Illinois Agriculture Secretary Jerry Costello cuts the opening ribbon at Star Buds IL in Rockford, Ill. with craft grow facility owner Tiffany Hightower.

With fanfare and giant scissors, Illinois’ Secretary of Agriculture cut the ribbon to open Illinois’ first operating craft grow facility, Star Buds IL, in upstate Rockford. An accomplishment almost impossible to imagine a year ago – as licenses were first issued a year ago, but were further delayed by court cases, a market crash, and capital fleeing Illinois for other states.

The facility, 66% owned by a local, Black-led team with experience in Michigan, is partly owned by Starbuds, a multi-state operator with dispensaries in five states and Jamaica.

“This is how we build an equitable cannabis industry and begin to repair the devastating harm done by the War on Drugs on communities of color,” said Illinois Gov. J.B. Pritzker in a press release.

Illinois issued 40 craft grow licenses in July 2021 and then distributed another 48 in June 2022. Last May, the state trumpeted the start of construction for three craft grow facilities, of which Star Buds IL was one. But there has been little news of progress for other craft grow licensees since then.

“Looking at Star Buds, they have a combination of Starbuds [MSO] and people in Illinois. Starbuds has existing operations and they appear to be well capitalized from other operations. They were hitting on all cylinders. It’s a reminder to everybody else that it’s not automatic,” said Scott Redman, president of the Illinois Independent Craft Grow Association. (The Illinois business has a space between words, while the national one doesn’t.)

Indeed, other craft grow operations, even those with experienced operators, have been held up by the usual suspects: constrained capital, zoning, and permitting.

One such project is Kamikaze, a pair of craft grows aiming to site within Chicago city limits. Their lead investment is coming from West Side-native rapper Twista (the company is named after his breakout 2004 album), with operations led by Richard Park, a cannabis operator with experience in Colorado and Illinois.

“We’re pretty far along in the community process. The process in Chicago is burdensome. Almost everyone I know is looking at the suburbs for craft grow, or have suburban backups. We don’t know what will happen with the zoning, which has made valuation difficult,” said Park.

While Kamikaze has settled on a West Side craft grow site – the iconic former Moo & Oink butcher in Twista’s home neighborhood, K-Town, the company is struggling to find a South Side location for their craft grow.

“There used to be a lot of excitement from landlords, but I’m getting a lot of apprehension lately. A lot of these guys have signed LOIs and then people back out. I think landlords are getting sick of it,” said Park.

Redman says capital is clearly constrained in Illinois. 

“For whatever reason, delays by the state, lawsuits, economy, Covid, the money we saw when adult use first came out, that seems to have gone elsewhere. That was clear at [the August] Benzinga [conference]. Everyone is a lot more risk averse. Very few we talked to at Benzinga had any interest in pre-revenue investing or lending,” said Redman.

But, Redman doesn’t expect everything to happen at once.

“There’s going to be waves. The very first wave, Starbuds, the first of the first wave, are probably groups that have backing from operators existing outside the state with capital,” said Redman. “The next wave will hopefully include the team I’m part of, which has experience starting businesses and reasonable access to capital. And I don’t know how many of those there are. Those are the groups you’re going to see in the next 6 to 9 months. Everybody else, who knows?”


Editor Mike is a co-founder and the editor of Grown In, a U.S. national cannabis industry newsletter and training company. His career has taken him from Capitol Hill to Chicago City Hall, from...