It’s been 20 years since entrepreneurs have been this excited. In the mid-1990s, the Internet boom transformed the way people communicated with each other and created myriad new ways of doing business.
A similar shift is happening today with cannabis. Until the late nineteenth century, cannabis was a well-known ingredient in medicinal products. In the 1930s, cannabis became linked with violence and crime. Now, decades later, cannabis is being embraced again for its medicinal benefits. Today, it is generating the fastest-growing industry in America. Between 2014 and 2015, the legal market in the U.S. grew 74%, and economists from the Marijuana Policy Group are projecting a $30 billion industry by 2019.
Because of this explosive growth, many people are eager to get into the cannabis industry. If you are interested, you can focus your business on the Cannabis sativa plant itself or look into ancillary products and supporting services. There is plenty of room for profit and growth.
A ‘golden opportunity’ awaits entrepreneurs and investors in cannabis business operations
Just as in the golden days of tech, the cannabis industry is attracting venture capitalists ready to invest. Seattle-based Privateer Holdings has already raised $100 million to take cannabis mainstream, $75 million of which came from PayPal founder Peter Thiel’s investment group.
Steve DeAngelo is a longtime cannabis activist who co-founded the ArcView Group, an investment firm that connects cannabis entrepreneurs and investors. In a recent interview with Forbes magazine, he said now is “the golden window of opportunity for investors” to get in on the ground floor.
The business plans are as interesting as the entrepreneurs writing them. Some want to fund scientists to explore and validate medical usage while others want to build dispensaries for recreational users. Many businesses will support cannabis cultivation and sales. Some will harness new technologies to improve lighting and climate control. will offer cannabis consulting, dispensary management, company branding, accounting, and legal expertise.
Expect a boom in consumer-facing cannabis products, too, from laser-etched cases to vape pens made of gold. Cannabis fashion statements and upscale jewelry are already popular in California. Products made from hemp, including CBD, personal care and food, are currently a $573 million industry that is trending upward.
The categories getting the most attention – several entrepreneurs in these areas have received startup capital north of $1 million in funding – include:
- Medical cannabis cultivation
- Grow technology and hydroponics
- Cannabis-delivery and social network apps
- Cannabis advertising and design firms
Smart business planning for startups
When remembering the wild ride of the Internet boom, it’s easy to focus on success stories, such as Apple and eBay. But don’t forget, scores of ideas fizzled fast during those days as well due to poor planning, lack of funding, or just bad timing. Some companies ran into trouble when they veered into unchartered legal territory, such as Napster, a music-sharing service that was sued out of existence for copyright infringement.
Not all Americans are on board with legalizing cannabis (including the Federal government, which creates additional challenges), so there are still hurdles for businesses to clear. Cannabis business operations must be built on a solid business plan that follows local, state, and federal laws to the letter – for products, employees, and accounting practices. The more buttoned-up your business is, the fewer reasons law enforcement will have to knock on your door.
This growing market sector has already translated and is estimated to generate billions of dollars in tax revenues every year. That sounds good to us!
SIVA Enterprises is a full-service business development firm that provides consulting, turnkey management, venture opportunities, and brand acquisitions and licensing to cannabis entrepreneurs across the country. Learn why we have the highest success rate of approved cannabis license applications in the United States. Contact SIVA at (818) 562-3362 or firstname.lastname@example.org