Discover the key challenges facing social equity applicants in the cannabis industry—from lack of capital to inconsistent policies—and explore actionable strategies to foster a fair and inclusive market.

The cannabis industry has emerged as a promising sector, but for social equity applicants, significant barriers stand in the way. These obstacles—including a lack of capital, limited professional networks, and inconsistent state and federal policies—pose substantial challenges to those seeking to enter this competitive space. Let’s dive deeper into these barriers and explore actionable strategies to foster a more equitable industry.

The Capital Conundrum

One of the most critical challenges faced by social equity applicants is an inherent lack of capital—a key barrier in the cannabis industry due to limited access to traditional funding sources and systemic inequities. As Jamal Barghouti, DEI Outreach Manager at Blackbird, puts it, “I think that the major pain point is really funding¹.” Traditional banking services are largely inaccessible due to federal regulations that classify cannabis as a Schedule I substance—the same category as heroin and cocaine. This restriction creates a unique hurdle, especially for those from low-income backgrounds. Without access to traditional business loans, many aspiring entrepreneurs are left searching for alternative funding sources.

Bridging the Knowledge Gap

Another significant barrier is the lack of business acumen among social equity applicants. Felicia Carbajal highlights the importance of financial literacy, business management, and time management as foundational skills that are often underdeveloped in marginalized communities². Without this knowledge, navigating the complexities of the cannabis industry becomes an uphill battle.

The Patchwork of Policies

The inconsistencies between state and federal cannabis regulations further compound the challenges. This “patchwork³” of policies creates confusion and makes it difficult for applicants to chart a clear path forward. The result is an environment where only those with significant resources and networks can successfully navigate the system.

A Critical Look at the Challenges

These barriers are deeply rooted in the federal classification of cannabis as a Schedule I substance. This classification not only stigmatizes the industry but also prevents equitable access to traditional business resources. Social equity applicants—often defined as individuals residing in disproportionately impacted areas, those with previous cannabis-related arrests, or individuals from low-income backgrounds⁴—are disproportionately affected.

Consider Steve DeAngelo’s experience: Despite operating a $35 million-a-year business, he couldn’t secure a $10,000 line of credit⁵. If seasoned professionals face such hurdles, it’s easy to see how social equity applicants, many of whom lack higher education or professional networks, are at a significant disadvantage. The cannabis industry is capital-intensive⁶ from the start, leaving those without resources to navigate blindly, often without mentorship or support.

Solutions for Social Equity

Key actions include supporting social equity brands, advocating for policy change, and holding retailers accountable for promoting inclusivity in the cannabis industry.

So, how can we address these barriers and promote social equity in the cannabis industry? The answer lies in empowering both businesses and consumers to take action. Here are some strategies:

1. Support Social Equity Brands: Actively seek out and purchase products from social equity brands. This directly supports businesses working to create a more inclusive industry.
2. Ask Questions: Engage with dispensaries and retailers by asking how they’re supporting social equity initiatives. If they lack a plan, consider shopping elsewhere.
3. Advocate for Change: Write to local officials and demand policies that promote social equity within the cannabis sector.
4. Encourage Retailers: Prompt dispensaries to research and carry products from social equity brands.
5. Heal the Harm: Focus on repairing the inequities caused by past cannabis policies by supporting initiatives that benefit disproportionately impacted communities⁷.

By taking these actions, you become an empowered consumer who drives meaningful change. Retailers and businesses will ultimately align their practices with the demands of their customers—and that means you hold the power to shape the industry.

Final Thoughts

The road to equity in the cannabis industry is undoubtedly complex, but with collective effort and a focus on tangible solutions, it’s possible to create a more inclusive and sustainable future. Let’s ensure that the industry’s growth doesn’t leave behind those who have been most impacted by its historical injustices. Together, we can break down the barriers and build an industry that truly reflects the values of equity and fairness.

Citations

1. Jamal Barghouti – DEI Outreach Manager, Blackbird, Unit 5 – What are some of the Obstacles of Social Equity?
2. Felicia Carbajal – DEI Outreach Manager, Blackbird, Unit 5 – What are some of the Obstacles of Social Equity?
3. Richard Ng – DEI Outreach Manager, Blackbird, Unit 5 – What are some of the Obstacles of Social Equity?
4. Unit 5 – What does Social Equity Look Like in Various States and Cities?
5. Unit 4 – Sectors in the Cannabis Industry Services
6. Jamal Barghouti – DEI Outreach Manager, Blackbird, Unit 5 – What are some of the Obstacles of Social Equity?
7. Unit 5 – How Should Consumers look at Social Equity?