Gorilla Rx CEO on Black-owned cannabis companies: ‘We must rely on ourselves’

Yahoo Finance’s ‘A Time for Change’ welcomes mother-daughter duo Kika Keith and Kika Howze to talk about their company, Gorilla Rx, the only Black-female-owned cannabis dispensary in Los Angeles. The entrepreneurs discuss the beginnings of Gorilla Rx, the effects of the war on drugs, and the steps the cannabis industry needs to take to help diversify ownership.

Video transcript

[MUSIC PLAYING]

MARQUISE FRANCIS: Welcome back to "A Time for change." In the city of Los Angeles, there are more than 200 licensed dispensaries, and just one is owned by Black women. It's called Gorilla Rx, and it was started by a mother and daughter, Kika Keith and her daughter, Kika Howze. And they're here to tell us how they made it happen. Thank you both for joining us this morning.

KIKA HOWZE: Thanks for having us.

KIKA KEITH: Glad to be here.

MARQUISE FRANCIS: So you opened your shop this year, a lot of fanfare. If you went on TikTok or Twitter for a bit, every video was your shop. But the reality is, it actually didn't happen overnight. It was years in the making. Why was now the right time, Kika? I'll start with you.

KIKA KEITH: Well, you know, it's funny that you said that because we often call our place the house that people built, because it was such a battle to open our doors. And as we've heard before on this fight that we have with the war on drugs, it still transcends as we're looking to get licenses. And it took us three years to open our doors. So it was highly celebrated and highly anticipated because we certainly did not think that it would take that long.

MARQUISE FRANCIS: And over to the daughter, you all could have opened this suspensory in any community in LA, but you actually chose Crenshaw. Why was this specific community important for you all to have this business?

KIKA HOWZE: Yeah, definitely. Our family moved to the Crenshaw district in the early '70s. And for us, this is the area in the community that raised us. And this specific community is so impactful for the Black community specifically. Just being in Los Angeles, it's the epicenter of so much culture, so much heart. They call it Little Africa.

And for us, as the community changes, it was important for us to have a place where people could come and be a source for wellness, could be a source for joy, and most importantly, to be able to have a form of reparations for our community, who was so adversely impacted by the war on drugs, to have almost, like, a championship ring for the community. And that's what we hope to represent.

MARQUISE FRANCIS: That's beautiful, a championship ring. We know the Lakers just won not too long ago.

KIKA HOWZE: Hey.

MARQUISE FRANCIS: And just a quarter of cannabis businesses are actually owned or founded by women. It's no coincidence, obviously. So big Kika, what needs to happen to ensure women have access to the industry?

KIKA KEITH: Well, you know, I think education is the key. Folks don't even know where to start from, you know? And as we look specifically as Black women, and when you see these cities and it's happening nationally and states that are starting these social equity programs without education, without access to capital, and we know Black folks get less than 1% of loans, of business loans in the traditional market. And so, we really have to look at both access to capital and education to properly prepare us to run a compliant business.

MARQUISE FRANCIS: And I know you all went through LA's social equity program meant to level the playing field. I'd love if you all could walk us through what that experience was like.

KIKA KEITH: Yeah, well, you know, the LA opened in 2018. And we thought LA required that you have to have a property to apply. We thought that, you know, come spring of 2018-- mind you, we opened in 2021-- that the process would open, and we saw very quickly, you know, it's a big fight. You have these multistate operators who want these cannabis licenses. And when they say that they exclusively go to people in the community, it is a battle to make sure that we maintain our equity, to maintain our ability to manage and create brands in this market. And so it has been a battle and a very political one.

Little did I know-- and I'm a serial entrepreneur-- that this would be such a political fight. And I think that's the biggest thing that really needs to get out to the public, especially our community members, who must engage in the policy process, because we saw, month by month, the intent of the social equity program dismantled through the laws. And so that's really critical. And the entrepreneur that wants to get into the cannabis industry must seriously take on the politics.

MARQUISE FRANCIS: And I'd love if we could get into the numbers a bit because a lot of people see opening up a marijuana dispensary. There's over $20 billion industry. And yet, it actually costs a lot to get your own marijuana strain, to open up a business, the licenses. I know you all spent so much money on just having a physical space for so long until your license was approved. So what are the numbers looking like to actually get into the marijuana industry?

KIKA KEITH: Oh, yeah, that's the part people need to talk about. In LA in particular, and I'd say it's a much higher market, but the cannabis real estate tax, you know, what they charge you, they quadruple your rent. So I was looking that thing. I was paying $12,000 a month on an empty property for three years. So when you look at that side of things, when you look at the licensing fees that are costs, it is exorbitant.

And remember, to qualify for the social equity program, one of the qualifications is that you're low income. And so I always say, you know, this thing seemed to be designed to fail because how do you expect those of us that come from the community that were most harmed by the war on drugs be able to put up those amount of dollars?

MARQUISE FRANCIS: And I'm no math wizard, but $12,000 every month for three years, that's a lot of money. And so, you definitely need a lot of money to get in and to stay into this. And Kika, I want to turn to you. My colleague mentioned fewer than 10% of US adults said marijuana should not be legal. But in 1969, 12% supported it. So I know you all have three generations of, you know, women in your family who are part of this business and who are all for it. So I'm curious, how has the evolution of marijuana been in your family, and what are you all seeing from the older generation to a younger generation, the evolution of marijuana in your family?

KIKA HOWZE: Yeah, we come from a very strong-rooted family. My grandmother, who was a Black Panther and also a medicine woman for our community, created a beverage by the name of Gorilla Life, which was the first to market chlorophyll water, and it was distributed by my mom in Whole Foods across California. And for us, that was really the beginning of engaging plants and medicine to be able to bring wellness to our community.

And so we took that name, and it was what became Gorilla Rx. And it was something that was a part of our family for so many generations and brought healing. And that's what we hope to be able to do for our community as well through cannabis. We have a wide range of people who come in, from our elders to the cannabis connoisseurs, the influencers, but also the community that surrounds us.

And to be able to educate not just based off of what we know from smoking the plant, but also, what are the topical wellness for pain medication and the bath salts and, you know, all of those different remedies and methods that really takes us back to where the plant came from as a healing source. And so that, on its own, brings so much destigmatization within our community that really just allows for things to flourish in the way that they should.

MARQUISE FRANCIS: Yeah, and going back to the inception of why you all put this business in Crenshaw for the community, by the community, you are also building a training center next door to help other people through the social equity process, which, honestly, is amazing and super selfless on your end. Why do you feel like this was an important move for you all? Big Kika.

KIKA KEITH: Because we won't be successful if it's just us across the finish line, right? We understand the historical implications of this time, of getting Black and Brown people in the cannabis industry. And we cannot rely on the government to provide that education and information. We can't rely on the investors to provide that education and information. And so, we must rely on ourselves. I believe in self-determination. And so, that's what we did to get to this point.

You know, we had to fight the city. And the way that we fought the city is, we educated community members. We go into the neighborhood councils. We go into the Black clubs. And they will become our grassroots lobbyists. And so the same thing, we see that is our obligation. This would not be a successful model if we would not have a training center where the workforce is developed.

Because the city of LA has a social equity workers mandate where they have to hire a certain amount of social equity workers, which means your ex-felons or on-government assistance, but who's training them? And so we hope to fill that void. We know we will fill that void and work hand in hand, taking on the McDonald's University model, where we create a way and a systems, and we teach we teach the POS systems and the software and prepare people either for the workforce or to be entrepreneurs.

MARQUISE FRANCIS: Wow, that's amazing. And it's not even 10:30 out in LA, and we can see there's so many people behind you. The store is already buzzing. So Kika Keith and her daughter, Kika Howze, thank you both for sharing all of this insight today.