how to start a marijuana growing business in colorado

Narrator: They go on every plant when they’re young.

Jeremy: A lot of people are really unable to divorce themselves from the stigma that drugs are bad. Cannabis is a drug, so why are we saying it’s OK? No. 1 is simply highway safety.

Jeremy: So basically, anyone who can afford to get a license, they can get one, which makes it very competitive.

Narrator: In July 2020, Sen. Chuck Schumer proposed legislation that would legalize marijuana federally. Jeremy says at the core of that legislation is equity.

Narrator: Licenses to start a farm can cost up to $80,000 alone.

Adriana: I know, it’s good for me.

Adriana: We waited two years for a license.

Jeannette: Specifically to build intergenerational wealth for the communities most harmed by the war on drugs. Those two things come together, a high capital-intensive business, and then the lack of personal capital, personal wealth. And it’s a hard place to start for a Black founder in cannabis.

Narrator: If compliance officers find that rules aren’t being followed, a lot of bad stuff can happen.

Nancy: Which essentially really removes our ability to scale.

Narrator: Those regulations follow all the way to the last step: delivery.

Narrator: Adrian again lobbied and got the limit raised to $3,000.

Will: Does this look ridiculous?

Adriana: As you can see, all these metric tags here are made out of plastic. You can’t reuse them. The tag takes me hours on end. And then you have to physically go and loop them around each plant. They cost around 50 cents a pop, which is really expensive when you have 1,100 plants in your facility.

Narrator: They got approved in 2020 and started their company, Magic Hour Cannabis, in Portland.

Narrator: When Adrian Wayman moved to Portland in 2016, he had to fight hard for his company to even exist.

Adriana: It is very white male-dominant. And there’s no reason that that is what it should be.

Adrian: I don’t like being told no. I hate restrictions. So I got an order, pull it up on my phone, and this is basically a box of pre-rolls. This one is going to Northeast Portland. Here’s my manifest for the state tracking. That whole drawer is just all manifests, just from deliveries. I have to keep them for three years.

Adrian: I’ve been selling weed since high school. Got arrested for it, was on probation, did the whole nine. When I was getting fingerprinted for my license, it was just really weird, because I was like, man, the last time I’ve gotten fingerprinted, I was going to jail for selling pot, selling weed, and now I’m getting fingerprinted to get a license to sell it legally.

Narrator: Each of those manifests lists out exact turn-by-turn directions that Adrian has to follow on a delivery. Jeremy says that’s because regulators want to make sure no marijuana products go out the back door.

Jeremy: A lot of police unions are really worried about what it’s like when people drive high. There’s no standard to say like, OK, you’re high after you’ve had two puffs. Everybody has a different tolerance. THC binds to your fat cells. A blood test after the fact, it might tell you you smoked last week. Another key hurdle is around teen use. There is a lot of troubling research that cannabis does really impact the development of adolescent brains. In terms of developing mental conditions like anxiety, depression , even suicidal ideation.

Cannabis extracts are part of the fastest-growing segments of the legal marijuana market. Getting started requires either a Medical or Recreational Marijuana Products Manufacturer license as well as a license from a local licensing authority. The first step to complete the MED Regulated Marijuana Business License Application.

There are eight types of cannabis business licenses available in Colorado; four recreational licenses and four are medicinal licenses. A business can hold both a recreational license and a medical license, but will have to apply for each one separately.

The bill authorizing recreational marijuana delivery services went into effect in January 2021. However, as is the case with most, if not all, marijuana legislation in Colorado, local governments were given wide discretion on how to implement it. Denver, for example, has made recreational delivery licenses available only to Social Equity Applicants until 2024.

Fees for this type of application vary based on whether the application is for medical or recreational cannabis cultivation and the number of plants grown.

On November 6, 2012, Colorado voters passed Amendment 64, legalizing the use and regulation of recreational marijuana. Two years later, Colorado started issuing licenses, and since then, the marijuana business in Colorado has boomed. Sales have increased every year since the market opened in 2014, and they show no signs of stopping. Even the economic slowdown COVID-19 pandemic caused could not slow the industry down. In fact, marijuana sales in 2020 increased 25% to $2.19 billion when compared to 2019. If you’re looking to get involved in this lucrative industry, we have some helpful information for you below; keep reading to learn more!

Initial Steps.

A consideration unique to licensed marijuana businesses in Colorado is that the Colorado Marijuana Enforcement Division (“MED”) must be kept up to date on any changes made to the trade name or any DBA (doing business as) a business may undertake.

These businesses grow and cultivate marijuana for sale to marijuana stores or a product manufacturer but cannot sell directly to consumers. A cultivation license allows such businesses to cultivate, prepare and package marijuana. Operating one of these businesses requires significant horticultural knowledge and typically requires material capital investments.

To get started in the cannabis industry, a business is going to need a substantial amount of capital. To apply for the Regulated Marijuana Business License, for example, a business will already need to possess the property where the business will be located, which could be a costly endeavor. In addition, it will also need to pay several fees to state and local governments, among them are:

The fee for a medical license is $2,500. The fee for a recreational license is $6,500.

These are just the initial license fees. Each license needs to be renewed annually.

Before submitting any applications to the MED, a prospective cannabis business should have already:

Again, the state has 45 to 90 days to respond to an application and, if approved, the application is forwarded to the local governments listed therein.

As is the case with Marijuana Cultivation Facility licenses, the state has 45 to 90 days to respond. If the state approves the application, it will be forwarded to the local governments listed therein. Response times may vary from municipality to municipality.

Adults 21 and older are permitted to grow up to six cannabis plants for their own personal use in Colorado. Growing cannabis commercially, on the other hand, requires either a Medical or Recreational Marijuana Cultivation Facility license as well as a license from a local licensing authority. The first step is to complete the MED Regulated Marijuana Business License Application.


While possession and cultivation of marijuana are legal at the state level in Colorado, counties, and localities are given substantial discretion on how to implement marijuana legislation. Each town and county can decide to ban recreational marijuana businesses if they so choose. As of April 2017, 272 of Colorado’s municipalities had decided to prohibit the sale of recreational marijuana within their jurisdiction.

Sales in the recreational segment of the marijuana market have grown every year since inception. Cumulatively, recreational sales have accounted for $10 billion in only seven years. Getting started first requires the same MED Regulated Marijuana Business License Application.

As is the case with Marijuana Cultivation Facility licenses, the state has 45 to 90 days to respond. If the state approves the application, it will be forwarded to the local governments listed therein. Response times may vary from municipality to municipality..

Unlike the recreational marijuana market, which has been around for less than a decade, medical marijuana has been legal since 2000. Despite being older, operating a medical marijuana dispensary is still a vibrant business opportunity. Getting started requires a Medical Marijuana Store license as well as a license from a local licensing authority. First, you need to complete the MED Regulated Marijuana Business License Application.

Businesses (or individuals) can be separately licensed to transport marijuana from one business to another, like from a Cultivation Facility to a Products Manufacturer.In addition, Colorado has recently began issuing retail marijuana delivery licenses pursuant to which delivery directly to homes and businesses will be permitted.

Like all businesses, a cannabis-focused enterprise needs to first pick and name and incorporate with the Colorado Secretary of State. Cannabis companies can use any form of entity incorporate available in Colorado including corporations, limited liability companies, or limited liability partnerships. The choice of entity type could have significant legal and tax implications so we recommend speaking with one of Newburn Law’s experienced business lawyers prior to taking this step.

How to Open a Recreational Cannabis Dispensary.

Dispensaries are divided into two types, a retail or recreational dispensary, where customers at least assuming they at least 21 years old, and having a valid form of government ID like a driver’s license or a passport, can purchase marijuana and a medical dispensary, where customers require medical marijuana card to make purchases. While medical cards can technically be acquired by individuals over 18 but below 21, it is important to note that businesses selling both medical and recreational marijuana at a single location cannot sell to anyone younger than 21 at that location.

Manufacturers are allowed to purchase marijuana and incorporate it into new products, like edibles and oil. These products are then sold to dispensaries who sell them to consumers. Marijuana product manufacturing requires a separate license and is subject to additional regulations including regular testing of product.

After a completed MED Regulated Marijuana Business License Application is submitted, and the required fees paid, the state has 45 to 90 days to respond. If the state approves the application, it will be forwarded to the local governments listed therein. The specific local government’s response times vary but can be as long as six months.

Even if counties and municipalities decide to opt-in, they are still given discretion on how to implement marijuana policies. For example, while the state allows marijuana stores to be open until midnight, Denver requires theirs to close by 10 pm. Similarly, Colorado allowed recreational marijuana delivery services to apply for licenses starting January 2, 2021; but Denver has restricted access to these licenses to Social Equity Applicants until 2024.

If you are considering entering this potentially lucrative space, contact the experienced cannabis lawyers at Newburn Law to learn more about what you need to know to start a cannabis business.

Cannabis Dispensary : businesses that intend to retail medical cannabis to qualifying patients will require a dispensing license.

Cannabis Tester : laboratories intending to test medical marijuana products for quality and potency will be required to apply for a tester license.

Cannabis Processor : this license allows business entities to process raw medical marijuana plant matter into a variety of medicinal products.

How to start cannabis extraction business legally in Colorado.

From the legislative perspective, the inclusion of the “distributor” model was a necessary compromise to address the trust deficit with people who do not believe the cannabis industry is effectively and consistently self-regulating.

Cannabis Transporter : business intending to transport medical marijuana from one licensed facility to another.

Additional license types currently in the law include:

Cannabis Distributor : It is required that – while business agreements can be made directly between any licensed entities—a third-party distributor be responsible for overseeing and officially conducting any business transaction that occurs. Distributors are required track all products received, and to have them tested for quality.

Cannabis Grower/Cultivator : this license is for entities that wish to grow medical marijuana plants from seed or clone, to flower and finish. Growers wishing to provide clones, but who do not intend to flower or finish plants, may apply for a specialty nursery license.

Please do not hesitate to contact us to make an order for a cannabis business plan or a cannabis industry research. We will create complete and professional business plans, including pro forma financials and projections to help you know how much money it’ll cost to start your business and how much money you can make by starting and operating your 100% legally compliant medical and recreational marijuana business.

How to start cannabis growing legally in Colorado.

How to open medical cannabis or recreational dispensary legally in Colorado.