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A lot can change in 16 years.
In 2009 a drug conviction earned Cos Marte a seven-year prison sentence. This year, Marte expects to make about $12 million from legal cannabis sales.
Marte, 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 2023Conbud added a second location in the Bronx last April.
Marte’s business currently brings in roughly $800,000 in sales a month, including nearly $100,000 in profit, according to documents reviewed by CNBC Make It. Marte projects a cap of about $7 million for 2024, he says.
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After being released early from prison in 2013, Marte launched a fitness business called Conbody based on his workout regimen behind bars. Then, in 2021, New York legalize the sale of recreational cannabis and expunged all past convictions for marijuana-related offenses.
A year later, the state announced that entrepreneurs with past marijuana convictions would be eligible to obtain the first licenses to sell recreational weed. Given his experience running Conbody and the requirements set by the state for retail licensees, Marte saw a golden business opportunity, he says.
“I followed that law and what they required was two years of net profitable business and a conviction on your record,” Marte says. “Now, how many people have that to qualify for a cannabis license? There aren’t many.’
From prison workouts to multiple businesses
Marte grew up on the Lower East Side, surrounded by the illegal drug trade, which caught him at age 13 after he saw other teenagers making money that way, he says.
“When I was little, people would ask me, ‘What do you want to be when you grow up?’ And I’d say, ‘I want to be rich,'” says Marte. “The first opportunity was in the drug world. So I started doing weed.”
In prison, doctors told Marte he was overweight and had dangerously high cholesterol. He began exercising intensely using bodyweight exercises he could do in his cell. After his release from prison, Marte connected with Defy Ventures, a non-profit program offering entrepreneurship training and business mentoring to ex-prisoners.
Cos Marte, founder and majority owner of Conbud, one of New York’s first legal recreational cannabis dispensaries.
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With a $10,000 grant from Defy, Marte launched Conbody — which now brings in about $1 million in annual revenue, he says — in 2014.
Eight years later, Marte paid $2,000 to apply for a retail cannabis license. He put about $50,000 of his own savings into Conbud, mostly from Conbody and paid speaking engagements, he says—and raised nearly $1.2 million in additional seed funding from friends and family who now own the business privately.
Marte owns 51% because New York requires the “justicially affected” licensee to retain majority ownership.
Conbud’s seed funding paid for a $400,000 security deposit on the Lower East Side retail site, construction costs, salaries and inventory, Marte says. The business opened in October 2023. and brought in approximately $250,000 in revenue per month—while the authorities shut down hundreds of unlicensed operators selling illegal cannabis last year.
Looking to grow in a highly competitive market
The crackdown in New York was a welcome development for licensed retailers like Marte, which face an uphill battle to establish long-term positions in the industry.
The State Office of Cannabis Management has distinguished its commitment to prioritize “social and economic justice” while growing the market for legal cannabis, but critics worry that smaller stores will eventually be pushed out by larger corporations with a national reach.
Curaleaffor example, is one of the largest dispensary owners in the US with annual revenue over $1.3 billion. The company began adult sales in Queens, New York in 2023.
This chart breaks down Marte’s monthly business expenses.
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Even the simple costs of doing business — especially rent and labor costs — are high, leaving Marte with a relatively thin profit margin of 13 percent, he says. If cannabis becomes legal at the federal level, Marte will gain access to federal tax credits for payroll and other business expenses, and extended banking options with lower fees.
“So that 13% (eventually) will grow to 25% profit margins,” he says.
Both Conbud and Conbody almost exclusively hire workers who have been “justice affected,” meaning either they or a family member has been incarcerated for past drug convictions, Marte says. In total, he employs 72 people who meet these criteria.
Marte himself left prison with $40 and a bus ticket, only to “end up on my mom’s couch” as he tried to figure out how he could make ends meet with a drug conviction on his record, he says. Without his own second chance, he probably never would have found himself in this position, he notes.
“It’s a big, big community that’s growing with us,” Marte says. “I feel blessed, man.”
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