It’s a great time to be a startup in the cannabis industry.
A report from Grand View Research, Inc. suggests the global cannabis market could grow to as much as $66.3 billion by 2025. Meanwhile, the total cannabinoid market in the U.S. (which includes hemp-derived CBD as well as cannabis) is expected to reach around $44 billion by 2024.
Those numbers help explain why so many entrepreneurs are scrambling for a piece of the cannabis pie. But they’re rarely doing it on their own. Instead, cannabis companies often seek financial support from investors, incubators, and accelerators — to the tune of an estimated $14 billion in 2018 alone.
Why do so many cannabis companies seek funding?
For starters, the cannabis industry is capital-intensive — meaning it’s tough to get off the ground without the financial means to access technological resources, rent or own agricultural land or retail spaces, comply with regulations, and so on. And because many banks are still hesitant to provide loans or banking services to companies in the cannabis space, capital resources can be extra-hard to come by.
That’s where cannabis incubators and accelerators come in.
These programs provide funding, mentorship, and networking opportunities (among possible other benefits) to help startups get up and running with a clear path toward growth. As a general rule, incubators target early-stage companies, while accelerators tend to support startups that are already generating revenue but need some assistance in order to scale.
Would that kind of support help you grow your cannabis startup? Then consider any of these top startup incubators for cannabis businesses.
The Top 10 Startup Incubators for Cannabis Businesses
- The Cannabis Startup Business Incubator
- Canopy Boulder
- Gateway
- Greenhouse Ventures
- Hood Incubator
- The Initiative
- Leaf Forward
- Marijuana Accelerator
- Momentum (from Eaze)
- Redfund Capital
1. The Cannabis Startup Business Incubator
The name says it all: The Cannabis Startup Business Incubator is focused on leveling up startups in the cannabis space with an industry-specific incubator program.
The program is the brainchild of KC Stark, a well-known name in the cannabis space who’s operated a number of medical and recreational cannabis operations in multiple states. (He’s also been dubbed “The Steve Jobs of Weed.”)
The incubator has been around for over 10 years and has helped launch more than 100 operations across the United States, including companies that focus on medical cannabis, recreational cannabis, and the hemp sector.
The mentor-based program provides expert coaching, access to tools and resources, and networking opportunities for qualifying companies. In the process, it seeks to support the growth and development of local companies with backing from a team of nationally recognized experts.
After completing the program, alumni get access to exclusive resources, including online masterminds. Program participants and alumni can also avail themselves of the extensive educational resources on the incubator’s site.
The Application Process
The organization doesn’t share much info about the application process on its website, so interested startups will fare best by reaching out directly.
2. Canopy Boulder
Canopy Boulder operates alongside Canopy San Diego, both of which are strategic partners with the Arcview Group — which defines itself as “the first and largest group of high net worth cannabis investors.”
Both Canopy brands offer accelerator programs for cannabis entrepreneurs. Since 2014, Canopy Boulder has launched 100 companies and made over 120 investments.
Canopy Boulder’s venture fund draws investors who are interested in supporting seed-stage ancillary cannabis startups. Not surprisingly, the accelerator program also focuses on startups in ancillary cannabis markets. (This means the program is interested in hemp/CBD products and services and does not invest in THC-related products or services, such as cultivation and retail.)
The accelerator program accepts one cohort per year for a 13-week, in-person program in Boulder, CO.
Here’s how it works: Participants receive a $20,000 investment upon acceptance into the program (in exchange for between 6 and 9.5% common equity), and an additional $100,000 is available in convertible note (with a $2.5 million valuation cap). Program participants enjoy access to a network of more than 200 advisors, mentors, and industry leaders as well as over 1,300 investors. The mentorship-based accelerator guides participants in refining their business models, developing prototypes, and initiating fundraising efforts. At the end of the program, participants pitch to investors.
The Application Process
Applications for the program are closed until fall 2020, and the application is not available at the time of writing. You can fill out a form here to be notified when the next application goes live.
3. Gateway
Gateway offers a full-immersion business accelerator and seed investment program in the San Francisco Bay Area — the heart of startup innovation across a wide range of industries, including cannabis.
Twice a year, the cannabis-specific accelerator selects 10 lucky companies to receive $50,000 each (for 5% equity) and partake in an immersive mentorship experience. That immersion happens in Oakland, CA, where the chosen companies work out of Gateway’s co-working space for four months.
During the program, startups benefit from close mentorship while developing a product demo. At the end of the program, startups will present their demos to an investor panel.
Alumni become part of the Gateway Network, a network of cannabis-specific entrepreneurs, startups, and investors. So they continue to benefit from connections even after leaving the program.
Those startups that choose to remain in the Bay Area can also take advantage of Gateway Works, a co-working space that’s designed exclusively for entrepreneurs working in the cannabis industry.
Even if alums don’t stay in the area, they can benefit from Gateway’s extensive digital resources, including a podcast and blog that tackle a wide range of topics related to succeeding as a company in the cannabis space.
The Application Process
What does it take to get accepted into the Gateway accelerator program? It all starts with an application, for which you’ll need to provide (among other basic info):
- A description of your company
- A link to a company website
- A 1-sentence company pitch
- A 4-minute, continuous-shot pitch video (a 3-minute pitch plus 1 minute about why you’re applying to the program)
- A description of what makes you qualified to run your business
- A description of the company’s ability to scale
- A link to a pitch deck
After the application process is complete, those entrepreneurs who are being considered will take a test and then interview prior to the final selection process.
4. Greenhouse Ventures
Greenhouse Ventures claims to be “the first innovation accelerator and commercialization incubator for cannabis and hemp ventures in the world.”
Translation? They’ve been around the cannabis incubation scene for a while.
The investment and venture development firm provides an early-stage innovation accelerator for startups in both the cannabis and hemp industries. The company seeks to invest in companies for between $1 and $5 million that can eventually be sold for anywhere from $25 to $250 million. The company’s guiding principles include Diversity, Business Model Scalability, Capital Efficiency, and Core Community Contributions.
In February and September of each year, Greenhouse Ventures accepts up to 10 companies for its 10-week “accelerator semester.” This mentor-based “boot camp” enables cannabis and hemp business owners to learn from industry experts, entrepreneurs, and investors about best practices pertaining to business development, capital formation, and more.
Over the course of the 10 weeks, companies prep for “Demo Day,” a culminating event during which startups pitch their business to potential advisors, customers, investors, and partners.
The Application Process
Greenhouse Ventures accepts one application per company. Among other information, the application requires:
- A clear description of the business
- A thorough description of the assets already in place
- An Executive Summary
- A pitch deck and/or a 5-minute pitch video
Qualifying applications will be selected for an interview before the final cohort is chosen. Startups that aren’t yet equipped with the resources required for the application are encouraged to enroll in Greenhouse Ventures’ Cannabis Due Diligence Crash Course to become better prepared for an accelerator.
5. Hood Incubator
Born in 2017, the Hood Incubator is an award-winning cannabis incubator that’s doing unique and important work in the industry.
It’s a nonprofit organization with a progressive focus: to uplift communities adversely impacted by the War on Drugs. To that end, it’s committed to “building economic and political power for Black and Brown communities” by increasing these communities’ participation in the legal cannabis industry. Hood describes itself as the “first people of color focused cannabis accelerator in the nation.”
The need for this work is clear. Per the ACLU, Black people are nearly four times more likely to be arrested for marijuana possession compared to white people. Meanwhile, Black people comprise less than 5% of founders and business owners in the cannabis industry.
To improve industry access and opportunity for marginalized communities, the organization is focused on three core areas: community organizing, policy advocacy, and economic development. This work includes a cannabis industry apprenticeship program; a robust network to provide industry access, resources, and support; and efforts to develop the nation’s first Cannabis Equity Program.
Hood Incubator has also created an accelerator program expressly for Black and Brown entrepreneurs in the cannabis industry. That accelerator offers business education, technical assistance, mentorship, and access to industry resources.
To date, the Hood Incubator’s Cannabis Business Accelerator Program has grown its membership to more than 2,000 people across the U.S., and the accelerator has directly supported 10 entrepreneurs. The program is currently centered in Oakland but plans to expand across the country.
The Application Process
The Hood Incubator’s accelerator program runs once per year. Applications are currently closed, and the website doesn’t share info about the application process at the time of writing. Interested companies are advised to check back in early 2020 for application updates.
6. The Initiative
The Initiative is a cannabis industry incubator program that’s partnered with big industry names including Miller Nash Graham & Dunn, Hotbox Farms, R2C Group, and Sentia Wellness, as well as dozens of educators and mentors from all over the U.S.
Amidst a sea of cannabis incubators, the Initiative stands out for several reasons. Not least among them? It’s focused exclusively on cannabis businesses with at least one woman founder.
The Initiative provides a variety of resources for women entrepreneurs in the cannabis space, including networking and educational events, special “office hours” where founders can come for strategic advice and growth planning, executive and leadership training programs, and an accelerator program.
That accelerator program provides tools, education, mentoring, fundraising support, and networking for women-founded, post-revenue cannabis businesses with a consumer goods focus and aggressive growth strategies.
Participants spend three months working in-house in Portland, OR while attending classes, meetings, and networking events. The program has several areas of focus, including strategic growth, pitch deck creation, executive training, team building, financial education, and marketing education.
At the program’s end, businesses pitch to a group of investors who are committed to funding women-founded businesses. Alumni receive ongoing feedback and mentorship.
The Application Process
Applicants for the program need to meet several criteria, including:
- An interest in aggressive national growth
- Readiness for raising money
- A product that’s already in production in a legal state
Applications are currently closed, and the full application is not available at the time of writing.
7. Leaf Forward
Located in Canada, Leaf Forward claims to be that country’s “first and leading cannabis business accelerator.”
The program seeks to advance early-stage cannabis companies through a number of pathways, including mentorship, access to licensed space, and connection to capital and industry networks.
To that end, Leaf Forward holds a variety of education meetups across Canada, offers 4-day intensive training bootcamps for cannabis entrepreneurs, and has developed a three-month accelerator program for startups in the cannabis industry.
That program, the Leaf Forward business accelerator program, has worked with more than 40 cannabis startups since its launch in 2017. It focuses on early-stage companies that are solving an existing problem in the cannabis value chain, have a clear path to market, and have a defensible concept. It also prioritizes companies with more than one founder, demonstrated subject matter expertise, existing cannabis industry experience, and existing startup experience.
Here’s how the accelerator works: The program invests up to $75,000 ($52,5000 in cash and $22,500 in services, in exchange for 10% equity) in promising early-stage companies. The 16-week accelerator takes place in Toronto, though participants are not required to be on-site for the entire program. Startups enjoy mentorship from more than 60 experts as well as access to members of the accelerator’s industry-wide network.
At the end of the program, participants have a chance to pitch to investors and possibly gain more funding.
The Application Process
To be considered for the Leaf Forward business accelerator program, applicants must meet the focus outlined above. They’ll also need to submit an application that addresses in-depth questions about the following information (and then some):
- What problem the company solves
- What the company does
- The company’s unique positioning
- The founders’ relationship to each other
- A video introduction of the founders
- The company’s progress thus far
- The company’s financial opportunities and current stats
- The founders’ understanding of the industry
- Competitors
- Customers
- The company’s structure
-
Equity
Applications are accepted on a rolling basis. After submitting an application, applicants might be contacted with follow-up questions. Applicants who move forward will participate in in-person or video interviews. If selected, applicants work with the accelerator’s Investment Committee to select a start date and sign on to terms.
8. Marijuana Accelerator
The aptly named Marijuana Accelerator is a division of Player’s Network, Inc., a publicly traded diversified holding company that’s focused on marijuana and media.
The organization is committed to developing partnerships in the cannabis industry via a variety of initiatives, including: providing capital, tools, and resources for entrepreneurs; identifying opportunities for partnerships and joint ventures; presenting companies with growth potential to their network of investors; and placing seasoned professionals into their portfolio companies.
To achieve that first initiative, the MJ Accelerator Program offers a 14-week, mentor-led intensive boot camp for technology and media startups in the cannabis space that have high potential to scale.
The program has locations in Las Vegas, USA and Barcelona, Spain, so it has a global perspective and focuses on potentially world-changing companies. MJ Accelerator partners with startups at all stages, though it prefers early-stage companies that are focused on some aspect of seed to sale (e.g. companies that grow, extract, or sell marijuana products) or technology (e.g. companies that utilize technology to serve the cannabis industry).
The accelerator program is structured according to three phases: Discover, Validate & Build, and Invest & Grow. Participants receive initial seed capital, guidance from qualified mentors and industry experts, access to discounted products and services, the opportunity to work in a collaborative office space and receive daily support, and participation at a culminating Demo Day.
After “graduation,” participants enjoy membership in an extensive alumni network.
The Application Process
Beyond basic personal and company info, applicants will need to provide information about:
- Their company type
- Their company stage
- Number of employees
- Competition
- Current investors
- A company website
- Current financials
9. Momentum (from Eaze)
Some people will recognize Eaze as the company that’s made a name for itself as the “Uber of weed.” And it certainly is true that Eaze offers on-demand and compliant cannabis delivery in dozens of cities throughout California and Oregon.
But the company is so much more than a delivery service.
It also provides educational materials for consumers; has developed an online marketplace that connects cannabis retailers and customers; publishes Eaze Insights, which shares data about cannabis industry economics, consumers, and so on; and has created a cannabis business accelerator dubbed Momentum.
The Momentum accelerator targets underrepresented founders in order to build a diverse industry that helps combat the War on Drugs. The advisory committee is refreshingly diverse, and Eaze is working to help clear hundreds of thousands of criminal records related to the War on Drugs.
How does the accelerator work? Ten qualifying startups are awarded $50,000 (equity-free!) grants and benefit from a 10-week curriculum that includes mentorship from industry professionals along with training for managing and scaling a business, compliance best practices, and more. Participants also benefit from access to Eaze’s network of investors, brands, and retailers as well as teams who specialize in analytics, marketing, legal, and other industry-specific areas.
At the end of the program, participants pitch to investors and are considered for inclusion in the Eaze marketplace — meaning their products could become part of the Eaze delivery ecosystem.
The Application Process
Because Momentum applications are closed at the time of this writing, we’re unable to share exactly what’s required of applicants. The accelerator is no longer taking applications for 2020, but check back often to learn more about the application process for 2021.
10. Redfund Capital
Redfund Capital is distinct from other options on this list, because it’s not exclusively devoted to the cannabis industry. But it has partnered with a variety of mid- to late-stage heavy hitters in the space. The fund is composed of bankers and entrepreneurs with more than 100 years of combined experience in business, consulting, capital markets, corporate finance, and healthcare services.
The organization offers incubator and accelerator programs that partner with first mover, high-growth companies to provide them with capital (in exchange for equity), resources, and infrastructure access. Program participants benefit from close advising around their business plans, revenue growth, (possibly) introduction to public markets, and more.
The organization has a strong focus on financial returns. In other words? This program is for cannabis companies that are confident in their ability to generate high returns. Currently, Redfund Capital supports the likes of Mary’s Wellness and Wahupta Ventures, Inc..
The Application Process
Redfund Capital does not seem to publicize its application process on its site. To learn more about the process, companies should reach out to Redfund Capital directly.
The Bottom Line on Cannabis Business Incubators
As you can see, there’s a ton of variety when it comes to the focus, terms, and resources offered by various cannabis incubators and accelerators.
No matter your personal background, your niche in the cannabis industry, or your goals for your startup, you should be able to find a cannabis business incubator or accelerator that will help you refine your focus, clarify your branding, and chart a clear path toward growth.
With the help of one of these incubators, you’ll soon be eating your slice of the cannabis industry pie!