Ever since California legalized medicinal marijuana in 1996, the industry has been reborn. Today, two-thirds of U.S. states have legalized it for medical use, and 10 states plus D.C. allow you to walk into any licensed dispensary and purchase an ounce of weed without a medical marijuana card (2.5 ounces in Maine).
The rules that govern the development of the cannabis industry are still very much in the preliminary stage despite rapid growth. As is the case with weed legality itself, cannabis rules relating to cultivation, sale, and compliance, vary according to the state. As a result, state and local governments continue to create regulations on a trial and error basis.
This is where CannaTech comes in. With better cannabis technology, it will become easier to combat the many challenges that surround legislation, financial accounting, genetic testing, seed-to-sale tracking, point-of-sale processing, and much more. Without further ado, let’s look at five CannaTech companies that could lead the way forward in 2019.
Before I begin, however, I would like to report that CannaTech received a blow earlier in 2019. Each year, the tech industry gathers in Las Vegas for the Consumer Electronics Show (CES). It is the world’s largest tech show, but in 2019, no CannaTech companies were allowed entry.
Several business owners were angry when they found out that their exhibits were not allowed on the showroom floor. Bizarrely, despite weed becoming legal for recreational use in Nevada on January 1, 2017, the organizers of CES were ‘uncomfortable’ with cannabis. Even though the legal weed industry could be worth $75 billion by 2030, it continues to be shunned in certain quarters.
1 – PAX Labs
PAX was one of the companies frozen out at CES 2019. It was a huge missed opportunity for the vaporizer producer because CES is the kind of event where the exposure could transform a small startup into a global behemoth. PAX was founded by Adam Bowen and James Monsees, the duo also responsible for forming Juul. Incidentally, investors recently valued Juul at $15 billion.
At present, PAX Labs creates vaporizers designed for use with cannabis flower, along with a pen and pod system for cannabis oil. Last year, PAX hired a vastly experienced executive, Bharat Vasan, as its chief executive. One of PAX’s biggest assets is the fact it doesn’t produce or touch cannabis. As a result, it is eligible for listing on the New York Stock Exchange and may end up there sooner rather than later.
In October 2018, PAX announced that it raised $20 million from investors. At the beginning of 2019, Vasan said that PAX’s rapid growth meant that an additional round of funding is on the cards in 2019, ahead of a possible Initial Public Offering (IPO).
2 – Harborside
This firm is actually called FLRish IP LLC but is commonly referred to as ‘Harborside.’ It is the longest running cannabis operator in California and gets its nickname due to the large chain of retail weed shops it runs in San Francisco’s Bay Area. Andrew Berman, the company’s CEO, is looking to raise approximately $50 million via a private placement and hopes to get the company listed on the CSE, the marijuana stock database, by the end of March 2019.
When the company was first founded (by Steve DeAngelo and others), it was a non-profit medical marijuana dispensary. However, since Berman became CEO, Harborside has moved into the ‘for profit’ sector and has implemented a capital markets strategy. The firm plans to use the new capital to expand its existing retail locations, along with its cultivation facilities near Salinas in California.
3 – KlickTrack
According to the founders of KlickTrack, a recently formed company, “retail will never be the same.” The firm’s story begins at the end of 2017 when Steven Kessler and Brendan Hill, a pair of shop owners, were unable to find a way to streamline their operations. When the duo were owners of a retail marijuana boutique called Paper and Leaf, they had serious problems in finding software solutions.
Their frustration ultimately resulted in the formation of KlickTrack, marketed as a ‘synchronized ecosystem’ which can help cannabis retailers save time and cash. According to Kessler, their company eliminates compliance worries from retailers and enables them to focus on running a business.
KlickTrack lets you view and manage your inventory and offer your list of products according to the brand. It will speed up workflow, decrease inventory redundancies, and allow retailers to keep their level of customer service high on busy days. Retailers benefit from sales metric insights so they can analyze historic product and customer data. There is even a ‘compliance translator’ that ties straight into your state’s regulatory system, so there is basically no risk of an infraction.
4 – Springbig
Marijuana is in hot demand right now, but there is an incredible number of businesses. For example, California has almost 11,000 active cannabis-selling licenses. As a result of this level of competition, it is imperative that your dispensary stands out. However, dispensaries are unable to advertise traditionally, and frankly, weed users probably won’t pay much attention to ‘normal’ ads!
Fortunately, you can rely on Springbig to offer superior marketing technology and strategy to help you reach your target audience. With Springbig, you can use loyalty programs to reach customers. By earning ‘points,’ your customers will be more likely to return to your store. The data provided by Springbig boosts your sales and helps you determine what works best with your customer base.
According to the company, dispensaries that use it benefit from a 25% increase in sales. You can even use Springbig to find out your customers’ preferences and send targeted marketing messages. With increased visits to your website, more customer spending, and significantly better customer retention, using Springbig could be the best decision your dispensary makes this year. It is a company on the rise, and we expect big things from it in 2019.
5 – Seed
There is a LOT of information about cannabis online, but not all of it is trustworthy. Likewise, when a new customer walks into a dispensary, they are usually overwhelmed by the different strains, effects, THC content, etc. As a result, a dispensary worker can spend a significant amount of time trying to explain the differences between strains and the benefits of each.
With Seed, you can educate your customers in-store without using up staff time. It features interactive touch screens which answer almost all of their questions. According to the company, it will turn your visitors into experts who then become more likely to make a purchase.
Each unit is integrated with the inventory of a dispensary so once a customer uses the touch screen to make a purchasing decision based on the information they read; Seed will tell the person that the dispensary has it in stock. Although Seed is focused on education, the touchscreens will undoubtedly become an excellent sales aid.
Final Thoughts on CannaTech
As the marijuana industry grows, it is inevitable that CannaTech will grow with it. All of the companies mentioned above are finding new ways to move the industry forward. With more information and a greater number of user-friendly features, it is inevitable that more consumers will be drawn towards the herb.