Inside one nonprofit’s plans to enter NY’s legal weed industry

A nonprofit focused on employment and housing for people experiencing homelessness could open one of Manhattan’s early legal marijuana dispensaries, with a 5,000-square-foot shop on 13th and Broadway.

Last month, New York’s Cannabis Control Board issued Conditional Adult-Use Retail Dispensary (CAURD) licenses to eight nonprofits, one of which was The Doe Fund. The duo slotted to run the dispensary say they’re currently meeting with growers and preparing to build out their flagship site.

“We’re looking to source as many products as we can from BIPOC and women-owned New York State brands,” said Arana Hankin-Biggers, the store’s president. “We’re also looking to incorporate a really fun experience inside the store; a more experiential retail.”

Hankin-Biggers and Paul Yau – who will serve as the store’s CEO – are both from Harbour Community, a company they founded with two other partners last year with the intention of starting a legal cannabis business in New York.

The Doe Store – which they plan to rename before opening – is a majority-owned subsidiary of the Doe Fund, Yau said. Under a partnership arrangement, Harbor Community will develop and run the Doe Store. The Doe Fund will receive 51% of the store’s profits, and Harbor Community will get the rest.

According to documents it submitted to Manhattan Community Board 2, the Doe Store will operate from the ground floor of a five-story building at the corner of Broadway and East 13th St. It will operate daily from 8 a.m. to 12 a.m.

Yau’s business background is mainly in banking, private equity and venture capital. He started working in and around the cannabis industry about five years ago while doing asset management work for Arcview Group via his consulting firm, Tribeca Black, he said. Since then, he’s consulted for multiple cannabis companies, and served 18 months as acting CFO for Massachusetts cannabis company Community Growth Partners, he said.

Related: NY licensed eight nonprofits to sell weed. Are those organizations even allowed to do that? (Guest column)

Hankin-Biggers has substantial experience in New York real estate and large scale public/private building development projects. She’s the founder and managing principal of real estate project management firm the Delevante Development Group, and previously worked as vice president of development for New Amsterdam Design Associates.

Hankin-Biggers and Yau plan to open a small section of the space for business next month, while construction crews renovate the rest of the store, Yau said.

“We’re going to launch part of our store in late-January while we build out, and then we’ll do a full-store opening likely in Q2,” Yau said.

Dutchie will handle the store’s point of sale system, payment processing, and delivery interface, and will connect them to New York’s seed-to-sale tracking system, Yau said. The store will offer on-site shopping and in-store pickup at first, and will later add delivery.

Hankin-Biggers said the store could hire up to 50 employees, including graduates of Doe Fund employment training programs.

Some in and around the cannabis industry have worried that nonprofits could lose their 501(c)3 status if they open a dispensary, because cannabis is federally illegal. But Yau said he’s confident that the store will not affect the Doe Fund’s nonprofit status.

“We’ve spent a lot of time with counsel going through this issue, and where we’ve ended up with regard to the structure and operating team is reflective of that,” Yau said. “We feel comfortable that our structure works form a 501(c)3 and an OCM perspective.”

Yau declined to elaborate on the specifics on what details will protect the Doe Fund’s nonprofit designation while a subsidiary engages in activity that’s still federally illegal.

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When she appeared in front of the Cannabis Licensing Committee of Manhattan Community Board 2 last week, Hankin-Biggers raised some eyebrows when she said the Doe Store would bring California brands to New York – that’s because, under the MRTA, all legal weed sold in New York must be grown in New York.

But she told NY Cannabis Insider she had been referring to working with New York growers who engage in “white labeling,” a business arrangement in which a brand attaches its label to cannabis grown by a third-party cultivator.

The Doe Store recently hired someone to connect them with cultivators and processors across the state as they search for longterm vending contracts to supply the store.

“We have a great lead that we brought in to help on the supply side to help us interact and sit down and meet with every single farmer in New York State,” Hankin-Biggers said. “We’re working closely with local farmers, and … we have a really good team of folks who are vetting all of the available product in New York State right now.”

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