle-class ideology of individual merit that reinforces
stereotypes of Black inferiority (Schlussel, 2017). Further, consumer discrimination exhibits
White supremacy as consumers pay a premium not to purchase goods and services from Blacks

53
(Ogbolu & Singh, 2019; Price, 2005), thereby demonstrating White supremacy as a social
construction.
Voice or Counter-Narrative
Ladson-Billings (2013) identified historical stories result from a power source’s
determination of relevance and significance resulting in the embellishment of history. Critical
race theory utilizes voice for social justice purposes, highlighting the importance of a
marginalized group’s story and lived experience (Ladson-Billings, 2013). Haney-López (2014)
demonstrated Whites experience skepticism of racial discrimination claims in the legal system,
believing social institutions operate in a racially fair manner (Haney-López, 2014). Thus, the
Haney-López narrative contradicts the lived experiences of Black business owners who
experience marginalization in terms of business assistance and capital (Kilmer, 2019).
Further, in the marijuana industry, Harris and Martin (2021) examined the experiences of
Black marijuana business owners identifying Black owners’ frustration with the White
dominance of the industry. As contrasting views exist regarding racial disparities in marijuana
business ownership, it is essential to examine the counter-narrative. In addition to critical race
theory, levels of racism theoretical framework guide the study.
Levels of Racism Theoretical Framework
Jones’s (2000) levels of racism framework is utilized to guide the dissertation. The
framework classifies three levels of racism: institutionalized racism, internalized racism, and
personally mediated racism. Further, Jones identified institutionalized racism as an important
level to address for the other two levels to potentially self-resolve. Figure 10 illustrates the levels
of racism framework.

54
Figure 10
Illustration of Levels of Racism Theoretical Framework

Institutional Racism
Jones (2000) identified the first level of racism, institutional racism, manifests as
inherited disadvantages including differential access to information and resources. The levels of
racism framework explore the codification of structural racism into our laws, practices, and
customs (Jones, 2000). With the economic structure of the United States, Koechlin (2019)
examined the Whitewashing of economic education. The study found the conflation of
discrimination, history of racist exploitation, and false narrative of a natural market correction of
racism ignores the relationship between capitalism and racial inequality. As such, most
economists exclude the effect of racism on business outcomes (Koechlin, 2019), thus
demonstrating the codification of racism and bias with business economics and U.S. economic
structure.
Institutional
Racism
Internalized
Racism
Personally
Mediated
Racism

55
Lamikanra et al. (2013) examined the occurrence of unintended racial discrimination as
characteristics of institutional racism, including occurrences with non-biased intentions and
awareness of the discrimination. Further, the study highlighted the necessity of activism for a
timely removal of structural racism and an interim equitable society (Lamikanra et al., 2013).
Specifically, McCluney et al. (2020) identified three actions to combat institutional racism:
embracing discomfort to recognize racist mistakes, exploring the long-term history of racism,
and examining structural methods of maintaining racism. As such, it is important to examine the
effect of institutional racism and the pathways to rectify the disparities.
In the marijuana industry, institutional racism perpetuates as barriers to entry. The
criminal justice inequities highlighting the codification of racial biases with arrests through
police practices and criminal punishment in laws (Americans Civil Liberties Union, 2013;
Gatson, 2019) result in human capital deficiencies. The lack of access occurs at financial
institutions (Harris & Martin, 2021) and hinders businesses’ ability to procure start-up capital
(Palia, 2016). Further, Black business owners experience differential access to industry
information and lack the political capital to influence regulations (Hudson, 2019).
Internalized Racism
The second level, internalized racism focuses on stigmatized groups’ acceptance of
negative messages regarding their abilities and self-worth (Jones, 2000). David et al. (2019)
found the experience of racism over generations and throughout life leads to internalized
messages of inferiority, undesirability, and the development of animosity within the racial group.
Further, David et al. identified the normalization of negative messages as causing racial groups
to rationalize and perpetuate discriminatory thoughts and actions. As such, internalized racism

56
resulting from White-dominant ideologies and values manifests as self-doubt and disbelief in
people of a similar race’s ability and limits self-expression (Jones, 2000; Pyke, 2010).
In business, internalized racism is exhibited through Black’s discouragement with
entrepreneurial tasks resulting from previous racist encounters (Neville et al., 2018; Robb &
Morelix, 2016). As Blacks experience self-doubt relating to financing, the lack of loan
applications negatively impacts business growth (Fairlie et al. 2021). Further, consumer
discrimination and the resulting message of product inferiority influence sales and marketing
(Ogbolu & Singh, 2019; Price, 2005). Finally, the negative peer views perpetuate as lack of
social capital (Hudson, 2019) and decreased neighborhood support (Harris & Martin, 2021).
Conversely, Kaufka (2009) and Watts-Jones (2002) examined community involvement
and therapy to combat the phycological effects of internalized racism, thus exploring potential
solutions to entrepreneurial discouragement and social capital disparities. Liu et al. (2020)
signifies the benefits of positive messages in the use of positive racial differentiation to convey
added value for products. As such, internalized racism, specifically Black business owners’ self-
perception, provides a relevant lens to examine the lack of racial problem in the marijuana
industry.

57
Figure 11
Conceptual Framework—Integration of Levels of Racism and Critical Race Theory

Figure 11 details the conceptual framework. In the conceptual framework, the Levels of
Racism theoretical framework defines the constructs of the critical race theory. Specifically, two

58
levels of racism—institutional racism and internalized racism—frame the critical race theory
tenet of racism as normal, thus creating the four constructs of the conceptual framework:
institutional racism, internalized racism, race as a social construction, and voice or
counternarrative. Further, the conceptual framework’s four constructs then form the five key
concepts guiding the study: access disparities, barriers to entry, Black entrepreneur self-
perception, consumer discrimination, and the Black entrepreneurial experience.
Conclusion
The study seeks to analyze challenges, best practices, programs, and resources necessary
to examine Black business ownership in the marijuana industry and, thus understanding the lack
of racial diversity problem and racial inequities in the marijuana industry. The study examined
historical and current literature related to racial inequities experienced by the closest comparable,
minorities and Blacks in general business. Further, the practices of the marijuana industry were
reviewed to inform the study. Additionally, the limitations of the existing academic research of
the marijuana industry were discussed. Further, the chapter utilized the recent literature, critical
race theory and levels of racism theoretical frameworks to shape the conceptual framework to
guide the study. Next, Chapter 3 details methodology for the study.

59
Chapter Three: Methodology
The study sought to identify the barriers, best practices, policies, and resources
necessary to provide equitable representation of Black business owners and sustainable
business practices in the marijuana industry. The study employed the levels of racism
theoretical framework and critical race theory as a basis of the conceptual framework
alongside qualitative data analysis to form the research design. The following questions
guided the study:
• How have Black business owners accessed resources to support business ventures?
• How do Black business owners perceive their status as business owners?
• How do Black business owners navigate the opportunities available to them in the
marijuana industry?
• What resources would benefit Black business owners and lead to sustainable business
operations?
Chapter 3 outlines the methodology, research design, instrumentation and data collection,
and data analysis. The qualitative analysis includes sampling and recruitment strategy,
participating stakeholders, interview sampling criteria and rationale, recruitment strategy and
rationale. Further, the study evaluates the credibility and trustworthiness, validity and reliability,
and ethics of the data collected.
Research Design
The research study used qualitative interviews to explore the lived experiences of Black
marijuana business owners. Mertova and Webster (2020) found narrative research employs
varying data collection methods dependent on the research problem and data analysis. The study
utilized interviews to obtain information not practical to observe alongside the participants’

60
perspective (Patton, 2002) of the impact of race on their business. To properly analyze the
research questions, it was important to gather the stories, feelings, and reactions of the
participants. The study utilized one-on-one interviews to gain an understanding of the
participants’ use of resources, perception of status, navigation in the industry, and perceived
needs. See Table 4.

Table 4
Data Sources: Interviews
Research questions Interview
1. How have Black business owners accessed resources to support
business ventures?
X
2. How do Black business owners perceive their status as business
owners?
X
3. How do Black business owners navigate the opportunities available
to them in the marijuana industry?
X
4. What resources would benefit Black business owners and lead to
sustainable business operations?
X

61
Sampling and Recruitment
The participants for the study were Black business owners in the marijuana industry. The
target sample size of 10 interviewees, specifically Black business owners were purposefully
selected from California. To ensure a sufficient diversity of data to provide saturation (Saunders
et al., 2017), the participants were selected based on the sampling criteria and rationale detailed
by the researcher.
Interview Sampling Criteria and Rationale
The study utilized theoretical sampling with purposeful sampling as the initial sampling
decision in the planning phase. Theoretical sampling allows for data collection and analysis to
inform additional data collection and sampling (Thornberg & Charmaz, 2014). As the study
explores the participants’ lived experience, purposeful sampling was most appropriate selection
in the planning phase as the researcher selected individuals who can provide information most
related to the study (Maxwell, 2013). Additionally, Maxwell (2013) detailed the five goals of
purposeful selection that align with the study goals as follows: achieving representation, capture
population heterogeneity, selecting individuals critical to the study, establishing comparisons,
and establishing productive relationships.
Through purposeful sampling, which is appropriate for qualitative studies (Maxwell,
2013), participants were selected to ensure variety in gender, location, age of business, type of
business, business profitability, and use of social equity programs. To properly represent the
population, the participants were selected from California and a mixture of genders. Further, the
study included business owners in the start-up phase, established businesses operating over 2
years, and closed businesses with failed operations. For detailed business practice comparison

62
purposes, the participants included businesses at various profitability levels. The participants
were limited to those in the legal marijuana industry only.
Additionally, the study focused on maximum variation in the sample (Merriam & Tisdell,
2016) to ensure study saturation (Saunders et al. 2017). Through the review of the interview data
after 10 participants, the researcher evaluated the sample for study saturation to ensure additional
sampling was not necessary (Saunders et al., 2017). Further, the researcher evaluated the data to
identify the non-emergence of new themes (Given, 2016) prior to certification of saturation.
Thus, the researcher selected participants who have participated in social equity programs and
who have not received race-based assistance to evaluate the effectiveness of policies currently in
place to address racial inequality within the marijuana industry, across various types of business
within the industry subjected to regulation, and of varying demographics apart from race.
Criterion 1. Operation of a Legal Marijuana Business
Legal and illegal marijuana businesses comprise the marijuana industry in California. As
legal businesses are influenced by institutional racism described by the conceptual framework in
the literature review, the legal marijuana business population provides insight into business
owner experience and interaction with government and regulations. From among the study
participants, eight businesses had current operations, one was in process of completing the
application phase and identified as pre-operational, and one had a failed business or business not
currently in operation.
Criterion 2. Identification as Black or African American Owner
The lived experiences of Black marijuana business owners are crucial to the study.
Therefore, it was important to select 10 participants who self-identified as Black or African
American, and members of the Black or African American community. To fully explore all

63
aspects of business ownership, the study was limited to Black owners or executives with an
ownership stake in the company.
Criterion 3. Operation in Flower-Touching Marijuana Business
The study focused on marijuana flower-touching businesses such as retail, dispensaries,
edibles, cooperatives, cannabidiol brands, farms, events, accessories, distribution services.
Ancillary businesses such as consultants and accountants were excluded as their services are
transferrable across industries and often offer non-marijuana-related services. Thus, ancillary
businesses may not face the same problems as marijuana only businesses are not susceptible to
the same regulations affecting the legal marijuana industry. A total of 10 business owners
participated in the study representing seven types of flower-touching businesses.
Criterion 5. Business Operation in the California
As marijuana business regulations and the conceptual framework are unique to the United
States, the study participants were limited to businesses within the United States, specifically
California where marijuana has been legalized at the state level. To account for the regulatory
variations in each state within the United States, the study participants were limited to California.
Interview Recruitment Strategy and Rationale
The researcher recruited participants using personal networks, social media networks, and
referrals. In accordance with IRB guidance (Gelinas et al., 2017) to recruit participants, the
researcher utilized passive recruitment through post on their personal social media networks such
as Instagram and utilized active recruitment through personal messaging of identified Black
owned marijuana brands in California on Instagram. After initial social media solicitation,
participants received a recruitment letter through e-mail to ensure privacy. Appendix F details

64
written recruitment letter and Appendix H provides the social media post for the study’s
recruitment.
The researcher acknowledges an indirect connection to a participant recruited through
personal networks. As the researcher is a member of an investment fund which provides
financing to social equity applicants. The participant does not receive any direct funding from
the researcher. Further, the researcher is not involved and has no influence over the participant’s
activities. Although the researcher initially excluded the participant from the study due to the
indirect relationship, the participant was identified by multiple interviewees as a promising
practice in social equity. While reviewing independence and the value of the interview, the
researcher determined that independent evaluation may still occur with the business
Data Collection
Interviews were the primary method of data collection chosen for the study to provide the
researcher with a qualitative understanding of the racial effect on Black business ownership in
the marijuana industry. Interviews provide insight into thoughts, feelings, intentions, and
meanings attached to actions and policies (Patton, 2002). Further, the researcher utilized the
method to capture information on text responses, vocal tone, and body language when possible
(Burkholder et al., 2019). The interviews were conducted over a 2-month period to allow
convenience to the participants and maximize participation.
The researcher collected interview data via Zoom with recording and video optional for
the participants. The video was optional for the participants to increase the comfort of the
participants due to visual privacy (Burkholder et al., 2019), which may be desired due to the
semi-legal nature of the industry. The researcher utilized the video feature while conducting the
interviews to increase the comfort of the participants, highlighting Black identity as a cultural

65
similarity (Bogdan & Biklen, 2007). The study employed interviews rather than a focus group
primarily due to the potential influence of group talk over participants, availability of
participants, and location logistics and focused on the comparison of individual experiences
(Burkholder et al., 2019). However, while analyzing the data collected in the interviews, the
researcher examined the appropriateness of the data collection method and determine if a change
or additional data collection method is necessary (Thornberg & Charmaz, 2014).
Interview Process and Protocols
In a semi-structured format, the researcher qualitatively explored 20 questions with each
interviewee within a 45- to 90-minute video call interview. In accordance with Maxwell (2013),
the interview questions focused on gaining an understanding of the current industry conditions
that affect Black participation in the marijuana industry. Further, the interview questions used a
mixture of general questions and follow-up questions about specific events to include episodic
interviewing (Maxwell, 2013) guided by the conceptual framework. The dialectic approach
utilizing a combination of generalized questions and episodic questions allowed for a more
complex understanding of the problems (Maxwell, 2013) and for the participants to speak freely
about their experiences (Bogdan & Biklen, 2007).
The researcher allocated 90 minutes for each interview and protocol; however, if the
interviews last about 45 minutes, they were deemed acceptable. The interviews did not surpass
90 minutes to respect the participants’ time. If additional time was needed to complete interview
questions, clarify any open-ended questions, or to obtain additional information after initial
analysis, the researcher requested a follow-up interview with the current or new participants not
to exceed 90 minutes. When conducting a follow-up interview with new or current participants,

66
the researcher created a revised interview protocol comprised of the new questions (Thornberg &
Charmaz, 2014).
Interview Design
The interview questions directly related to the conceptual framework and the issues
identified in the literature review (Weiss, 1994). The key concepts from critical race theory
(Delgado & Stefanic, 2001) and the levels of racism theoretical framework (Jones, 2000) were
explored through the lived experiences of the participants (Patton, 2002) in the generalized
questions. Appendix G details the interview questions and the alignment to the research
questions, conceptual framework constructs, and key concepts. For example, through Interview
Question 1 (see Appendix G) the researcher asked the participants about financial resources
utilized to start their marijuana business. By identifying a specific resource, financial capital, and
obtaining the participants’ narrative about the process, the interview question sought additional
details regarding access to resources, which aligns with the purpose of Research Question 1 to
examine Black business owners’ access to resources to support business ventures (see Appendix
G). Further, the question aligns with the conceptual framework construct of institutional racism
and key concept of differential access to financial resources; indeed, the literature review
identified racial disparities in the procurement of financial capital (Bates & Robb, 2013; Fairlie,
2013; Fairlie et al., 2021; Small Business by Federal Reserve of Banks, 2021) resulting in a
barrier to entry in the marijuana industry (Analytic Insight 2020; Cannabis Control Commission,
2020b; Harris & Martin, 2021; Kilmer, 2019).
To ensure full and fairly recorded interviews (Patton, 2002), the researcher utilized a
mixture of live transcriptions and checked the accuracy with manual transcriptions as dialect and
accents are not always accurately captured by live transcriptions. As educational studies are rare

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in the marijuana industry (Tilburg et al., 2019), the researcher utilized a semistructured protocol
allowing a relaxed and conversational interview for more genuine and meaningful responses
(Merriam & Tisdell, 2016). As such, an interview guide that lists areas included in the interview
and suggested lines of inquiry was utilized (Patton, 2002; Weiss, 1994). The interview included
an average number of 20 questions; however, the specific number of questions varied as the
interview was designed to be conversational, and not all questions applied depending on the
participants’ previous responses and the time limits. Further, interviews conducted with
participants with specific knowledge of events focused on their unique information (Weiss,
1994). Further, the researcher was prepared to drop the guide entirely depending on the
interview’s direction (Weiss, 1994). Appendix D presents the interview protocols and guide.
Data Analysis
Maxwell (2013) highlights the importance of data analysis design prior to data collection.
Narrative analysis allowed the researcher to utilize data collected in the study, including the
participants’ responses, to extrapolate patterns and develop a theory based on data. Through
completing the qualitative data analysis, the researcher analyzed individual and collective Black
marijuana business owners’ actions, interactions, practices, problem-solving processes,
resources, and the meanings placed on situations and actions (Thornberg & Charmaz, 2014). The
data analysis occurred after each interview and continued until the conclusion of the study.
As the participants naturally told stories in response to interview questions, the researcher
utilized narrative analysis. Studies identify that individuals make sense of and share their past
experiences with others through stories (Gibbs, 2007; Mertova & Webster, 2020) as a method of
defining an issue and identifying a collective stance (Gibbs, 2007). Further, narrative analysis
focuses not only descriptions of events and experiences, but also captures the meaning of the

68
experience (Gibbs, 2007). Narrative analysis examines personal and social stories within the
social context taking into consideration the influence of experience and culture on knowledge
(Mertova & Webster, 2020). Thereby, an appropriate analysis method for the study.
Analysis of narratives includes identifying thematic ideas and structural points
considering events, experiences, accounts, and rhetoric (Gibbs, 2007). Identifying patterns and
categories to analyze the interview transcripts, the researcher utilized open coding to develop a
coding frame (Gibbs, 2007). Further, the researcher compared and grouped codes, examined
codes and emerging categories, compared different incidents, examined and compared
participants’ narratives. Thus, allowing for the identification of patterns and conceptual
categories specific to the marijuana industry to address the research questions (Gibbs, 2007) and
identify study saturation (Saunders et al., 2017).
Further, the researcher used comparative methods to analyze participants’ narratives and
descriptions. Merriam and Tisdell (2016) identified the creation of tentative categories at the
conclusion of each data collection. The tentative categories formed the coding frame and were
then analyzed, sorted, combined, and reduced to construct themes while considering the
frequency of mention, audience, and uniqueness. Thereby, allowing the creation of insights and
understanding to construct findings in the form of descriptive accounts, theories, themes, and
categories (Gibbs, 2007; Merriam & Tisdell, 2016).
Through ongoing data analysis after each interview, the researcher developed 31
inductive categories comprising the coding frame. Appendix I details the inductive categories
comprising the initial codebook. Utilizing coding software, direct interview quotes were linked
to each category (Creswell & Creswell, 2018). Then, the researcher examined and grouped the
codes, creating 12 final code categories further analyzing the codes and interview quotes to

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create the findings. Appendix J details the 12 categories comprising the final codebook.
Considering frequency of mention and audience (Merriam & Tisdell, 2016), if 80% of the study
participants mentioned a final category, the researcher identified the concept as a theme and
reviewed the narrative data within the theme to comprise the findings.
Further, the researcher searched for variation in data collected by Black marijuana
business owners thereby utilizing the participants’ narratives and descriptions to verify the
problem and explore Black marijuana business owners’ actions and processes. After each
interview, the researcher used memos to record tentative codes and categories, gaps, links to
relevant research, new questions, and analytical ideas (Thornberg & Charmaz, 2014). Thus,
allowing for ongoing data analysis (Merriam & Tisdell, 2016). Chapter 4 details the actions and
processes identified and the resulting detailed analysis.
Positionality
Cooper’s (2017) axis of privilege, domination, and oppression highlights the privilege
nature of the researcher’s credentialed identity and the oppression of Black and female social
identities. Resulting from the intersectionality of social identities, people experience the world
differently (YW Boston, 2017). As a member of the Black community, the researcher has direct
and indirect connections to people negatively impacted by the lack of access to the legal
marijuana industry which shapes the world view of the problem through heightened awareness to
problem. As such, the researcher’s positionality impacts the motivation associated with the
identification of problem and interest in finding.
Further, the intersectionality of the researcher’s social identities as a Black college
educated woman, institutional racism, and internalized racism effects the view on the lack of
diversity in the industry. Personally, the researcher experienced barriers throughout their career

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which impacted the view of the problem, including heightened sensitivity to the identification of
systemic barrier and the dismissal of other explanations of the lack of diversity from privileged
groups such as lack of interest from minorities. Thus, motivating the researcher to identify and
address the causes of lack of diversity within the marijuana industry.
However, the researcher’s privileged positionality results in blind spots the role of
nonidentifiable causes and racism in advancement prior to the point of business ownership. Due
to the privileged nature of the researcher’s credentialed identity, the researcher did not
experience all the effects of racism that most Black females encounter. Jones (2000) identified
internalized racism as a reflection of systems of privilege and identified the impact on individual
sense of value. As the lack of self-identification with the feelings of resignation and helplessness
experienced by Black business owners involved in the industry for an extended period of time
may potentially influence the study, the researcher purposefully selected entrepreneurs with over
2 years of experience in the industry and business owners with failed operations to capture a
variety of experiences.
Further, Jones (2000) demonstrated that entrainment of institutional racism in our society
results in the lack of need of identifiable causes. Due to the impact of privilege on the
researcher’s positionality, the study did not fully explore the role that constant institutionalized
racism plays in the advancement of Blacks to even reach the barriers of entry within the
marijuana industry. Additionally, the researcher’s world view motivates the belief that equity can
be achieved through the identification and correction of specific systems and policies that
disadvantage Blacks from entering the industry leading to the creation of solutions resulting from
the interview data. As such, the positionality shaped by the researcher’s identities effect the lens

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through which the study examined the lack of diversity problem in the marijuana industry and
provided solutions.
Credibility and Trustworthiness
As inherent bias exists within the researcher during qualitative procedures (Merriam &
Tisdell, 2016), the researcher implemented steps in the research design, collection, and analysis
to maintain the credibility and trustworthiness of the study. In the research design, quantitative
questions were utilized to anchor the qualitative interview discussion (Weiss, 1994). Further, the
researcher ensured maximum variation during sampling to increase transferability (Merriam &
Tisdell, 2016) and has received IRB approval to conduct the interviews.
As the researcher also shares the identity of a Black entrepreneur, this allows for
reflection and empathy to formulate additional probing questions (Bogdan & Biklen, 2007,
increasing trustworthiness and credibility in the data collection. During data collection, the
researcher documented their feelings and prejudices as possible sources of bias in addition to
generating understanding and establishing rapport with the participants (Bogdan & Biklen,
2007). The reflexivity increased credibility by identifying the effect of the researcher’s
experiences, worldview, and biases on the data collection and interpretation (Merriam & Tisdell,
2016).
To ensure the validity of the interview, the researcher completed a post-interview review
of the transcripts to ensure the reasonableness of the responses, uncover areas of uncertainty or
ambiguity, and requested clarification from participants if necessary (Patton, 2002). Further, the
researcher performed member checks for emergent findings or irregular data (Merriam &
Tisdell, 2016). During research analysis, the researcher utilized triangulation through document

72
analysis of press releases (Bowen, 2009) and popular culture artifacts (Bogdan & Biklen, 2007)
to increase the internal validity of the study.
The documents, which served as multiple converging data points (Merriam & Tisdell,
2016), provided context and background information, assisted with the suggestion of follow-up
questions, provided supplementary research information, and verified findings (Bowen, 2009).
As the use of triangulation increases the credibility and trustworthiness of the study (Creswell,
2009; Maxwell, 2013; Merriam & Tisdell, 2016), the researcher performed document analysis
using thorough examination and interpretation combining thematic and content analysis (Bowen,
2009), thus increasing credibility and trustworthiness when the documents validate the
participants’ interviews (Merriam & Tisdell, 2016).
Ethics
The researcher explained the purpose of the study and the methods (Merriam & Tisdell,
2016) to all participants prior to the commencement of the interviews as part of the interview
protocols in Appendix A. Additionally, the researcher considered their relationship to some of
the participants as an indirect investor in a social equity group which funds minority-owned
dispensaries in Los Angeles. The researcher does not personally invest into a marijuana business.
The researcher has no direct involvement with any owner and there was no apparent conflict.
The relationship was disclosed when applicable but advised study participation would have no
impact on the business as the researcher is not directly connected. Further, as the researcher
utilized live transcription for complete data capture and the study was not sponsored by an entity,
anonymity was not an ethical concern (Merriam & Tisdell, 2016).
As the marijuana industry is federally illegal, the study presented unique legal, ethical,
and privacy concerns. Merriam and Tisdell (2016) identified the importance of protecting of

73
subjects from harm, informed consent, and treating participants as people and not subjects
through relational ethics. A signed Informed Consent (see Appendix E) was received prior to the
interviews, and protection procedures were discussed prior to the interview as included in the
Interview Protocols (see Appendix D). To protect data access and ownership (Merriam &
Tisdell, 2016), all interview video recordings were stored in an encrypted system. To ensure
confidentiality (Merriam & Tisdell, 2016), all transcripts utilized pseudonyms to conceal the
identity of the participants.

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Chapter Four: Results and Findings
Chapter 4 details the study’s results and findings. The purpose of the study was to
analyze the challenges, available resources, and best practices of Black marijuana entrepreneurs
to understand racial inequities within the industry and the persisting inequities influencing Black
entrepreneurial success. To guide the study’s research questions, tenants of critical race theory
and the levels of racism theoretical framework were utilized to create the study’s conceptual
framework. Further, the narrative project utilized qualitative analysis to explore Black marijuana
business owners’ navigation of the marijuana industry and the development of business presence
in California through the lived experiences of the business owners.
The study utilized one-on-one interviews conducted via Zoom ranging from 45 to 90
minutes to gain an understanding of the participants’ use of resources, perception of status,
navigation in the industry, and perceived needs. The following research questions guided the
study:
• How have Black business owners accessed resources to support business ventures?
• How do Black business owners perceive their status as business owners?
• How do Black business owners navigate the opportunities available to them in the
marijuana industry?
• What resources would benefit Black business owners and lead to sustainable business
operations?
Using qualitative analysis, the narrative analysis study sought to identify the barriers, best
practices, policies, and resources necessary to provide equitable representation of Black business
owners and sustainable business practices in the marijuana industry. ATLAS.ti software was
used to perform the qualitative analysis which included the utilization of open coding. The

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researcher utilized ATLAS.ti software to compare, group, and examine codes; identify emerging
categories; examine and compare participants’ narratives, thus allowing for the identification of
patterns and conceptual themes.
If 80% of the study participants mentioned a concept, the researcher identified the
concept as a theme in this chapter. Through the use of open coding and review of the 10
participant interviews transcripts, the researcher identified five key themes: regulatory
environment, financial capital, predatory business practices, information access, and marijuana
stigma. The codebook for the study in Appendix I details the key themes identified in the data
analysis.
Participating Stakeholders
The participants in the study were Black marijuana business owners in the marijuana
industry located within the State of California. The participants were purposefully selected based
on the following sampling criteria: operation of a legal marijuana business in California, owner
identification as Black or African American, and operation of a flower touching marijuana
business. Business owners were recruited through personal networks, referrals, and social media.
As discussed in Chapter 3, an organization was excluded due to the researcher’s indirect
affiliation with the organization. However, while conducting the interviews, three participants
identified the organization as a promising practice organization in social equity. Considering
independence, the researcher deemed it appropriate to include the organization and evaluate
impartially.
Ten participants agreed to participate in the study. For the protection of the participants,
they are referenced by pseudonyms throughout the chapter. Table 5 details the assigned
pseudonyms.

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Table 5
Study Participants’ Pseudonyms
Participant number Assigned pseudonym
1 James
2 JM
3 John
4 Liz
5 Luke
6 Mark
7 Miami
8 Michelle
9 Mona
10 Paris

Participant Demographics
The study was comprised of 10 Black marijuana business owners in California. There
was no requirement on where within California the business was located. All study participant’s
self-identified as Black business owners. The study participant represented varying genders,
business type, years in business operations, and current business operation status to ensure study
saturation. Five participants self-identified as female and five participants self-identified as male.
Eight businesses were currently in operation, one business was pre-operational as they had not
yet opened their retail location, and one business was currently closed. The study included Table
6 summarizes participant demographics and details.

77
Table 6
Summary of Participant Demographics
Participant name Gender Business Years in
operation
Operation status
James Male Beverage
licensing
2018–current Operating
JM Male Franchiser 2019–current Operating
John Male Consumer brand 2018–current Operating
Liz Female Consumer brand 2021–current Operating
Luke Male Retail location 2014–2015 Closed operations
Mark Male Celebrity 2016–current Operating
Miami Female Consumer 2020–current Operating
Michelle Female CBD brand 2006–current Operation
Mona Female Retail location Preopening
Paris Female Retail location
grower
2015–current Operating

As discussed in Chapter 2, the social equity programs were designed to provide
marginalized Blacks with access to the legal marijuana industry. This program is unique to the
marijuana industry, and three participants participated in social equity programs. Table 7 details
the social equity participants in the study.

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Table 7
Social Equity Businesses
Participant name Social
equity
James
JM X
John X
Liz
Luke
Mark
Miami
Michelle
Mona
Paris X

Theme 1: Navigating Regulatory Environment
The first theme, navigating the regulatory environment relates to the following research
questions:
• How have Black business owners accessed resources to support business ventures?
• What resources would benefit Black business owners and lead to sustainable business
operations?
The participants discussed the availability and accessibility of resources to navigate
banking, tax, marketing, and licensure regulatory environment. Further, the participants explored
the impact that race plays on their access to resources.
Banking
The participants identified common industry barriers that the participants’ associated with
the semi-legal nature of the marijuana business and did not attribute to race. Specifically, nine
participants including Miami, Mona, John, Paris, Luke, JM, James, Mark, and Liz highlighted

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the navigation of banking as a common issue. The participants identified the lack of accessible
banking in the marijuana industry due to the regulatory environment. Mona detailed the current
banking environment, “you can’t even put cannabis money in banks . . . so you have to have an
ATM, a cashless ATM basically like for a nail salon or something like that. But it can’t be for
cannabis business because they will take your money.” Similarly, James stated, “Banking. You
can just forget about it, you know?” As such, the participants verified inability to obtain banking
access in the marijuana industry.
While some participants detailed not being able to obtain a bank account, others
acknowledged the possibility, but noted the high cost associated with obtaining an account.
While comparing the costs of banking for a marijuana business to his other restaurant franchise
businesses JM communicated:
The cost of banking is maybe 10 X, what it would be if this was not a cannabis business.
So, the cash management fees, the cheque processing fees, the wire transfer fees, that
account just to have accounts, all of the fees are 10 X what they are in the cannabis space
versus my [other] businesses.
Additionally, Mona detailed her businesses’ ability to bank and the high costs associated with the
service disclosing:
We pay a bank. We’re probably like 750 bucks on average a month for our cannabis
account because it’s at risk. . . . When people say that you can’t bank in cannabis,
everybody can have a bank account. All you have to do is pay for it.
Further commenting on the ability to bank and the high costs, Michelle expressed, “Thank God
we have banking. But for a lot of dispensary owners, they do not. There’s a huge minimum that
you have to have for banking and that kind of keeps the business unsafe.” As the participants

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highlighted the additional cost hinderances if the business obtains a bank account, banking is a
sustainability barrier for Black marijuana business owners.
Two participants, Liz and Michelle, identified the lack of banking resulting in safety
issues, including Liz who voiced:
You can’t get a bank account if you have a touching business, and that makes it real, real
difficult. To keep your books. It makes safety an issue if you’re selling, you know,
$80,000 a week in product, that’s $80,000 in cash that you need to find someplace to put
safely and keep.
Michelle further detailed the safety issue caused by lack of access to banking, “You know, if
they knew that, like, banking was a reality, then they wouldn’t be following folks home or, you
know, trying to go after folks businesses.” Thus, highlighting the security issues resulting from
improper banking access.
John, who owns a consumer brand, described banking as a necessity to conduct routine
business activities. He detailed basic business functions that were hindered due to banking
regulations stating, “But we also don’t have safe banking where we can put all of our money,
you know, where we can write checks and pay you know, pay our employees through a check
system.” As such, the participants specifically attributed banking access with the necessity to
perform daily business functions.
Further, Mark, who operates a celebrity consumer brand commented, detailed not only on
the necessity of change with banking regulations, but the hinderances caused by the current
banking regulatory environment voicing:

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The banking laws have got to loosen up. The limitations that are placed on candidates,
business owners, marketing wise, they just intentionally make it more difficult than any
other product out there that is.
Similarly, James described the difficulties conducting business without access to a bank account,
“How do you actually move money around? How do you get properties? How do you execute a
business when it’s considered federally?” Thus, highlighting the hinderances associated with
lack of banking access in the marijuana industry.
Additionally, participants described the loss of access to bank accounts as common and
negatively impacting business operations. Miami highlighted specific banking hinderances early
in her business operation due to the “high risk” nature of the industry that resulted in a 6-month
freezing of her account. Mona detailed a vault raid and the potential impact on other businesses:
There was a vault service that was actually picking up and holding money as a bank for
cannabis businesses. And they actually got raided by the feds. And the feds had to return
that money. But in turn, that hurt the businesses for us that would have devastated our
business. . . . But if that had been us, we would have probably had to close our doors.
Thus, emphasizing the business hinderances caused by lack of banking access.
A closed bank account not only impacts the business, but also the business owner. Luke
had his business account closed due to its affiliation with marijuana which impacted his ability to
maintain a relationship with banks for personal services, “I guess they [the bank] did research
after the fact and realized that we were a cannabis business. And due to those regulations, they
[the bank] pretty much canceled my ability to bank with that bank.” As such, Luke emphasized
the lack of affordable banking access Black business owners encounter, the business impact, and
resulting personal impact.

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Participants believe that changes to the banking industry would positively impact
business sustainability. When asked about changes that would benefit Black business owners,
Michelle identified banking divulging, “Banking is a big one.” Similarly, Mona identified
banking as the most immediate change needed, “Changes? Banking would be best.” Although
the participants did not provide specifics regarding the changes and the resulting benefits, Mona
and Michelle identified banking changes as a necessity. As such, access to banking is a key
resource to successful navigation of the marijuana industry.
Taxes
Eight out of 10 participants including Michelle, Miami, Mona, John, Paris, JM, James,
and Mark discussed the tax environment in the marijuana industry. Most participants understood
the necessity of complying with taxes. Michelle stated, “paying our taxes, those are best
practices.” Other participants expressed frustration with taxes. For example, Miami said:
Then the excise tax that they put on this. I’m tired of being taxed. Okay. I’m sick of it. I
paid literally five different types of taxes, and it makes me want to vomit. . . . California’s
tax rate on the cannabis industry is, like, 40%, and which means that you got to raise your
prices to offset what the cost is for it to even make sense.
Thus, highlighting the participants varying emotions associated with paying high taxes.
Additionally, Mona corroborated the high taxes disclosing, “The taxes are ridiculous.
When people go, you’re paying like 35% in tax. It’s very high tax rate. . . . Liquor is even taxed
at that rate.” In addition to highlighting the high tax rate, JM identified the tax environment as a
hinderance, expressing, “It is 37% taxes in California right now or in LA. When you get out of
the city, state, federal taxes combined. So that’s prohibitive.” Paris further detailed the business
issues caused by the high tax rate, “And I can literally tell you every point of the supply chain

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that a tax hits and it’s just not economically sustainable like for any industry.” Thus, highlighting
the necessity of a reasonable tax structure.
Two participants, James and Mark, highlighted the importance of business structure to
minimize taxes. Both companies are brands who participate in licensing versus a business
structure as a marijuana company. James explained the benefit of a non-marijuana business
structure communicating, “Because once you go down on paper as a cannabis company to the
IRS, you do understand you fall under 280 E . . . 60% of your overall income ain’t going to hurt
you. You’re toast.” Conversely, John structured his business as a cannabis consumer product. He
passionately described the problems associated with his business structure and the resulting high
tax rate:
We don’t get the write offs that a regular business owner will get. So our taxes are
[expletive] 1000 times higher than regular tax industries. . . . People think we make all
this money, but and we do, but the state, the city and the state, they take it from us. So,
we wind up generating more, but taking home just a little bit more than the yogurt owner.
Thus, the details provided by James, Mark, and John provide a sustainability comparison of
businesses with a favorable tax structure.
Four participants (Mona, John, JM, and Mark) identified tax laws as a necessary change
in the marijuana industry. While John discussed the overall tax system stating, “Tax reform
would benefit us a lot.” Similarly, when discussing changes, Mark identified the need for a
uniform tax system, “A tax structure that is nationally recognized...So it makes no sense that if
you are selling cannabis in Florida, Oklahoma, New York, California. You have completely
different tax structures.” Mona identified the tax rate as the issue announcing bluntly, “Lower the
tax rate.”

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Licensure Process
Seven out of 10 participants including Michelle, Miami, Mona, John, JM, James, and Liz
expressed frustration with the licensure process. Due to the length of time and cost, Miami
expressed frustration declaring:
It takes about a year to get a license. So, I feel like I shouldn’t take that long. I feel like if
I go through this process, it shouldn’t take a year and it shouldn’t be. I ain’t gonna say it
should it be so expensive.
Mona described her experience obtaining a license in Los Angeles detailing the long process:
The licensing process on our journey has been long. It’s. But the funny part about it is LA
is one of the easiest cities to open for social equity people. But it took us, what, 4 years to
get there, and then another year after we moved forward. . . . So, it’s been a long a very
long, hard process.
John provided an explanation for the lack of timeliness of the process, pointing to the inadequate
resources allocated. When describing the Department of Cannabis Regulation that issues the
licenses in Los Angeles, John declared:
For a long time, there was 11 people working in this department, 11 people to handle 300
licensed license holders. So, you can imagine how long it takes for you to get a response
for something, how long it takes for you to get an application pushed through. It takes
forever.
Thus, emphasizing the frustrations associated with the marijuana licensure process.
Further, JM detailed the business problems caused by the length of time associated with
the process leading to inevitable failure:

85
[The regulator] didn’t understand the sense of urgency from a timing perspective. They
mandated real estate prior to the licensing process. They were asinine and having social
equity licensees who by the charter had to make less than $48,000 to qualify for the
program. On how to maintain real estate while they figured out how to regulate the
opportunity. I was just asinine. . . . And they didn’t enable well capitalized companies.
They didn’t incentivize well capitalized companies based upon the policy that they stood
up. And therefore, their program is not successful.
Similarly, Mona described the financial impact of the licensure process of her business
and other Black businesses. She expressed, “We’re not the only people that actually ran out of
money trying to hold a location for licensing. We are not an anomaly. There’s a lot of people that
actually went bankrupt because of this, waiting for the city to move into licensing.” Thus,
highlighting the frustration of Black business owners and the business problems associated with
the marijuana license regulatory process.
Marketing
Eight participants (Michelle, Miami, Mona, John, Paris, JM, Mark, and Liz) identified
marketing as a unique issue in the marijuana industry. To highlight the differences in marijuana
marketing to other industries, Paris compared marijuana product marketing to marketing in the
tech industry stating, “Of course, we can’t even use social media, but we have extremely hard-
core regulatory regulations when it comes to how we can market and where we can market and
the population we can market to and billboards and all of these different things.”
Similarly, JM identified the same issues disclosing, “Now there are different barriers
because you can’t market the same way on social media, etc., etc.” In addition to the digital

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marketing restriction, Mona also detailed the physical marketing restrictions faced by Black
business owners. She stated:
The marketing restrictions are really interesting because you’re not really allowed to
advertise online. You can do social media and things of that nature. But, Billboards, you
can advertise to a certain extent. You can’t do it near schools, daycare, so there are a lot
of restrictions when it comes to advertising.
In addition to the inability to obtain a billboard, Miami described the inability to
effectively market to her audience digitally. She disclosed, “You’re not allowed to run ads about
cannabis or any type of anything related to cannabis. You can’t do it. So, whereas I can have the
best product in the world. I can have proven results. I can have all the hype. But like, if no one
knows about it, what good is it?” Thereby, highlighting the frustration of Black business owners
attempting to create product visibility.
Combating marketing hinderances in the marijuana industry, Liz leveraged her strong
online presence and expertise as a social media marketer to organically market her marijuana
business product. She discussed the importance of a strong marketing strategy and digital brand
presence stating highlight those factors as contributing factors to a marijuana business’s
sustainability:
Nowadays, you have to have a strong online presence, and I’ve been able to do that with
both brands in a very short period and do it very well, especially in the cannabis space. . .
. I’ve seen that a lot of cannabis businesses struggle in marketing and gaining a following
and that’s really been our strong point.
Thus, providing a pathway to navigate marketing challenges for Black marijuana business
owners.

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Further, John explained the importance of marketing for overall brand and marijuana
messaging. While discussing changes needed in the industry he divulged, “Allowing us to brand
and market on television, on Instagram and social media platforms, allowing us to educate the
world and let the world know that we exist and that we’re here in that we have a great product
like everyone else can do.” Thus, highlighting the importance of effective marketing to Black
marijuana business owners.
Four participants (Miami, John, Mark, and Liz) described similar experiences with social
media account bans restricting their ability to effectively digitally advertise their business.
Although marijuana related posts are permissible within guidelines on social media, the frequent
account bans and shadow bans discourage business owners from activity. Miami described
deletion of her accounts communicating, “My Instagram got deleted like five times. I had to
petition Instagram to give it back to me. My Tik Tok went viral and then got deleted after it went
viral.” Similarly, John stated, “It’s been the worst part of this whole [expletive] thing because my
Instagram has been taken down, which is my only way to market in general and cut out
education about my brand to my consumers are followers. We’ve been shadow banned.”
Further, Mark expressed discouragement while describing the current social media
environment:
It’s like literally not even a point of even having an account on TikTok. TikTok is the
fastest growing social media engine out there. Instagram has gotten better, significantly
better. But they will shadow ban. And their shadow bands very they will make it hard for
customers to find you or they’ll make you a good example.
As such, exemplifying the social media marketing obstacles for Black marijuana business
owners.

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In addition to marketing difficulties hindering a business owners’ ability to speak directly
to consumers, Mark described the negative impact of marketing regulations on marijuana
business operations. Due to a product description affiliation with marijuana, an online retailer
prohibited the sale online. Mark revealed:
[My brand] made a very unique, singular joint holder, high quality, something you can
carry a pre-roll in. And we made the mistake of calling it a joint holder, and just because
we called it a joint holder, we were pulled by [online retailer] . . . And literally we could
have named it cigar holder and sold them just fine through [online retailer].
Thus, highlighting the difficulty on marketing and selling directly to marijuana consumers.
Racial Barriers and the Regulatory Environment
All 10 participants described racial barriers exacerbating an already difficult regulatory
environment in the marijuana industry. Due to the White dominance and navigation of the
industry, participants described perceptions of racism built into the industry regulations and
programs. James voiced, “being Black is definitely, I hate to use the word disadvantage. The
field is not. It’s not prepared.” Further, James described the challenges of the marijuana industry
coupled with racial challenges expressing,
I would say it definitely makes my situation and the business itself. More challenging
than it already is, and it’s already a very challenge before you even get to that point. This
is a challenging business, but yet when you add that aspect [race] into it, it makes it that
much more challenging for sure.
As such, highlighting the additional racial barrier experienced by Black marijuana business
owners in addition to the industry barriers.

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Although participants described the industry as not designed for Black business success,
Paris described the industry strongly announcing, “It’s like when they tell you the intention is to
help you, but in reality, it’s just causing you more trauma and more undue harm from the
regulatory framework that set up.” For example, Michelle described marijuana licensure
programs as not designed for equitable participation. She expressed, “There at the time that we
obtained our licenses, the programs were not developed to help [Black people].”
Similarly, Liz detailed issues with the social equity program highlighting the lack of
intentional racial equity in the design. She stated,” I think that social equity could and would
work better, one, with more funding. And two, if the regulations weren’t set up or stacked up so
that we could fail. It doesn’t seem like the way things are regulated. It’s not done so for us to
succeed.” Thus, Liz emphasized her belief that marijuana programs were not designed for Black
business owner success.
JM correlated the policy makers lack of business experience with the poor design of
social equity programs. JM disclosed:
[Regulators] mandated real estate prior to the licensing process. They were asinine and
having social equity licensees who by the charter had to make less than $48,000 to
qualify for the program. On how to maintain real estate while they figured out how to
regulate the opportunity. I was just asinine. . . . And they didn’t enable well capitalized
companies. They didn’t incentivize well capitalized companies based upon the policy that
they stood up, and therefore their program is not successful.
Thereby, JM identified specific design problems leading the business failures in social equity
programs designed for Black business owners.

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Corroborating JM’s identification of flaws in the social equity program’s design and
execution, John detailed his experience as a social equity business owner navigating poorly built
programs. He stated:
[The city] just gave you the license and said, [the city] gave you a license, so don’t tell
us that you can’t be successful. So that’s kind of where it’s that’s where it’s broken,
right? The only reason why I [expletive] made it was because I had 25 years of
[expletive] experience from growing illegal and selling illegal weed, so I knew how to do
that already and I had illegal money stacked up. . . . But for everyone else who the socio
equity applicants who don’t have that, but they just got the license. But you have no
[expletive] resources so you’re going to fail.
As such, highlighting the impact of lack of resources combined with the marijuana regulatory
environment.
Additional participant detailed varied resource related racial barriers. Miami described
the racial wealth gap and licensure costs saying, “What average Black person, you know, has
$50,000 sitting in their bank just for an application for a license. That is no guarantee whether or
not you’re going to get approved. It’s bewildering. It’s literally set up for White people.”
Although he did not specifically reference financial resources, Mark detailed his overall
experience with race related resource limitations. “Those [resource] accesses are impacted by my
race because. Typically, the operators with the most experience [are] already the top of the food
chain, so that creates an almost organic level of discrimination.” Thereby, highlighting the
perception of the regulatory environment by Black marijuana business owners in combination
with the racial barriers associated with access to resources.

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Theme 2: Financial Capital
The second theme, financial capital, relates to the following research questions:
• How have Black business owners accessed resources to support business ventures?
• What resources would benefit Black business owners and lead to sustainable business
operations?
All 10 participants identified lack of access or restrictions with obtaining financial capital
as a problem in the marijuana industry. Additionally, the participants discussed the benefit of
access to adequate financial capital. All 10 participants either partially or fully self-funded their
business with five participants utilizing legacy funds and two participants obtaining funding from
investors. Table 8 details the business funding for each participant.

Table 8
Sources of Financial Capital
Participant name Personal
funds
Legacy Friends and
family
Capital
raise/investor
James X
JM X X X
John X
Liz X
Luke X
Mark X
Miami X
Michelle X X
Mona X X
Paris X X

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The lack of third-party financial assistance was corroborated by Miami who described no
family or friends’ assistance with starting her business. She expressed, “I self-funded in order to
start the business. Yeah, there was no handouts from anybody.” By highlighting the lack of
“handouts,” Miami verified the absence of outside financial contributions to her business.
Mona identified the lack of financial capital as an industry wide problem, voicing
“Access to funding is not really readily available for people in cannabis at this time.” However,
Miami associated the lack of financial capital with race asserting, “I feel like my race does play
an effect on lending opportunities.” Similarly, Michelle stated, “I think that capital is involved,
or the lack of capital is involved with race.” Luke further verified the existence of financial
capital as a hinderance to Black owned marijuana businesses. Luke disclosed:
[The marijuana industry] it’s capital heavy . . . you have to have X, Y, Z amount of
income, you have to have XYZ amount of liquid. And that that in itself is going to create
a barrier to entry. They marginalize a lot of African Americans just solely off the finances
that they’re acquiring.
Thus, describing the impact of race on financial capital in the marijuana industry.
Although Miami, Luke, and Michelle did not specifically identify factors associated with
racial inequity in relation to finances, James and JM determined the funding gap resulted from
varying networks between races. Highlighting the racial wealth gap within the Black community,
James stated:
[The marijuana industry] is not established for us to gain access to funds because
traditional capital raise is mostly family and relationship based. So, if you don’t come
from a network of people who have access to disposable income, equity, income,

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convertible, convertible debt, all of these different instruments that traditionally we don’t
even understand or have access to.
Similarly, JM, who successfully completed a capital raise for his business identified the same
racial wealth gap and networking hinderances in his marijuana business communicating:
Very few African Americans who have generational wealth [or] have created
generational wealth [or] have significant family offices. So, maybe if I was Jewish or
kind of White came from a different network, or if I didn’t go to Morehouse, but I was
Ivy League, I might have a different network of people who come from families with
different kinds of resources, which would have led to other conversations and
opportunities to be capitalized in a different way. . . . Race does play a part in the
relationships that we do or don’t have in our business based upon the probability of
having aligned relationships with high-net-worth people or representatives of high net
worth people just based upon life journey.
Thus, highlighting differences in the funding capability of Black and White networks.
Additionally, JM found that Black networks with the financial capability to participate
were less willing than White networks. JM describing his differing experiences with Black and
White people during his capital raise commented on the willingness of Black people to invest in
marijuana businesses:
Black wealth is less amenable to regulatory risk. . . . It’s almost like because we’re Black
and we’ve achieved something, we’re more risk averse in terms of White folks taking it
away. So, there’s that in ways that I didn’t encounter White people who are afraid of
cannabis at all from the beginning. I did encounter Black people who were.

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As such, highlighting the racial gap in ability and willingness to fund a Black owned marijuana
business.
While John highlighted personal networks as a best practice for funding, he attributed the
lack of commercial lending opportunities to race. John expressed, “The best financial resources
[are] private funding, private friends, and family money. Don’t even think about going and
getting a traditional loan or a loan from a bank. It just it’s not it’s not happening. And that is that
is definitely race.”
Additionally, James, who operates a beverage licensing company attributed the lack of
ability to get a loan due to race. He asserted, “You can’t just go get a loan. But even if you could
go get a loan. How many of us are going to get that loan?” As such, John and James description
highlights Black business owners’ perception regarding the inability secure business loans
through commercial banks.
Theme 3: Predatory Business Practices
The third theme, predatory business practices, relates to the following research questions:
• How have Black business owners accessed resources to support business ventures?
• How do Black business owners navigate the opportunities available to them in the
marijuana industry?
Eight participants (Michelle, Miami, Mona, John, Paris, Luke, James, and Mark)
discussed predatory business practices directed towards Black marijuana business owners. Two
out of the three (66%) social equity participants identified predatory practices; while six
nonequity license holders detailed their knowledge and experience with predatory investors,
consultants, vendors, or business partners. Table 7 details the social equity business owners.
Although the participants correlated the predatory business practices with social equity license

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holders, the participants discussed widespread predatory business practices with general Black
marijuana business owners.
Luke described the financially focused motivation of business vendors that caused him to
question the available business opportunities. Luke said, “That’s what I think of when I when
you say opportunity was you don’t really know for me personally, you don’t know if it’s a
genuine opportunity or it’s a money grab.” Luke described additional feelings of inequitable
business practices from vendors and suppliers. He stated, “But as I said before, the feeling was
more of a kind of like a money grab, you know, it’s like your patron in a person’s business. Are
they going to give you the best deals? Not necessarily.” As such, Luke perceived current
business relationships and opportunities as predatory and proceeded with caution.
Mark identified predatory business investors that negatively impact a Black business
owners’ sustainability resulting from Black marijuana business owners’ lack of business
knowledge and existing relationships. Specifically, he discussed the inability to identify
predatory behavior and opportunistic partners. Further, Mark highlighted the potential financial
consequences associated with the inability to identify predatory business partners. Mark
expressed, “Unfortunately, what it means is you meet a lot of the wrong people at first. And you
have to churn through them as quickly as possible and try not to lose much capital doing that.”
Thus, Mark verified the existence of predatory behavior towards Black marijuana business
owners and the corresponding consequences.
Unable to quickly identify predatory investors, Mona is in the process of litigation to
remove the predatory investors from her business. Mona detailed the lack of value provided by
the investors stating, “Investors, they have not really provided anything to us. We’re actually in a
process of litigation with them and getting rid of them. Describing the situation Mona attributed

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the behavior to race voicing, “So the only people that were willing to fund or pretend to fund
were predatory investors . . . a lot of it has to do with race.” Thereby, not only identifying the
predatory practice, but directly associating the behavior with race.
Four participants (James, Miami, John, and Paris) discussed the structure of the social
equity license creating opportunities for predatory investors. Specifically, James warned about
the predatory nature of social equity deals declaring, “He [an investor] could get me in a
predatory deal. . . . You know, and this is where our people signed those messed up social equity
deals.” Thus, highlighting the unfavorable structure of the social equity program.
Further, Paris, a social equity program participant, described her feelings towards the
social equity program resulting from predatory behaviors in the marijuana industry. Paris said,
“undo harm would be the word. It’s like when they tell you the intention is to help you; but in
reality, it’s just causing you more trauma and more undue harm from the regulatory framework
that set up.” As such, Paris verified the predatory practices occurring in the social equity
programs.
Additionally, Miami corroborated the existence of predatory social equity deals by
describing a close associate receiving payments in exchange for the exploitation of a social
equity license by a non-Black business owner. Miami revealed:
So, I have a friend who got approved for the social equity program who was selected and
was able to get a license to cultivate. He actually has two licenses, one in New Jersey and
one in Chicago. He went and got partnered with one of the big boys . . . and he became a
millionaire literally overnight. This man won the lottery and a social equity thing and is
literally making millions of dollars. He gets to own maintain 50% ownership in his
license. And he doesn’t have to do anything but wake up and breathe.

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Thus, the business owner White marijuana business owners were able to obtain and utilize a
social equity license.
Expanding on the common practice of Whites obtaining a social equity license, James
details the predatory nature of the contracts providing a Black business owner or eligible social
equity candidate with a large upfront fee. Although the upfront fee was large, the details of the
contract removed all control from the Black business owner and eventually utilized the upfront
fee. James described the predatory behavior detailing:
We [the investor] got $1,000,000 for you. . . . They [the investor] are going to own your
IP. They [the investor] are going to own your brand. They [the investor] are going to own
everything about what you’re doing. And you don’t even have access to the million
dollars. They got the million dollars, and they tell you how to spend it.
Thus, exampling the predatory contracts that hinder Black marijuana business ownership.
Further, John, a social equity consumer brand briefly described the predatory business
actions of a political group assisting him with the initial licensure process highlighting the
assistance but also the predatory behavior. John expressed, “they also kind of took advantage of
me a little bit as well, so I wound up moving away from them.” Thus, verifying the predatory
business practices encountered by Black marijuana business owners and the impact on
navigating available opportunities and resources.
Theme 4: Information Access
The fourth theme, information access relates to the following research questions:
• How do Black business owners navigate the opportunities available to them in the
marijuana industry?

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• What resources would benefit Black business owners and lead to sustainable business
operations?
All 10 participants identified lack of access to business and industry information as a
business operation obstacle. Although the participants associated the inaccessibility of
information with their race, six participants discussed human capital as a beneficial resource to
advance the racial gap, navigate opportunities, and lead to business sustainability.
Information as a Resource
Specifically, when discussing access to business information Miami attributed the
industry information knowledge gap to race saying, “Race definitely does play into effect.”
Highlighting the business owner perception of a racial information barrier in the marijuana
industry.
When discussing the importance of political information that impacts licensure Michelle
discussed the lack of access to information resulting from her status as a Black business owner.
As such, she expressed exclusion from access to information due to her race. Michelle said:
We as African American business owners don’t necessarily get the tools or the resources
or the information to actually know about. Oh, well, the city council meeting is next
Thursday at 7:00 pm. Make sure you’re there. Sometimes those things like that are not
advertised. That’s kind of an in-house network piece of information that only I feel like a
few are given.
Similarly, Mona attributed the lack of access to information to a racial gap with the
information gatekeepers. She expressed frustration from receiving inaccurate information due to
the lack of investment of non-Black contractors in Black business success. She stated:

99
Most of the lawyers are either Armenian, Jewish or something else, not too many Black
lawyers out there that are at the litigation level. And so, they tend to kind of give us
wrong information or information that is not in our favor.
Therefore, highlighting the limitation on access to industry information.
Additionally, James identified information gap regarding starting and maintaining a
successful Black owned business, also attributing the difference to race. He voiced:
For instance, I went into business thinking I was going to sell my way to the top . . . So, a
good business has to bring in capital. But the key to raising capital is not sales. And this
is a learning curve because I’m Black and we don’t have these discussions that I don’t
know that all my counterparts know.
Thus, James attributed an information gap which impacts the business’ ability to secure funding
to race.
Miami discussed the value of marijuana-specific information as a necessity because of
the nature of the marijuana industry as a “niche market.” Further, she highlighted the lack of
applicability of general business advice from peer business owners in other industry owners and
described the process attempting to self-research the necessary information due to lack of
assistance from others in the industry. Miami communicated:
No one is like opening the door and like opening up their, I would say, their intellectual
property to try to help you navigate this world because it’s such a niche market and
there’s not a lot of people that understand it. And it’s literally me being relentless and
hundreds of hours of literally like studying. I’m like staying up till 3 and 4 a.m. like eat,
sleep and breathing, trying to figure out the do’s and don’ts, trying to just understand the
lines, understand how to just navigate.

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As such, Miami utilized self-research to access industry information. Further, John corroborated
the uniqueness of marijuana industry information and the necessity of Black marijuana business
owners to utilize self-research. Additionally, he identified the negative impact of self-navigation
on business sustainability due to the costs. He revealed:
Whereas in cannabis there’s no template. Right? Again, we’re still building the template.
So, you kind of got to figure it out on your own, and when you’re having to figure things
out on your own, those experiences are costly. They cost you money.
Thus, highlighting impact of information on Black marijuana business owners’ navigation of the
marijuana industry and resources.
Successful Navigation
The participants discussed the tools necessary to successful navigate marijuana business
opportunities and access industry information. Six participants (John, James, Mark, Mona,
Miami, and JM) identified human capital as a method to obtain industry information.
Mona identified human capital available in government programs; however, qualified
that the results from the pilot program have not been assessed. She said:
The DCR, which is the city run program, where it was like a pilot program where they
[the program] walk you through to see how ready for like do you have your business
plan? Do you have certain things in place? Your investors, what are you looking for?
How do you pitch things of that nature? So, somebody that’s literally starting from
scratch, that was a benefit. It was actually a good program. We’re still waiting to see the
outcome from it.
Thus, exampling that human capital can provide the necessary information through government
programs for business sustainability.

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Mark discussed his lack of business knowledge due to no prior entrepreneurial experience
but expressed belief that human capital could lead to marijuana business sustainability. He
stated, “You can’t be an expert in every field. You have to surround yourself by people who are
better at things that you’re not.” Additionally, Mark identified specific attributes of team
members as an important resource disclosing, “There are also individuals that are very skilled in
operations and scaling. They’re very skilled. They’ve learned under the right people, and so
being able to work with those individuals, they just maximize your chance for chances of
success.” Therefore, highlighting the importance of human capital and the corresponding
necessary skills.
Although Mark did not identify the specific experts necessary for successful industry
navigation, James highlighted the benefit of his relationship with the appropriate lawyer and
accountant to start his business within the compliance requirements. He divulged:
The most powerful attorneys in the game right now are Ackerman. And they handle
every billion-dollar company. They do all the mergers and acquisitions. I went and found
the head of cannabis compliance and the partner over there and I retained him. That was
expensive right then. I had to go get very respected and old accountants to get all of my
data, all of my information, all of my sales, everything, and organize that.
Thus, verifying James’s attribution of the successful launch of his Company to the knowledge
and efficiency of the people retained.
Additionally, James discussed the large tax savings and ability to obtain a bank account
due to the company structure as a non-cannabis entity. He stated:
Luckily again, I retain the type of lawyers that structured my business in a way that
allows you to do banking . . . to be a cannabis company is a setup. That’s another thing

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our people don’t know, because once you go down on paper as a cannabis company to
the IRS, you do understand you fall under 280 E. . . . So, if you’re not believe in 60% of
your overall income ain’t going to hurt, you’re toast.
Although there was a high cost to obtain the information, once received, it resulted in successful
business operations.
Similarly, John attributed his ability to navigate business opportunities with the human
capital of his business team. John voiced:
I think I took advantage of pretty much everything that was available to me, but it wasn’t
because I personally had the knowledge. It was because somebody on my team had the
knowledge. So, in my particular case, I got lucky because I had two individuals on my
team who were very, very knowledgeable and very, very detail oriented when it comes to
finding opportunities to help us.
Due to his team’s business knowledge, John successfully navigated business opportunities.
Further, James acknowledged that human capital could positively impact the existing
racial knowledge gap in the marijuana industry. He expressed,
And there’s experts on this that will teach you how to leverage money, real estate, IP
licensing deals into ways that benefit the business without you just spending your cash.
You know, these are tricks of the trade that we weren’t raised in. So, I would say there
has to be more access to that for our people.
As such, highlighting the necessity of knowledgeable individuals to provide general business
knowledge not possessed by Black marijuana business owners due to their race. Thus,
demonstrating the impact of information on the navigation of resources and opportunities for
Black marijuana business owners.

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Theme 5: Marijuana Stigma
Theme 5 details the stigma associated with marijuana sale and usage. The theme relates
to the following research question: How do Black business owners perceive their status as
business owners? Ten participants discussed the negative stigma associated with the marijuana
industry. Further, the participants identified the impact of marijuana stigma on their perception
as business owners and their ability to navigate business opportunities.
When describing the negative attributes of Black marijuana business ownership, James
mentioned marijuana stigma. He communicated, “The downside, I would say, is the stigma
associated with it still.” Thus, despite legalization Black business owners feel impacted by the
stigma.
Through describing common thoughts and feelings about marijuana, Mona detailed the
stigma of marijuana. She said, “People still look at it [marijuana] as if it’s heroin and it’s as if it
[marijuana] is not natural. People are terrified of it.” Additionally, she discussed the narrative
and association of marijuana with other drugs voicing, “The way that, you know, cannabis has
been put out there, it’s like the gateway drug to all other drugs. So, people really still have a
negative stigma about it. It’s super still super stigmatized.” Thus, detailing the fear and
association of drugs with marijuana.
Through contrasting her lived experience in New York and California, Liz detailed the
marijuana stigma around consumption in the Black community. She said:
A lot of my friends here didn’t consume [marijuana], and they [my friends] weren’t even
really comfortable with cannabis culture. And I realized it was because of a lack of
education. There’s this stigma, the stereotype of smoking weed, especially amongst Black
women, that it’s gross, it’s unladylike.

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As such, Liz detailed the negative stigma associated with marijuana consumption.
Although Miami did not explain the specific stigmas associated with marijuana, Miami
discussed her desire to combat the negative association of marijuana due to her personal
experience and belief in marijuana’s health benefits. She said:
My dad had cancer. And I grew up really super religious, so I didn’t believe in cannabis.
We didn’t consume the devil’s lettuce. That’s not something that we did in my
household. It was it was very taboo. And it wasn’t until I started giving him the CBD and
the THC Oil that his tumor started to shrink, and then I became a believer. It’s like been
my mission, which is like the reason why I’m still in this. The reason why I love it is to
redefine what cannabis means. Like it’s not some drug that you just smoke to get high
and be stoned out with your friends. It’s actually out here killing cancer cells.
Although Miami identified her initial stigmatization of marijuana resulted from her religious
identity, she acknowledged the inaccuracy of the stigma through witnessing the healing benefits
with her father.
Similarly, Mona described the marijuana stigma within Black communities. She voiced,
“Most people don’t want dispensaries in their neighborhoods because a lot of them [are] people
that were impacted by the war on drugs. So, they saw their kids, their grandkids, you know, go to
jail. They had to move out of public housing because of drugs.” Thus, emphasizing the Black
negative experience with marijuana.
Luke corroborated Mona’s description of the Black community’s experience with
marijuana and the associated stigma. He said, “Before there was a huge stigma on marijuana. He
[Luke’s father] was going to jail for selling marijuana, you know, and then once that stigma got
released, got uplifted and it became profitable and acceptable to a certain degree.” As Luke’s

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participated in the legacy marijuana market, he described the legalization of marijuana altering
his status as a business owner. However, he still acknowledges the presence of a stigma with
Black marijuana business ownership.
Miami also described the influence of marijuana stigma on her identification as an
entrepreneur. Miami expressed:
We live in California. We’re very liberal out here. Very, very liberal. But go to the
Midwest, go to the south, go to places where, you know, this is so taboo, and then they’ll
[people in the Midwest] just look at you like a drug dealer or like, you know, a left wing,
It’s such a stigma that comes along with this industry and being a Black woman in this
industry, it’s just it’s just a crazy stigma that’s associated with it.
As such, the stigma of marijuana shapes Miami’s identity as a successful Black business owner.
When discussing differences between the marijuana industry ownership and general
business ownership, Luke detailed the impact of stigma on navigating available business
opportunities. He disclosed:
Trying to get over that stigma, especially if you’ve come from the legacy market. When
starting the business, you kind of have this, this kind of looking over your shoulder type
vibe, whereas if you were selling t shirts or clothes, you wouldn’t have that because it’s
not it’s not a stigma attached to it.
Thus, detailing the lack of freedom is business operation resulting from marijuana stigma.
JM described the hesitancy and excuses from Blacks when seeking funding for a
marijuana business. He communicated:
Black people are more skittish around [marijuana]. I don’t want to. I can’t risk my
reputation. I can’t risk my law license. I can’t risk you know, I don’t want to be involved

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in cannabis because it’s not federally legal. It’s almost like because we’re Black and
we’ve achieved something, we’re more risk averse in terms of White folks taking it away.
Thus, highlighting the negative impact of marijuana stigma on Black business financing.
Mark described the outdatedness of marijuana stigma and its impact on politics. He said,
“The stigma on cannabis belongs in the 20th century, not in the 21st century. Unfortunately,
we’re still dealing with lawmakers from the 20th century.” Thus, the stigmatized views held by
policymakers ensures that marijuana stigma continues and impacts business operations.
Although Miami did not provide actionable steps, she discussed the importance and
dedication to creating a positive marijuana narrative. Miami stated, “I’m very passionate about
getting rid of the stigma and redefining what cannabis means and like, you know, the structuring
and everything involved with it.”
Further, Liz identified a change in view on marijuana usage resulting from education
focused on Black women. She stated:
And so, I kind of just started the page to break down some of those [stigmatized] ideas
and to help shift the narrative about what it means to consume cannabis and ways that it
can help us as women of color. And from that, there was a great response.
Thus, highlighting the importance of marijuana education to combat marijuana stigma which
impacts Black marijuana business owners’ status perception.
Summary
Chapter 4 details key findings from the analysis, specifically the presence of significant
industry barriers that were exasperated by racial problems. The marijuana specific barriers
identified by participants included banking, taxes, licensure, and marketing. Additionally, the
analysis found that due to race, Black business owners encountered unique racial challenges

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navigating resources within the industry resulting from limited social networks and resources.
Specifically, the participants identified racial hinderances accessing information, personnel and
knowledgeable individuals, and financial capital resources which limited their ability to support
business ventures. However, the participants identified human capital provided a solution to
information and industry barriers.
Additionally, the analysis found that Black business owners’ experiences with predatory
investors, business partners, and vendors led to business owners practicing skepticism in relation
to available opportunities and hinderances with navigating resources. Further, the participants
identified marijuana stigma impacting their perception as a business owner and highlighted the
use of education as a method of combating the current stigma. Chapter 5 provides an overview of
key findings, discussion of identified themes, study limitations, recommendations for leaders and
practitioners, and recommendations for further research.

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Chapter Five: Discussion
Chapter 5 provides the study’s key findings, research limitations, recommendations to
leaders and practitioners, and recommendations for further research. The qualitative study
explored the lived experiences of Black marijuana business owners to examine the lack of racial
diversity in the marijuana industry. The purpose of the study was to verify the racial diversity
problem, identify barriers to Black marijuana business sustainability, provide solutions and best
practices for Black marijuana business owners.
To complete the study, the researcher conducted 10 semistructured interviews with legal
Black marijuana business owners in California. The data was analyzed using Atlas.ti to perform
open coding through creating and grouping codes. Then, the researcher analyzed the codes
identifying five conceptual themes: navigating the regulatory environment, financial capital,
predatory business environment, access to information, and marijuana stigma. The study’s
findings highlight the financial, knowledge, and social capital gaps between Black marijuana
business owners and White marijuana business owners and provides three recommendations for
the finding’s identified in the study.
Key Findings
The study’s findings validate the existence of racial bias in the marijuana industry and
identify social, financial, knowledge, and human capital deficiencies in Black marijuana business
ownership. The participants provided insight on the impact of marijuana stigma on their business
and their self-perception as business owners. Additionally, the interviews evidenced the impact
of regulatory barriers such as banking, taxes, marketing restrictions, and the licensure process on
Black business owner success in the marijuana industry.

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Further, the participants confirmed the added institutional racial barrier experienced by
Black business owners operating in the heavily regulated industry and identified regulatory flaws
that negatively impacted Black businesses. Black marijuana business owners identified racial
gaps in access to information and financial capital. Additionally, the participants emphasized the
importance of a network with funding capabilities and human capital exploitation in building a
sustainable marijuana business. Further, the participants exposed the predatory business
operating environment existing in the marijuana industry for social equity and non-social equity
Black business owners.
Discussion of Key Findings
The conceptual framework comprised of tenants of critical race theory and levels of
racism theoretical framework and the literature review in Chapter 2 guided the development of
the study’s research questions and interview questions. The interview findings evidenced the
lived experiences of 10 Black marijuana entrepreneurs. The emerged themes included:
navigating the regulatory environment, financial capital, predatory business environment, access
to information, and marijuana stigma.
Theme 1: Regulatory Environment
Black business owners believed the current regulatory environment of marijuana created
significant barriers for successful business operations. Specifically, the participants identified
banking, tax, marketing, and licensure process barriers impacting their conceptual knowledge.
Further, due to the restrictive design of marijuana regulations, the participants perceived race to
intensify banking, tax, marketing, and licensure obstacles. The study’s findings were consistent
with Analytic Insight (2020) study identifying a problem in social equity programs addressing
racism and the lack of marijuana industry inclusiveness.

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Banking
To improve the current regulation environment, the participants recommended banking
reform. As discussed in Chapter 2, Legislation such as the Marijuana Opportunity Reinvestment
Act of 2020 seeks to decriminalize marijuana by abolishing penalties for marijuana possession,
manufacturing, and distribution. The legislation removes cannabis as a federally controlled
substance, establishes a federal expungement process for marijuana convictions, and allows
commercial banks to provide capital for cannabis-related businesses (Marijuana Opportunity
Reinvestment Act of 2020). More recently, President Joe Biden announced a three-step plan
which includes federal pardons for marijuana possession and a review of the federal
classification of marijuana as a control substance (White House, 2022) potentially removing the
current bank hesitancy to provide services to Black marijuana business owners (Hill, 2021;
Kamin, 2020; Tilburg et al., 2019). As such, demonstrating the influence of politics on the
banking regulatory environment for Black marijuana business owners.
Most participants described the inability to obtain and maintain a bank account with
frustration. Expressing anger due to unnecessarily high fees, two participants confirmed the
utilization of financial capital to obtain bank account. Thus, the participants confirmed the
findings in Chapter 2 identifying that less than 7% of banks service marijuana businesses
(FinCEN, 2021; McVey, 2021) and that marijuana business owners pay high monthly fees (Hill,
2021). Although the cost of a bank account was significantly higher when compared to other
industries and difficult to obtain, the participants capable of obtaining a bank account
experienced less business and personal risk resulting from a closed bank account or operation of
an all-cash business. Further, verifying the discussion in Chapter 2 detailing FinCEN guidance
highlighting risks associated with marijuana bank accounts and requiring the filing of suspicious

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activity reports by banking institutions. Thus, confirming Black marijuana business owners’
banking obstacles.
Taxes
In addition to regulatory restrictions in banking, study participants identified high taxes
as a regulatory obstacle. Thus, confirming the effective tax rate industry barriers identified in
Chapter 2 detailing marijuana businesses inability to deduct business expenses creating a high
effective tax rate resulting from Internal Revenue Code Section 280E (Kamin, 2020; Taylor et
al., 2016). Consistent with the study’s participants perception of the high tax rate’s
unsustainability with business operations, Hanson and Rohlin (2011) demonstrated tax incentives
increase business growth and entrance of entrepreneurs into an industry. Thereby, displaying the
impact of the current tax regulatory environment on Black marijuana business owners.
Further, participants identified the utilization of business structure knowledge to allow
marijuana businesses to deduct expenses and lower the effective tax rate. A review of cultural
artifacts verified the structure of marijuana business may cause effective taxes exceeding
business profits and confirmed the impact of strategic business structuring to lower taxes
(Bloomberg Tax, 2022; Newburn, 2022; Shannon, 2021). Thus, highlighting the value of
conceptual knowledge related to business structure and the ability to impact Black marijuana
business sustainability.
While describing beneficial industry changes, Black marijuana entrepreneurs highlighted
the desire and potential benefit of tax reform within the industry. However, the participants
identified the necessity of political capital to facilitate change. As the IRS created the high
effective tax rate to support public policy against drug dealing (Taylor et al., 2016), the IRC code
emphasizes the impact of political capital to influence regulations.

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Marketing
In addition to changes in the tax regulatory environment, the participants categorized
effective executing social media and digital marketing as necessities to successfully navigate the
marijuana industry. Confirmed through the study’s comparison of the marketing insights from
successful digital campaign and the agitated Black marijuana business owners with restricted or
shadow-banned social media accounts, the study’s findings emphasized the value of direct-to-
consumer marketing. Consistent with the study participants’ perception the necessity of
successful digital lifestyle campaigns, Carlini et al. (2020) evidenced the positive impact of
lifestyle advertisements on attitude towards products.
Additional studies corroborated the difficulties associated with marijuana marketing and
the importance of effective marketing. Marijuana marketing restrictions prohibit the depiction of
overconsumption, use of cartoons, health benefit claims, and the mandatory inclusion of health
warnings and age restrictions (Carlini et al., 2020; D’Amico et al., 2018; Krauss et al., 2017).
Thereby, limiting marketing opportunities for Black marijuana business owners.
However, studies demonstrate the impact of effective marketing on Black marijuana
businesses. Krauss et al. (2017) demonstrated the importance of marijuana marketing
highlighting the association between favorable views of marijuana consumption and exposure to
advertisements. Maduku and Kaseeram (2021) identified advertising budget as a predictor of
Black business sustainability. Further, Scott (2015) verified the impact of leveraging digital
advertising as a method of low-cost communication to potential customers. Thus, demonstrating
the impact of marketing restrictions limiting Black marijuana business owners’ sustainability.

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Racial Inequity
All 10 participants believed institutionalized racism impacts the regulatory environment
perpetuating as additional barriers for Black marijuana business owners. The participants
expressed frustration with business and industry programs designed and destined for failure.
Thus, confirming Schlussel’s (2017) identification of marijuana policies benefiting White
business owners and promoting racial biases. Specifically, the study participants perceived the
lack of timeliness, lack of program resource appropriation, and unrealistic criteria as institutional
racism hindering Black marijuana businessowners navigation of the industry and business
sustainability. Thereby emphasizing the prevalence of institutional racism, the participants
claimed that race substantially impeded Black entrepreneurs in an already difficult and heavily
regulated industry.
As a method of combating institutional racism, McCluney et al. (2020) suggests the
examination the structural methods of maintaining racism. In congruence, the study’s
participants described the marijuana licensure program design and execution as problematic.
Thereby, providing consistency with Reuben and Queen (2015) identification of a majority of
Black owned businesses in industries with low barriers to entry. As such, the scrutiny of
marijuana regulations provides an opportunity to mitigate institutional racism for Black
marijuana business owners.
With frustration, the participants detailed the incompatibility of the tax system, banking,
and marketing with their conceptual knowledge. Confirming the difficulty of navigating the
regulatory environment, a 2017 Cannabis Equity Report from the County of San Francisco
verified legal complexity as an inequitable barrier of entry into the marijuana industry (Office of
Cannabis et al., 2017). Further, Anderson et al. (2001) demonstrated the role of conceptual

114
knowledge in understanding the relationships between elements and structures allowing
functions and procedural knowledge in performing tasks. Thus, exemplifying the necessity of
conceptual and procedural knowledge for Black marijuana business owners to successfully
navigate the complex tax, banking, and marketing restrictions within the marijuana regulatory
environment.
Resulting from the combination of limited conceptual knowledge, procedural knowledge,
and the bias present in regulatory environment, Black marijuana business owners struggled with
successful navigation. Chatzoudes and Chatzoglou (2015) verified knowledge management can
benefit an organization through promoting customer loyalty, enhancing productivity and
performance, increasing innovation, and creating shareholder value. Thereby, emphasizing the
vital role of knowledge to exploit resources related to banking, reasonable tax rates, and effective
marketing leading to Black marijuana business sustainability and combatting racial inequity in
the marijuana industry.
Theme 2: Lack of Access to Financial Capital
Chapter 2 detailed the relationship between access to financial capital and marijuana
business ownership (Analytic Insight 2020; Cannabis Control Commission, 2020b; Kilmer,
2019). During the interviews, the study’s participants expressed the importance of obtaining
adequate financial capital to support business ventures and believed additional financial
resources would benefit Black business owners and lead to sustainable operations. Further, all 10
participants believed access to funding was negatively impacted by race.
The study found Black marijuana business owners experienced limited access to financial
capital. The study found 8 participants utilized personal funds or friends and family as a source
of financial capital; while 2 participants were able to secure funding from a third-party investor

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(see Table 8). Additionally, the participants verified the inability to obtain traditional financing
through loans at financial institutions. Thereby, aligning with previous studies identifying most
marijuana businesses as self-funded and supplemented with investments from friends and family
(Harris & Martin, 2021; McVey, 2019).
The participants perceived their lack of ability to obtain third party financing as a racial
disparity. The limited number of participants receiving an outside investment aligned with
previous studies identifying preferential private equity treatment (Bates & Bradford, 2017) and
increased willingness to invest in White businesses (Gutierrez & D’Mello, 2019) by private
equity investors. As such, confirming the presence of racial inequity in capital fundraising in the
marijuana industry.
Further, the participants identified the wealth limitations of personal networks as a
hinderance in the effective supplementation of personal funds. Consistent with existing studies
on general Black and minority businesses (Bhutta et al., 2020; Fairlie, 2013; Pew Research,
2016), the participants indicated the existing racial wealth gap decreases the availability of
potential investors within a Black marijuana entrepreneurs’ network. Further, the participants
expressed that risk and high financial costs associated with operating a marijuana business deters
potentially capable Black investors from an already finite pool. Thus, detailing the impact of
social capital deficiency on Black marijuana business capital financing.
Additionally, the study identified five out of 10 participants accessed and exploited
legacy funds as an initial self-funding source to start and maintain a sustainable marijuana
business (see Table 8). As the current regulatory environment prohibits the use of legacy funds
(Hill, 2021), the study’s findings indicate limited adequate sources of self-funding available to

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Black marijuana entrepreneurs. As such, emphasizing that self-funding lacks viability and
feasibility.
Further, the study participants identified financial capital as a necessity for business
survival verifying previous studies as discussed in Chapter 2 (Association for Enterprise
Opportunity, 2017; Fairlie et al., 2021; Gai & Minniti, 2015). As such, the participants’
diminished access to financial capital hinders Black marijuana business success. As the study
participants experienced limited internal and external financial capital, the findings indicate
institutional racism perpetuates as differential access to resources and a barrier to marijuana
industry entry and sustainability.
Theme 3: Predatory Business Practices
The study’s findings indicate the occurrence of exploitative business practices. Eight out
of 10 participants reported unfair or predatory business behaviors as common with Black owned
marijuana businesses. The participants felt exploited by inequitable investor contracts from non-
minorities perusing social equity licenses, consultants with undisclosed conflicts of interest, and
business partners seeking to capitalize on preferential programs designed for Black marijuana
business owners. A study by Gideon and Lucas (2020) and a review of cultural artifacts
confirmed the prevalence of predators and scams in the marijuana industry (Illinois Department
of Commerce & Economic Opportunity, 2022; Rodriguez, 2022).
Additionally, the study’s findings indicate the lack of conceptual and procedural
knowledge caused the participants to rely on predators for successful navigation of the marijuana
industry. The study found the participants perceived their inability to identify predatory behavior
resulted from a lack of prior work experience and business knowledge. Thus, verifying the racial
knowledge gaps and human capital deficiencies as identified in Chapter 2.

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Additionally, the findings emphasize the negative consequences associated with the racial
human capital gap in the marijuana industry. During the interviews, the participants detailed
unfair transactions with dishonest consultants, vendors, investors, and business partners resulting
in loss of equity, hesitancy to explore available opportunities, and financial loss. Confirming the
impact of predatory behavior, Neely and Carmichael (2021) examination of the medical industry
during the COVID-19 crisis proved predatory investors intensify inequities. Further, Fairlie and
Robb (2007) evidenced inadequate work experience as a contributing factor to Black business
failure.
The participants’ description of reluctance and diminished profitability identifies the
impact of knowledge and human capital gaps on predatory business practices and marijuana
industry navigation. As such, the study’s findings demonstrate dishonest business practices
provide a conduit for business insolvency through financial loss and opportunity avoidance.
Thereby, highlighting the importance of conceptual and procedural knowledge and the impact of
human capital on Black owned marijuana businesses.
Theme 4: Access to Information
Ten participants indicated information as a necessary and unavailable resource to Black
marijuana business owners. Due to the marijuana industry’s regulatory environment, general
business best practices are not always applicable; thereby, highlighting the value of industry
specific best practices and navigation techniques. Further, the participants attributed the
information disparity to race. Thus, highlighting the impact of institutional racism as it may
manifest as differential access to industry information (Hudson, 2019).
As marijuana industry information is not easily accessible, the participants utilized self-
research and self-navigation resulting in financial inefficiencies. Expressing frustration with the

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lack of readily obtainable information, the participants described the negative impacts to
business operations. Bastian and Zucchella (2022) examines the importance of entrepreneurs’
metacognition to successfully identify and exploit opportunities despite uncertainty and
ambiguity. Although self-navigation provided an opportunity for marijuana industry navigation,
the study’s finding indicated the tool negatively impacted the business due to cost and
inefficiencies. Thus, demonstrating the role of Black marijuana business owners’ metacognition
in the navigation of the marijuana industry.
Further, the participants attributed successful operations and exploitation of available
opportunities to obtaining human capital. Consistent with the findings in Chapter 2, the
participants associated access to industry and business information with the experts providing the
knowledge. As such, the human capital utilized by the participants provided the factual,
procedural, and conceptual knowledge necessary for sustainable business operations.
Through explaining the importance of consultants creating the proper business structure
and resulting tax savings and ability to bank, the participants highlighted the current utilization
of human capital to access information necessary to navigate the complex regulatory
environment. Thereby, confirming human capital as a necessity for business sustainability as
identified in Chapter 2 (Dodson, 2009; Valdez, 2008). As such, the study’s findings emphasize
the provision of factual, procedural, and conceptual knowledge through human capital and
highlight the role of Black marijuana business owners’ metacognitive knowledge.
Theme 5: Marijuana Stigma
Ten participants reported the negative stigma associated with marijuana impacted their
self-perception as a business owner. The participants described fear, immorality, and disdain as
associated with marijuana products. Specifically, the participants expressed increased hesitancy

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from the Black community to embrace marijuana consumption. Similarly, Reid (2020) examined
marijuana stigma identifying the decline of marijuana stigma, but the lack of marijuana
consumption normalization. As such, the participants perception of marijuana stigma and the
resulting business impact verified the identification of marijuana stigma as a business obstacle as
discussed in Chapter 2.
Further, the study’s findings detailed the ramifications of marijuana stigma on Black
marijuana businesses. The participants perceived the negative stigma impacted sales, identity as
a business owner, and decreased community support. As Black businesses grow through
informal social ties and word of mouth (Hedegard, 2018; Vaisey & Lizardo, 2010), the stigma of
marijuana within the Black community negatively impacts social capital and Black business
sustainability.
However, the study’s findings indicate educating the community on benefits of marijuana
consumption can diminish marijuana stigma. Chapter 2 details the impact of stigmatized group
acceptance of negative messages (Jones, 2000) and the manifestation of internalized racism in
Black marijuana businesses as diminished social capital (Hudson, 2019) and decreased
neighborhood support (Harris & Martin, 2021). As such, the participants beliefs confirm that
community involvement (Kaufka, 2009; Watts-Jones, 2002) and positive messaging (Liu et. al,
2020) provide potential methods to combat internalized racism.
Limitations of the Study
As the study was limited to California and marijuana regulations and programs vary by
region, there are limitations to this study. Resulting from the limited sample, the results may not
transfer to all Black marijuana business owners. Further, the study was limited to Black

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marijuana business owners. As such, the study did not include the perspective of other executives
without an ownership stake and Black business owners in ancillary marijuana industries.
Further, limited empirical research exists regarding Black marijuana business ownership.
As such, the study utilized empirical research to examine the Black and minority business
disparities and explored a combination of empirical research and cultural artifacts to examine the
marijuana-industry-specific racial ownership differences.
Additionally, the interviews and analysis were conducted prior to Joe Bidens’
announcement of a federal plan for marijuana law reform. Due to the evolving nature of the
marijuana industry and the lack of plan specifics, the impact of the plan is unknown. There was
no attempt of the study to evaluate and quantify the impact of each marijuana regulation on a
Black marijuana business owner. Despite the sampling of California Black marijuana business
owners, existing empirical research, and changing regulations, the limitations of the study do not
impact the contributions or significance of the findings.
Recommendations for Leaders and Practitioners
The study presents three recommendations for addressing the racial diversity problem in
the marijuana industry. The recommendations are based on the findings and themes identified in
the study. Additionally, each recommendation includes supporting evidence detailing the
appropriateness and feasibility.
Recommendation 1: Networking and Mentorship Program
Through the participants description of the regulatory environment, predatory business
practices, and differential access to information, the results identified factual and procedural
knowledge gaps. Additionally, the findings demonstrated the lack of access to financial capital
due to diminished social capital. Clark and Estes (2008) established training as an appropriate

121
solution to procedural knowledge gaps. Training provides information, support, feedback, and
guidance (Clark & Estes, 2008). Considering the potential presentations of the training,
sociocultural theory highlights that skills and knowledge are developed within communities as
part of a social process and cultural context (Searle, 2017).
Carvin (2011) verified mentorship groups as a successful training and development
strategy. As a mentorship and networking groups highlight the social nature of learning, a
marijuana specific community of practice would foster the development of necessary skills and
knowledge (Carvin, 2011). Further, mentorship programs foster the growth of mentors and
mentees resulting in the adaptation by organizations, businesses, academic institutes, and
governments to address issues not covered by traditional education (Treasure, 2022). Thus,
providing a feasible recommendation for development and growth of Black marijuana
entrepreneurs.
By examining social entrepreneurship, Thomaz and Catalao-Lopes (2019) identified a
mentors’ ability to prepare entrepreneurs to interact with clients, investors, and suppliers.
Through a focus on sharing of knowledge regarding navigating the regulatory environment and
accessing financial resources, a networking and mentorship program provides an opportunity for
Black marijuana business owners to increase factual, procedural, and conceptual knowledge
while fostering marijuana industry relationships (Thomaz & Catalao-Lopes, 2019). Through
examination of four different types of mentorship programs, Treasure et al. (2022) established
mentorship as an effective approach for knowledge and skill development. Further, studies
confirm a community oriented social growth strategy through which Black business owners
share strategic planning, technical assistance, and access to capital as a method of combatting
economic disparities impacting Black business sustainability (Lahr et al., 2022; Nembhard,

122
2004). Thus, a networking and mentorship program creates an environment to provide
information and simultaneously facilitate the building of social capital.
Further, Treasure et al. (2022) identified key factors for successful mentorship programs
including a defined program vision and scope, the development of organizational structure once
desired outcomes are defined, planned activities to support program goals, recruitment of
mentees with success in mind, development of mentor support strategy, development and
evaluation of mentor–mentee matching strategies, utilization of technology, effective
communication, and consideration of funding and sustainability. When evaluating the
networking and mentorship program, Kirkpatrick’s four levels is pertinent to implement.
Kirkpatricks’ four level of training evaluation examines reaction, learning, behavior, and results
(Kirkpatrick & Kirkpatrick, 2016). As such, the program should be evaluated annually for Black
business owners’ reactions, learning, behavior, and resulting sustainability of the business.
Recommendation 2: Education Program to Increase Conceptual, Theoretical, and Strategic
Knowledge and Skill
The results indicated participants lacked conceptual and procedural knowledge and
utilized metacognition to navigate the industry. Clark and Estes (2008) identified education as an
appropriate method of knowledge and skill enhancement to assist with novel and unexpected
future challenges and problems. Due to the marijuana industry’s evolving and unpredictable
regulatory environment, the ability to anticipate and solve future challenges fostered by
education (Clark & Estes, 2008) is important.
Zeuli et al. (2018) confirms the fundamental role of business education to successful
entrepreneurship. Specifically, the study attributed diminished Black business startups in high
growth industries to education gaps. As such, a marijuana business ownership educational

123
program provides an opportunity to build conceptual and procedural knowledge. Further, the
program allows the strengthening of metacognition identified by participants as a key to
successfully navigating the marijuana industry and creating a sustainable business. Bratianu et al.
(2020) highlights the benefits of business educational programs focusing on knowledge, skills,
and attitudes to develop business competence. Thus, confirming the alignment of Black
marijuana business owners’ needs with a recommendation for an education program.
Zeng et al. (2020) explored the efficacy and feasibility of business leadership programs.
The study identified significant increases in business management self-efficacy, implementation
of practices promoting business functions, and application of new knowledge. Through a
program focus on business knowledge, business skills, and resources to support the application
of the knowledge and skill, the study verified the knowledge, skills and resources were feasible
and relevant to business practices (Zeng et al., 2020).
Due to the novel nature of the marijuana industry and the racial equity focus of the
educational program, the design for equity in higher education model is vital to consider. The
design for equity in education model centers equity in program design to account for power,
emotions, and oppression (Culver et al., 2021). As the study participants found the current design
regulatory environment incompatible with Black marijuana business success, the model’s
implementation of negotiation and collaboration with key stakeholders as an integral activity
(Culver et al., 2021) provides an opportunity for the consideration of Black marijuana
entrepreneurs’ needs in the programs design.
Recommendation 3: Community Events Focused on Removing Marijuana Stigma
The findings identified the necessity of community support to counter marijuana stigma.
Lahr et al. (2022) identified the social value strategy inclusive of community-oriented social

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growth as a pathway to address inequities in business ownership. A key component involves
entrepreneurs’ focus on social strategies rather than economic strategies to leverage community
networks to support Black owned business growth and viability. Additionally, multiple Black
business owners can combine as key stakeholders forming a cooperative alliance with the
community to increase market engagement and visibility (Lahr et al., 2022).
Nembhard (2004) verified the use of community based economic development efforts to
address the needs of marginalized groups. Additional studies demonstrate the successful leverage
of community for advancement despite systemic and institutional barriers (Lahr et. al, 2022;
Nembhard, 2004). Through nudges which steers people in a specific direction but allows them to
make their own decision (Sunstein, 2014), community events and programs hosted by Black
marijuana business owners provide an opportunity to foster support. Further, Office of Cannabis
et al. (2017) equity report identified district targeted and culturally sensitive outreach as an
initiative to promote stakeholder engagement. As such, the community events provide Black
marijuana business owners an opportunity to voice their views on marijuana and perceptions of
marijuana business ownership, specifically, the impact of the War on Drugs, consumer
discrimination, and the contrast between the legal and illegal marijuana industry as discussed in
Chapter 2.
Sunstein (2014) found the utilization of nudges maintains freedom of choice and relies on
evidence which is vital. Marijuana’s historical context as discussed in Chapter 2 and the
participants’ experiences highlight the racial bias and hinderances associated with Black
marijuana business ownership provide the necessary evidence for a nudge. Further, informing
people of the nature and consequences of their past choices (Sunstein, 2014) including the
diminished community support of Black marijuana businesses impact on sales, political capital,

125
financial capital, and overall business sustainability. Thus, it is important to nudge community
members to support Black owned marijuana businesses at community events.
Recommendations for Further Study
The study’s literature review identified a need for a national quantitative study analyzing
the racial diversity in marijuana business ownership by region. As the study utilized Black
marijuana business owners in California, a recommendation for further study includes a
nationwide comparative study of Black marijuana business owners considering the differing
regional regulations. Additionally, the impact of the legacy market on Black business owners’
motivation and business sustainability are potential areas to explore.
Summary
Black marijuana business owners identified the use human and social capital to access
resources to support business ventures. Perceiving their status as business owners stigmatized by
the negative narrative of marijuana, the participants described the fear, immorality, and disdain
associated with marijuana products. Further, Black marijuana business owners identified racial
and industry barriers impacting business sustainability.
The regulatory environment, diminished access to financial capital and information,
predatory business practices, and marijuana stigma hinder a Black marijuana business owners’
access and exploitation of human, social, and political capital resources necessary to start and
maintain a successful business. Successful navigation of the marijuana industry involved costly
self-navigation and increased human and social capital. As the study identified significant
knowledge gaps and highlighted the importance of Black business owners’ metacognition access
to information and guidance is a necessity. Thus, resulting in a recommendation of network and

126
mentorship programs, education programs, and community events for Black marijuana business
owners.
Conclusion
Racial diversity continues to be a consistent problem with Black business owners. In a
recently legalized, emerging industry, Black marijuana business owners are facing
disproportionate barriers to entry and success. Thus, perpetuating societal disparities such as
income, generational wealth, and human capital.
Systemic racial issues should not persist for Black business owners in a different form.
Equity centered programs should be designed allowing for Black business sustainability in the
marijuana industry. Industries should be designed allowing for racially equitable participation.
New entrepreneurs must be able to exploit passions and expertise without racial
encumbrances. Equitable business participation is necessary in our society. We can’t always
rectify our past actions as a society and the ingraining of racism in our everyday lives, but it is
our responsibility to stop the perpetual cycle and create a future that looks nothing like our past.

127
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Appendix A: Marijuana Policy
State Expungement Social equity licensing Reinvestment Other
Colorado (2012)
In 2017, lawmakers enacted a
law for expungement of
prior misdemeanor
convictions. Under
authority granted by a law
approved by the state
legislative, Gov. Jared
Polis pardoned 2,732
convictions involving
possession of an ounce or
less in October 2020.
Eligibility was narrowed
by several restrictions, and
many with prior arrests
were excluded.
In June 2020, Gov. Polis signed
HB20-1424, which established
a social equity licensee
classification. An applicant is
eligible if: They lived in a
disproportionately impacted
area for at least 15 years; they
or their family member were
punished for a prior marijuana
offense; or their household
income in the year prior to
application did not exceed
50% of the state median
income. Social equity
licensees are granted access to
mentorship programs and
financial incentives.
None of Colorado’s
cannabis tax
revenue is
specifically
directed to
disproportionately
impacted
communities. In
January 2021,
Gov. Jared Polis
requested $5
million to support
cannabis
entrepreneurs,
including a loan
program for social
equity licensees.
MJ Biz Daily
published a
2020 article on
Colorado’s
industry and
social equity
plan.
Washington
(2012)
Gov. Inslee signed a bill in
2019 that allows any
person who was convicted
of a misdemeanor
marijuana offense when
they were 21 or older to
apply for and be granted
expungement.
In March 2020, Gov. Jay Inslee
signed HB 2870 to create a
new social equity program for
social equity licensees (read a
summary here). An applicant
is eligible if they have lived
for at least five of the past 10
years in a disproportionately
impacted area, or if they or a
family member have been
convicted of a marijuana
offense. The Washington
Liquor and Cannabis Control
None
MJ Biz Daily
published a
2020 article on
Washington’s
social equity
program.

Seattle’s city
government
established a
team to explore
social equity
policies and
158

State Expungement Social equity licensing Reinvestment Other
Board may only issue new or
revoked licenses to social
equity applicants. The law
also establishes a $1.1 million
grant program to assist social
equity applicants’ business
plans.
write a report in
2020.
Oregon (2014) In 2019, Gov. Kate Brown
signed SB 420, which
allows individuals to file
motions to expunge low-
level marijuana offenses
that occurred prior to 2015
without paying filing fees.
This followed passage of
SB 364 in 2015, which
directs courts to evaluate
requests to set aside prior
convictions as if they had
occurred under current law,
making it possible to
expunge several kinds of
marijuana offenses that
occurred prior to 2013.
None Not at the state level.
In 2016, the city of
Portland approved
a local 3% sales tax
on marijuana,
which funds the
SEED Grant to
support business
development and
social justice
programs.
MJ Biz Daily
published a
2020 article on
Oregon’s
industry and its
efforts to
promote social
equity.

In 2019, Gov.
Brown signed
SB 970, which
prohibits
landlords from
discriminating
against those
who either use
medical
marijuana or
have
marijuana-
related
convictions.
Alaska (2014)
None. A sealing bill passed None None None
159

State Expungement Social equity licensing Reinvestment Other
the House but died in the
Senate in 2018 and 2019.
Nevada (2016)
In 2019, Gov. Sisolak signed
a bill that allows
individuals to have their
past convictions sealed if
the conduct — such as
marijuana possession —
has been legalized or
decriminalized. In June
2020, the governor
pardoned roughly 15,000
past marijuana convictions.
None Not at the state level.
Clark County
(where Las Vegas
and many of the
state’s marijuana
businesses are
located) allocates
some local tax
dollars to
supporting
unhoused people.
MJ Biz Daily
published a
2020 article on
Nevada’s
industry and its
efforts to
promote social
equity.
California
(2016)
Prop 64, which legalized
marijuana in 2016,
established a pathway for
expunging or resentencing
offenses that were reduced
or eliminated by the law. In
2018, Gov. Jerry Brown
signed AB 1793, making
expungement automatic.
The law, however, lacks an
enforcement mechanism,
and as of January 2021,
many county court systems
had still failed to process
the expungements required
by the 2018 law. Code for
American project leaders
said that approximately
144,000 cannabis
There were no social equity
provisions at the state level.
However, some local
governments have established
social equity licensing and
programs to support people
from disadvantaged groups
who wish to enter the
marijuana industry
Per the voted-
approved law, the
state directed
nearly $30 million
from cannabis tax
revenue in 2020 to
a grant program
that supports local
programs to help
disadvantaged
communities in
2020. At least 50%
of the grants must
go to local
nonprofit
organizations. By
FY 2022–2023,
this grant pool will
increase to $50
MJ Biz Daily
published a
2020 article on
California’s
industry and its
efforts to
promote social
equity.
160

State Expungement Social equity licensing Reinvestment Other
sentences had been reduced
or discussed with help
from their online tool.
million annually.
The state also
dispersed funding
to local
governments to
support their
social equity
programs.
Maine (2016)
None. However, in 2021,
lawmakers introduced
legislation to seal or
expunge prior marijuana
convictions.
None None

Massachusetts
(2016)
Under a law passed in 2018,
individuals may be eligible
to have their past records
for marijuana possession
sealed.
However, many state residents
have struggled to clear
their records.
None yet, though it is
permissible under
existing law. In
July 2020,
members of the
Cannabis Control
Commission
expressed support
for S 2650, a bill
that would
establish a social
equity loan fund
for license
applicants
disproportionately
harmed by
previous
marijuana
prohibition.
MJ Biz Daily
published a
2020 article on
Massachusetts’
industry and its
efforts to
promote social
equity.
161

State Expungement Social equity licensing Reinvestment Other
Michigan (2018) In 2020, Michigan’s governor
signed legislation to “set
aside” marijuana-related
and other kinds of
convictions. They will not
be public records, but state
police will keep a non-
public record. Individuals
can petition to expunge
past marijuana
misdemeanors. In addition,
after seven years, up to
four misdemeanor
convictions can be set
aside (marijuana-related or
not), along with up to two
non-violent felonies
(excluding certain
offenses.) A separate bill
allows for an automatic
expungement process for
some offenses, including
some marijuana offenses,
in 2022.
The 2018 voter-approved ballot
initiative that legalized
marijuana directed state
regulators to develop “a plan
to promote and encourage
participation in the marihuana
industry by people from
communities that have been
disproportionately impacted
by marihuana prohibition.”

In May 2020, the Marijuana
Regulatory Agency announced
an expansion of the state’s
social equity program. Under
the plan, cannabis businesses
owned by people who have
prior marijuana convictions or
who are from communities
disproportionately affected by
marijuana prohibition may be
eligible for discounted
licensing fees up to 75%. The
regulating agency also
provides assistance and
training to social equity
applicants.

After approval of a social equity
ordinance by the city council in
November 2020, Detroit
began accepting applications
None
MJ Biz Daily
published a
2020 article on
Michigan’s
industry and its
efforts to
promote social
equity.
162

State Expungement Social equity licensing Reinvestment Other
for cannabis businesses in
January 2021, and at least
50% must be awarded to
“Legacy Detroiters,” a
designation that gives priority
to applicants who have lived
in the city for a certain period
of time and/or have a prior
marijuana conviction.
Illinois (2019) Automatic expungement for
up to 30 grams, via the
governor’s clemency
process. For amounts of 30-
500 grams, the state’s
attorney or the individual
can petition the court to
vacate the conviction. On
the final day of 2020, Gov.
J.B. Pritzker announced the
pardon of nearly 500,000
low-level marijuana
convictions.
The state’s legalization law
establishes a “social equity
applicant,” which is a person
who was arrested or convicted
of a minor cannabis offense,
or who is related to someone
who was. It can also be a
person who lives in or has ties
to a community with high rates
of poverty and/or that has
been disproportionately
impacted by the war on
cannabis. This can include
those individuals living in such
an area now, or for five of the
last 10 years.

If an applicant qualifies for the
social equity program, they
receive a significant points
advantage compared to other
applicants for licenses. They
The state’s
legalization law
established the
Restore, Reinvest
and Renew (R3)
Program.
According to the
state, “The R3
Program drives
25% of cannabis
tax revenue to
fund grants for
violence
prevention,
reentry, youth
development,
economic
development and
civil legal aid
services in areas of
the state that are
objectively found
to be acutely
MJ Biz Daily
published a
2020 article on
Illinois’
industry and its
efforts to
promote social
equity.

In addition to
assistance
entering the
regulated
cannabis
industry, there
is more
opportunity
available with a
wider range of
business
licenses.
163

State Expungement Social equity licensing Reinvestment Other
can also access the Cannabis
Business Development Fund
to help defray start-up costs
associated with entering the
licensed cannabis industry.
This includes a 50% reduction
of the non-refundable license
application fee and any other
non-refundable fees, along
with loans and other financial
incentives.
suffering from the
horrors of
violence, bolstered
by concentrated
disinvestment,
identified by their
rates of gun
injuries, child
poverty,
unemployment,
and incarceration
rates.”
Vermont (2020) In October 2020, Gov. Phil
Scott signed S. 234 to
establish a procedure for
automatically expunging
prior marijuana convictions
that involved possession of
up to two ounces of
cannabis and/or the
cultivation of up to four
mature plants. The law
may help as many as
10,000 Vermonters with
prior marijuana
convictions.
The state’s Cannabis Control
Board, which will oversee and
regulate the legalization
program, is directed to
prioritize and consider
cannabis business applicants
who would “foster social
justice and equity in the
cannabis industry by being a
minority or women-owned
business.”
None.

Arizona (2020) The 2020
voter-approved legalization
ballot measure allows
expungement for
possession of up to 2.5
The Department of Health
Services will issue 26 licenses
to applicants who qualify
under the Social Equity
Ownership Program.
The legalization law
sets aside 7% of
marijuana tax
revenue for the
Justice Investment
Fund, which will

164

State Expungement Social equity licensing Reinvestment Other
ounces of cannabis and for
cultivation of up to six
plants. Prosecutors and the
Attorney General can file
expungement motions on
behalf of individuals.
provide grants to
health programs
and nonprofit
organizations to
support
communities
disproportionately
harmed by
marijuana
prohibition.
New Jersey
(2020)
In 2019, Gov. Phil Murphy
signed legislation
establishing an expedited
process for expunging low-
level marijuana offenses.
Under the bills signed into law in
February 2021, 25% of the
total licenses issued,
regardless of class, must be
awarded to applicants who
have lived in “impact zones”
(municipalities with higher
levels of police activity,
unemployment, and/or
poverty) or to applicants who
plan to ensure at least 25% of
their workforce will be
comprised of people who live
in impact zones.
Additionally, at least 25% of all
licenses awarded must be
given to microbusinesses.
At least 70% of
cannabis revenues
(including fees and
tax revenues) will
be used for grants,
loans,
reimbursements of
expenses, and
other financial
assistance, in
municipalities
defined as “impact
zones.”
The bills approved
in February
2021 will
rename the
Office of
Minority,
Disabled
Veterans, and
Women’s
Medical
Cannabis
Business
Development
by removing
the word
“Medical.” The
office’s purpose
is to promote
participation in
the industry by
people from
socially and
165

State Expungement Social equity licensing Reinvestment Other
economically
disadvantaged
communities.

The office is
tasked with
ensuring that
not less than
30% of the total
number of
cannabis
licenses issued
go to
businesses
certified by the
office.
Montana (2020) Under the voted-approved
2020 ballot initiative, I-
190, conduct that is no
longer criminal can be
expunged or be eligible for
resentencing
None
None

Note. From Social Equity Policies in Adult-Use Legalization Laws. Marijuana Policy Project, 2022
(https://www.mpp.org/issues/legalization/social-equity-policies-in-adult-use-legalization-laws/)

166

167
Appendix B: Marijuana Arrest Rate
State Marijuana
possession arrest rate
Black arrest
rate
White arrest
rate
Black/White
rate ratio
Montana 127.62 1064.23 110.60 9.62
Kentucky 141.72 788.34 84.19 9.36
Illinois 43.01 137.84 18.56 7.51
West Virginia 447.32 2516.95 344.26 7.31
Iowa 133.82 776.28 106.90 7.26
Vermont 21.54 126.26 20.83 3.06
North Dakota 332.52 1437.25 260.99 5.51
Minnesota 126.71 536.94 100.02 5.37
Wyoming 592.89 2677.27 515.27 5.20
South Dakota 707.34 2151.53 426.79 5.04
Utah 343.37 1526.97 310.43 4.92
Kansas 80.56 323.84 66.94 4.84
Oklahoma 199.25 719.47 169.62 4.24
Wisconsin 324.37 1125.85 265.58 4.24
Delaware 89.33 222.45 53.57 4.15
Alabama 55.82 128.03 31.01 4.13
New Hampshire 202.10 803.40 195.28 4.11
Massachusetts 4.52 14.76 3.65 4.04
Connecticut 49.85 152.57 37.91 4.02
Maine 54.99 214.84 53.89 3.99
New Mexico 225.71 837.21 210.54 3.98
Idaho 332.16 1026.94 263.83 3.89
Michigan 140.95 373.80 104.06 3.59
Indiana 247.61 712.06 204.01 3.49
New Jersey 369.54 1007.96 292.49 3.45
South Carolina 673.26 1420.68 412.27 3.45
Virginia 314.33 768.01 223.37 3.44
Ohio 248.68 526.73 153.48 3.43
Louisiana 412.28 795.52 237.31 3.35
Rhode Island 37.80 110.17 33.17 3.32
North Carolina 234.85 528.27 162.03 3.26
Tennessee 343.94 820.16 255.09 3.22
Nebraska 409.42 1163.94 379.73 3.07
Arizona 208.75 580.65 190.90 3.04
Nevada 76.65 212.26 69.72 3.04
Pennsylvania 226.52 577.96 190.40 3.04
Georgia 428.81 804.32 271.82 2.96
Mississippi 294.78 478.88 176.39 2.71
Missouri 340.28 780.94 296.38 2.63
New York 287.76 597.59 227.53 2.63
Texas 244.12 561.60 213.99 2.62
Arkansas 322.12 648.46 271.21 2.39

168
State Marijuana
possession arrest rate
Black arrest
rate
White arrest
rate
Black/White
rate ratio
Washington 25.90 52.18 24.44 2.14
Maryland 279.40 470.16 220.74 2.13
Oregon 69.54 130.90 71.24 1.82
California 9.14 18.12 10.00 1.81
Hawai’i 55.78 130.90 73.42 1.78
Alaska 53.35 70.82 45.40 1.56
Colorado 82.20 130.51 84.90 1.54

Note. Rates in middle three columns by per 100k people. From A Tale of Two Countries:
Racially Targeted Arrests in the Era of Marijuana Reform. American Civil Liberties Union,
2020 (https://www.aclu.org/sites/default/files/field_document/marijuanareport_03232021.pdf)

169
Appendix C: Marijuana Laws for All U.S. States and District of Columbia
State Legalized Decriminalized Legalized medical
Alabama
Alaska 2014 1998
Arizona 2010
Arkansas 2016
California 2016 2010 1996
Colorado 2012 2000
Connecticut 2011 2012
Delaware 2015 2011
District of Columbia 2014 1998/2010
Florida 2016
Georgia 2019
Hawai’i 2019 2000
Idaho
Illinois 2019 2016 2013
Indiana
Iowa
Kansas
Kentucky
Louisiana 2016/2018
Maine 2016 1999/2009
Maryland 2014 2014
Massachusetts 2016 2008 2012
Michigan 2018 2008
Minnesota 1976 2014
Mississippi 1978
Missouri 2014 2018
Montana 2004/2016
Nebraska 1979
Nevada 2016 1998/2000
New Hampshire 2017 2013
New Jersey 2010
New Mexico 2019 2007
New York 2019 2014
North Carolina 1977
North Dakota 2019 2016
Ohio 1975 2016
Oklahoma 2019
Oregon 2014 1998
Pennsylvania 2016
Rhode Island 2012 2006
South Carolina
South Dakota
Tennessee

170
State Legalized Decriminalized Legalized medical
Texas
Utah 2018
Vermont 2018 2013 2004
Washington 2012
West Virginia 1998
Wisconsin 2017
Wyoming

Note. Years laws were enacted as of March 2020. From A tale of two countries: Racially
targeted arrests in the era of marijuana reform. American Civil Liberties Union, 2020,
(https://www.aclu.org/sites/default/files/field_document/marijuanareport_03232021.pdf)

171
Appendix D: Protocols and Interview Guide
Research questions:
1. How have Black business owners accessed resources to support business ventures?
2. How do Black business owners perceive their status as business owners?
3. How do Black business owners navigate the opportunities available to them in the
marijuana industry?
4. What resources would benefit Black business owners and lead to sustainable business
operations?
Respondent type: Black marijuana business owners
Industry specialty:
Date of interview:
Location of interview:
Start time:
End time:
Name of interviewer:
Name of interviewee
Recording mechanism:
Introduction to the interview:
Thank you for participation in my study. My name is Christina Bachelor, and I am a
doctoral student at the University of Southern California. The interview should last about 90
minutes, but feel free to let me know at any time if you need a break. The interview has
approximately 20 questions. The goal of my study today is to understand your perspective as a
Black business owner in the marijuana industry and evaluate the effect if any that race plays in

172
your business and your industry. You may decline to answer any question that you do not wish to
answer or withdraw from the interview at any time.
I will be recording this interview through Zoom to accurately capture the information that
you provide. The recording will be used to create an audio only transcription. The interview will
be confidential in the fact that your real name will not be used, and your respective data will be
kept confidential as well. I will use password protection, pseudonyms, and encryptions to keep
your information safe. Let me know if you have any questions or concerns before we begin.
Conclusion to the interview:
Thank you for your participation in my study. Would I be able to reach out to you if I
have additional questions or need clarification on anything discussed today? Please feel free to
reach out to me if you have any questions after the interview. My contact information is included
on the handout. I am happy to provide you with a copy of my study once it is completed if you
are interested. Thank you again.

173
Appendix E: Informed Consent
I voluntarily agree to participate in this research study.
I understand that even if I agree to participate now, I can withdraw at any time or refuse to
answer any question without any consequences of any kind.
I understand that I can withdraw permission to use data from my interview within one week
after the interview, in which case the material will be deleted.
I have had the purpose and nature of the study explained to me during the interview protocols
and I have had the opportunity to ask questions about the study.
I understand that participation involves a 90-minute interview and a possible follow-up
interview
I understand that I will not benefit directly from participating in this research.
I agree to my interview being video recorded, but I can turn my video off for additional privacy
I understand that all information I provide for this study will be treated confidentially.
I understand that in any report on the results of this research my identity will remain
anonymous. This will be done by changing my name and disguising any details of my interview
which may reveal my identity or the identity of people I speak about.
I understand that disguised extracts from my interview may be quoted
I understand that signed consent forms and audio transcriptions interview in which all
identifying information has been removed will be retained using password protected and
encrypted
I understand that I am free to contact any of the people involved in the research to seek further
clarification and information.
Signature of research participant Signature of participant Date
----------------------------------------- ----------------

174
Appendix F: Recruitment Letter
(Date)
Re: Diversity in the Marijuana Industry
Dear: (Name)

My name is Christina Bachelor, and I am a doctoral student at the University of Southern
California. I am writing to let you know about an opportunity to participate in a voluntary
research study about racial diversity in the marijuana study.
Participation in the study includes a 90-minute virtual interview comprised of approximately 20
questions. The goal of my study today is to understand your perspective as a Black business
owner in the marijuana industry and evaluate the effect, if any, that race plays in your business
and your industry. All personal identifying information will be kept confidential. To be a
participant in the study, you must identify as Black or African American, be a licensed marijuana
business, operating in California, and a flowering touching business.
If you are interested in participating in the study or would like additional information about this
Institutional Review Board approved project, please contact me at cbachelo@usc.edu. I look
forward to your response.
Best,

Christina Bachelor
University of Southern California

175
Appendix G: Interview Questions
Interview question Conceptual
framework
construct
Research based probes
Research Question 1: How have Black business owners accessed resources to support
business ventures?
1. Please tell me about financial
resources that you utilized to start
your business. Was your business
financing impacted by your race?

Institutional racism Differential access;
barriers to entry (Bates,
2011; Bhutta et al.,
2020; Fairlie et al., 2021;
Harris & Martin, 2021;
McVey, 2019; Palia,
2016)
2. Describe the process of starting your
marijuana business and your political
or industry connections used, if any?
Does your race play a role in your
networking?

Institutional racism

Barriers to entry
(American Civil
Liberties Union, 2020;
Cannabis Control
Commission, 2020b;
Hudson, 2019;
Marijuana Opportunity
Reinvestment Act of
2020; Rosenburg et al.,
2017)
3. What general resources or challenges
have you encountered maintaining
your business and have they been
affected by your race?
Institutional racism Differential access (Bates,
2011; Kilmer, 2019;
Loftsrom & Bates, 2013)
4. What role does race, if any, play in
your business practices or marketing?
Race as a social
construction
Consumer discrimination
(Coyne et al., 2010; Liu
et al., 2020; Ogbolu &
Singh, 2019; Price,
2005)
Research Question 2: How do Black business owners perceive their status as business
owners?
5. What entrepreneurial experience did
you have prior to starting your
business and how does that affect, if at
all, your experience running your
current business?

Internalized racism Black business owners’
self-perception
(Koechlin, 2019;
Lamikanra et al., 2013;
Neville et al., 2018;
Robb & Morelix, 2016)
6. How does your marijuana industry
business ownership experience
compare or contrast to your other peer
business owners? Do they share
similar hinderances and best practices?
Voice/counter
narrative
Black entrepreneurial
experience (Hudson,
2019; Harris & Martin,
2021; Jones, 2000; Pyke,
2010)

176
Interview question Conceptual
framework
construct
Research based probes
7. How have experiences in the
marijuana industry shaped your life?
How have experiences in the
marijuana industry shaped your goals
(immediate, future/short-term or
long)?
Voice/counter
narrative
Black entrepreneurial
experience (Harris &
Martin, 2021; Neville et
al., 2018; Robb &
Morelix, 2016)
8. Describe the current benefits and
challenges of marijuana business
ownership. Are these impacted by your
race? What changes, if any, would be
beneficial?
Voice/counter
narrative
Black entrepreneurial
experience (Cox
Edmondson et al., 2008;
Shelton & Minniti, 2017;
Haney-López, 2014;
Harris & Martin, 2021;
Kleiman et al., 2019)
9. What are the similarities and
differences between marijuana
business ownership and general
business ownership? What changes, if
any, would be beneficial in the
marijuana industry?
Voice/counter
narrative
Black entrepreneurial
experience (Hill, 2021;
Kamin, 2020; Kleiman
et al., 2019; McVey,
2019; Tilburg et al.,
2019)
10. How would you describe your business
success in comparison to other owners
of a similar race? Compared to a
different race?
Internalized racism Black business owners’
self-perception (Ayala &
Manzano, 2017; Harris
& Martin, 2021)
11. What impact do you and your peers
have on marijuana regulations? Does
this differ by race? What changes, if
any, would be beneficial?
Internalized racism Black business owners’
self-perception (Hudson,
2019; Stoa, 2021)
Research Question 3: How do Black business owners navigate the opportunities available to
them in the marijuana industry?
12. Describe the impact of the illegality of
marijuana on your journey as a
business owner? Does your race
impact any benefits or challenges?
Voice/
counternarrative
Black entrepreneurial
experience (American
Civil Liberties Union,
2013; American Civil
Liberties Union, 2020;
Kamin, 2020 Nicholas et
al., 2019; Rahwanji,
2019; Thompson, 2017)
13. Tell me about the impact of social
justice initiatives on your business.
What changes, if any, would be
beneficial?
Voice/
counternarrative
Black entrepreneurial
experience (Analytic
Insight, 2020; McVey,
2021)
14. What opportunities benefited you
while starting and growing your
Voice/
counternarrative
Black entrepreneurial
experience (Coyne et al.,

177
Interview question Conceptual
framework
construct
Research based probes
business? Were any impacted by your
race?
2010; Cox Edmondson
et al., 2008; Liu et al.,
2020; Shelton & Minniti,
2017)
15. What opportunities did you not take
advantage of due to lack of
knowledge?
Institutional racism Differential access
(Hudson, 2019; Kilmer,
2019)
Research Question 4: What resources would benefit Black business owners and lead to
sustainable business operations?
16. What resources would most benefit
your business if readily available and
easily accessible? Is access to these
resources impacted by your race?
Institutional racism Differential access
(Analytic Insight, 2020;
Cannabis Control
Commission, 2020b;
Hudson, 2019)
17. What is the best financing resource
available for entrepreneurs looking to
enter the marijuana industry? Is the
availability of the resource impacted
by race?
Institutional racism Differential access (Bates,
2011; Bhutta et al.,
2020; Fairlie et al., 2021;
Harris & Martin, 2021;
McVey, 2019; Palia,
2016)
18. What is the best way to leverage
neighborhood relationships and
resources when starting and maintain a
marijuana business?
Race as a social
construction
Social capital (Boggess et
al., 2013; Hudson, 2019;
Pew Research Center,
2016)
19. What best practices does your business
utilize or you see other businesses
utilize that lead to sustainable business
operations?
Voice/
counternarrative
Black entrepreneurial
experiences (Analytic
Insight 2020; Bates &
Robb, 2014; Cannabis
Control Commission,
2020b; Hudson, 2019)
20. Describe the current industry resources
and opportunities exist that most
benefit a marijuana business.
Institutional racism Differential access
(Kleiman et al., 2019)

178
Appendix H: Social Media Ad Approved by IRB
Seeking African-American marijuana business owners in California for research study.
Message me for more information.
USC Study
African American marijuana business owners needed for USC study. Message me to
learn more information.
Research Study
California African American marijuana business owners needed for research study.
Message me to learn more information.
Research Study
Seeking African-American marijuana business owners in California for research study.
Message me for more information.

179
Appendix I: Initial Codebook and Code Frame
Code Code description
Gender intersectionality Additional gender discrimination described by Black female
marijuana business owners due to race
Access to banking Inequitable access to banking
Safety due to bank Safety concerns due to lack of access of banking and cash
business operations
Banking regulations FDIC banking restrictions that hinder banking in the marijuana
industry
Banking business
operations
The impact of banking of business infrastructure and operations
Cost of banking Increased cost associated with a marijuana business bank
account
Taxes Marijuana regulatory tax environment
Best practices Best practices associated with marijuana business operations
Marketing Marketing best practices for a Black marijuana business
Funding Financial capital
Community marketing Word of mouth marketing and community support through sales
Racial branding Presence or lack of visibility of marijuana business owner’s race
Political capital Influence on marijuana regulations and regulators
Social capital Network of community relationships influencing black business
sustainability
Entrepreneurial
experience
Prior business experience and exposure to entrepreneurs
Industry information Information specific to navigating the marijuana industry
Licensure process Process of obtaining a marijuana retail, grower, or operations
license
Social equity Experiences due to social equity program participation
Speed Speed or lack of speed associated with licensure process
Real estate Real estate requirements associated with the marijuana retail
licensure process
Financial capital Financial capital investment necessary for licensure process and
business sustainability
Motivation Reason or incentives influencing Black marijuana business
owners
Health benefits Health benefits of CBD and marijuana
Resilience Continuation despite difficulties and obstacles
Generational wealth Financial assets passed through generations
Business owner status View as a business owner and executive
Marketing restrictions Restrictions associated with marijuana related advertisements
Shadow ban Social media account block without users’ knowledge
Social media account ban Social media account deletion or block
Program design Non-racial equity focused design of marijuana programs
Racial success
differences
Observance of White business owner success in the marijuana
industry

180
Code Code description
Racial wealth gap Racial differences in income, assets, and equity
Capital financing sources Sources of financial capital necessary for initial business startup
and sustainability
Discriminatory
regulatory
environment
Inequitable and inefficient design of marijuana regulations
Inequitable access to
capital
Racial inequities in access to capital
Marijuana stigma Negative views of marijuana as a recreational drug
Cannabis culture Shared ser of practices and beliefs for marijuana supporters
Legacy marijuana
industry
Pre-legalization marijuana industry

181
Appendix J: Final Codebook
Code Description of code
Gender intersectionality Additional gender discrimination described by Black female
marijuana business owners due to race
Regulatory environment Restrictions related to navigating the marijuana industry that
Black marijuana business owners must comply with
Best practices Best practices associated with marijuana business operations
Licensure process Process of obtaining a marijuana retail, grower, or operations
license
Motivation Reason or incentives influencing Black marijuana
business owners
Racial barriers Industry obstacles attributed to race
Marijuana stigma Negative views of marijuana as a recreational drug
Social capital Network of community relationships
Human capital Knowledgeable employees, contractors, and partners
Predatory business practices Unfair business practices exploiting Black marijuana business
owners
Industry information Information specific to navigating the marijuana industry
Business knowledge General business and industry knowledge acquired through
education or prior work experience

Abstract (if available)

Abstract Black marijuana business owners are disproportionately excluded from the marijuana business ownership. The evidence highlights that the racial disparity existing in general business ownership also occurs in the marijuana industry. Four research questions guide the study: How have Black business owners accessed resources to support business ventures? How do Black business owners perceive their status as business owners? How do Black business owners navigate the opportunities available to them in the marijuana industry? What resources would benefit Black business owners and lead to sustainable business operations? The key findings of the study are the navigation of the regulatory environment, access to financial capital, predatory business environment, access to information, and marijuana stigma. Based on the key findings, the study presents three recommendations. First, the creation of a networking and mentorship program. Next, the creation of a business education program. Finally, the execution of community events focused on addressing marijuana stigma.

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The impact of toxic behaviors by queen bees and their in-group on national sorority member involvement

Asset Metadata

Creator Bachelor, Christina Elizabeth (author)

Core Title Racial diversity in the marijuana industry

School Rossier School of Education

Degree Doctor of Education

Degree Program Organizational Change and Leadership (On Line)

Degree Conferral Date 2022-12

Publication Date 06/14/2023

Defense Date 11/03/2022

Publisher University of Southern California (original), University of Southern California. Libraries (digital)

Tag Black business,Black business owners,Black business ownership,Black entrepreneurship,Black sustainable business,cannabis,Marijuana,marijuana stigma,OAI-PMH Harvest,racial diversity

Format theses (aat)

Language English

Contributor Electronically uploaded by the author (provenance)

Advisor Brady, Melanie (committee chair), Green, Alan (committee chair), Datta, Monique (committee member)

Creator Email cbachelo@usc.edu,cbachelor4@gmail.com

Permanent Link (DOI) https://doi.org/10.25549/usctheses-oUC112620920

Unique identifier UC112620920

Identifier etd-BachelorCh-11373.pdf (filename)

Legacy Identifier etd-BachelorCh-11373

Document Type Dissertation

Format theses (aat)

Rights Bachelor, Christina Elizabeth

Internet Media Type application/pdf

Type texts

Source 20221214-usctheses-batch-997 (batch), University of Southern California (contributing entity), University of Southern California Dissertations and Theses (collection)

Access Conditions The author retains rights to his/her dissertation, thesis or other graduate work according to U.S. copyright law. Electronic access is being provided by the USC Libraries in agreement with the author, as the original true and official version of the work, but does not grant the reader permission to use the work if the desired use is covered by copyright. It is the author, as rights holder, who must provide use permission if such use is covered by copyright. The original signature page accompanying the original submission of the work to the USC Libraries is retained by the USC Libraries and a copy of it may be obtained by authorized requesters contacting the repository e-mail address given.

Repository Name University of Southern California Digital Library

Repository Location USC Digital Library, University of Southern California, University Park Campus MC 2810, 3434 South Grand Avenue, 2nd Floor, Los Angeles, California 90089-2810, USA

Repository Email cisadmin@lib.usc.edu