September 2015

Men’s Wearhouse founder comes out in favor of pot legalization

You can count on one hand the number of chief executives of large companies who publicly support the legalization of marijuana. The list goes as follows:

John Mackey, co-CEO of Whole Foods Market; Richard Branson of the Virgin Group; billionaire financier George Soros; and Peter Lewis of Progressive Insurance (who was a longtime advocate before passing away in 2013).

Now, there’s a fifth CEO–George Zimmer, founder of Men’s Wearhouse, a company that fired him two years ago. He divulged to CNBC that he’s a cannabis aficionado of sorts.

Read More › How to legally invest in pot companies

“I’ve been smoking marijuana on a regular basis for about 50 years,” Zimmer said to CNBC, before joking, “As you can see, it’s really impacted me in a negative way.”

Zimmer gave the keynote speech Friday at the Cannabis World Congress & Business Expo in Los Angeles, pushing for legalization. “Everybody in the country knows what the truth here is, except the 535 people we elect to make these decisions in Washington, D.C.,” he told attendees. “It’s astounding.”

He’s throwing his support behind an initiative to legalize recreational marijuana in California next year, just as he supported the proposition that failed in 2010. No matter what form legalization might take, Zimmer said, “I think it’s important that we protect limited home cultivation without any government licensing, so whether it’s one plant or 10 plants, I don’t know, but I think that’s very important.”

‘Biggest con ever perpetrated’

George Zimmer, Men’s Wearhouse founder
Getty Images

George Zimmer, Men’s Wearhouse founder

Inside the Los Angeles Convention Center, he was surrounded by a variety of start-ups hoping to cash in on the legal pot craze. Zimmer said he looked into investing in one such company a year ago but decided not to—not least of which had to do with the Internal Revenue Service.

“There are still a lot of questions that are raised in terms of dispensaries, and the way the IRS does not allow normal business deductions.” He’s hoping that could change, and that at the very least, the federal government will remove marijuana from the list of Schedule I drugs.

“It’s treated like it was heroin,” he said. “Everybody’s who is in high school hears that and goes, ‘What are they talking about?'” He said it’s as if “The emperor’s not wearing any clothes. This is the biggest con that has been perpetrated on this country in the last century.”

Back in the menswear business

Marcus Lemonis, host of the CNBC show “The Profit”
Marcus Lemonis disses ‘Uber for tailors’

Meantime, Zimmer is also back in the men’s apparel business. He just launched an online suit and tuxedo rental site called Generation Tux. With the website, a groom or best man can submit measurements and rent formalwear for as little as $95.

“Our business model involves having the tuxedo arrive a week ahead of your event, and you to try it on. If there’s a mistake, we will FedEx another out to you, and if it’s still not right, we will dispatch a tailor to make it right,” he said. Zimmer has also started a tailoring company called zTailors, and he said both companies cost $50 million to start.

Generation Tux has a distribution center in Louisville, Kentucky, with 30,000 suits and tuxedos, and the company hopes to break even in 2017. If it takes off, Zimmer said they will need to raise more money. So would he ever consider going public again? “I wouldn’t go public if it [was] my call, but I’m not going to stand in the way if other people want to do that,” he said.

Men’s Wearhouse beats 2Q profit forecasts

It’s understandable. His ouster from Men’s Wearhouse was not pretty. Zimmer recalls having dinner with his family the night he was forced out. “It was a sort of uncomfortable quietness at the table,” he said.

“I said to my children, who were probably 10 and 12, I said, ‘Hey, look, Dad got fired,” he said. “It’s not going to mean anything to our lives, but I want you to understand that in life you’re going to have these adversities, and you have to overcome them, you have to learn to overcome all adversity in fact.”

Zimmer also said being fired was “probably the greatest thing that ever happened to me.” It forced him to learn about the latest technological developments in retail, which led to his new businesses.

“My best advice is, ‘You only lose if you don’t get back up off the ground. Every time you get back up, you win,” he said.

People United For Medical Marijuana / United For Care

Morgan & Morgan funds most of these funds!

A political committee spearheading a ballot initiative to legalize medical marijuana in Florida raised and spent more than $400,000 in August, according to a newly filed finance report. People United for Medical Marijuana, which also is known as United for Care, collected $437,220 during the month, with much of the money coming from the Orlando law firm headed by committee Chairman John Morgan. The Morgan Firm PA contributed about $363,000, the report shows. The political committee also spent $459,271 during the month, with about $352,000 of that amount going to PCI Consultants Inc., a California-based firm that does such things as gathering petition signatures. The committee had submitted 95,327 valid petition signatures to the state as of Friday morning, enough to trigger a Florida Supreme Court review of the proposed ballot wording. If the Supreme Court approves the wording, the committee would need to submit a total of 683,149 valid signatures to get the proposed constitutional amendment on the November 2016 ballot. A similar ballot measure in 2014 narrowly failed to get enough votes to pass.