Listen: MedMen’s Adam Bierman on Building the Apple Store of Weed

April 29, 2019 15+ min read

Opinions expressed by Green Entrepreneur contributors are their own.

As co-founder and CEO of marijuana giant MedMen, Adam Bierman’s watched the company grow from a few dinky, medical marijuana dispensaries on the west side of LA to a behemoth, which includes 70 dispensaries and cultivation centers across 12 states and a new product line.

But Bierman won’t stop until a gummy edible is as mainstream as a glass of chardonnay.

On this episode of the Green Entrepreneur Podcast, Berman talks to us about his journey to the dank side, and what he’s learned along the way.

Jonathan:  I’ve had the chance to meet Adam twice. The first time was last year at their 12,000-square-foot sprawling office complex in Culver City. I asked him how he got started.

Adam:  In 2009, Andrew and I had a business that we were running together, branding, design and construction company, out of our apartment. It was a solid, local business for two twenty-somethings, and we got a phone call one day and she’s now affectionately forever known as the Blue Haired Lady. We got a phone call from the Blue Haired Lady, who said that she had a marijuana dispensary on Sunset Boulevard, and she wanted to come talk to us about hiring us to provide services to her.

I knew nothing. I didn’t know marijuana was a business. As I drove the streets of LA, I was naively driving around not understanding that the green crosses meant marijuana, because I wasn’t a marijuana user. Especially back then, there was this kind of commitment that marijuana users wouldn’t tell non-marijuana users that they were marijuana users, even if they were friends with them, so I didn’t have an understanding of the fact there was this entire culture that existed.

I showed up and it was a 600-square-foot dump, **** [0:01:22.8] and this Blue Haired Lady with crazy blue hair sticking straight up told me she was doing $300,000 a month in revenue out of her place. I corrected her multiple times and said, “No, no, I’m trying to figure out what is your monthly revenue, monthly customer count, so we can address where it is you’re trying to go with marketing solutions and rebranding and rebuilding this place out of whatever.” She kept going back and said, “No, no, that’s not my annual. I do 300,000 a month. I want to do 600,000 a month.”

I left there dumbfounded and had a conversation with Andrew. I said, “What is going on?” Andrew has been a marijuana user, so Andrew is way smarter than I am. He had been a marijuana user. He knew—because he grew up in LA—he knew what it was all about. I said, “Yeah, that’s going on, but what are we doing?” That was our introduction.

Jonathan:  The next time I met Adam was at the Bellagio Hotel in Vegas, where I was in town for the opening of MedMen’s new store, just off the strip.

Adam, welcome to the podcast.

I had the opportunity to go up to your Mustang factory in Reno, Nevada and I noticed in huge writing on the wall, there was a sign that said, “Mainstreaming marijuana.” I wondered if you could tell me about that. Is that a central premise of your company?

Adam:  It has informed basically every decision we’ve made over the last nine years.

Jonathan:  Okay.

Adam:  You know, we had this vision that we could build this marijuana company through brand, through accessibility, by way of destigmatizing cannabis, knowing that it’s something that people could benefit from accessing and using, but in order to build the business, we had to simultaneously build this industry. When we started this, there was no such thing as a successful marijuana business that was legal, at least. So, if you have to build this industry while simultaneously building this business, the way that we look at that is you have to mainstream marijuana. Marijuana can’t have the stigma that it had when we started nine years ago, and an industry be built, or a business long term be viable.

I think the latest numbers or projections from Callan is that this is a $75 billion-plus opportunity in the U.S. The best part about that is six months ago they came out and said it was a $50 billion opportunity. Then it was updated and it’s a $75 billion opportunity. Two years ago, it was a $25 billion opportunity. We think it’s $100-plus billion opportunity and we think that it is so big, in large part, because of, you know, as a consequence of it becoming mainstream because of all those new users that aren’t currently being accounted for.

I say it all the time, the chardonnay moms. What is it going to take to get them to replace chardonnay at brunch with a couple hits of this statemade vape pen? Are they really accounted for in that Callan projection of 75 billion?

What mainstream consumer product does not cater towards the sensibilities of women and that is just any mainstream product that understands, or company behind that CPG product, understands that women are making the majority of household buying decisions. If we see a future where marijuana is mainstream, then marijuana is one of those decisions, or the purchase or marijuana is one of those decisions that will largely be made by women.

Statemade is really about accessibility back to the mainstream concept to the mainstream. I think that there are plenty of, you know, what we call the legacy core users that don’t need attractive packaging, don’t need real straightforward kind of descriptions, don’t need—they don’t need all this stuff. They know what they like, what the strain is called and what it does to them, but that’s not who we’re catering to. We’re catering to the future. We’re catering to the user of tomorrow.

That user of tomorrow, whether it’s a woman or a man, is somebody who is going to be attracted to this product line because of how mainstream it feels.

Jonathan:  So, MedMen stores have been called the Apple Stores of cannabis, which I’m sure you take as a compliment, and it is obvious that you were inspired by the Apple Store. The simple design, lots of glass cases. Talk to me about the thought process behind that design idea.

Adam:  Same consistent answer. I like the theme of this discussion, but it’s good, right? How do you make something accessible? Whether it’s a product or it’s a retail store, we’re not reinventing anything. Nothing we’ve done over the last nine years have reinvented anything. We’re just applying it towards cannabis maybe for the first time.

We take a lot of pride in the stores, my partner and co-founder, Andrew Modlin, the stores are really his vision and he deserves a ton of credit for it. But I think when we use the term vision, it wasn’t like Andrew envisioned an entirely new retail experience. What Andrew has done is he’s envisioned what a cannabis retail experience could look like, if you pretended it wasn’t cannabis. If you forgot for a second that it had somehow to be different because it was cannabis or you needed to apply some type of different thought process, how about if you just applied the same thought processes any retailer would apply towards optimizing an experience for a consumer, and it just happened to be a marijuana store.

I think when you walk into that store, what our hope is, is that but for the product inside the cases, you wouldn’t necessarily know what it is that that store sells. I could tell you that store sells electronics, I could tell you it sells makeup, I could tell you it sells clothing, and it would all work.

All we’re doing is applying best practices from retail. The fact that we’re applying it for the first time to cannabis, I think we get a lot of credit, which we’re really humbled by and flattered by, but it’s really just about the vision to mainstream marijuana.

Jonathan:  All right. How do you attract that chardonnay mom, that canna-curious customer who might have had a horrible experience when they were younger or a terrible experience with an edible?

Adam:  We take a long approach. We’re looking at this, what will this business be in five years? What will this industry be in five years and where will the world be in regard to its perception of cannabis in five years.

I think first and foremost, for us, it’s about retail. The reason that we’re making such a concerted effort around retail is we believe that that is the door or that’s the window through which people will climb or the door through which people will walk into this light. I look at it, it’s like walking from the black and white into a rainbow, right?

So, where we put these retail stores and the effort that we put into building out those stores and making them inviting and welcoming and accessible—the store that we’re opening is not nine miles from the Las Vegas strip, in a strip center, in the back with a discrete, small green cross. I mean, this store is literally across the street from McCarran Airport, where everybody who exits McCarran will drive past in their car, their Uber, or their taxi and they’re not going to see a small sign. They will see a very proud MedMen sign.

You know what? They may have to drive past that store four visits in a row to Las Vegas over the course of 15 months until they finally say, “Let’s pull over, let’s see what that’s about.” When they walk in for the first time, they may not buy anything. But when they walk in for the first time, we built the store in a way that will make them feel good, will not make them feel anything that has to do with shame.

The training programs and the hours and the investments that we put into our staff, so that the interaction they’re going to have with the people that work there is going to be so positive and so informative that even if they might have to drive by it four times, walk in and out of it twice, and then eventually, you know what? They’re going to go ahead and pick up a statemade vape pen.

One thing I do know, now being in this for as long as I’ve been in this, is that this works. This statemade vape pen, this will work. This will have its desired effect on you and when it does, you know what’s going to happen? You’re coming back. And it’s not just that you’re coming back to MedMen. We feel really great about the fact that we do think that you will come back to MedMen, but you’re going to come back to cannabis, to use it responsibly and substitute other things out of your life that aren’t as healthy, that aren’t as positive. You’re going to substitute them for cannabis.

Your question is, how are you a part of this kind of transition that society is going through right now, and that’s how we see kind of our leadership role in it, is by welcoming. Welcome to the new world. We can touch you and welcome you in in all these different ways. You mentioned it, from a billboard to a wrapped taxi, to just the sign outside of the store, to the open glass windows. Wherever you are around the country, when you see our store, you can see what’s going on inside and it looks normal, right? All those touchpoints welcome you into this new world of legal pot.

Jonathan:  You admittedly started off in the business knowing nothing about pot.

Adam:  I think our naivete is core to the success or the progress we’ve made to date. In all fronts.

I don’t know what would’ve happened if we fell into this industry the way we did, and our background was traditional big box retail. I don’t know what would’ve happened if we fell into this and our background was agriculture. I don’t know if we had fallen into this and our background was anything else. We fell into this and we were young. We didn’t have much experience.

Jonathan:  You’re still young, really.

Adam:  Well, thank you. I’ll take it. We didn’t have much experience other than just living in the world ourselves and being really entrepreneurial from a really young age and kind of looking at the world through an entrepreneur’s lens, but I think that’s been such a benefit. It’s not like we stepped into this and said, “This is how it should be. This is how everybody does it.” We stepped into this and said, “Well, look, if we’re going to do this, we know that we don’t know. Let’s just be pragmatic.”

We’ve looked at everything through this practical lens and as we look at these stores, I remember in California, when we opened our first store we went around, and we saw all the stores that we could go visit and up and down California. They all had these systems where bars on the windows, blacked out, green cross out front. You walk in, a security guard that looks like he’s ready for a full invasion somewhere in the desert buzzes you in, asks for your ID. Then you get buzzed back through another steel door to a room where there’s jewelry cases.

When we did that, I guess if we had come from being marijuana people, we’d say, “That’s how it is.” But we didn’t. We said, “Why is that how it is?” As we looked at it and talked to everybody, it was like, “That’s just, ‘That’s just how it is.’” And that was never enough for us.

We said us as consumers, we wouldn’t want that and then we started looking at casinos. We started looking at big box retail. We started looking at restaurants. We looked at all these different industries that we felt like had analogous pieces to what it was that we were trying to create, and we just ripped off, essentially, best practices from all of them. You think about the way a supermarket is laid out. You think about the way that a casino floor is designed. You think about the way that these really mature kind of industries have figured out how to optimize for a retail footprint or just a footprint where you’re trying to drive consumer behavior and we just applied it.

Jonathan:  Talk to me about the importance of consistency in the marijuana business. You drink a bottle of wine and you pretty much know what you’re going to feel like every time you have that sip of that wine, the same bottle of wine. Are you going for the same kind of consistency in marijuana?

Adam:  Look, it is a crop. It is a plant. No, even though all the Driscoll’s raspberries look the same or all the orchids looks the same, there’s absolutely some very minor deviation in there.

Jonathan:  Yeah.

Adam:  No two living things are necessarily exact-exactly the same. It comes down to the mainstreaming concept. We don’t believe that you can go mainstream marijuana, transition all these people that are using other products and goods and drugs to using cannabis as a substitute unless it’s consistent. Because you know what? That chardonnay mom, she knows that if she has two glasses of a certain chardonnay at brunch, it’ll taste a certain way and it will have a certain effect.

We are creatures of habit and we just don’t believe that unless you can provide that type of consistency in these products, that you can get people, to bring them in and make them habitual, make them part of their routine, “mainstream” them. If we want to take what Callan thinks is 75 billion and turn it into 100-plus billion of opportunity, we’ve got to have all those people come over. To get them to come over, we have to create consistent products.

What we can’t have, now, look, there can be minor deviation, especially in the raw material, the flower itself, with the tissue culture and all the other measures that we take in these factories to create consistency, it’s going to be very minor deviation. But outside of the raw flower itself, when you get into these vape pens and the tinctures and the rest of it, we’ve got it down. It is consistent. You will have the exact same experience every single time. Furthermore, with us and the statemade concept is, have that exact same experience everywhere in the country.

The one thing—and I know this is a business podcast so we can get a little more business in it—because of the fact that you cannot cross state lines with this product, you realize how unique of a proposition that is as an industry. There is no item and the answer is none other. But what we have to do is we have to create that consistency in that vape pen that you have here that, you know—what is this? Max. So, the Max vape pen, statemade vape pen, has to taste and smell and feel the same, whether you buy it in Vegas, whether you buy it in Chicago, New York City, Los Angeles, San Francisco, Phoenix, Scottsdale. It’s got to taste the same.

Which means that each of the factories in all those states that we have, have to grow it the exact same way from the exact same base material, extract it the same way, manufacture it.

Jonathan:  Interesting, yeah.

Adam:  So that you have the same experience. Until we can do that, it can’t truly be mainstream, and I think with the launch of this product and all the new states that we’ve recently entered, we have the opportunity for the first time in the history of this industry to create that kind of consistency across the country. Which I think will just, will bring this into the mainstream by leaps and bounds in a way that we just haven’t yet experienced.

Jonathan:  Okay. You started in the dispensary business but now you’ve launched a new line of products called statemade. Was that all part of the plan? Was to first open up a bunch of dispensaries and then have products to sell in the dispensaries?

Adam:  Yeah. I mean, the way we look at it is shelf space. When we’re talking about retail, what we’re really talking about is shelf space. We’re now at a place between California, Nevada, New York, Florida, Massachusetts, Arizona, Illinois—that’s as of this taping, so check back in.

Jonathan:  I’ll check back in.

Adam:  Every week there’s something new. But we’ve looked at it as these primary markets, really. Los Angeles, Las Vegas, Manhattan, Southern Florida, those are the places. The shelf space in those places are where brands are built, globally.

First, it was about the shelf space, which the way that that happens in this industry is the retail. We got the shelf space now. What are you going to do with that shelf space? It’s always been about brands. I think that to our credit, we’ve been patient. We haven’t launched something like this until we had the shelf space, until we had critical mass in regard to the shelf space until we had the factories up and running. Because we weren’t going to launch this thing if we couldn’t completely control the entire supply chain. From the input, the actual raw material, to the manufacturing process, to the distribution, down to the actual retail. We control all of that in every market we’re in.

Now that we have what we believe to be the premiere shelf space in the world of marijuana in our possession, what are you going to do with it? You’re going to build amazing brands. You’re going to put them on those shelves and those are going to be the brands that the marijuana consumers of tomorrow are going to become familiar with and they’re going to be the brands that they stick with for the rest of their lives.

Jonathan:  You introduced statemade. What is next?

Adam:  Yeah, the way we see this is we have the shelf space now. This is the first brand we’re launching, statemade. We certainly see additional brands coming on to fill up more shelf space with, that we’re in control of.

Now that we have the footprint in the markets that really matter when it comes to brand building, you’ll see us start going deeper in those markets. For example, on one hand, really excited about Q2 of ’18. It came out and the best analysis anybody could do is that we did about 6% of all of California’s sales. But we did that with like five or six stores or something like that.

Jonathan:  Right.

Adam:  Only in Southern California and really only in LA. Awesome stat, which means, for me, the challenge then is, okay, Adam, how do you get that to own 15% of the California market? Well, you got to be in Northern California. You can’t just be in Southern California.

I think you’ll see us go deeper. Not just be in LA, but have a real strong presence in North Cal, have a much bigger presence in San Diego. We just entered Arizona and we acquired what we believe to be the premiere retail asset in Arizona, in Scottsdale, that will work for MedMen, but adding a couple more dispensaries.

So, going deeper in these markets, I think you’ll see that over time and then that combined with launching these additional brands, really kind of solidifying our place in the hearts and minds of these consumers going forward.

Jonathan:  What are some brands that you guys look at that inspire you? I think of a Red Bull, which started off as one thing, a sports drink, and then became a lifestyle brand. Do you think of MedMen as a lifestyle brand?

Adam:  Yeah, we definitely do. We were talking about it at length in our last board meeting. We happen to have Jay Brown from Roc Nation on our board and he is just a dynamic guy. The way he looks at culture and lifestyle, it’s incredible. It’s fascinating just to be around and listen.

I think for us, we look at Red Bull, we think what they’ve done is awesome from a lifestyle standpoint. We look all the way at Starbucks and the way that Starbucks has ingrained itself into the daily life of the Starbucks consumer. So impressive what they’ve done.

I’m not a “every morning has to be coffee at the same time,” but Andrew definitely is, and he’s got his Starbucks mobile and I mean, it’s just part of his day. To be able to become part of a routine, a daily routine, for people that way is so impressive.

From a business model standpoint, it’s really Luxottica that we look up to. For those that aren’t as familiar, Luxottica owns Sunglass Hut, LensCrafters. Most people don’t recognize that they also own all the sunglass brands on the shelf as well. It’s an incredible business concept. A consumer walks in and goes through Tom Ford and Prada and Gucci glasses and all the rest, but at the end of the day, they’re all being manufactured at the Luxottica plant. Those sunglasses themselves are all owned by Luxottica through licensing deals with those third parties. And they own the retailer itself as well. What a fascinating business model they are and something that we look up to as well.

I mean, look, we’re just trying to pull the best of all this. We’re here in Las Vegas today. Harrah’s Corporation, now Caesar’s Entertainment, the way that Harrah’s—and it’s really, I look like a guy like Gary Loveman, the former CEO, started in the marketing side and became the CEO of that company. We look at Harrah’s, the way that Harrah’s used data to completely fundamentally change the way that the gaming industry worked.

Before Harrah’s, there was no such thing as a loyalty program. There was, “Hey, we have a high roller, we give him a nice suite and give him tickets to a fight.” Harrah’s came in and used real analytics and really broke down data for the first time.

Another really cool thing Harrah’s did, is Harrah’s looked at gaming as if it wasn’t gaming. At the time that Loveman started, you talk about stigma. Nobody wanted to touch casinos and gaming. That was dirty stuff. He said, “Well, let’s pretend it’s not casinos and gaming. Let’s hire a bunch of MIT guys to come in, guys and girls to come in, and let’s really analyze the data here. What do our consumers want? What is important to them? What motivates them? What will get them sticky? What will get them coming back and not going anywhere else?”

They created the loyalty program that they created that I think not only changed gaming, it kind of changed the world.

Jonathan:  Right.

Adam:  When I talk about, you know, we’re hiring people that want to be best in the world, want to be in a history book, I look at Harrah’s for that and the way that they looked at gaming, forgot any of the shame, forgot any of the stigma, and said, “How do we turn this into the best business we can turn this into?” That’s a business that we look up to as well.

Jonathan:  You talked about the importance of asking yourself why not as an entrepreneur. Tell me a little bit about that.

Adam:  It’s really just about asking the question, “Why not?” If you can’t get a great answer, then go do it.

If you are a sports team and you’re saying, look, I understand, I’m a baseball team. I understand that the way that the positions are supposed to be played is you have two guys on the left side of the infield and two guys on the right side, but I’m paying attention and these pulled hitters are getting up and 90% of all the balls they hit on the ground are to the pull side of the diamond. Why not put three guys over there? “Well, because that’s not how it’s done.” No, no, that’s not a good enough answer. I’m asking why not? If you can’t give me a great answer, then I’m going to do it.

I think with us, it’s why not? Why can’t you build a $50 billion marijuana company? Why not? Why can’t you make marijuana mainstream and have a store across from McCarran Airport that looks the way this store looks? Why not? Why can’t you have products that look like this, that will have this desired effect for people? Why not?

Everything MedMen does is informed by why not, but I think, yeah, I think that’s the best advice I could give to an entrepreneur.

Jonathan:  Ask yourself why not.

Adam:  At the end of the day, why not? You know what? If you’re too scared to go there and ask that question and actually follow through based on the answer, being an entrepreneur isn’t necessarily like what everybody should be doing. I think in this interview we’ve used the word lunacy a few times.

Jonathan:  Right. Yeah.

Adam:  Yeah, and it’s not like suggested. We all should be doing the things that we are happy and excited to do, but at the core of any entrepreneur should be a why-not attitude.

Jonathan:  Let’s talk about the Green Rush. I mean, these are big heady days for cannabis. Do you foresee what happened to the dot com business in the early 2000s happening to the cannabis business? The dot com boom, the dot com crash?

Adam:  Well, I think half and half. You talk about dot com, so half and half. Will a lot of the businesses that are currently in the marijuana industry fail over the next five or ten years? Absolutely. And you know why? Because this is a real industry.  And if that wasn’t the answer, there would be a problem. So, we will see a lot of failure. There’s so much excitement, so much hype, so many people flocking towards this, so much money that’s going to be attracted into this. Of course, there’s going to be failure and some of it will be epic.

Will there be successes? Absolutely. Some of it will be epic, too, and we very much hope that we’re in that category and we work tirelessly to do everything we can to ensure that.

But as far as the industry goes, when you talk about dot com, first of all, there were failures in businesses, but there was certainly no failure in industry when you’ve got trillion-dollar companies that now exist as a result of it. We sit here interviewing this podcast in a small conference room with all this technology, right?

That for the most part emanated from that. But as an industry, the marijuana industry, we’re way past the potential of failure. You talk about red states, you also want to talk about a presidential election a few years ago where the State of Arkansas cast their vote for Donald Trump and concurrently cast their vote for legalized medical marijuana, you realize on the same ballot.

How crazy that is! You’ve got over 90% of the United States in favor of medical marijuana. You’ve got the majority of the U.S. in favor of recreational marijuana. You have the country of Canada legalize marijuana recreationally at the federal level. Marijuana will be legal, fully legal. Whether it’s in two years or three years or five years, like prohibition is ending in marijuana.

The industry itself, when you said like what’s the doomsday scenario, we’re past that. Now it’s really a question of how big—let’s go back to the beginning—the question is how mainstream does it get, how quickly.

Jonathan:  What would you like to tell the 23-year-old, naïve, entrepreneurial you now? If you could go back and talk to that person?

Adam:  You know, I’d say the biggest shift—and it’s hard when you say 21. I mean, I’ve been in business essentially since I was 14.

Jonathan:  Okay. Maybe the 14-year-old self, yeah, I don’t know.

Adam:  For the next time I’m on your podcast, ask me about my Black Eyed Peas story when I was 17 years old.

Jonathan:  Is it a long story, because I kind of want to hear it.

Adam:  It’s a good one. The 17-year-old, again, naïve self of mine, somehow figured out how to convince the Black Eyed Peas to come perform at a show I put on in a roller rink in Oceanside, California.

Jonathan:  Wow!

Adam:  Keep in mind, I had no money and no means to do this, but I put this crazy deal together where I rented out a roller rink in Oceanside. I signed a contract with the Black Eyed Peas to come play the roller rink, along with other people, and then when out and sold tickets to high schools for an all-ages dance party.

I didn’t do very well on the deal and the Black Eyed Peas ended up not being paid and left pretty upset. But hey, you know?

Jonathan:  Why not?

Adam:  Why not? Yeah! That was 19 years ago.

Jonathan:  Okay.

Adam:  And we’ve come a long way since then.

Jonathan:  So have they.

Adam:  But I think the biggest thing that I’ve learned since I started trying to make deals happen and be an entrepreneur, is how to lose. I’ll tell you, the Black Eyed Peas, the 17-year-old me did not know how to lose. The 21-year-old me didn’t know how to lose.

Learning how to lose is something that’s way more recent for me and I can’t give some kind of generic advice to all entrepreneurs out there. This is how you lose.

 But I would give this generic advice:  Learning how to lose is such an amazing skill when you are an entrepreneur. Whatever it is for you, how do you embrace loss? How do you embrace failure? Not just that you’re good with it and you get back up off the mat. Like that whole stuff, like that’s not the answer. That was me. Get punched in the face, get right back up. Turn a no into a yes! You know, whatever it is.

That’s not the answer. I think that for those seeking real, true, sustainable success, whatever that means, is you’ve got to know how to lose. How do you lose? How do you compliment the other side? Because when you lose, that means there’s another side that wins most of the time, right? Or prevails. Even if it’s them telling you no, they don’t want to invest in your business, they have prevailed in that debate or conversation for the day. How do you give them credit and say, “You know what? You came to that conclusion. I respect that. Good game, good job, good day.”

And then how do you go back and reflect on that? Not from a place of being vindictive. “I’m going to go get them! They were wrong! I’m going to prove them wrong!” How do you react to that and say, “What is there to learn from me losing? I’m not going to win all the time, but I can see why they did that, why they said that, why they chose that. I can see that. How do I learn and grow from that?”

Jonathan:  Adam, thank you so much for your time.

Adam:  Thanks for having me.

Jonathan:  And that’s our show! Thanks so much for joining us. If you like what you heard, don’t forget to subscribe to Green Entrepreneur Podcast on Apple Podcast, Google Play or any other place that you may find podcasts.

I’m your host, Jonathan Small. If you want to reach out to me directly, hit me up at JSmall@Entrepreneur.com.

Until we meet again, always remember, yes, you cann-abis.