Podcast Summary: The Future of Cannabis - feat. Will Muecke

Episode: The Future of Cannabis
Guest: Will Muecke, Co-Founding Managing Member and Chief Investment Officer, Artemis Growth Partners
Release Date: October 9, 2024
Host: Leslie Heaney

1. Introduction and Personal Anecdote (00:00 - 05:00)

Leslie Heaney begins the episode with a personal touch, sharing a humorous frustration from her recent trip to the DMV with her 15-year-old son. This anecdote serves as a segue into her curiosity about the legality and regulation of cannabis, especially after noticing billboards advertising CBD and low-THC products in Tennessee.

Notable Quote:

“I sort of confused by it and thought, gosh, is pot legal in Tennessee?” — Leslie Heaney [02:15]

2. Guest Introduction and Background (05:00 - 06:06)

Leslie introduces Will Muecke, outlining his extensive background in finance and his pivotal role at Artemis Growth Partners, a private equity firm dedicated solely to cannabis investments with over $400 million in assets under management.

Notable Quote:

“Will is the co-founding managing member and chief investment officer for Artemis Growth Partners, Artemis is a private equity platform which is just solely dedicated to investing in the cannabis industry worldwide.” — Leslie Heaney [05:50]

3. Defining Cannabis: Hemp, THC, CBD (06:06 - 09:55)

To set the foundation, Will provides clear definitions distinguishing between cannabis, hemp, THC, and CBD. He explains that cannabis encompasses both hemp and marijuana, differentiated primarily by THC concentration—hemp contains ≤0.3% THC and is federally legal under the 2018 Farm Bill, whereas regulated cannabis contains higher THC levels and remains illegal federally.

Notable Quote:

“The real difference between hemp and regulated cannabis is just the concentration of a molecule called THC.” — Will Muke [06:23]

4. Historical Context of Cannabis Criminalization (09:55 - 15:34)

Will delves into the history of cannabis in the U.S., highlighting the pivotal role of Dr. Harry Anslinger in the 1930s who spearheaded the criminalization of cannabis through the Federal Bureau of Narcotics. He contrasts this with the plant’s historical uses for medicinal and industrial purposes, underscoring the racially motivated policies that shaped current perceptions.

Notable Quote:

“The history here is not a pretty history for cannabis. And we're still, unfortunately, living under some of those overhang of those laws set back in the 20s.” — Will Muke [11:35]

5. Shift in Perception and Medical Use (15:34 - 21:36)

The conversation shifts to the 1996 California legalization for compassionate use, primarily aiding AIDS patients. Will emphasizes that this marked the beginning of shifting perceptions, moving cannabis from a strictly prohibited substance to one recognized for its medicinal benefits. He also touches on the broader implications of legalizing cannabis beyond just medical use.

Notable Quote:

“California said, well, let's allow people to have access to the plant because it's the right thing to do.” — Will Muke [15:03]

6. Federal vs. State Legalities and Their Implications (21:36 - 29:48)

Will explains the complexities arising from cannabis being legal in some states but illegal federally. This discrepancy creates challenges such as restricted banking access, punitive taxation under IRS Code 280E, and limited medical research. He highlights how these federal restrictions hinder the industry's growth and profitability.

Notable Quote:

“The federal government has not passed any law legalizing cannabis, but some states have legalized it for medicinal and recreational purposes.” — Leslie Heaney [09:55]

Notable Quote:

“Because cannabis is federally illegal, it means that a cannabis operator doesn't have access to the same benefits that a normal company that's not in any controlled space like cannabis does have access to.” — Will Muke [25:42]

7. Public Opinion vs. Political Will (29:48 - 34:42)

Leslie and Will discuss the stark contrast between overwhelming public support for cannabis legalization and the slow pace of federal legislative change. Will attributes the delay to polarized politics and lack of incentives for politicians to act, despite clear voter mandates.

Notable Quote:

“Gallup polling... the overwhelming majority... believes that there should be at least medical, legal access to cannabis everywhere.” — Will Muke [30:54]

Notable Quote:

“It's just a matter of getting the politicians on board and giving them the right data.” — Will Muke [34:42]

8. Impact of the Illicit Market on Legal Businesses (34:42 - 48:29)

The discussion explores the tension between legalized dispensaries and the persistent illicit market. High taxes and strict regulations in legal markets often make illicit options more price-competitive, undermining legal businesses. Will emphasizes the need for lower taxation and increased accessibility to curb the illegal market effectively.

Notable Quote:

“As long as you don't have a dispensary or a delivery service or a legal way of getting cannabis in a certain jurisdiction, jumping in a car and driving an hour... likely going to pick up their phone or their chat, and they're going to find an illegal supply.” — Will Muke [48:29]

9. International Perspectives: Europe and Beyond (48:29 - 77:29)

Will provides an insightful overview of cannabis legalization in Europe, with Germany's Pillar 1 and Pillar 2 programs serving as models for medical and potential recreational use. He discusses pilot programs in Switzerland and the Netherlands, emphasizing the importance of domestic supply chains and regulated distribution to ensure safety and reduce illicit activities.

Notable Quote:

“Germany is the catalyst for the rest of Europe. It really is the engine on the train.” — Will Muke [67:05]

Notable Quote:

“In Germany, you go to a doctor, you can be your orthopedist and you say, well, why don't you try cannabis?” — Will Muke [15:34]

10. Personal Motivation and Advocacy (48:29 - 57:00)

Leslie shares a heartfelt story about her sister's battle with cancer and how medical cannabis significantly improved her quality of life by reducing opioid dependency. This personal experience fuels her passion for advocating cannabis legalization, aligning with Will's mission to expand access and dismantle outdated stigmas.

Notable Quote:

“The way that cannabis is illegal has nothing to do with science. It's all political.” — Leslie Heaney [50:12]

Notable Quote:

“It's like the Blues Brothers. I'm on a mission.” — Will Muke [55:58]

11. Investment Strategies and Future Outlook (77:29 - 89:45)

Will outlines Artemis Growth Partners' investment philosophy, focusing on defensible barriers to entry, unique genetics, and strong branding rather than commodity-based operations. He discusses the firm’s significant investments in the U.S. and Europe, highlighting Europe's growing market as a primary focus until U.S. federal laws evolve.

Notable Quote:

“We think about cannabis like the supply chain to really reduce it to a more simplified state. We think about it like Apple and Foxconn.” — Will Muke [82:32]

Notable Quote:

“We're on the right side of history and we will get there.” — Will Muke [89:36]

12. Closing Remarks and Future Prospects (89:36 - End)

Leslie and Will conclude by reiterating the importance of federal legalization and the positive impact it would have on public health, safety, and the economy. Will expresses optimism about the industry's future, emphasizing continued advocacy and strategic investments to drive global cannabis legalization.

Notable Quote:

“We need to stop criminalizing something that shouldn't be criminalized.” — Will Muke [89:45]

Key Takeaways

• Definitions Matter: Understanding the distinctions between cannabis, hemp, THC, and CBD is crucial for navigating legal and commercial landscapes.

• Historical Stigmas: The criminalization of cannabis was heavily influenced by racial and political factors rather than scientific evidence.

• State vs. Federal Law: The U.S. operates under a patchwork of state laws, creating significant challenges for the cannabis industry, including banking restrictions and high taxation.

• Public Support is Strong: There is overwhelming public support for cannabis legalization, yet political inertia remains a barrier.

• Illicit Market Challenges: High taxes and limited legal accessibility perpetuate the illicit market, undermining legal businesses.

• Global Insights: Europe, particularly Germany, serves as a model for regulated cannabis markets, emphasizing the importance of domestic supply chains and pilot programs.

• Personal Advocacy: Personal experiences, such as Leslie's sister’s use of medical cannabis, highlight the profound benefits and drive advocacy efforts.

• Investment Focus: Artemis Growth Partners prioritizes investments in areas with strong barriers to entry, unique genetics, and branding potential, with a current focus on the burgeoning European market.

• Optimistic Future: Despite current challenges, the industry is poised for significant growth and positive societal impact with continued advocacy and legislative progress.

Conclusion

This episode of The Interview with Leslie Heaney offers a comprehensive exploration of the cannabis industry's past, present, and future. Through insightful discussions with Will Muecke, listeners gain a deep understanding of the complexities surrounding cannabis legalization, the interplay between federal and state laws, the challenges posed by the illicit market, and the promising global trends spearheaded by Europe. Personal narratives add an emotional layer, underscoring the real-world benefits of medical cannabis. As the industry stands on the brink of transformative change, the episode serves as both an informative guide and a motivational call to action for advocates and investors alike.