Maisha Bahati, Co-Founder and CEO of Crystal Nugs – Interview Series

Since March of 2019, fashion designer-turned-cannabis businesswoman Maisha Bahati has served as Co-Founder and CEO of the massively popular Crystal Nugs, the Sacramento-based dispensary dedicated to “redefining the image of cannabis” and its widely diverse group of consumers. Along with running a well-known and much-acclaimed cannabis retail location in the Golden State’s capital city, Bahati is a very involved member of the Sacramento Black Chamber of Commerce. This organization promotes networking and the continued success of Black-owned businesses.

How did you first get into the cannabis industry, and what were some memorable moments that led to that decision? 

So, the idea to get into the industry probably came around late 2015. We were thinking about opening a cannabis medical office where people could come get a medical card because at the time it was just medicinal that was legal in California. So we played around with that idea for about a year, and realized that with Prop 64 likely passing in 2016, medical offices would fade out. So, we decided to switch gears and go for a delivery license once recreational was legal as that was the lesser cost of all the licenses and dispensaries were capped at 30 at that time. We started the process of trying to find a delivery location and that took a year. We finally found a shared location that we were able to get a suite inside of and we got our license in December 2018.

March 8, 2019 is when we opened Crystal Nugs Delivery.

What aspects interested you about being a cannabis business owner, and how did Crystal Nugs come to fruition?

So, I don’t come from the legacy background in cannabis. I am a fashion designer and I worked in corporate for 18 years before I retired to become a cannabis entrepreneur. I guess I was one of those people that just wanted the glamourous life. I was completely new to anything cannabis, as I never sold it and I never bought it. I’m a creative person, and I felt like the corporate world boxed me in. When we decided to go for a license and cannabis, I saw that as an opportunity to potentially make a way better living than what I was doing, and it was also so new that I felt like we could be creative and how we could market ourselves.

I remember like it was yesterday. I was working still for the County of Sacramento. It was around 2018 and I was sitting in my cubicle. I was on a group text with our three other owners trying to come up with a name for the business. I knew I didn’t want anything that represented the medicinal side of it. I wanted something that was more commercial, something that represented luxury femininity retro. I was looking at pictures of cannabis nugs on the Internet, and I saw one with the most gorgeous crystals and right there is were we decided on Crystal Nugs.

In your own words, how would you describe the overall experience of owning and operating a dispensary? What have been some great accomplishments, and what have been some major defeats or disadvantages that you’ve had to face?

Owning and operating the dispensary has been an emotional rollercoaster. On one hand, seeing something you created for almost 3 years come to life and seeing people come to your store and enjoy coming to your store is an absolutely amazing feeling. However, it has been very overwhelming. We are hands-on operators and we’re there every day and it’s been a lot to learn. There’s a saying that says “first to market is first to mistake” and we’ve had some mistakes. We’ve learned some expensive lessons, but nothing that has taken us out the game thank God. It’s very overwhelming mentally, physically, emotionally, and financially. It’s a 24 hour, seven days a week commitment that you have to have, and it consumes 99% of your life. We opened Crystal Nugs with our own money, and we really liquidated the majority of our assets to get the store open, so budgeting and not creating costly mistakes is on your mind every single day. Luckily, I’m pretty obsessed with Crystal Nugs and I truly enjoy milestones, accomplishing goals, and the creative freedom I have and that what keeps me going.

In the years since Crystal Nugs has been open, how has the store stayed true to its mission statement of “redefine the image of cannabis through technology, innovation, and true social equity” as well as the other great clauses of the statement?

I wrote our mission statement on my own and it resonates very true today. My goal with Crystal Nugs was to infuse technology and innovation and we’ve done that with our kiosk and with having a fashion boutique in the store. And we’re continuing to incorporate that as we grow. True social equity represented myself as an equity participant, someone who grew up in one of Sacramento’s underserved communities, but I was able to make it out of that and was able to get into our social equity program here in Sacramento to take advantage of the opportunities that we’re presented to me. And, I was able to navigate through the rigorous regulatory process to open up a dispensary and now can create an environment that is representative of me as a Black woman and that’s very important to me.

Recently, Nevada promised a number of allocated consumption lounge licenses specifically for social equity applicants. Since social equity is mentioned in the mission statement for the dispensary, I wanted to ask how social equity measures have been included in the larger California cannabis industry, if at all?

Social equity is a really complicated issue. The intentions of the program were good, which was to give those who were harmed by the war on drugs an opportunity to create generational wealth here in the cannabis industry. However, there are so many barriers to get into the industry, ranging from money to finding a good location, navigating the complex licensing through the city and state, etc. So there’s a tremendous amount of capital needed as well as the proper understanding of what is needed and what it takes to operate a cannabis business.

When do you get a particular storefront dispensary license? There’s a lot of responsibility that comes with those licenses and if you are giving these licenses to folks who don’t have the capital and who don’t have the knowledge, then you’re setting them up for failure. They are now a predatory target because you have to have money and you have to have someone who knows how to run a store. But at the same time, you don’t want to lose the opportunity. So I think that these equity programs need to have more of an open dialogue with current equity operators to understand what’s needed and what they can provide. Equity programs give you the opportunity to get into the industry that is 100% for sure. However, you have to be able to change and grow with the industry and I think a lot of these equity programs are not changing and growing with the industry, and we’re seeing a lot of complications from that.

Obviously, when it comes to size and total revenue, the California cannabis industry has quite an advantage over other states with legal cannabis. From your experience, what other advantages would you say that the California cannabis industry has over other state industries?

California is the weed capital of the world. Everyone knows the best weed comes from California, so we’re like the golden child of weed. California has also done a horrible job with how they have handled the taxes with cannabis businesses, which is why the industry here in California is suffering the way it is. However, California is a trend maker in the industry and we can push forward with new ideas and concepts in cannabis. For example, the consumption lounges in cannabis cafés that were recently approved by Governor Newsom. As we continue to normalize the industry, creating social spaces and events for consumers to come together is really important and California has been progressive in that sense, which is a huge advantage for us as a market.

Conversely, what are some major and common disadvantages that the California cannabis industry faces? I would imagine the unlicensed market is quite a rampant problem.

Taxes, taxes and more taxes. As well as the need for better social equity programs, we can all do better and having less barriers will help prevent many of the predatory practices that take place with social equity participants. Those are definitely some disadvantages here in California.

What is your role on the Board of Directors for the Sacramento Black Chamber of Commerce, and why do you believe that the work of this organization is beneficial and worthwhile?

I no longer serve on the board, however I maintain a very positive and good relationship with the Sacramento Black Chamber of Commerce and President Azizza Goines. As a member since 2019, Azizza has been extremely supportive in my journey here in cannabis. The time I served as a board member was extremely rewarding. It all allowed me, a cannabis business owner, to blend in with other reputable businesses and I felt like it was another step in me normalizing not only my business, but just cannabis as a whole. I was introduced to a whole new business world that I didn’t know existed, and I felt very proud to not only represent the Chamber, but represent Crystal Nugs. I made connections and contacts that I would not have been introduced to had it not been for my participation in the Chamber. It felt good knowing that I had this business community supporting me and very grateful for the opportunity to experience that.

What are your thoughts on the possible federal rescheduling from Schedule I to Schedule III? Would such a sweeping reform be good for the industry and healthy towards its growth, or rather hinder its growth and success?

The biggest benefit for rescheduling would be the removal of Tax Code 280E, which would allow cannabis businesses to write off various operating costs on our taxes which would be a lifesaver for many of us as well as another step in normalizing cannabis. Now unfortunately with just rescheduling, it doesn’t do anything as far as releasing incarcerated people for cannabis offenses. But, you have to start somewhere and any step is a good step and right now, the survival of the industry relies on some sort of tax break. Hopefully, 280E will be that lifesaver we need.

When it comes to the California industry in particular, do you think a rescheduling would benefit the state’s industry or only exacerbate the current issues?

I absolutely believe rescheduling will benefit California’s industry. The removal of 280E is going to be a game changer for all businesses, and any sort of tax relief is a great thing. The industry is so over-restricted that it’s insane and I just think that any progress forward to lessen the stigma and regulatory handcuffs will only help the industry. Little by little equals a lot, and as long as we as an industry can continue to progress forward, then we all have a chance to survive in this industry.

Thank you for joining us Maisha! For more information on Crystal Nugs, please visit its website. To stay up to date on the Sacramento Black Chamber of Commerce website, click here.