Many cannabis entrepreneurs considering where to start their business will need to consider these 5 points;
- The climate — outdoor growing will be the future of the industry. Artificial lighting is costly and consumers desire a natural product. Different plants grow in different climates so its important to study landrace strains and identify what genetics can be created within your environment. These strains can live anywhere up to 50° latitude North and South, which is a pretty wide belt around the equator.
- Labour — we are not just talking about those working the farms — though this does have a big impact on the cost of production. The sometimes overlooked aspect is in finding the best; marketers, salesman, logistic experts, bud tenders etc. Businesses are built on the quality of their team. Highly skilled staff have historically migrated to the cities that their skills are required.
- Regulation — this is such an important point when making your decision on where to launch your business. The difficulty is that its ever changing. The countries that have been fast to change regulation need to keep up. New countries need to be fast and more open with less red tape. Historically, this is how industry has established itself and how areas like Silicon Valley have pushed ahead of its competiton.
- Capital market — there are many ways to go about launching and scaling a business. Venture capital has seen companies in the tech sector accelerate at a pace previously un-heard of. Will this model work in cannabis? Where will this capital be centred? Will there be a new form of capital such as ICO/STO? In the UK (due to the coronavirus pandemic) the government have launched an investment fund that will match any other investor like-for-like — will this extend to cannabis businesses?
- Addressable market — the final point is that you need customers. In some cases you will need as many customers as you can and in other situations you will need the right customers. Are you selling on price or is your product suitable to a higher income customer. You need to understand whether the market you are launching into has a desire for your product and the means to acquire it.
In past articles I highlighted 7 of the best places to launch your cannabis business. This series covered; Israel, Lesotho, Canada, Colorado, UK, Jamaica and California.
We believe that there will be a ‘silicon valley’ style hub that leads this new industry. Countries and states that are keen to benefit from this burgeoning industry (with all of the potential benefits that will come with it) need to consider the points above. This is a once in a lifetime opportunity for them to establish a strong industry that will benefit all of their citizens!
