Diddy is jumping into the weed business.
The music producer and entrepreneur whose given name is Sean Combs, announced that he had agreed to buy the assets of a major marijuana wholesaling business, Cresco Labs, in a deal that the companies say is worth as much as $185 million. The deal, Combs’ first move into the legalized cannabis industry, is emblematic of the way the Bad Boy Records founder has always done business. In the 90's, when other entrepreneurs from the hip-hop world branched into ventures like fashion by doing endorsement deals and marketing campaigns, Combs founded Sean John, an apparel and fragrance line in which he invested heavily in not just the marketing but the production of his garments as well.
In media, he eschewed just hosting or producing shows, instead launching his own network, Revolt TV, as a competitor to older entertainment networks like BET, MTV and VH-1. He’s putting a similar focus on scale in the weed business. Several rappers and producers have launched cannabis brands without actually controlling growing or distribution operations, but Diddy’s acquisition means he’s buying grow facilities in New York, Illinois and Massachusetts, all states where weed is legalized for either medicinal or recreational purposes and where he’ll now have the ability to produce and distribute his greenery.
Cresco and Diddy’s Combs Enterprises said the deal will make Combs the first non-white owner of a multi-state weed business that operates in the growth, distribution and retail phases of the industry.
“My mission has always been to create opportunities for Black entrepreneurs in industries where we’ve traditionally been denied access, and this acquisition provides the immediate scale and impact needed to create a more equitable future in cannabis,” Combs said in a statement.
The deal comes as the legalized weed industry is growing by leaps and bounds but is also mired in regulatory issues and problems with limiting opportunities for Black and Hispanic entrepreneurs.
In April, the House passed the Marijuana Opportunity Reinvestment and Expungement Act, a bill that would legalize weed at the federal level, eliminating the current patchwork of laws that makes it difficult for weed businesses to operate across state lines. Last month, President Joe Biden pardoned thousands of people who had been convicted on federal charges of simple marijuana possession, a major hurdle for people for some nonwhite would-be entrepreneurs who, with existing convictions, were barred from entering the weed business even in states that have already decriminalized.