A lot can change in 16 years.
In 2009, a drug conviction resulted in Kos Marti being sentenced to seven years in prison. This year, Marty expects to make up to $12 million selling cannabis legally.
Marty, 39, is the founder and CEO of Conbud, one of the first fully licensed recreational cannabis businesses in Manhattan, and the first on the city's Lower East Side. After opening its doors for the first time October 2023Conpod added a second location in the Bronx Last April.
Marty's business currently generates roughly $800,000 in sales per month, including nearly $100,000 in profits, according to documents reviewed by CNBC Make It. Marty says he expects a final tally of about $7 million for 2024.
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After receiving early release from prison in 2013, Marty launched a fitness company called Conbody, based on the exercise regimen he followed behind bars. Then in 2021, New York Legalize the sale of recreational cannabis and expunged all previous convictions for marijuana-related crimes.
A year later, the state announced that entrepreneurs with prior marijuana convictions would be eligible for the first licenses to sell recreational weed. Given his experience running Conbody and the requirements the state had for retail licensees, Marty saw a golden business opportunity, he says.
“I was following this law, and what they were asking for was two years of net gainful employment and a conviction on your record,” Marty says. “Now, how many people have that to qualify for a cannabis license? Not many.”
From training in prison to multiple jobs
Marty grew up on the Lower East Side, surrounded by the illegal drug trade that entrapped him when he was 13, after seeing other teens making money that way, he says.
“When I was a kid, people would ask me: What do you want to be when you grow up?” “I would say, 'I want to be rich,'” Marty says. “The first opportunity was through the drug world. So I started dealing cannabis.”
In prison, doctors tell Marty that he is overweight due to dangerously high cholesterol. He began exercising intensely, using body weight exercises that he could do in his cell. Upon his release from prison, Marty connected with Defy Ventures, a nonprofit program that provides entrepreneurship training and business mentorship to formerly incarcerated people.
Kos Marty, founder and majority owner of Conbud, one of the first legal recreational cannabis dispensaries in New York City.
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With a $10,000 grant from Defy, Marty launched Conbody — which now generates about $1 million in annual revenue, he says — in 2014.
Eight years later, Marty paid $2,000 to apply for a cannabis retail license. He invested about $50,000 of his own savings in Conbud, mostly from Conbody and from paid speaking engagements, he says — and raised about $1.2 million in additional seed funding from friends and family, who are now part owners of the company.
Marty owns 51%, with New York requiring the “equity affected” license holder to retain majority ownership.
Marty says Conbud's startup money paid a $400,000 security deposit on the Lower East Side retail location, plus construction costs, payroll and inventory. The company opened its doors in October 2023, generating revenues of approximately $250,000 per month – even the authorities Shutting down hundreds of unlicensed operators selling cannabis illegally last year.
Looking to grow in a highly competitive market
The New York crackdown was a useful development for franchised retailers like Marty's, who face an uphill battle to establish a long-term foothold for the industry.
The state's office of cannabis management has Described Its commitment to prioritizing “social and economic justice” while growing the legal cannabis market, however Critics worry That small stores will eventually be eliminated by larger companies with a national reach.
Coralevfor example, is one of the largest dispensary owners in the United States Annual revenue is more than $1.3 billion. Company Adult sales begin in Queens, New York, in 2023.
This chart explains the monthly expenses of Marty's business.
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Even the simple cost of doing business — especially rent and labor costs — is high, he says, leaving Marty with a relatively small profit margin of 13%. If cannabis becomes legal at the federal level, Marty can access federal tax deductions for payroll and other business expenses, and Expand banking options With lower fees.
“So that 13% will (eventually) grow into 25% profit margins,” he says.
Both Conbud and Conbody almost exclusively hire workers who are “justice-impacted,” meaning they or a family member has been incarcerated because of a prior drug conviction, Marty says. Collectively, he employs 72 people who meet these criteria.
Marty himself says he left prison with $40 and a bus ticket, only to end up on mom's couch while trying to figure out how he could make a living with a drug conviction on his record. He points out that without his second chance, he likely would not have found himself in this situation.
“It's a very large community that's growing with us,” Marty says. “I feel lucky, man.”
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