HelloMD was initially an app that could connect the sick with doctors specializing in their particular ailment, Transcend Lighting provided LED for Canadian farmers trying to grow lettuce indoors, and Spare CS was a little known competitor to apps like Venmo and Chase Quick Pay.
Now they’re all thriving because of marijuana. Bloomberg reports that these are just a few of the companies that are pivoting green: taking their broad ideas for startups and using weed to give them laser focus.
HelloMD now connects patients with doctors who can prescribe marijuana, which has helped more than 14,000 Californians get medical marijuana cards. Transcend Lighting now has an entire light of LED strips built specifically to help marijuana growers yield the best crops.
In perhaps the most curious example, Spare CS is trying to help the marijuana industry evolve from its cash only roots. While marijuana is legal for recreational use in five states (and the District of Columbia), and legal for medical use in even more states, it is still illegal federally. That means banks and credit card companies, with their strict federal regulations, have been reluctant to take money from weed-related ventures.
In an interview with Bloomberg D’ontra Hughes, Spare CS founder, said his father noticed the cash only issue too. “He said, ‘Hey, they are showing up to the IRS with duffel bags of cash because they can’t deposit it.’” So Hughes had Spare CS pivot and start handling those cash only transactions between dispensaries and customers—only all over the phone. Customers punch in how much money they’d like to hand over and a barcode appears on their phone. Dispensaries then scan the barcode and the cash is deposited in their account.
In order to make the pivot, Spare CS had to move its business from California to Colorado where it joined seed accelerator Canopy Boulder. Canopy Boulder, unlike other accelerators, is focused exclusively on the new market of cannabis startups; it’s only mentoring and guiding companies who embrace the potential of ganja.
Twenty-nine startups, including Spare CS, have completed Canopy Boulder’s three-month program. But Canopy Boulder isn’t the only program in the venture capital community with its eyes on the THC-prize. Investment in weed-related startups more than doubled from 2014 to 2015, jumping from $97.1 million to $215 million in a year. Spare CS, HelloMD, and Transcend Lighting are just a few of the companies that have enjoyed this particularly green-tinged windfall.
As more states embrace legalization—New York we are WAITING—the potential for profits will only improve. So if you’ve got a startup idea in the back of your closet, now is the time to dust it off and ask yourself one major question: “how can I make this about weed?”