ROXBURY RESIDENTS Solmon Chowdhury and Brian Keith had no plans to get into the marijuana business.
But as the industry started getting off the ground in Massachusetts, the two men were approached, separately, by large out-of-state cannabis companies asking them if they were interested in getting involved. Chowdhury is Bangladeshi and Keith is Black, and the state’s cannabis licensing rules give priority to minority entrepreneurs. The large companies were seeking well-respected people of color to be their community face – but the terms of the proposed contracts made clear that the investing companies would run the business.
Chowdhury and his wife Rokeya Chowdhury are successful Boston restaurant owners, operating Shanti Restaurants in Dorchester, Roslindale, and Kendall Square, and Dudley Café in Roxbury. Brian Keith, who works in aviation sales, was president of the Mount Pleasant Avenue Neighborhood Association in Roxbury and ran unsuccessfully for Boston City Council in 2017. His wife Joanne Keith works in finance.
The friends from Roxbury – who met through their children, play club sports together, and work together on community boards – were uninterested in being the face of someone else’s company. “We recognized if the four of us then worked together, we could do this better than what the large out-of-state corporation was trying to do, and we could also make it so that community people were actually involved,” Brian Keith said.
Three years later, the Chowdhurys and the Keiths have established Rooted in Roxbury, a retail cannabis company owned and invested in exclusively by Boston residents of color.
“We weren’t initially looking to be in this industry, but one of the things we saw is if we don’t step up there’s going to be another person who is going to say it’s okay to be in our neighborhood, but not really [have] the dollars going into our neighborhoods,” Rokeya Chowdhury said. “We want the people who are driving or walking past this particular location to be the ones to be able to say, ‘Oh, I have a piece of that.’”
Unlike much of the industry, which is dominated by large cannabis companies and funded by venture capitalists, Rooted in Roxbury boasts over 40 investors, of whom 96 percent are black, all are people of color, 51 percent are women, and all are Boston residents from Roxbury, Dorchester, Mattapan, and Hyde Park. The founders said they reached out to people they know through their community work, targeting investors of color. They set a minimum investment amount of just $1,200 to encourage people who are not wealthy to invest. One group of women pooled their money to reach the threshold. The average investment so far is $16,500.
“These are investors that are in our community, they’re part of our neighborhoods, they’re our customers in the café. They’re daily people that we run into,” Rokeya Chowdhury said.
Keith said the founders recognized that there is wealth in the “Black and Brown communities,” unlike other companies that tend to only solicit investors of color when they are trying to fill a diversity quota. “We wanted to kind of flip the script and make sure that we were reaching out to people of color first, so this community was getting into this business on the ground floor versus when we were needed,” Keith said.
Statistically, the cannabis industry in Massachusetts is overwhelmingly white and male.
Fewer than 30 cannabis businesses that have been given permission to open are designated as a priority licensing category, which generally means they are owned by minorities, people disproportionately affected by the war on drugs, women, or veterans.
Of 932 applications that have gotten some level of approval from the Cannabis Control Commission, just 77 are minority-owned, 45 are female-owned, and another 59 identify as at least two “disadvantaged business” categories, which can be racial minorities, women, veterans, or other groups.
Of marijuana company employees registered with the commission, nearly 72 percent are white and 63 percent are male.
Experts say one reason for the disparity, despite a state marijuana law that prioritizes equity, is the black community has less generational wealth, and often minority entrepreneurs have less access to capital in an industry where traditional bank loans are unavailable. The total cost for opening a retail store is easily over $1 million, and there is often a long lead time where an entrepreneur must pay to secure a location while going through a long, expensive licensing processes. Brian Keith described the current climate as a “gold rush,” with people spending a lot of money to secure a location, then starting the licensing. “A lot of the times, people of color don’t have the funds to secure the lease for an extended time where they don’t know if they’ll be bringing in revenue,” he said.
The only large company with a stake in Rooted in Roxbury is Green Thumb Industries. GTI leased the Newbury Street location and planned to open a medical marijuana store there, but the firm’s plans fell through. GTI agreed to lease the property to Rooted in Roxbury and received 9.9 percent equity for a limited time, as part of the deal to pay for the property.
Rooted in Roxbury has received approval from Boston to open its first store on Newbury Street, and it will now begin the state licensing process. The founders hope to open in six to eight months. A second location in Nubian Square was approved by the Boston cannabis board, and a hearing is scheduled before the zoning board. They are starting the process to open a third store in Downtown Crossing.
The founders have expertise in business, not cannabis, so they will have to hire operators with cannabis expertise. They have not yet decided where they will source their marijuana from, but hope to have a boutique shop with a range of products – ideally purchasing from many minority and small growers. They set hiring goals of 80 percent Boston residents, and half women, Roxbury residents, and people of color. The Newbury Street store will have around 25 employees. The company has committed to paying $16 an hour, profit-sharing with employees and offering benefits that include a down payment assistance program.
Brian Keith said he and his partners chose Newbury Street – the high-end downtown retail corridor – because that is where foot traffic is and where there is money. Two other cannabis stores are looking at opening within a half mile. “If we’re generating revenue in these areas and were paying out profits, were paying out the revenues from these areas back to our communities, back to Dorchester, back to Roxbury, back to Hyde Park,” Keith said.
Update: On August 10, after this story was published, the Boston Zoning Board of Appeal denied Rooted in Roxbury’s application to open a store in Nubian Square.