In 2014, Hadley Ford was looking for
a new job. He logged on to LinkedIn for
the first time in years and saw thousands
of pending invitations. He accepted them
all. One of those invitations was from
Randy Maslow, an old friend. Maslow
called Ford a few minutes later and pitched
him a radical idea for a new business that
had the potential for enormous gains but
also enormous risk: They were going to
legitimize the business of marijuana.
Today, Ford is a managing director and
CEO of iAnthus Capital Holdings, a publicly
traded provider of startup capital and advice
for cannabis businesses.
It was a radical departure from Ford’s
earlier career. Previously, he had followed
the well-worn path for people with business
ambitions: He earned a BS in business
from Boston University, where he was
valedictorian, and was an Arjay Miller
Scholar at Stanford GSB. He worked as an
investment banker at First Boston, Bank
of America, and Goldman Sachs, then
founded and led a company called ProCure,
a provider of proton therapy as a treatment
for cancer, which he left in 2013.
Ford, who lives in New York City, talked
to Stanford Business about what drew him to
this sometimes seedy business and how he’s
working to make it as socially acceptable —
and profitable — as selling beer.
Why cannabis? I knew Randy from my
days at Goldman. We invested in his
company, XO Communications, and took it
public. After the public offering, he retired,
set up a virtual currency company, then
retired again. He called me in early 2014
and said, “I found the next big thing.” He’d
had a very successful career in tech so
I expected to hear about ones and zeroes.
He said, “Cannabis.”
What was your reaction? I didn’t see that
it could scale nationally. Cannabis is still
illegal in most of the U.S. That means you
can’t trademark or copyright your product or
distribute across state lines. You might have
a few storefronts, but you can’t easily build
a really large, national business.
How did he convince you to join him? He
started off by saying this is a $50 billion
market moving from black to white. He said,
“There has to be a national opportunity.
Let’s figure it out.” We went to a bunch of
conferences and met with many operators.
There are thousands of entrepreneurs who
want to grow, process, or sell cannabis but
don’t have access to financing and need
advice on how to run a company. We saw an
opportunity for a merchant bank.
That’s the logical part — the how. But
why are you really doing this? There must
be other ways to make money. I am a child
of the late ’60s and early ’70s. For me, it’s
about “power to the people.” You don’t want
the Man telling you what to do. Why should
anyone tell anyone else that they can’t
grow it and use it and do what they want
with it? I’m not a user, but I do have
a passion around individual rights and
helping people build companies.
Is that a coincidence — or were your
parents hippies? A strong entrepreneurial
spirit runs in my family. My parents were
driven A-types but also very libertarian.
They were progressive socially but
conservative in a “stay out of my bedroom
and kitchen” kind of way.
Can you be successful in this business if
you don’t smoke? Do you have to partake
to be trusted? You do get guys who’ve
been growing plants for decades. You’re not
considered authentic to those people unless
you worship at the altar of the cannabis
plant. There are also entrepreneurs who just
want to build businesses. I’m comfortable
in either world. The common denominator
is they all need capital.
Once you and Randy decided to do this,
how did you get started? We thought
we could raise a couple hundred million
and roll up our sleeves. But we learned
that for the same reason Citibank wasn’t
providing loans to build a greenhouse,
we weren’t going to easily raise capital for
a new fund. So we went to Canada,
where issuers can sell securities related
to cannabis. There are a dozen public
companies in Canada that touch the plant,
as well as banks, traders, and research
reports. We structured a public vehicle
that raises money in Canada and uses the
money to fund businesses in the U.S.
Have you made any investments yet?
We have invested in three states, and we are
in term sheet discussions with businesses in
four more states.
How has the transition been for you?
Do you find people from your banking
and health care history treating you
differently now? In my last business
I raised $800 million off my Rolodex. A year
and a half ago I started this company as
the same guy, with the same Rolodex, and
I’ve raised $9 million.
How do people react at cocktail parties
when you tell them what you do? It’s
a much harder cognitive dissonance than
you might imagine. I had a couple of friends
who said, “You are a fool. You will end up
in prison.” There is a lot of caution, people
are leery, but I haven’t been shunned. I’ve
always been very entrepreneurial; people
probably always thought I was crazy to take
Do I sense a little pride from being an
outsider? Nothing ever gets created if you
are just copying.
the Risks of
An entrepreneur ventures into
BY ERIKA BROWN EKIEL
Photograph by Cole Wilson