‘Business Of Marijuana’ Comes To B-School

As more and more states legalize recreational and medicinal marijuana, the University of Denver Daniels College of Business is innovating to keep up. On Tuesday (March 28), the school held its first class session of Business of Marijuana, a pilot four-credit-hour elective course. The 10-week-long course has 25 students of all sorts enrolled. According to Paul Seaborn, the assistant professor who created the course, it’s the first of its kind at a school accredited by the Association to Advance Collegiate Schools of Business.

“Our primary focus is how this industry impacts the various business disciplines,” Seaborn tells Poets&Quants. “So, you’ve got impacts in management and strategy, which is my core area, but also finance, accounting, marketing, and ethics.”

A NATURAL ‘PROGRESSION’ FROM FIVE YEARS OF RESEARCH

The course, which has enrolled 13 undergraduate students and 12 graduate students, is the next step in a progression of research set in motion when Seaborn began his time at Daniels in 2011. Upon graduating with his Ph.D. from the Rotman School of Management at the University of Toronto, Seaborn arrived in Colorado about a year before the state passed Amendment 64. The measure, which passed comfortably, made Colorado the first state, simultaneously with Washington state, to legalize recreational weed.

Seaborn, who focused his Ph.D. research on business and government, was fascinated. In 2013, he published one of the first business cases focused on the pot industry, examining outdoor marijuana advertising in Denver. Three years later, he published the first-ever Colorado Marijuana Market Report, which analyzed marijuana license data gathered by the Colorado Marijuana Enforcement Division from January 2013 to December of 2016. Along the way, Seaborn organized panels at industry conferences like the Academy of Management’s 2015 meeting in Vancouver, British Columbia, Canada, which featured researchers from schools like Minnesota’s Carlson School of Management and Virginia’s Darden School of Business.

“In that progression, the class was just the next step,” Seaborn explains. “It complements what I’m already doing as a researcher.”

COURSE PROPOSAL ‘DEFINITELY RAISED SOME EYEBROWS’

The course has been in the works for about a year, Seaborn says, which is the typical timetable after a course is approved. But it wasn’t approved by the Daniels College before some questions were answered. “It definitely raised some eyebrows, and there were a lot of questions,” Seaborn says. The main question was about the message and intention of the course. “There is no personal agenda from my point of view,” he says. “It’s really a chance for the students to educate themselves, and then they can use that information just as they would in an accounting or strategy class.”

According to the syllabus, the course aims to “provide a rich introduction to the business implications of the emergence of a legalized marijuana industry as well as the more general concepts of new industry emergence across a wide range of industries.”

Also helping Seaborn’s case was an already-established course, Representing the Marijuana Client, taught at the University of Denver’s law school. Seaborn tapped law professor Sam Kamin, who teaches the course and is the Vicente Sederberg professor of marijuana law and policy at the University of Denver.

“The existence of the law course, in particular, helped my case when I was proposing the business course, and I think will help continue the trend of similar courses popping up on other colleges campus as well,” says Seaborn, who sat in on Kamin’s course multiple times.

FIRST-DAY QUIZ: DIFFERENCES BETWEEN INDICA AND SATIVA STRAINS

Seaborn says the interest of students enrolled in the course runs the gamut from those who already have experience in the marijuana industry to those simply curious in case their careers cross paths with the industry down the road. After all, even students entering careers in banking, accounting, or marketing and advertising might deal with the pot industry, Seaborn points out.

For those planning on entering the industry after graduation, Seaborn says, “this will be a course where they’ll develop expertise and connections that they can apply directly into the industry upon graduation.”

“The other group in the class,” Seaborn continues, “are students who just see this as an interesting topic to understand and come at it the same way I do, and that there are a lot of similarities to other industries. I think we can learn a lot by seeing what is similar and different from the marijuana industry to tobacco, alcohol, pharmaceutical, or even automotive or biotech.”

As a first-day ice-breaker, Seaborn gauged students’ knowledge of marijuana’s technical terms by asking them to quiz each other on things like the differences between indica and sativa strains and Section 280E of the Internal Revenue Code. “That’s the section of the IRS tax code that makes it difficult for this industry to attain normal tax deductions on its submissions,” Seaborn says.

AN INDUSTRY READY TO TAKE FLIGHT?

Regardless of personal beliefs, the pot industry seems poised to take off. According to Seaborn’s report published late last year, the total number of active marijuana business licenses issued in Colorado is nearing 3,000 — higher than ever before. Some 46% of those licenses are for recreational sales, the report says. Now, with the passage of Proposition 64 in California, which will unleash that state’s massive weed cultivation and sales, the industry is set to explode. Last September, Bloomberg predicted California could triple the $6 billion already in the marijuana industry. The same report predicted pot sales may reach $50 billion within a decade.

Seaborn says other business schools are producing cases on the industry, and as “word spreads” about his course, he imagines similar courses popping up at other B-schools in the United States. Indeed, a team of two MBA students and one undergraduate from the University of California’s Berkeley Haas School of Business published a case examining the potential of the marijuana industry last October.

As for the future of his course, Seaborn believes it is here to stay.

“I’ve had so much interest from the academic and industry sides that I’d be shocked if this course isn’t offered next year and for years to come.”

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