​Five Cannabis Executives Give Their Thoughts on Client Acquisition

The legal cannabis industry is expected to hit over $7 billion in 2016, which is 25% higher than last year, and is on pace to reach $44 billion by 2020. The robust growth rate is even more impressive when considering that only four states with legalized recreational use and 25 states for medical use (Washington, DC has legalized both). There is also a number of other states expected to or in the process of putting legalization up for a vote in the near future.

All this suggests that the market opportunity for cannabis companies is expected to be blown wide open. But there’s still a significant amount of uncertainty with entrepreneurs and business leaders having to navigate through the uncharted waters on multiple fronts. Regulatory and banking issues aside, businesses still need to focus on getting customers through the door effectively. Fortunately, good business is still good business, and a lot of the principles that have proven successful in other industries–particularly consumer-oriented ones–still prove true in the cannabis space.

To get a better gauge on how cannabis companies are attracting customers and growing market share, we gathered the perspectives and advice from five executives operating on the frontlines of this major shift to see what’s working for them.

Aaron Herzberg, Partner at CalCann Holdings:
What They Do: CalCann invests in medical marijuana real estate opportunities in California.

“Unlike in other industries, the cannabis space has a self-regulating quality to it that ensures for the advancement of companies that promote best practices and deal with other industry occupants with a high degree of honesty and competence. As a result of this, bad players in the industry (while they may or may not be able to procure some measure of success for a time) inevitably fall out, especially as regulations such as MMRSA are implemented in the space. The best thing that a cannabis business can do for the sake of accruing clients, building revenues, or securing investments is to buckle down and deal with others in a straightforward fashion.”

Kyle Sherman, CEO of Flowhub:
What They Do: Flowhub provides a seed-to-sale platform for the cannabis industry and reports to CTS & METRC automatically.

“Based on my experience in and out of the cannabis industry, there’s no clear-cut way to get clients. There are some tried and true best practices for achieving success, which can be boiled down to a combination of hard work, patience, thoughtfulness, empathy, and time, but that’s perhaps true for most industries.

“What makes the cannabis industry different is that people seem to be in it, for the most part, due to a genuine desire to help others and legitimize the space. While there might be people with selfish motives in cannabis, the vast majority of people I’ve met in the sector are good-natured, hard-working and fun. With this kept in mind, building a business in the space is best done with a greater focus on people and relationships than what might be required in other traditional sectors.”

Pamela Johnston, Director at Electrum Partners:
What They Do: Electrum Partners provides advisory and consulting services specializing in the legal cannabis industry in the United States.

“The key to getting clients in the cannabis industry isn’t about pitching, so much as it’s about building relationships and trust around shared vision. Engaging in meaningful discussions at a high level – working with experienced and collaborative professionals with a track record of success – and developing an authentic culture beyond tactical approaches to business, are all part of realizing success in the cannabis industry. At Electrum, we develop ideas and execute plans that serve client goals as well as the industry at large, and that attracts business to us versus the other way around.”

Michael Bologna, CEO at Green Lion Partners
What They Do: Green Lion Partners is a consulting and entrepreneurial firm in the regulated cannabis industry.

“With all of the burgeoning excitement surrounding the cannabis industry, there is no shortage of new companies being formed. With that comes intense competition for clients, customers, and a need to differentiate oneself from within the masses. The most efficient way to do this has been availability: attendance and networking at the major industry events, consistently seeking out partnerships with the established leaders in the marketplace, and a constant drive to educate the general public and specifically, the potential customer base being targeted.”

Brett Roper, COO and Founder, Medicine Man Technologies:
What They Do: Medicine Man Technologies (MDCL) provides cannabis consulting services and solution management for those seeking to operate in the legal cannabis industry.

“While it is certainly true that cannabis businesses face these challenges they also face others; the most pressing of which is federal law that is now more often that not in conflict with state laws and regulations addressing cannabis either medically or from an adult use perspective. Underpinned to this substantial industry gauntlet comes the plethora of those wanting both access to the space and those having access to the space from a business development as well as investment perspective.

“Due diligence should be every investor’s watch word to possible entry into the space as they consider the ever present clamor for capital. Take advantage of like-minded industry investor groups such as ArcView and others to ensure you are getting the perspective you need prior to writing a check. As someone once told me … experience is the toughest teacher as it generally gives the tests long before any lessons.”

Source: equities.com