As a seasoned entrepreneur and teacher of entrepreneurship, I am so excited about transferring my classroom frameworks into a rapidly emerging marketplace—the Cannabis market. Cannabis is the scientific name for the marijuana plant, and its market has reached the tipping point. This is a wave that I couldn’t ignore. So, for the past several months, I’ve been investigating and researching
this market, and I’ve used my favorite tactics to shed light on this new, emerging opportunity.
So, here’s an early tour of my ideas and research.
I hope this helps you think through your own exploration of new markets.
Primary Research: Talking to "Insiders"
Insiders come in many different forms. Talk to people who:
- have been there/done that. I've had conversations with attorneys serving businesses in the space, CEOs of successful cannabis companies, master growers, cannabis chefs and more. Most of these people gained their experience in California. I learned that Cali is the grandmother of all cannabis business experience.
- have lived with or benefitted from the product. I was surprised to learn of the many "caretakers" involved with the industry. Half of the cannabis newbies that I met in my early networking were people looking for relief for a loved one's illness. This is a strong signal regarding the future market for medical marijuana.
- are in advocacy groups. I've met some people active in PhillyNORML. They are passionate crusaders seeking to overturn unjust laws and end cannabis prohibition. In these conversations, I learned a lot about how laws are formed and influenced. Next, I'm planning on checking out the work of the Keystone Cannabis Coalition and their pro-HEMP agenda.
- run training courses. I met the instructors from Cannabis Career Institute when they did their all-day training in Philadelphia. These insiders were happy to share their experience and helped me with introductions to other industry insiders.
- shape the legislation in your state and local community. I have yet to meet with legislators on this topic, but it is the logical next step. Getting to know your local officials and starting conversations to understand their concerns is also important if you plan to run a business in your neighborhood.
Secondary Research: Consume and Analyze Data
Seek out and read the best research reports you can find. While its early days in the cannabis industry, there are some emerging sources of research.
- Access Definitive Reports. While they are often pricey, these reports are a short-cut to deep dives on industry trends, costs, profitability, etc. Companies like Gartner Group, Forrester Research and Jupiter Research have been successful in selling their research to entrepreneurs and investors who want to quickly understand new markets. For the cannabis industry, the Marijuana Business Factbook 2014 (from MMJBusinessDaily.com) is the definitive source for insights into the industry. The report describes all of the major market niches in detail - built through surveys of early stage cannabis-related business owners. It also provides state-level grades for stability and opportunity. This information will help inform where to set up shop for entrepreneurs willing to travel to the action. At $200, this report is a bargain given the wealth of industry insight it provides. I've found answers to questions like: how much does it cost to open a dispensary? how long does a cultivation business take until it is profitable? how much money are marijuana businesses making? The Marijuana Business Factbook 2015 should be available in late March.
GreenWaveAdvisors.com offers an in-depth research package that will be updated on an ongoing basis. The site provides a nice executive summary of the industry for free. A third option, which I haven't reviewed yet, is ArcView's report on The State of Legal Marijuana.
- Watch Television. Television hasn’t missed the opportunity to get in on the Cannabis industry. CNN's Dr. Sanjay Gupta covered medical uses of cannabis in his well-researched cannabis documentaries. Pot Barons of Colorado on MSNBC is a six-part documentary that provides an in-depth look into a handful of Colorado Cannabis entrepreneurs navigating the wild waters of recreational legalization.
- Take a Training Course. It is another excellent source of secondary research. Oaksterdam University is one of the oldest educational firms in the business. They occasionally take their show on the road as they did this past year in Atlantic City for $1000 four day long cannabis industry seminar. I attended Cannabis Career Institute where a day long, $300 event gives a whirlwind tour of the history, current state of the industry, current laws in my state, different career opportunities, overview of cultivation practices, and an overview of edibles. A powerful side-benefit of attending this seminar is that alumni are invited to attend future sessions free of charge. Since these are potent networking opportunities, I've been going as often as I can. I've met some knowledgeable industry insiders through these courses.
Building your Business Story: Try on Different "What If?" Hats
Determine which aspects of the industry are the best match for your disposition, skills and resources.
- Start by examining your own strengths and weaknesses when evaulating new career opportunities. My favorite tool for this is the Sweet Spot analysis. Check out our timeless post on finding the sweet spot for a cannabis career. When I tried this for myself regarding the Cannabis industry - I determined that an advisor to new cannabis entrepreneurs might be good starting-place role for me.
- Create and progressively refine a value proposition and a go-to-market strategy. Building a 10 slide pitch deck allows helps to create a "bouncing ball" that you can test with your network.
- Take your pitch deck and test your offering. I like to call this process "bouncing your idea ball" and it is a great way to integrate feedback from knowledgeable people in service of strengthening your business idea.
- Test your brand. Have you brainstormed some business names? Researched domain names? While I caution against investing too much too early in your brand definition, it's never too early to start playing with different names. As part of that research, I've registered the domain names FrothyWave.com, GreenDirtConsulting.com, BigBudConsulting.com and GreenRushAdvisors.com. (We recommend the domain name service Namecheap.com - they're reasonably priced, don't try to up-sell you using multiple screens and have a Live Chat feature with nice customer service folks. ) I've tested the names with different audiences and used that very early feedback to help direct my brand definition.
Gut Check - Does this Path Have Heart?
One of my favorite quotes for entrepreneurship is from Carlos Castenada's book on the Teachings of Don Juan:
"Before you embark on any path ask the question: Does this path have a heart? If the answer is no, you will know it, and then you must choose another path. The trouble is nobody asks the question; and when a man finally realizes that he has taken a path without a heart, the path is ready to kill him. At that point very few men can stop to deliberate, and leave the path. A path without a heart is never enjoyable. You have to work hard even to take it. On the other hand, a path with heart is easy; it does not make you work at liking it.”
― Carlos Castaneda, The Teachings of Don Juan: A Yaqui Way of Knowledge
To me, existing marijuana prohibition is nothing short of a violation of our civil liberties. I believe that it's an extension of unjust laws that were founded in racial prejudice and propaganda. Today, we imprison a disproportionate number of American citizens in large part due to marijuana prohibition. Furthermore, medicinal and therapeutic properties of cannabis are being discovered regularly; often providing relief where none could be previously found. It's a plant - and it's a farce to think that the government can tell us how we can use nature. However, my position on this industry is a topic for another post.
As you consider possible new business ties with the cannabis industry, I recommend you first consult with your inner circle for guidance and feedback. It's important that you check in with those most important in your life. You can't control what your broader network will say, but you can find out where your family stands.
I checked in with family, close associates and friends ...and do you know what I found? It has been surprising how many people are ready for this change. Are you?
(Please leave your reactions and contributions in the comments section.)