Cultivating Real Profits from Fake Weed

Derek Williams was working as a trash-truck driver when his cousin told him about K2, a product made from plant materials and chemicals that provided a legal, marijuana-like high. Williams saw his ticket out of the rubbish business: Make a better blend. He studied compounds that mimic the effects of pot, and soon after created his own brand, Syn Incense, in his home in Kansas City, Mo. Williams, 29, says his startup, KC Incense, has sold more than $1.5 million worth of the stuff in at least 10 states in less than a year. He says that marketing the product as incense allows him to avoid federal regulations, though he says he knows most customers smoke it.

Williams's ability to stay a step ahead of federal and state authorities underscores the hurdles regulators face as they move to ban chemicals used in such products, which they say may pose serious and unknown dangers. Williams says that when his ingredients are restricted, he switches to similar ones. William E. Marbaker, director of the crime laboratory division of the Missouri State Highway Patrol, says that's typical of producers and makes it hard for law enforcement. "You're basically playing a game of whack-a-mole trying to keep ahead," he says.