An alumni-owned cannabis business in D.C. called District Derp experienced a 300 percent increase in sales in the weeks before nonessential businesses in D.C. closed.
Mayor Muriel Bowser’s order for the closure of non-essential businesses put alumni Chris Licata and Anais Hayes, who run District Derp Art Gallery– a non-medical cannabis company- in an unfortunate position.
While Bowser is allowing medical marijuana businesses to remain open during the pandemic, non-medical cannabis companies in D.C. are considered non-essential, and prohibited from operating.
While some of these recreational companies have chosen to continue operations against Bowser’s order, Licata and Hayes have chosen to halt their company’s normal operations and focus instead on keeping in touch with customers.
Under the 2014 D.C. law called Initiative 71, citizens 21 and older are allowed to possess, grow and transfer minimal amounts of cannabis. Unless it is for medical purposes, explicitly buying or selling the drug is still a federal offense.
But District Derp and other similar companies have been able to run “legal” cannabis businesses under the caveat that cannabis can be transferred between parties in minimal amounts as long as there is no monetary value ascribed to the drug itself. In D.C., this legal loophole is commonly referred to as “the gifting model.”
Licata and Hayes sell prints of custom paintings made by their four-year-old dog named Sudo for gifts of cannabis flower, THC cartridges and THC infused edibles. Before starting District Derp, they taught their dog Sudo how to paint. Licata said he capitalized on her love of sticks by drilling a hole into one, fitting a paint brush in it and getting her to hold it in her mouth. And they said they soon realized Sudo’s paintings would be a prime product to base a gifting cannabis company off of.
Because District Derp markets itself as an art gallery “first and foremost,” the couple said as a non-essential business, they chose to respond to Bowser’s order by temporarily ending all disbursement of their products. But Licata added that some local non-medical cannabis companies are not following suit and continue to distribute cannabis.
“I know for sure five different services that are still running in direct opposition to the closed order,” Licata said.
One company, Ez Gifting D.C., put this announcement on their website’s homepage, which is still accepting customers, “First and foremost, we want to express our sincere concern for everyone who has been impacted by the Corona Virus.”
Two others that remain operational are Green Label Grinders which currently sells face masks, instead of their usual grinders, with gifts of cannabis and Dreamy D.C. which sells “inspirational speeches” with gifts of cannabis.
Licata and Hayes said that since suspending sales, they have switched to keeping their customers engaged in the company through social media campaigns and virtual events.
But weeks before District Derp suspended operations, Hayes said the company experienced a spike in business. The couple saw a roughly $55 dollar increase in average order value and about a 300 percent increase in overall sales.
“Especially with such a big bump in our business that was going on, that was really a bummer then having to close down,” Hayes said.
Just before Bowser’s stay-at-home order took effect, the couple faced the “busiest night we have ever had,” Hayes said. The company needed to assemble 40 orders, leading them to run out of almost every strain of cannabis flower they had and all of their edibles.
The couple, who met at their graduation ceremony in 2015 and launched the business in fall 2018, plan on eventually quitting their jobs as a software engineer and project manager at an NGO to work for District Derp full-time and possibly open a storefront in the future. They said they don’t want to break Bowser’s order to ensure they can follow through on plans to expand the business once the pandemic subsides.
“If we’re caught operating, that can have repercussions in terms of fines and repercussions in terms of us getting a license later on,” Hayes said. “We’re in the middle of a pandemic. We’re in the middle of a really, really horrible thing, and I think we viewed it as our responsibility as members of the community to do our part in flattening the curve, to do what we can to help our community in this circumstance.”
Licata and Hayes said they are working to maintain engagement with their customers while their company is on pause. They ran a 4/20 campaign last month in partnership with Washington City Paper, which gave people who subscribed to the newspaper a discount on their first cannabis order when they reopen.
They also ran a contest starting April 27 inviting followers to submit recipe ideas for new edibles, they tested them and prized the winning recipe with free edibles when they reopen for business. They have also hosted live Facebook and Instagram events including a live painting session with their dog Sudo, invited customers to virtual smoke sessions on Zoom and have been posting on social media daily to spark conversations about things like cannabis education, supporting small business and to update followers on Sudo and their daily business tasks.
“It seems like at least our engagement has actually gone up,” Hayes said.
Licata added that even though they seem to have more social media attention than ever, District Derp will most likely lose customers to cannabis companies that are still running during the pandemic.
“We are going to lose a lot of clients after this,” he said. “Because obviously people are not going to stop buying weed just because there’s a pandemic going on.”
But they remain optimistic for the future and confident in the resilience of District Derp.
“We’re going to be in this pandemic circumstance for a while, like it’s not going away soon,” Hayes said. “But I don’t think that’s put a damper on where we see the business going.”
This article appeared in the May 18, 2020 issue of the Hatchet.