Jacob Redmond
Well-Known Member
It’s risky, unproven and still illegal at the federal level, but a group of Boulder investors is betting on the cannabis industry.
They’ve launched Canopy Boulder, a mentorship and seed-stage investment program, and put up $1.2 million to shepherd 20 entrepreneurs into the new, fast-growing field of marijuana ancillary businesses and services.
The way they see it, the cannabis market is theirs for the taking. But because it’s new, there is no model to look to for guidance.
“When you are looking at investments, the huge focus area is on the founding team — how good are they,” said Micah Tapman, a partner in Canopy Boulder whose background is in cybersecurity. “What we found in the cannabis sector with traditional seed-stage investments is that the business maturity level of the teams was very low, very raw, untested.”
Canopy Boulder is not investing in marijuana growers, manufacturers or dispensaries. Instead, it is focused on all the businesses behind the pot industry.
“You could brainstorm all the normal businesses that operate around any industry — cannabis needs all of them,” Tapman said. “We could create any of the companies.”
Canopy Boulder’s mentoring program is modeled after Boulder-founded startup accelerator Techstars. The company is partnered with the ArcView Group, a California-based collective of 500 accredited investors who work with cannabis-related businesses.
Last year the U.S. cannabis industry grew by 74 percent. However, big companies still shy from doing business with marijuana-related enterprises. Many worry how investments would clash with federal law that describes financial firms involved with pot businesses as aiding and abetting in drug trafficking.
It leaves the space wide open, Tapman said. For example, a startup called Tradiv aims to help marijuana business buy and sell their wholesale products online. Another company called BDS Analytics is building a market research company based on point of sale data.
The founders of those companies were among the first 10 entrepreneurs to go through the 12-week the Canopy Boulder accelerator program.
“Tradiv is tackling problems that are inherent to any industry,” Tapman said. “What is neat about the area (is that) the cannabis area is protected from competition by the biggest players in marketplace. Google is not doing online advertising” (for cannabis businesses).
Canopy Boulder starts its second 12-week mentorship program Aug. 24. In the first round, about 120 entrepreneurs from across the country applied for the 10 slots; this time there were 130 applicants for the 10 slots.
Entrepreneurs are given $20,000 and a 12-week mentoring program that includes advice and consultation from a list of 80 mentors in such areas as financial modeling, data collection and research, advertising and marketing, human resources, fundraising, branding and regulations.
The big bet is that California — the world’s eighth-largest economy, if it were a nation — will legalize recreational marijuana in 2016. A push is underway to put a legal-pot measure on the state’s ballot next year; medical marijuana is already sold there.
“The timing is interesting,” Tapman said. “We are in a slow period. This year, no new states are coming online and there are no major changes in federal policy.
“The anticipation is that California will fully legalize cannabis in 2016 — conservatively, it will double from a $1 billion to $2 billion industry.”
The first round of Canopy Boulder graduates appear to be gaining traction; the first group of 10 has collectively raised about $3 million in investments.
“It’s mind boggling to think of growth and where the industry is going,” Tapman said. “Investors are getting in now when it’s cheap.”
News Moderator: Jacob Redmond 420 MAGAZINE ®
Full Article: City Investors Steer Funding To Businesses Behind The Marijuana Industry
Author: Monica Mendoza
Contact: Email The Author
Photo Credit: Micah Tapman
Website: Upstart Biz Journals
They’ve launched Canopy Boulder, a mentorship and seed-stage investment program, and put up $1.2 million to shepherd 20 entrepreneurs into the new, fast-growing field of marijuana ancillary businesses and services.
The way they see it, the cannabis market is theirs for the taking. But because it’s new, there is no model to look to for guidance.
“When you are looking at investments, the huge focus area is on the founding team — how good are they,” said Micah Tapman, a partner in Canopy Boulder whose background is in cybersecurity. “What we found in the cannabis sector with traditional seed-stage investments is that the business maturity level of the teams was very low, very raw, untested.”
Canopy Boulder is not investing in marijuana growers, manufacturers or dispensaries. Instead, it is focused on all the businesses behind the pot industry.
“You could brainstorm all the normal businesses that operate around any industry — cannabis needs all of them,” Tapman said. “We could create any of the companies.”
Canopy Boulder’s mentoring program is modeled after Boulder-founded startup accelerator Techstars. The company is partnered with the ArcView Group, a California-based collective of 500 accredited investors who work with cannabis-related businesses.
Last year the U.S. cannabis industry grew by 74 percent. However, big companies still shy from doing business with marijuana-related enterprises. Many worry how investments would clash with federal law that describes financial firms involved with pot businesses as aiding and abetting in drug trafficking.
It leaves the space wide open, Tapman said. For example, a startup called Tradiv aims to help marijuana business buy and sell their wholesale products online. Another company called BDS Analytics is building a market research company based on point of sale data.
The founders of those companies were among the first 10 entrepreneurs to go through the 12-week the Canopy Boulder accelerator program.
“Tradiv is tackling problems that are inherent to any industry,” Tapman said. “What is neat about the area (is that) the cannabis area is protected from competition by the biggest players in marketplace. Google is not doing online advertising” (for cannabis businesses).
Canopy Boulder starts its second 12-week mentorship program Aug. 24. In the first round, about 120 entrepreneurs from across the country applied for the 10 slots; this time there were 130 applicants for the 10 slots.
Entrepreneurs are given $20,000 and a 12-week mentoring program that includes advice and consultation from a list of 80 mentors in such areas as financial modeling, data collection and research, advertising and marketing, human resources, fundraising, branding and regulations.
The big bet is that California — the world’s eighth-largest economy, if it were a nation — will legalize recreational marijuana in 2016. A push is underway to put a legal-pot measure on the state’s ballot next year; medical marijuana is already sold there.
“The timing is interesting,” Tapman said. “We are in a slow period. This year, no new states are coming online and there are no major changes in federal policy.
“The anticipation is that California will fully legalize cannabis in 2016 — conservatively, it will double from a $1 billion to $2 billion industry.”
The first round of Canopy Boulder graduates appear to be gaining traction; the first group of 10 has collectively raised about $3 million in investments.
“It’s mind boggling to think of growth and where the industry is going,” Tapman said. “Investors are getting in now when it’s cheap.”
News Moderator: Jacob Redmond 420 MAGAZINE ®
Full Article: City Investors Steer Funding To Businesses Behind The Marijuana Industry
Author: Monica Mendoza
Contact: Email The Author
Photo Credit: Micah Tapman
Website: Upstart Biz Journals
