Jim Smith takes a leadership role at a cannabis company

In August 2020, on a Friday afternoon, Rogers’ attorney, Jim Smith, received a phone call from Alex Gray, a Little Rock attorney.

Gray wanted to hire Smith, considered one of Arkansas’ leading and most experienced business attorneys, to acquire one of Arkansas’s eight cannabis cultivation licenses. Gray was an investor with an operation that wanted the license: Good Day Farm Arkansas LLC.

Arkansas voters approved the legalization of medical marijuana in November 2016, with 53% of the vote. State legislators and regulators were slow to develop and implement the rules for issuing cultivation and dispensary licenses, and a series of legal actions stymied the process.

But, after a painfully slow launch, the industry was buzzing. AND good morning farm had plans to be a player, looking to acquire the license of an existing operator that wanted to get out of the market.

“[Gray] he said he needed to close the deal in two weeks,” Smith recalled. “It’s been a sprint since I got that phone call.”

Smith’s sprint has landed him in a job he couldn’t imagine for himself a few years ago: a leadership role in a medical marijuana business. While Good Day Farm built its business infrastructure, Smith handled the legal work as part of his practice at Rogers, Smith Hurst PLC.

He joined Good Day Farm in June 2021 as General Counsel and Head of Mergers and Acquisitions. Earlier this year, Good Day Farm hired him as business president.

Smith is responsible for the company’s corporate office in Little Rock, including finance, legal, human resources, mergers and acquisitions, compliance and regulatory functions. Essentially, everything that is not cultivation and facilities. Good Day Farm has a separate director of operations in charge of growing operations. Another president is the cultivation chief.

The growing company also hired a chief marketing officer in the fall of 2021. All four report to a newly hired CEO. Smith said the company would announce that hire later this spring.

Smith also said Will Mullen, a Smith Hurst partner, will become Good Day Farm’s deputy general counsel.

“Many of us have said many times throughout this process that if we had been told two or three years ago that we would be involved in the cannabis world, that would be the last thing we would say,” Smith said. “But the group that has been put together is an outstanding management team, and it’s an outstanding group of successful investors behind us.”

BUSINESS TRANSITION
Smith’s move to Good Day Farm comes at a transition year for his professional career.

On March 8, Little Rock-based Rose Law Firm announced an agreement to acquire Smith Hurst, a seven-attorney regional business and private equity firm in Rogers. The merger pushes the firm’s bench to 37 attorneys: 19 members, nine associates and nine attorneys.

Founded in 1820 prior to Arkansas’s statehood (1836), the Rose Law Firm is the oldest law firm in the state and the oldest law firm west of the Mississippi River.

rebeca hurst

Rebecca Hurst, managing partner of the firm, will become a member of the Rose Law Firm and will manage the Northwest Arkansas locations in Fayetteville and Rogers. She will also join the firm’s six-person executive committee.

Smith’s role at the firm will be advisory. The merger is effective April 1.

“I’m not going to abandon the clients that I have,” he said. I will be involved [with Rose] in an advisory role for select clients and projects.”

Smith and Hurst started their law firm in the summer of 2011. The two had previously worked at Friday, Eldredge & Clark in Fayetteville. A Russellville native, Smith was one of two attorneys sent from central Arkansas to open the Little Rock-based law firm’s Fayetteville office in 2000. He later hired Hurst, who is from Clarksville, in 2006 after who earned his master’s degree in taxation in New York. University School of Law.

Smith said he was proud of the company’s achievements over the past decade, and there are no sad feelings about removing the company’s image from the business community.

“We think the name Rose is exceptional,” he said. “It’s an old firm with some energetic young partners who will work well with us. We did many transactions with [Rose] through the years.”

Those who know Smith say his reputation as one of the best business attorneys in Arkansas is well earned. His extensive practice covers the full range of business advice and transactional law.

But he always understood that it is not enough to be smart and possess an understanding of the law.

Marshall Ney

“A lot of people can check those boxes,” said Marshall Ney, a partner at Friday, Eldridge & Clark in Rogers. “Instead, success goes to those who also care about their customers and their customers’ businesses and continue to respond to them day and night. Those qualities come naturally to Jim. He has a genuine curiosity and interest in his clients and has always immersed himself in his lives and businesses.

Ney has known Smith since they moved to northwest Arkansas two decades ago. She said they have been competitors, adversaries, co-counsel, and now attorney/client.

“Through it all, we have been friends and enjoy social time together,” Ney said. “Jim hasn’t just been a lawyer. He is an invaluable business partner.”

Others say Smith is well regarded because his reputation is built on tangible results. Smith has advised several companies on deals worth hundreds of millions of dollars. A memorable deal occurred in April 2013 when Smith acted as legal counsel to Fayetteville-based Acumen Brands Inc. in its $83 million Series C investment round led by General Atlantic. It was the largest private equity investment within the state of Arkansas.

“He has a brilliant mind with great business instincts and exercises tremendous judgment in understanding the complexities, nuances and interests in the negotiation. [such as] legal, emotional, historical, relational, reputational,” said David Echegoyen. He was the president and CMO of Acumen at the time. “The creativity and persuasive skills of his are also admirable. He is also able to be assertive and respectful at the same time, while displaying unflappable confidence and knowledge of the law.”

Among non-lawyers, there may be no one who knows Smith better personally or professionally than Echegoyen, who said Smith remains a sounding board, a source of advice and a confidant.

Echegoyen joined Jet.com in 2017, a year after Walmart acquired the business for $3.3 billion, eventually serving as the company’s director of customer service. He ended up at Walmart in 2019 as a senior marketing executive and then led Walmart’s first membership program as general manager of Walmart+, leading the team responsible for the development, growth and economics of the program.

David Echegoyen

“Jim quickly became someone I could trust completely, knowing he would always give me an honest point of view,” said Echegoyen, who is now the operating partner of Cove Hill Partners, a private equity firm in New York City. . He still lives in Northwest Arkansas. “But he didn’t force me to agree with him in order to forge a fruitful relationship. Although being the great lawyer that he is, Jim was clearly persuasive.

“I admire Jim’s talent and dedication, and I am grateful for his guidance in many situations throughout my life and career.”

BOOMING BUSINESS
Smith, 53, has never smoked marijuana, recreationally or otherwise.

“I was not attracted [Good Day Farm] as an enthusiast or hobbyist,” he said. “It appealed to me from a business perspective. It’s a booming business. It is growing rapidly and is very competitive.”

According to a report earlier this year from the online cannabis market Leafly Holdings Inc. (NASDAQ: LFLY), the US marijuana industry continued to grow in 2021, with nearly half a million people now working online. full-time in the cannabis industry as state markets come online and mature.

Last year’s nationwide cannabis sales figure ($25 billion) is only about 25% of the industry’s potential, according to the report. It also projects that cannabis revenue is expected to nearly double by 2025, and even then, it would be “less than half of the total potential market.”

Good Day Farm operates a 100,000-square-foot growing facility in Pine Bluff that employs 300 people. There are similar facilities in Columbia, Mo., and Ruston, La. A cultivation facility is being developed in Oxford, Mo.

Smith points out that since cannabis remains illegal from a federal standpoint, there are nuances to growing the business in various states. Instead of one Good Day Farm entity, separate limited liability companies with common investors own numerous Good Day Farm companies. The requirements for ownership vary from state to state.

According to the Arkansas Medical Marijuana Commission, which administers and regulates the issuance of licenses to operate medical marijuana dispensaries and cultivation facilities, there are about 150 investors/owners from various states who back Good Day Farm.

“Our goal is to be the largest cannabis operator in the southeastern part of the country,” Smith said. “We don’t have a mothership that owns everything in these various states. By law, you can’t do that. We have separate companies in each state to comply with the rules and regulations of those states. Eventually, perhaps the laws will change to allow us to consolidate. But we cannot do that today by law. We have different groups of investors and property in each state in which we are involved.”

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