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HOT TOPIC Marijuana entrepreneurship; industry discussion

Ninjakid

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Come to BC, and you'll see what high demand in an industry looks like :D
 

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jkkkjkhk

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Really?

Why on earth would they increase the credit card sales arbitrarily when you pay as a percentage of the sale? It's usually against their merchant agreement to do that as well.

Weird. I've never seen this.
Not a clue as to why. lol There's dozen here in the PHX Valley and of the 5 I know they all do this.
 

miked_d

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One thing I've seen people getting into are the extracts. Specifically stuff made with Butane. From my understanding you can make very similar products with CO2. I know for a fact they already do this with hops for beer (co2 hop extracts using basically the same method - hops are very closely related to cannabis). Personally I think if someone came in, advertised similar extract products made with harmless CO2 instead of a combustible and harmful gas as the solvent, and and sold it to the retail chains, you'd make a killing.
I have some experience in the industry. Butane extraction is dangerous and produces a lower quality product than Co2. I am pretty sure producing with butane is illegal in California although sales are not (yes, I know that makes no sense).

I considered getting into it, but did not have the funds. Additionally LA County laws were a mess (still are).
 

M'egga Wolf

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Graduated this past year with my Chemical Engineering degree, I'm catching a lot of slack for diving into this industry. Currently putting together a proposal for investors, very exciting!
 

AgainstAllOdds

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More glamour = more competition = harder to make money

However, it is a new industry. So lots of upside.

Personally though, I'd prefer to compete in industries where the competition is predictable and sucks.
 

GoodShakers

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More glamour = more competition = harder to make money

However, it is a new industry. So lots of upside.

Personally though, I'd prefer to compete in industries where the competition is predictable and sucks.
I have always wondered why more people don't follow this. Getting into the hottest markets, whether it is Marijuana, SaaS, or whatever else essentially guarantees that you're competing against the smartest people around with unknown market variability.

I won't throw too many rocks from my glass house (currently made of web design and FBA), but my end game is doing HVAC for sea freighters or something.
 

Shades

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I have always wondered why more people don't follow this. Getting into the hottest markets, whether it is Marijuana, SaaS, or whatever else essentially guarantees that you're competing against the smartest people around with unknown market variability.

I won't throw too many rocks from my glass house (currently made of web design and FBA), but my end game is doing HVAC for sea freighters or something.

All those dot com era millionaires and billionaires are happy they didn't listen to this kind of advice. And yes, Marijuana is going to be about that big in the coming years.
 

GoodShakers

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All those dot com era millionaires and billionaires are happy they didn't listen to this kind of advice. And yes, Marijuana is going to be about that big in the coming years.
If you want to talk about outliers, I could easily counter with the people who went bankrupt or committed suicide after the dot-com crash, but what's the point of that?

The point I'm making is that there are a bunch of old industries out there that are potentially easier to succeed in than the aforementioned "hot" markets. Obviously, you can succeed in any market.

Also, I'm not sure I see how the marijuana market will come close to the $3.5 trillion (and growing) worldwide annual spend on IT.
 

M'egga Wolf

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I have always wondered why more people don't follow this. Getting into the hottest markets, whether it is Marijuana, SaaS, or whatever else essentially guarantees that you're competing against the smartest people around with unknown market variability.


My initial response is a Slowlane answer: it will allow me to be one of the few with a degree in Chemical Engineering with X amount of years experience in the Cannabis Industry.

Fastlane answer: Ima let the vets handle that while I digest.
 

amp0193

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Shades

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If you want to talk about outliers, I could easily counter with the people who went bankrupt or committed suicide after the dot-com crash, but what's the point of that?

The point I'm making is that there are a bunch of old industries out there that are potentially easier to succeed in than the aforementioned "hot" markets. Obviously, you can succeed in any market.

Also, I'm not sure I see how the marijuana market will come close to the $3.5 trillion (and growing) worldwide annual spend on IT.

The real money is in HVAC
 

Shades

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My initial response is a Slowlane answer: it will allow me to be one of the few with a degree in Chemical Engineering with X amount of years experience in the Cannabis Industry.

Fastlane answer: Ima let the vets handle that while I digest.

Do your thing. Never listen to the people who tell you to stay away from markets with competition. That is dumb advice that comes from Youtube "guru" videos made mostly by people who haven't done anything.
 

GoodShakers

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The real money is in HVAC
By trying to mock me instead of responding to my comment, you're basically showing that you have nothing intelligent to share. I actually used that example because in the town I live in, there's a guy who owns a Marine & Offshore HVAC company worth mid-nine figures.

Let's let this go back to being an industry discussion.
 

Shades

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By trying to mock me instead of responding to my comment, you're basically showing that you have nothing intelligent to share. I actually used that example because in the town I live in, there's a guy who owns a Marine & Offshore HVAC company worth mid-nine figures.

Let's let this go back to being an industry discussion.
Im far from a intellectual. I simply found it funny that someone who wants to create himself a job in HVAC thinks someone shouldnt be trying to find their path in the countries next gold rush industry. But thats kind of the generation we are in. Competition = hard = no thanks.
 

AgainstAllOdds

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Let's let this go back to being an industry discussion.
This.

Apologies for my comment on how it's easier to make money in a less glamorous industry.

Obviously someone's going to make money in cannabis - it's just likely harder than choosing another emerging market.
 

HighestVantage

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I am about to start working my third year in California in the industry. There is obviously an emerging billion dollar market here. The question I have is how much can one really make being a producer? I don't know. I can see a lot of competition driving the price down in a major way. Before legalization product would cross borders and naturally experienced an inflated black market price.
Like many of you said, with all the hoops you need to jump through it has gotten very capital intensive. So the challenge is to raise money to actually get into the game.
Otherwise, there are the fast lane options to start building. Or if you're in the position to sell shovels you could make boat loads.
All this knowledge and these skills will be valuable increasingly nationally as more states open up their economies... (if it's happening why not tax it directly) and will be transferable into other Huge emerging industries. Say... indoor farming of fresh veggies. I hear people are already making big money doing that in certain locations.

I'd like to know what people think are some Fastlane perspectives on harnessing this industry.
Selling shovels are going to be big for a long time still in the right states, and if you could move with the demand you could probably retire off of it.
Getting over the wall to be part of the larger production/distribution of the product is also going to be big but there are big obstacles.
I see lots of opportunity for business services for dispensaries. There has got to be a solution to the cash problem these places are facing. Maybe placing Bitcoin conversion machines in dispensaries and installing a Bitcoin payment system in stores? Thoughts?
 

458

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Best bet in this industry is to design or redesign tools that producers use/need that can be patented. Weed is a commodity, you're at the mercy of a price setting market which has a tendency to go lower.
 

miked_d

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Anyone know if bitcoin for payments has been adopted at all in the Cannabis related market?
Only on the darknet markets. In real life, cash is easier for customer.
 

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RahKnee

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Any thoughts on how Sessions as AG might affect this industry? I've got my finger on the trigger to fund a service project, but I don't want my employees or myself getting arrested by the DEA and charged with trafficking.
 

Scot

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The biggest problem for this market is obtaining licensure. Here in Florida each county is trying to put a moratorium on medial dispensaries.

For most aspects in this industry, you'll need to obtain a very costly license from the govt. These licenses will be limited in their number and therefore extremely costly.

If you're going to make money in this business it won't be through the obvious grower or dispensary business model, but in the ancillary industries. Remember, gold rush, sell shovels.
 

MidwestLandlord

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Best bet in this industry is to design or redesign tools that producers use/need that can be patented. Weed is a commodity, you're at the mercy of a price setting market which has a tendency to go lower.
If you're going to make money in this business it won't be through the obvious grower or dispensary business model, but in the ancillary industries. Remember, gold rush, sell shovels.
Yep.

I sell a commoditized product (not weed, although I am somewhat in that space as well), and really the only way to make money is to sell to the people selling the commodity, and not sell the commodity itself.

With a commodity, retailers will come and go as the race to the bottom for pricing pushes out the weakest link. The chances of being a retailer, and not being on the list of "weakest links" is low, unless you have really deep pockets and don't mind losing tons of money while the market sorts itself out.

But if you sell to the retailers, sell to the businesses on the frontlines so to speak, they can come and go all they want, and you just keep selling to them. (just watch your account receivable's closely)

There's actually benefit to selling to retailers that have a high rate of bankruptcy and failure. That benefit is that turnover of new retailers drives sales.

Say there are 1000 retailers you can sell to. Once they bought everything they need, you're done selling. Bummer. But if half of them go out of business, and 500 new retailers pop up to take their place... that is 500 new retailers to sell to, even though the size of the market itself didn't change. If you sell equipment for instance, you could also get into the used equipment biz and keep the bankrupt retailers from competing with you there too...

So,

1) Sell the shovels
2) Buy back the used shovels and sell those too
3) Sell new and used shovels as gold miners come and go
 

AgainstAllOdds

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The-J

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The real money is likely in lobbying your state to pass laws that stifle competition and allow you to operate freely, whether as a retailer chain, a supplier, a supplier of tools, whatever.

If you can somehow nab yourself a government-enabled monopoly in this industry, then you're gold. You only need one state, too.
 

Shades

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Sean Spicer: Feds will step up marijuana law enforcement - CNNPolitics.com



1. Lots of upside.
2. Lots of competition.
3. Lots of risk (legality).

Starting a business in the cannabis industry has a low probability of success, high expected value if successful. To each his own, but I prefer industries where there's less variables to account for.
Nonsense from a guy who starts fires everyday. The opposite of what that job should be. I dont think he will be there much longer. Trump has said the opposite of that. Think this is more just Spicer inserting his own ideas into the answer, as usual.

Not an easy industry. Which is why it will be making a ton of millionaires over the next 5-10 years.
 

MonezMagnet

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Someone mentioned some time ago about an opportunity for cannabis business owners to accept payment other than cash.
Why don't you just use 3rd party payment services?
I mean our company helps business by charging a nominal fee so they can bypass any financial hurdles.
Just sayin
 

biophase

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Someone mentioned some time ago about an opportunity for cannabis business owners to accept payment other than cash.
Why don't you just use 3rd party payment services?
I mean our company helps business by charging a nominal fee so they can bypass any financial hurdles.
Just sayin
You can use high risk payment processors to accept payments.
 

Tom.V

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You can use high risk payment processors to accept payments.
Yup. I've been working on a prospect who manufactures his own CBD oil and hemp products. His issue was Paypal and Stripe cut him out which cut his sales in more than half for the past 3 months when he came to me. Immediately I was like guy, why aren't you just using a couple different high risk processors? Fees are a little higher, the process is a little more of a pain, but someone out there will always take your money.

The industry as a whole is a goldmine, it's just a shame that the major traffic sources make it difficult to get in front of your audience. But, that doesn't mean there isn't a plethora of different ways to get high quality traffic. Instagram influencers, related Facebook posts via comments, FB groups, banner ads, forums, Twitter comments, the list goes on. You could even go the route of printed flyers with discount codes in highly trafficked areas like subways, college campuses, etc. Take it a step further and start spamming windshields in health parks.
 

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