Pubdate: Wed, 05 Nov 2014
Source: SF Weekly (CA)
Copyright: 2014 Village Voice Media
Author: Chris Roberts

The "Uber of Marijuana" Is Quick and Unregulated. Just Like Uber.


I'm running around South of Market with my smartphone to my ear, 
looking for my driver. Traffic is thick on this early fall evening 
and all the taxis whizzing by, with their drivers' eyes glued to the 
GPS display on the dash, are full.

That's fine. I'm not looking for a ride. I'm looking for weed.

One phone call later and a late-model hybrid Honda pulls up to the 
Mission Street curb in front of me. I climb into the front seat, and 
the driver - a young, clean-cut man in his mid-20s named Charles - 
goes to work. Even in commute madness, Charles delivers medical 
marijuana anywhere in the city in "10 to 15 minutes."

Charles is one of the first people to sign up as a driver for Eaze. 
Founded by an early employee of the business social network Yammer 
(which got into weed following Yammer's buyout by Microsoft for $1.2 
billion in cash), Eaze went live in August, buoyed by headlines in 
the San Francisco Chronicle that trumpeted the arrival of "the Uber 
of marijuana."

And just like Uber, instant gratification is guaranteed, thanks to a 
small fleet of drivers like Charles cruising around San Francisco 
toting scent-proof briefcases stuffed full of prepackaged bags in the backseat.

A recent music grad (he has a master's degree in conducting 
orchestras, but no industry gig yet), Charles says he considered 
driving for Lyft. But a few things drew him to the marijuana 
industry: He can make up to $45 an hour during a 10-hour shift, the 
service's web site claims (but to earn that, you'd need to do four 
deliveries in an hour; we averaged about two to three in our evening 
together). He's also in on the ground floor with a company in an 
emerging industry, run by a man who's already had enormous business success.

Right now, Eaze's business plans are fluid. Initially, there was a 
promise to deliver weed 24 hours a day, but there wasn't enough 
demand for pot at 3 a.m. to justify someone driving around all night 
with a half-pound of weed. So now orders end around midnight, but 
they'll deliver to wherever a legal cannabis consumer might be at 
that hour, including a bar.

Other smartphone-hailed cannabis deliveries have since laid claim to 
the "Uber of" title, including a competitor named Meadow that went 
live last month (though TechCrunch pivoted with its headline 
heralding an "Uber-for-marijuana").

Of the two, Eaze probably deserves the Uber title the most. Just like 
Uber, Eaze is doing what other regulated services already do, minus 
the regulations part.

Eaze has no permit of any kind to deal marijuana. That's a risky move 
given the federal Justice Department's reminder to the California 
cannabis industry that a regulated, permitted industry is an industry 
that won't get raided.

Except Eaze isn't actually delivering any weed.

Not unlike an Uber driver, Charles is not an Eaze employee (there are 
only four, including founder Keith McCarty). Charles is not even an 
Eaze contractor. He's working for a transportation company, an LLC 
that's delivering weed on behalf of a Seattle-based cannabis collective.

It's the cannabis collective that contracts with Eaze, which charges 
the marijuana provider a per-delivery fee for connecting 
dispensary-to-customer via their software.

To distribute cannabis to 10 or more people in San Francisco, city 
law says you need a Department of Public Health dispensary permit. 
State law says you need to collect and pay state sales taxes. Neither 
of those are Eaze's concern.

"We're the technology service," McCarty tells me during a brief and 
vague interview. "We definitely don't need to be permitted."

These levels of separation are more smart than shady. Since Eaze 
doesn't actually handle any marijuana, the company's risk is 
significantly reduced. What's left is an investor-friendly platform 
that can easily be ported to other cities across the country.

Eaze's permit-less situation ends soon. The company will announce on 
Nov. 6 a partnership with a permitted city weed club. However, in a 
San Francisco full of Ubers, it's hard to imagine anyone but purists 
caring about permits.

Because not even the authorities care.

Law-flouting weed delivery services are nothing new. Only a few 
delivery-only dispensaries in town have ever had a permit, and only 
because their storefronts were shut down.

None of the other unpermitted delivery services ever had problems 
with law enforcement. Usually, they just peter out - because, believe 
it or not, it's hard to make money delivering marijuana in San 
Francisco. Successful business happens via a storefront dispensary.

And those have weak regulations, too. As has been repeated ad nauseum 
in this space, there's no statewide cannabis industry oversight, no 
Alcoholic Beverage Control for weed. And the Department of Public 
Health has yet to shut down a dispensary for breaking any rules.

Uber likes to point out how messy the taxi industry is whenever the 
issue of regulations come into play. It was only a matter of time 
before someone discovered how much messier marijuana is, and took advantage.

But will it work? It might not matter. After all, Eaze isn't 
delivering any marijuana, in the same way Uber doesn't provide a single ride.
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MAP posted-by: Jay Bergstrom