The passage of Proposition 64 in California this election cycle has finally opened the floodgates for potential investors to enter the new cannabis industry, and the time has arrived to throw in all chips and make it big! ….or one might think. While there is no doubt that full-scale adult legalization in the world’s sixth largest economy will create tremendous new market opportunities, the switch to cultivating a still-federally illegal substance, is not as simple as passing a popular vote. Rules and regulations remain unwritten, are in constant flux, or simply vary across states.
Entrepreneurship involves risk by definition, and often despite rhyme or reason, new business start-ups ultimately fail. The unique and subversive history which informs today’s cannabis culture has shaped the consumer market in ways which are unpredictable to analysts of other industries.
From LA Weekly on December 12:
“Brian MacMahon, whose L.A.-based startup center Expert DOJO has helped more than 600 startups get up and running since 2014, is now working with more cannabis businesses in the hopes that he’ll be able to increase their chances of surviving amid all the uncertainty. The failure rate of tech startups, according to MacMahon, is 97 percent and he anticipates that that number will be even worse in cannabis while the industry is getting established.”
There is no doubt that lingering questions at the federal level maintain a level of caution and hesitancy within the investment community. Securing relationships with vetted individuals and building highly-skilled teams are paramount to creating a robust organizational foundation; ensuring a process for longevity in the face of evolving regulations is just as crucial. Entrepreneurship in this brave new market will face fierce competition and a rollercoaster ride of regulatory compliance, but the payoff promises prosperity to those who can do it.
The International Cannabis Business Conference (ICBC), the longest continuously running international cannabis conference, will return to San Francisco this February 17th, and will feature numerous speakers and sessions addressing issues surrounding cannabis start-ups, trade in the US and foreign markets, and numerous other issues addressing the cannabis industry. This is a must-attend event that you won’t want to miss if you want to be part of the country’s next big thing.