Like any other burgeoning sector, the marijuana industry is brimming with ideas from aspiring “potpreneurs.” But with no one to guide them, these ideas would remain just that – ideas.
Thankfully, there’s Canopy Boulder, a startup accelerator that helps cannabis businesses get off the ground by providing them with a 13-week boot camp and $20,000 in seed capital in exchange for a 9.5 percent company stake. After all, Canopy Boulder CEO Patrick Rea believes that legal marijuana can become a $37 billion domestic market once it is legalized nationwide.
Unique ideas for unique companies
The cannabis industry can be split into two categories: businesses that “touch the plant,” and ancillary businesses that doesn’t involve growing, processing, testing, or retailing weed. Canopy Boulder deals with the latter because it is less risky and easier to expand.
Canopy Boulder has received more than 115 applications for its inaugural class last March 2015. The ones that the company selected are those that have the potential to expand beyond the usual demographic of young male potheads.
“One of our guiding themes from an investment point of view is, we see the strongest potential for market expansion in what I would call the everyday consumer,” Rea said. “Folks who are parents, folks who are grandparents. We want 35-year-old professional women to be a target demographic for some of our companies.”
Many of the potpreneurs in the first batch defy the stoner stereotype. There’s former finance worker Damien Williams who started Shivanysa, a lifestyle brand that aspires to be the Lululemon of cannabis. And then there’s Roy Bingham who founded the startup Business Decision and Data Service, which deals with cannabis market research. Bingham is a Harvard MBA graduate who used to work for blue-chip consultancy McKinsey.
There are also a variety of really unique ideas. There’s Leaf, which sells a smartphone-controlled grow box for cultivating plants at home, founded by Israeli-American Yoni Ofir. There’s also Healthy Headie Lifestyle, which sells in-home vaporizers for those who aren’t comfortable going to outside shops. According to co-founder Holly Alberti-Evans, it targets seniors who want to take alternatives to the prescription drugs they are currently taking.
One tip that Canopy Boulder gave to future applicants is to avoid businesses that deal with vaporizers and new smoking devices, as the market is already saturated. “You really have to have some truly unique evolution of that product to be competitive,” Rea said.
A typical day at Canopy Boulder involves being in the office from 10 in the morning to 2 in the afternoon. April is packed with networking and bonding activities like hikes and ski days, while May is pressure-filled as companies finalize their business plans and perfect their pitches.
The future awaits
Nick Hofmeister, a mentor for companies in TechStars – the accelerator that Canopy Boulder patterned itself from – gave a talk on Canopy’s opening day.
“Cannabis is a terribly interesting space,” he said. “It’s one of the only cases where there is a market that’s $50 billion but the legal market is only $2.7 billion. So you know the market demand is out there, and you know there’s going to be a massive expansion of regulatory support for it. What does it look like to create an industry not from scratch, but from legal scratch?”
Prominent activist and entrepreneur Steve DeAngelo also spoke to the group and predicted that domestic sales of medical marijuana will reach more than $150 billion in the near future. But he also emphasized that potpreneurs should not only focus on profit, but also on social responsibility, urging them to create “a new kind of industry” that doesn’t harm the environment and pays workers a decent living wage.
He said, “If, 20 years from now, we turn around and look over our shoulders, and all we’ve done is make big piles of money, we will have blown it.”
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