Arana Hankin-Biggers is changing cannabis retail in NYC

Arana Hankin-Biggers did not come into cannabis through the usual path. With a background in economic development and urban planning, she co-founded The Travel Agency, a purpose-driven cannabis retail company that became the third legal dispensary to open in New York City. Four locations later, she is still navigating what it means to build a business in one of the most regulated and unpredictable industries in the country while keeping equity at the center of every decision.

Tell us about The Travel Agency and how you got into founding a dispensary company

The Travel Agency is a really special place. We were the third legal dispensary to open in New York City, and that was in partnership with The Doe Fund. The Doe Fund is an incredible not-for-profit that has worked with formerly incarcerated and formerly homeless, primarily Black and Brown men, for the last 35-plus years. They have served over 30,000 men. My team is the minority owner, and we operate the dispensary on their behalf.

We partnered with The Doe Fund to go after a license, which is why we were able to get into the market quickly. The first group of licenses in New York were only being awarded to individuals with cannabis convictions or to not-for-profits that work with formerly incarcerated folks with cannabis convictions. I came into it through partners I met working in the real estate field. A very good friend who worked at The Doe Fund introduced us, and we went from there. We now have four locations. The first opened in February of 2023 in Union Square, and we have since opened three more here in New York.

The Travel Agency is also unique because we have leaned heavily into design and an elevated experience. When we opened the first location in Union Square, there were 3,000 illegal dispensaries operating in New York. We wanted to set ourselves apart from the illicit market, so we designed beautiful spaces using an award-winning architect. These are funky, gorgeous, retro-futuristic spaces. We also made sure our team is well trained when they interface with our customers.

Operating in a heavily regulated market is no joke. What has been the biggest challenge of scaling in that kind of environment?

There are endless challenges. Initially, the biggest was finding and securing a location and convincing four different landlords to work with us. Most landlords in New York have a mortgage on their property, and if it is federally backed, they cannot lease to a cannabis company because cannabis is still federally illegal. Finding a landlord who had a paid-off building, or who had enough sway with their bank, or was willing to move to a state-chartered bank was difficult.

On top of that, we were a brand new company. Entering into a lease worth $1.5 to $1.8 million without a corporate guarantee was incredibly challenging. We had to put up personal guarantees to secure each space. Finding investors was similarly difficult. The people I know personally who have the most capital to invest work in federally backed institutions, so they cannot invest in cannabis because it is still a Schedule I drug.

You use a location-by-location ownership model, which is pretty unique. Can you break that down for us?

Each location has a different owner. We have four stores, and each is held by a different license holder because the state was only giving one license per entity. We had to find a different partner for each location. The Doe Fund is our partner at Union Square. Our Fifth Avenue location belongs to a different partner, an individual with a cannabis conviction. Our downtown Brooklyn partner also has a cannabis conviction, and our SoHo partner is a service-disabled veteran, another category the state was prioritizing for licensing.

The war on drugs hit Black and Brown communities the hardest, and now cannabis is a booming legal industry. How intentional are you about making sure the people most harmed actually benefit from legalization?

The majority of our employees are Black and Brown. We have over 200 employees, and anywhere between 60 to 70%, maybe more, are Black and Brown. Many actually came from the legacy market. They sold cannabis illegally as their own hustle and were trying to get into the legal space. A lot of them do not even have a retail background, so we provide robust training to bring in folks who are passionate about the plant and who can learn what it takes to be an educated budtender.

We firmly believe in promoting from within. We have promoted a number of people of color from entry-level budtender positions to supervisors, assistant general managers, and general managers. Most of our stores are run by people of color. On the product side, it is unfortunate that there are not as many Black-owned brands as I would like to see in the New York market. But the ones that exist, we carry them, promote them, and maintain space for them on our shelves and ordering kiosks so they have prominence.

What are the pros of the cannabis industry for Black communities?

It is not often that within a generation, a brand new industry erupts. Similarly to the alcohol industry, we are in one of those moments now. My grandmother’s first cousin was the first Black woman to own a liquor license in New York State. She owned a liquor store in Harlem for many years. She bought a beautiful home next to Whitney Houston and Bobby Brown in Englewood Cliffs, New Jersey, helped her two brothers get liquor licenses, sent all of her children to college, and was also a civil rights activist. 

Percy Sutton helped her get her license. She also helped organize the first March on Washington with A. Philip Randolph and helped integrate a famous Harlem department store that was not hiring Black women.

There is a real connection between economic empowerment, social equity, and new industries. But corporate interests are more powerful today than they were in the 1950s. Even though New York has made a meaningful attempt to ensure Black people get opportunities to enter the market first, it is still challenging. 

The rents are high, the overhead is high, and we are subject to tax code 280E. Because cannabis is federally illegal, you cannot write off any business expenses. You can only write off the cost of goods. Our effective tax rate is 70%. It is very capital intensive. But there are Black owners in New York City who are running successful dispensaries. It is way more challenging than anyone expected, but they have opened, and they are surviving.

You are a Black woman leading in a space historically dominated by men and by capital. What does it take to hold your ground?

Cannabis is unlike any other industry. The rules are constantly changing. When we first opened, we had assumed things about the market that turned out not to be true. The state had projected the market to be $4 to $5 billion, and it remains to be seen if that will ever happen.

I was an investor in my own company. I scraped together money from friends, family, and savings. Because the market is not as stable as we thought, you have to keep finding more money. Even the profits you pull out have to keep going back in. My partners are white men who have more means than me. They are willing to take more risks because they have the capital. That has been very challenging.

They do understand the importance of building a people-first company, and they have been supportive of investing in our team. But if you are not hitting your numbers, some of the softer things go first. You cannot invest as much in training if you are not meeting targets. You cannot give your team heavy bonuses either. Some of what you are there to support falls by the wayside when the revenue is not there.

Where do you see The Travel Agency going from here?

I hope we continue to grow. We are nearing 600 dispensaries in New York State, with close to 300 in New York City alone. We are doing all we can to promote Black-owned, women-owned, queer-owned, and veteran-owned brands through more partnerships and events. We are also expanding our delivery program, which has been great for reaching customers throughout the state.

We have the best quality legal product. Because we have four dispensaries and are one of the most successful in New York, we get first pick of the best flower from the farms. Customers recognize that and become loyal. We are doing all we can to maintain our ground in a turbulent industry. Revenue started high, leveled off, and there are still many unknowns ahead.

Where can we find The Travel Agency?

Visit us at thetravelagency.co. Our Union Square location is at 13th and Broadway, just behind the Whole Foods there, diagonal from the movie theater. On Fifth Avenue, we are between 47th and 48th, next to the H&M flagship, across from Sephora. In downtown Brooklyn, we are across from Atlantic Terminal and the Apple Store. In SoHo, we are on Broadway just south of Houston, next to the Target. All locations are close to multiple subway lines and easy to find.