Benzinga recently had the chance to discuss investments
and investors in the cannabis industry with Micah Tapman, managing director and partner of CanopyBoulder, a
seed-stage investment program and mentorship-driven business accelerator for startups
in the cannabis industry.
In addition to the more cut and dry on investing, Tapman shared advice for investors and entrepreneurs looking at the legal weed
space.
Of particular interest was which sub-sectors in the industry offer the most space for growth.
Scalable Opportunities
For the venture capitalist, the best opportunities right now are in the retail and operations technology sub-sector; things like
resource planning systems or modern, in-store advertising platforms. “There has been a lot of movement around this area for years
without much real traction because, quite simply, traditional retailers have other ways of doing things,” he explained.
Nonetheless, the cannabis industry, being nascent and all, does not have cemented procedures. So, space to innovate and
incorporate diverse technologies into the retail and operations processes is pretty ample.
Other interesting areas are that of consumption technologies and data & analytics, Tapman continued. “This industry is desperate
for that [data and analytics], so that’s really cool.” Finally, there’s supply-chain-related fields, which he believes are ripe for
disruption.
“Actually, that applies to most industries today,” he added, making reference to the recent Amazon.com, Inc.
(NASDAQ: AMZN) and Whole Foods Market, Inc.
(NASDAQ: WFM) discussion. If Amazon uses robots to manage its
warehouses, why don’t grocery stores recur to this technology to manage their shelf space?
“That is the sort of technology stuff that we can see in cannabis: using robots to help move product around or to do packaging.
And, those are great venture capital investments because they scale well beyond cannabis,” Tapman told Benzinga. “That is one of my
core investment theses: every investment that we make should go not only towards the cannabis industry, but also have applicability
outside of cannabis as well.”
Other Success Tips
Tapman, a mentor for startups, often tells his mentees that venture capitalism is all about authentic relationships. So, we
asked him what was his recommendation for entrepreneurs in the cannabis industry — beyond pitching their ideas at
CanopyBoulder.
“I think that the relationship building process, and being a good entrepreneur, a good business person and a
good venture capitalist is a long process,” he answered. “I think building a relation starts with honesty and transparency.”
Venture capitalist is a high-risk endeavor, he warned. So, “talking about the bad stuff is really important, and it really helps
to build trust ... and shows self-awareness and a recognition that there is a lot of work to be done.” On the other hand,
entrepreneurs who believe their businesses or ideas don’t have any trouble are — let’s say — naïve, in Tapman’s eyes.
“An entrepreneur saying, ‘my business has no problems’ is like an athlete saying, ‘I’m the best in the world and nobody will
ever compete with me.’ But, wait a year, and we’ll see the new guy come along and he’ll be just as good as you,” he continued.
“That’s the way the world works: you overcome hardships. It’s not about avoiding hardships all the time; it’s not about pretending
they don’t exist.”
More From Benzinga:
Beyond The Marijuana Index: MJIC CEO
Talks Company's Desire To Be 'Amazon Of Weed'
Marijuana Industry
Insiders On Why The IRS Is Targeting Them — And How To Avoid Business Disruption
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Image Credit: Javier Hasse
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