This article is a transcription of an episode from Thrilling Tales Of Modern Capitalism, Slates about companies and how they got there.The rise of marijuana-friendly hip-hop stars such as Snoop Dogg helped marijuana to become more mainstream in the 1990s. High Times found a way to make it work. Interviews with celebrities and weed lovers like Woody Harrelson were part of the mix. There was also outraged commentary about government hypocrisy and a passion for cannabis that is almost religious. Malcolm MacKinnon, the former editor-in-chief of High Times, said he ensured that every issue featured beautiful photos of marijuana. He says that people love to gaze at the buds. It was also known as bud porn. This is the close-up shot. It is easy to imagine people smoking it. That's what we were searching for. We could expect that a cover would sell for a long time if a bud was placed on it. But we needed to be more creative over the years.AdvertisementAdvertisementAdvertisementMacKinnon was obsessed at one point with photographing buds in front Mount Rushmore. I was planning to shoot buds up on the ridge with Mount Rushmore as the background. But I swear to God that cops were everywhere looking for me. So I went up to the top of the Ridge and shot the buds. Then, I came back down. I spoke with the cops for half an hour. Then I realized that my sweatshirt was gone. Do you think I could go back and get it? I went back up to the top and got the buds. I walked right past them wearing my sweatshirt.AdvertisementIn 2003, High Times' history was rewritten by a new publisher who decided for no apparent reason to make High Times a literary magazine of high quality and named John Buffalo Mailer as its editor-in-chief. Norman Mailer was friends with the new publisher, and John Buffalo Mailer was his son at 25 years old.MacKinnon claims John was not in his league. He had no publishing experience. He had no real respect for marijuana that anyone could see. The magazine's features were horrible. The magazine almost fell to its knees during those times. In nine months, we lost a third the magazine's circulation.AdvertisementVenture capital was increasingly entering the cannabis industry, and eventually, the money men started to look for High Times.This experiment with respectability was abandoned and order was restored in less that a year. John Buffalo Mailer left the scene while MacKinnon remained. High Times returned with a marijuana-focused magazine cover, which reassured the old-school crowd: The buds are back. The business was able to get back on its feet, and it continued to make money via subscriptions and ads for paraphernalia such as growing and smoking marijuana.High Times capitalized on legalization in some states in the 2010s by hosting lucrative events such as its Cannabis Cup. This competition aims to find the best strain of marijuana. High Times held the event for years in Amsterdam, which was less problematic, but it is now possible to hold events in other states like Colorado. High Times saw these events as a major profit center and legalization seemed like a good idea at first. As cannabis became more attractive to traditional capitalists, and less charming to drug smugglers such as Tom Forade, the magazine founder, had to face some difficult questions about their identity. MacKinnon asks how to redefine High Times if you aren't outlaws anymore, or if you just support the industry rather than the activists who brought it there. Are we appealing to people who love cannabis?AdvertisementAdvertisementVenture capital began to enter the cannabis industry, and then the money men started coming for High Times. High Times was taken over by the family of Tom Forades in 1978. Michael Kennedy, a powerful countercultural lawyer, also controlled the magazine. He managed its business affairs when he wasn't representing clients such as Timothy Leary or Huey Newton. Kennedy died in 2016. In 2016, Kennedy died. Adam Levin, an investment group headed by Adam Levin was the buyer. He had been well-known for his previous purchases of porn brands such as Penthouse or Girls Gone Wild.AdvertisementAccording to Ben Schreckinger (a Politico reporter who wrote about High Times), Levin didn't have street cred in the cannabis industry. He is described as having sharp elbows and as a shark who looks for the best angles and seeks to maximize profit. This has unsurprisingly affected long-time readers of the magazine, and likely even more long-term staffers.Schreckinger claims that Levin used an unusual presentation strategy last year during a webinar to convince people to invest his new vision for High Times. Adam Levin gave a fairly traditional investor pitch. He spoke about the brand's value, profit and loss, projected revenues and the brand's future. Then he stopped mid-webinar to smoke a bong. This is something that you don't see often on investor webinars. He wanted to demonstrate to people that he loved marijuana, that his values are consistent with this magazine's ethos, and that he isn't just someone who wants to make a quick buck off of it. Although I don't know how much this display helped to ease those fears, he clearly made an effort to do so.AdvertisementAdvertisementLevin began talking soon after taking control over High Times about how to dramatically expand the business of High Times and make it more than a magazine. Schreckinger says that it was originally supposed to be listed on the Nasdaq in 2017. We are now four years later and High Times is no longer trading on the Nasdaq.High Times is not publicly traded. Although you can purchase shares of the company using a credit card from High Times, there is not much else you can do with them. There is no liquid market until High Times actually issues IPOs. High Times cannot IPO until it files its financial information with Securities and Exchange Commission. This has not happened in the past two years. Its June 2019 SEC filing was not a good sign. According to the company, it had suffered losses of nearly $12 million in six months and had accumulated more than $100 million in deficit. Schreckinger states that until those financial statements are posted, we won't really know the extent of what has been happening for a long time.AdvertisementAdvertisementAdvertisementHigh Times did not respond to emails from us asking about its financial situation or when it plans to update information. Ben Schreckinger reported on the resignation of Vicente Fox, ex-Mexican President, from High Times, over concerns about the delayed IPO. High Times is still seeking money from regular people. You wouldn't invest in a magazine, you would be investing in a new marijuana empire. High Times branded cannabis, High Times brand weed stores, High Times high quality weed delivery services.High Times' real appeal isn't its subscriber base, says Adam Levin, an investment group. The familiar name and its authentic history with cannabis that High Times stands for are what make it appealing. And, of course, there's the chance to use that name on any revenue-generating products. High Times does not appear to be planning to grow marijuana, but it has its name on licensed High Times cannabis products. According to High Times, four High Times-branded stores are now open in California. A High Times weed delivery service is also available in the L.A and San Francisco metropolitan areas.AdvertisementIt is the 60-year old hippie who says, "Yeah, I'm going to get that High Times stuff!" Is it the 60-year-old hippie who is like, "Yeah, I'm going to go for that High Times stuff?"?With weed legalized in more states and newcomers to the market looking for a product, it is easy to see how having a recognizable national brand could be an asset. Chris Walsh, founder editor and CEO of MJBiz (a cannabis trade publication), says that no one has figured out how to make brands successful in weed. He said, "I just think that there is still a lot to be done about branding and the development and growth of brands in this sector." It's not as sophisticated as other industries. When we first started, I was shocked to see that the brownies infused with marijuana were wrapped in saran wrap. There was a sticker that stated that it had been made by someone. This was packaging back in those days. This was branding.AdvertisementWeeds with murky legal status is part of the problem. This is not a problem only for High Times, it's a problem that affects everyone in the industry. Because marijuana is a federal crime, it can be difficult to do business with banks. It can be difficult to do business across states when there are so many regulatory differences. One state may not approve a licensed product from another. There have been some attempts to create brands. Others take an organic approach and place products on shelves, hoping that consumers will recognize the brand and trust it over time. Some brands have attempted to get a jump start by leveraging celebrities. Houseplant is a cannabis brand that Seth Rogen, an actor, has created.AdvertisementAdvertisementHigh Times is a rare find in this world. High Times is an established brand, synonymous with weed for almost 50 years. It proudly declares its love for marijuana back when selling a joint can land you in jail instead of VC funding. It is now up to the cannabis buyer today whether this long history and hard-earned authenticity are worth it. Walsh said, "I don't know how it will work or how well the brand name will resonate with todays customers." Is it a niche? It is the 60-year old hippie who says, "Yeah, I'm going to get that High Times stuff!" Is it likely to be popular with today's customers, who are soccer moms and professionals returning home on Friday nights and buying pre-rolled marijuana joints or edibles or cannabis-infused beverages instead of a wine bottle? I don't know.AdvertisementThe original, outlaw appeal to marijuana, which was a countercultural vice and a way of sticking it to the man is now gone. It has been replaced by a more mainstream, normie vibe. Walsh claims that younger consumers don't really feel the same connection to this culture. You can find dispensaries and recreational shops that look a lot like Apple Stores. It looks like a modern, high-end facility where you can feel at home.Chris Walsh predicts that the U.S. cannabis revenues will soon surpass those of American craft beer. It is clear that anyone can build a massive cannabis brand, such as the Sierra Nevada or Budweiser. There are countless opportunities to make a lot of money. However, for those who were smoking cannabis during prohibition and for minorities who were targeted by police disproportionately, the rush to corporatize cannabis can be a problem. Most of the people involved in this effort are wealthy white men in suits. This is especially true for those who used to read High Times in their youth. The company is trying to turn itself from a band merry outlaw into a VC-backed retail giant. It's not clear if the brand will appeal to them anymore.AdvertisementMalcolm MacKinnon left High Times around the time Adam Levin arrived. He believes there is a fundamental conflict between High Times wanting to cover pot and be a part of it. People like him feel resentful of others who whizz by the new cannabis world without any appreciation for the old. People calling themselves pioneers of the industry when they have only been involved in it for three or less years is what really bugs us. Many people don't realize how much effort and how much danger it takes to legalize this plant.You can listen to the entire episode by clicking the player below. Or subscribe to Thrilling Tales of Modern Capitalism via Apple Podcasts, Overcast Spotify, Stitcher or wherever else you get your podcasts.
