With those caveats in mind, however, Proper is well-positioned to benefit brands and consumers alike, DeMott said. The company can show competitive prices in a given area to help optimize the transaction. As is often the case with Amazon, Proper does not sell direct to consumers, but rather points them in the direction of the appropriate brands. Proper then gets a percentage of the resulting deal. Serial entrepreneur A serial entrepreneur — in addition to being executive chairman and CEO of Proper, he has founded and served in the c-suite of a number of investment management firms — DeMott said he entered the cannabis/CBD business from a securities analyst perspective. “I’m one of those guys who never even tried it until I was 50,” he said. “I looked at it as an industry that has all the hallmarks of exciting growth, if you could find the right ‘in.’” That led to the research-and-data end, before the legalization of recreational weed began to gain seemingly unstoppable momentum. As for how big Connecticut’s cannabis market could be — some estimates have put it at $250 million in sales during its first year and over $725 million by the end of 2025 — DeMott noted that Colorado, which legalized it in 2012, racked up $187 million in sales in January alone. Being surrounded by Massachusetts, which legalized it in 2016, and New York, which like Connecticut expects to see retail sales begin in earnest next year, will probably have an adverse effect on this state’s sales, he said; he opined that “it could turn into a billion-dollar market ultimately” but added that that “is years away.” He also questions the opinion shared by Gov. Ned Lamont and many pro-legalization lawmakers that legalizing recreational marijuana will in effect wipe out the black market. “For people who haven’t been trying it, yes,” he said. “But if they wind up taxing the hell out of it, that will make it too expensive for consumers, who will go to the black market.” Longtime users, he added, “already feel comfortable there — they have longstanding relationships, trust who they’re getting it from, they’re happy with the product and it costs a third of legalized weed. That’s why I hope they keep taxes low, and illegal enforcement high.” As the law is currently written, the retail sale of recreational marijuana in Connecticut includes the state’s usual 6.35% sales tax, a 3% sales tax for the municipality in which the sale occurs, and a tax based on THC content that will cost roughly 10 to 15% of the sale price. “In total,” according to the state government’s website, “the tax rate is expected to be approximately 20% of the retail price of cannabis, in line with the tax rates in Massachusetts.”
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