This blog focuses primarily on the new and massive cannabis industry – recreational adult-use cannabis, medical cannabis, and CBD. These three verticals take up most of the hype, press, and investment dollars that are circling the industry. No surprise – the global legal cannabis industry is estimated to grow to $32 billion by 2022, with some industry CEOs projecting the industry to be as large as $150 billion.
While cannabis edibles are only one part of the cannabis ecosystem, we should also consider the ancillary industries that service and supply the cannabis LP’s:
- Cultivation – Companies that supply the hardware, technology, and services to support the cultivation, production and processing of cannabis. One example:
- Banking – Only about one in 30 banks in the U.S. will accept a cannabis company as a customer. With limited access to banking, businesses, especially retail/dispensaries, are left without the ability to process credit card payments, deposit cash, write checks to suppliers, and more, resulting in lots of cash. This lack of access to banks spurs innovation; there are well-financed, highly trained, bonded cash transportation companies that specifically service the legal cannabis industry. One of these upstarts is:
- Hardcar, a California-based company that offers a vertically integrated array of cannabis transportation, storage, logistics, and security services
- Compliance – While cannabis companies may consider compliance a headache, they acknowledge that it is necessary to achieving a legitimized cannabis industry. Strict compliance throughout the end-to-end process of cannabis production has given birth to numerous business opportunities, including seed-to-sale tracking software:
- Ample Organics helps cannabis companies in growing and production, client management, sales, and quality assurance. Founded in 2014, Ample Organics has been adopted by more Canadian licensed producers than any other cannabis software solution and was featured in MacLean’s Magazine as one of the Canadian startups that will make it big in 2019
- Distribution – the final step in the process of getting recreational cannabis in the hands of consumers is, in most jurisdictions, the cannabis dispensary. The local establishment, government-owned or private, is by far the most popular way to purchase adult-use cannabis. In the past year or so, the dispensary has been helped by technology-enabled home delivery:
- Eaze connects customers through its mobile app or website to delivery drivers from local, legal, and compliant dispensaries in most major cities in California and Oregon. They have enabled local retailers to complete over two million safe deliveries since 2014
We need to look beyond the licensed producers for companies that are innovating throughout the cannabis supply chain.