Many cannabusinesses are in need of startup funding but have very few opportunities to receive those funds. It seems no one is interested in going into partnerships with smaller entrepreneurs. Instead, big multi-state operators (MSOs) are getting all the attention.
The September 2022 Benzinga event was smaller and more intimate than the one we attended earlier this year. As a result, we were able to participate in valuable conversations to confirm certain industry trends, especially related to startup funding.
Read on to learn more about how and why we’re committed to fixing the lack of startup funding through networking and partnerships with smaller cannabusinesses.
Lack of Startup Funding: A Symptom of a Larger Problem
Lack of startup funding alone isn’t the only roadblock that smaller entrepreneurs are facing in the cannabis industry. Rather, it’s a symptom of a larger problem.
Currently, MSOs dominate the cannabis industry. As they move in and use their influence to win licenses and resources and acquire other businesses, they’re simultaneously shoving smaller business owners out.
Most groups offering capital partnerships are happy to finance these MSOs and other large entities but snub those who are just starting out. This stacks the cards even more solidly against entrepreneurs who don’t have the resources to lock in real estate or anyone to lobby for them in the local government.
Networking & Partnering Hasn’t Been Done… Until Now
In spite of all the roadblocks facing small cannabusiness owners, there’s plenty of potential for smaller operators to band together, increase opportunities for startup funding and support, and stand up against the pressure from MSOs. However, doing so will require a shift in perspective.
Instead of a constant competition against every other player in the industry, we need to focus on collaboration. Of course, a little competition is healthy when it’s used to push each other to grow and improve. The key is to collaborate and compete in a way that helps fill gaps in each other’s expertise or resources.
This is the opposite of the approach currently being used by large entities in the cannabis industry, who tend to shop around for the lowest price or the greatest personal gain without regard for the needs or potential of those they see as their competitors. We believe it’s time to change that approach.
Partnering With Higher Yields
In developing our capital partnership program, we’ve committed to forging true partnerships, not token systems that take advantage of social equity applicants. We understand the downward pressure from MSOs in the industry, but we also see massive potential in smaller players, and we’re determined to help enact change.
At the forefront of the Higher Yields partnership program is integrity. Instead of creating gaps between competitors, we focus on building bridges to bring about more creative solutions and better outcomes for everyone.
In our grant program, for example, we’re bringing together small operators who may not qualify for startup funding on their own but together meet all the requirements to apply for and win grants that will help them get started.
As another example, we recently partnered with a New Jersey cultivation whose expertise was in the hospitality industry. We were able to identify strengths from that expertise — such as strong customer service skills — that could transfer to cultivation. Then we helped them fill their remaining gaps and win the license.
Don’t Try to Do It Alone
At HYC, we keep our fingers on the pulse of the cannabis industry to help you navigate this very complex environment. Whether you need startup funding or are looking for guidance on riding industry trends, we’re here to offer our expertise and help you get ahead. If you’re an ambitious small cannabusiness owner interested in partnering with HYC, contact us to book a call.