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CannaCraft CEO William Silver seeks to make Sonoma County the business mecca for cannabis

Find more in-depth cannabis news, culture and politics at EmeraldReport.com, authoritative marijuana coverage from the PD.

If the Sonoma County cannabis industry is to grow and thrive as the business mecca for marijuana in California and possibly the United States, William Silver is likely to play a vital role.

Silver joined Santa Rosa-based cannabis manufacturing firm CannaCraft Inc. earlier this month as its CEO, stepping down in December from a decadelong position as dean of Sonoma State University’s School of Business and Economics.

Silver brings CannaCraft and the cannabis industry instant credibility within the North Bay business community, a super-connected contact list of colleagues and friends across varied sectors, and the ability to think outside the box. These could prove valuable commodities as California’s estimated $7 billion cannabis industry emerges from the shadows, wrestling with issues from high taxation to Attorney General Jeff Sessions’ desire to curb its growth.

Silver’s resume is impressive. He is an educator on entrepreneurship and innovation; a published author on a book — “The Way of Zing” — about aligning one’s work with their life; a rainmaker who helped raised $11 million for SSU’s Wine Spectator Learning Center, which will open in May and house its Wine Business Institute; and a consultant and advisor who has served on the boards of the Santa Rosa Chamber of Commerce and Sonoma County Vintners, where he played a major role in luring the county’s signature Taste of Sonoma wine-and-food event to the university’s Green Center last year.

His decision to take the job will likely serve as a turning point that will lead other local professionals to consider working in the cannabis industry, said Ben Stone, executive director for the Sonoma County Economic Development Board. It comes as the industry seeks to erase the stigma left by outlaw growers and sketchy head shop owners, crafting a new reputation as a mainstream business that needs to attract top talent for one of the country’s fastest-growing industries.

“I think it’s a hallmark in this industry as it’s becoming more normalized,” Stone said of Silver’s hiring. “You’ll have people of more traditional background going into it.”

For Silver, a 53-year-old married father of three teens, the decision was rather easy after first consulting with the co-founders of CannaCraft on its corporate structure and leadership team. The job gives him a chance to influence the future of the company — which produces such products as chocolates, vapor cartridges and massage oils — but also help to shape a developing industry.

“This was an opportunity to make a difference, not only for this company and this industry, but also for our region,” he said.

Trying weed

He experimented with weed while in college as he did his undergraduate work at the University of Michigan and later received his Ph.D. from the University of Washington. But he said it was the personal experience of having three family members — a son, his mother and mother-in-law — all battle cancer and noting the ability of cannabis to relieve pain and nausea during chemotherapy. Yet, there is scant research being conducted on the plant. His wife, Adrienne Silver, is a Kaiser Permanente pediatrician.

“As I learned about the efficacy of this plant for the potential in helping certain diseases, I wondered ‘why we are suppressing people’s ability to do research? Why aren’t we sharing knowledge?’ This was another opportunity to make a difference,” he said.

Find more in-depth cannabis news, culture and politics at EmeraldReport.com, authoritative marijuana coverage from the PD.

Silver is taking a sabbatical at SSU from teaching. He said his decision to step down as dean had nothing to do with Judy Sakaki taking over as president a year and half ago. He applauded her student-centered focus after the 24-year tenure of Ruben Armiñana, which was primarily centered on tremendous growth of the 269-acre campus, signified by building projects as well as the courting of large donors.

Silver acknowledged that he thought about becoming a university president “at times,” but “really loved” being a dean. “The dean of the business school is a tough job, but it’s a great job. Up until the day I left, I loved every minute of it,” he said.

School’s out

His focus has now turned to CannaCraft, which was raided in July 2016 by local and federal law enforcement agencies, who seized cash and extraction machines that produced cannabis oils. Co-founder Dennis Hunter was later arrested. Though the case has not been resolved, CannaCraft has secured a license with the city of Santa Rosa for its manufacturing. (Darius Anderson, managing partner of Sonoma Media Investments, which owns The Press Democrat, is a lobbyist for the company.)

He compared his role at CannaCraft to that of Eric Schmidt at Google. Schmidt took over as CEO of the internet company in 2001 to help guide and grow the business from co-founders Larry Page and Sergey Brin, whose strengths were in technology, not business management.

CannaCraft employs 180 people, which places it among the 20 largest private employers in the county.

“I’m an executioner. My job is to get things done,” Silver said. He wouldn’t reveal the company’s annual revenue for 2017, but said its revenue has doubled annually since 2015.

In essence, Silver will be the public face for the company and the local industry as he promotes CannaCraft, whether educating public officials, recruiting new employees or exploring other marijuana-friendly states.

“It wasn’t a shock to me he got a job like this,” said Robert Eyler, an economics professor at Sonoma State University who has worked closely with Silver. “He is connected and he gets it from soup to nuts.”

Positive feedback

Silver said he was encouraged, given the positive reaction from friends and colleagues about his new job. “I hope that my being in a role if it does anything, helps create more of a conversation. I’m an educator at heart. That’s never going to change,” he said.

There are, however, some issues that CEOs in other sectors don’t face. For example, cannabis companies have an effective corporate tax rate that can be more than twice than other businesses, Silver claims.

He contends the industry is taxed too high, but doesn’t know what the exact rate should be without better data. “I think we need to look carefully at how much do we want to tax an industry in its infancy before it has chance to grow and be successful,” Silver said.

It’s also a cash-only sector as federally regulated banks have declined to provide services to cannabis-related businesses because the product is still illegal under federal law. Silver said he has reached out to bankers — who he wouldn’t name — to see if there is opportunity to break the logjam at the state level. The Los Angeles Times reported last month on a proposal to establish one clearinghouse bank in California that would hold accounts from other financial institutions that do business with cannabis firms.

“There is enough interested people that are trying to figure it out. No one wants all these cash transactions,” he said. “The government wants to collect excise taxes.”

Lessons from wine

While he works for improvement on the regulatory front, Silver said he is drawing from lessons in the wine industry. He views the two sectors as complimentary industries that can be partners, even though most local wine companies have kept an arm’s length distance from cannabis because they don’t want to risk losing their federal license to produce or sell alcohol.

“Now you will see it (collaboration) between industries. Now you will see it with wine and cannabis, especially on sustainable technologies: ‘What have you guys figured out that we can share?’” Silver said.

The biggest takeaway many wineries are realizing as a result of academic research? “The wine industry isn’t a product industry, it’s an experience industry,” Silver said.

A few local wineries that Silver admired for their best practices will be helpful as case studies to carry over to his new position. They include Jackson Family Wines of Santa Rosa for its commitment to sustainability; Francis Ford Coppola Winery of Geyserville for its customer experience; and Hamel Family Wines of Sonoma for its philanthropy. The Hamel family endowed a professorship at SSU that allowed Silver to recruit Damien Wilson, who had previously served as director in the wine business programs at Dijon’s Burgundy School of Business.

Academia also is interested in cannabis, though federal law limits the scope of study and research. Cannabis is still classified in the most dangerous drug category by the federal government — which rules out classes on marketing and production of the plant. However, SSU has offered classes through its continuing education program on regulatory issues, while Humboldt State University has its Institute for Interdisciplinary Marijuana Research to study the social and economic costs.

Silver declined to comment on the future role SSU could play in cannabis and whether it could be similar to its relationship to the wine industry. He did say “when educational institutions are ready, this company will be ready to support them.”

Sonoma center stage

Sonoma County is in a prime position as business mecca for cannabis as it borders the Emerald Triangle, the counties of Mendocino, Humboldt and Trinity that are known for producing the highest quality of marijuana for decades, Eyler said. “It can be from seed to sale,” he said of the potential economic sector.

But he also said that other communities want to grab that opportunity as well, similar to the competition for the new Amazon or Apple campuses and the potential economic windfall that it can bring to local regions. “The key is whether or not there is the political will and investment level to make it happen,” Eyler said.

For his part, Silver said he would like to make it happen, leveraging cannabis as part of Sonoma County’s overall strength in the food and drink sector. The county is well positioned to take advantage of technological advances in agricultural research as well as sustainability programs that will benefit its core industries, including cannabis, he said.

“We need to find our niche,” he said. “In hockey, they say you go to where the puck is going. We can see where we are growing in these areas. It is ag-tech. It is sustainable technology.”

You can reach Staff Writer Bill Swindell at 707-521-5223 or bill.swindell@pressdemocrat.com. On Twitter @BillSwindell.