I’ve had a lot of conversations lately that start the same way: “I’m thinking about opening a cannabis business. What should I do first?” It’s a big question. With Minnesota’s legal cannabis market opening up, it feels like there’s opportunity everywhere. But as with any gold rush, there’s also a whole lot of fine print.
Starting a cannabis business here isn’t like flipping a switch. It’s more like building a house—there are permits, plans, and a lot of inspections. So, if you’re serious about getting into this space, here’s what that journey actually looks like.
Know Your License Type
Not all cannabis licenses are created equal. Some let you grow, others let you sell, and a few let you do a bit of everything. Minnesota offers licenses for micro businesses, mezzo businesses, cultivators, manufacturers, retailers, wholesalers, transporters, testing facilities, and delivery services. It’s a full menu, and each item comes with its own ingredients.
Think of it this way: you wouldn’t walk into a restaurant and order “food.” You’d order what you’re hungry for. Same idea here—do your homework and figure out which license fits your goals. The Office of Cannabis Management (OCM) is your go-to source, and yes, there will be a test later. (Kidding. Sort of.)
The idea is to prevent vertical integration between growers, processors, testers, and retailers. Minnesota hopes to keep the cannabis industry in the hands of smaller shops and prevent large corporations from swooping in and taking over. This provides great opportunities for entrepreneurs willing to put in the work.
Write the Plan—Even If You Don’t Have To Yet
I know. Writing a business plan sounds about as fun as a root canal. But if you’re going to build something sustainable, you need a blueprint. Even if Minnesota’s license lottery doesn’t require one up front, you’re going to need it eventually—for investors, for partners, and for your own sanity.
This isn’t just about cannabis; it’s about running a business. Marketing, compliance, staffing, taxes—these are all part of the deal. Having a plan means fewer surprises, and trust me, this industry already comes with enough of those.
Secure Your Funding (Yes, It’s Complicated)
Let’s not sugarcoat it: funding a cannabis business can be tricky. Traditional loans? Not always an option. Federal regulations make banking in this industry weirdly complicated. But that doesn’t mean you’re out of luck.
Some clients work with private investors. Others pursue state or local grants. Some get creative with real estate and equity partnerships. There’s no one-size-fits-all solution—but I can help you figure out what makes sense for your goals and your risk tolerance. I’ve got a good network here in Minnesota, and I’m happy to help you make those connections.
Apply Early, Verify Often
To get in line for a license, you’ll need to submit a preliminary application with the OCM. That means background checks for all the key players and—if you qualify—verification of your social equity status. And if you do qualify, don’t skip this step. Minnesota is actively prioritizing social equity applicants, and this could give you a real leg up.
Whether it’s a prior cannabis conviction, living in a disproportionately impacted area, low-income status, or a farming background—these are all factors that could qualify you. But here’s the catch: verification is a separate, free process. It’s not automatic. Take the time to get it right.
Location, Location…Zoning
Once you’ve got your initial state thumbs-up, it’s time to lock down a location. And spoiler alert: this part can be a bit of a headache. Local zoning rules vary wildly. Some cities are welcoming; others… not so much.
Before you sign a lease, make sure your city or county is on board. You may need a separate registration or approval process. And remember, you’re not just looking for any space—you need the right space. Location can make or break a cannabis business.
Final Approvals, Security Plans, and Surprise Expenses
Let’s say you’ve made it this far—congrats! But before you can open your doors, you’ll need to submit detailed operational plans to the OCM. Think security, recordkeeping, waste disposal, product handling… the works.
Yes, it will probably cost more than you expected. And yes, it’s absolutely necessary. The OCM will do a site inspection, and they’re not handing out participation trophies. If your facility isn’t up to code, you don’t get a license. Simple as that.
You’re Licensed! Now the Real Work Begins
Once you’ve passed inspection and paid your final fees, you’ll officially be licensed. Take a moment to celebrate—but not too long. Compliance is a 24/7 job in this industry.
From seed-to-sale tracking and lab testing to packaging rules and environmental standards, the expectations are high (no pun intended). You’ll want your business entity formed and registered well before this point so that you’re operating with the right structure from day one.
And if you’re wondering when to get help with all of this? The answer is now. I can walk you through everything from choosing your entity type to compliance planning to setting up contracts with suppliers and vendors.
Let’s Make It Happen
Minnesota’s cannabis industry is still taking shape, and with the right approach, there’s meaningful opportunity for those ready to build something lasting. At Lommen Abdo, we’re here to help you navigate every step—whether that’s choosing the right license, securing funding, finalizing your business structure, or staying on top of ongoing compliance.
We bring deep legal experience, local insight, and a practical mindset to support your goals from startup to success. If you’re ready to get started—or just want to understand what’s involved—reach out. We’d be glad to help.