Entrepreneurs traveled from across the U.S to attend a small, but sold-out startup summit at San Antonio’s Cellars at the Pearl Saturday. What was different about this startup program was its objective—helping founders accelerate their cannabis startups.
Rick Martinez, founder and CEO of the Wellness Project Rx, a cannabis business coaching company, launched a San Antonio-based cannabis entrepreneur accelerator program Wednesday. The Green Seed Cannabis Accelerator does not require a share in equity from founders. Instead, it will operate on a fee structure over the course of its 12-month program. Cannabis entrepreneurs who already have a business selling cannabis-related products, those supporting the cannabis industry with services such as marketing, or doctors who are proponents of using medical marijuana and cannabis-related products for their patients are eligible to apply.
Although marijuana is not legally available for sale in Texas, Martinez recognized the growing need for services and programs to support the explosion in cannabis entrepreneurship. Cannabis entrepreneurs are entering the startup world by the thousands. The Angel List alone has over 1,000 cannabis startups, and PC Magazine published a list of the top 21 tech cannabis startups to watch in 2018. Entrepreneurs are scrambling to gain a foothold as the fledgling cannabis industry is fragmented—no single company has a dominant market share in any state.
The legalization of marijuana has spawned an entire industry across the U.S. despite the lack of product dispensaries across the country. In 2018, Forbes reported $1.5 billion in sales to date from the 14 states offering the legal medical use of marijuana. Add in sales from legal recreational use, and the projected numbers skyrocket to $8 to $10 billion expected for 2018 and an estimated $22 billion by 2020.
Those billions are not just coming from marijuana sales. Cannabis-related sales of legal products with cannabidiol, or CBD, are on the rise. CBD is a chemical compound in marijuana that is reported to have beneficial medical uses such as relieving pain and anxiety made by extracting CBD from the cannabis plant, then diluted with an oil like coconut or hemp seed oil. CBD is not psychoactive and can be found in legally available products as varied as teas or cookies to non-edible products such as massage oils or creams.
The continued growth in the mature medical and recreational markets along with the emergence of related cannabis and hemp product lines are behind the job growth in the cannabis industry. By 2020 there could be as many as 340,000 new full-time jobs in cannabis-related businesses, at an estimated increase of 21 percent per year, according to the Marijuana Business Daily forecast. In contrast, the entire U.S.healthcare industry is expected to grow 2 percent annually.
Founder Ben Pasquel and employee Janessa Chavez traveled to the Green Seed Cannabis Business summit Saturday from Los Angeles because Pasquel recently launched Hemp Gains, a startup specializing in CBD products. Pasquel wanted to “learn everything I can about the cannabis industry,” while Chavez was looking to sharpen her entrepreneurial skills working at the CBD startup. Summit attendee Sara Barrera, who runs operations for the Killeen-based Citizen CBD, also said she traveled to “learn the latest in the rapidly changing cannabis industry.”
A veteran U.S. Army nurse, professional business coach for startups since 2012, and one of the mentors at RealCo’s long-term accelerator, Martinez decided to get into cannabis entrepreneurship to help a friend who had served two tours in Iraq.
“My buddy is a Marine who is dealing with PSTD [post-traumatic stress disorder],” Martinez said. “He wanted to start a CBD oil business to help veterans with PTSD. I realized the untapped potential of the cannabis industry and decided I wanted to help others make an impact in cannabis.”
Martinez is a Gazelle-trained coach who has also trained with entrepreneurial experts Tony Robbins and Jack Canfield. Having worked with different types of startups, including tech companies, as well as with companies ready to scale, Martinez recognizes principles still apply for a cannabis business proposition—it must be based on a solid idea.
“Where people perform is when they connect with what drives them,” Martinez said. “It’s where you have the best possible chance for a successful outcome in the cannabis vertical.”
There are currently eight cannabis incubators and accelerators in the U.S. such as the Boulder-based Canopy founded in 2016 that offers a four-month program. They provide a capital injection of at most $70,000 in return for a 6 to 9.5 percent equity stake. The Greenhouse Ventures accelerator takes an average of 5 percent equity in each venture participating in its ten-week curriculum. However, there is no long-term cannabis accelerator that accommodates remote individualized coaching for a flat fee instead of requiring an equity stake in the startup.
“There was no place for cannabis entrepreneurs to go get startup support, so this accelerator was launched out of demand,” Martinez said. “Our mission is to help 1,000 cannabis entrepreneurs achieve success by 2025.”
Featured image is of cannabis accelerator entrepreneurs participating in the San Antonio Green Seed Cannabis Business Summit. Photo credit: Marcus Macias Photos.