What are cannabis tech solution companies?
Cannabis technology solution companies provide tech solutions for consumers or other businesses within the cannabis industry. This can mean a wide range of things from software that ensures companies remain compliant with federal and local regulations, innovative point of sale or inventory tracking systems, testing or cultivation equipment and software, dispensary customer relationship management solutions, delivery services, or market research, among many others. While most tech solutions may work well for any industry, cannabis companies in particular have specific hurdles to overcome despite being entirely legal such as banking and payments issues for example. With a skyrocketing industry that isn’t slowing down anytime soon, cannabis tech solution companies are more important than ever to help dispensaries and other marijuana businesses keep up with rising sales and make the entire experience simple and worry free.
Top cannabis tech solution companies in 2022
Since marijuana is still a Schedule I drug that is illegal at the federal level, cannabis businesses aren’t able to use federally-insured banks and credit card companies won’t process marijuana-related transactions. This has been a burden on both retailers who are forced to handle large amounts of cash and customers who need to carry cash or pay ATM fees. CanPay calls itself “the world’s first debit payment app for cannabis retailers.” CanPay works like a debit card with a pin linked securely to a bank account and can be used at most dispensaries in place of cash. On the retailer’s end, the app is integrated into several of the most popular cannabis POS systems, making transactions seamless.
For most marijuana enthusiasts in legal states, cannabis regulations and compliance doesn’t even cross their mind. But behind the scenes, retailers and cultivators spend a lot of time and resources to ensure that their business is legal and that they are in compliance with ever evolving local and federal laws. Marijuana Enforcement Tracking Reporting Compliance (Metrc) supports businesses and protects consumers by furnishing real-time tracking data using radio frequency identification (RFID) from seed to sale in 16 states. The Florida-based company has quickly become the backbone of the cannabis industry and a forerunner in cannabis compliance around the world working on the government side of compliance.
Certain jobs like government positions and those in healthcare or transportation fall under federal requirements for drug-free workplaces. Hound Labs has created the first non-invasive cannabis breathalyzer geared towards law enforcement and employers who are required (or choose to) drug test their employees. Prior to this, marijuana drug tests typically involved urine samples which aren’t fun for anyone and only shows whether or not a person used cannabis in the past within a certain window and doesn’t discriminate between use on the weekends or during working hours. According to their website, the Hounds Labs breathalyzer is “one billion times more sensitive than an alcohol breathalyzer” and will only give a positive result if cannabis use was recent (within the last few hours), which is much more fair for employees who choose to partake in legal dry herb after work or on their free time.
This cannabis B2B wholesale platform links retailers with thousands of distributors and individual brands, removing kinks in the supply chain and ensuring an amazing customer retail experience. Based out of New York, the LeafLink platform saves dispensary owners time by simplifying communication between businesses and optimizing product ordering, while small scale cannabis brands are able to gain exposure and build relationships with licensed retailers on the opposite side of the country. According to the company’s website, LeafLink already manages 52% of all wholesale cannabis in the U.S. and is a valuable resource for 12,000 companies who use their service.
For a grow operation that’s almost as high tech as Tony Stark’s home office, large commercial cultivators and small scale home growers are turning to Growtronix. Their sensors, coupled with the online software and mobile app allows cultivators and breeders complete automation and control over the entire growing process from adjusting environmental factors like temperature and humidity to flexible scheduling and in depth data collection to assist in future grows. Every aspect of the commercial grow operation can be monitored and controlled with the touch of a button from anywhere with an internet connection.
Acquired by Weedmaps in 2021, Sprout is a dispensary CRM and marketing software that provides the most robust customer loyalty program around. Sprout drives more sales and helps small retail businesses grow, while assisting larger consumer-facing cannabis companies retain customers. The platform allows business owners to easily setup cannabis-specific automated marketing emails and drip campaigns, text messages, and mobile coupons so they can spend more time on more important aspects of the business and engaging with customers.
Everyone loves a good deal and Leafbuyer is on the hunt to do just that so no stoner overpays for the same product. Instead of checking individual dispensary websites for weekly and daily deals, smokers can just head to Leafbuyer, which showcases all the best discounts that day. The website also sends notifications when special coupons or holiday deals are going on. This is also great for dispensaries who want to draw in new customers, highlight special sales, increase customer loyalty, or advertise on a website they know targets smokers specifically.
What are the trends in tech solutions in the cannabis industry for 2023?
As more and more people see the potential of the cannabis industry, an increasing number of cannabis tech solution companies are launched each year and not all of them make it past the initial startup phase for a number of reasons. However, there are a few trends within the space that seem to be taking hold and will continue into 2023 and maybe even become normalized within the industry in years to come. These are just a few of the tech solution trends within the cannabis industry to look out for next year:
- Vertically integrated businesses - Some of the largest and most successful cannabis companies are vertically integrated, removing the middleman and cutting costs significantly. These businesses control all aspects of the supply chain by incorporating their own grow operation, packaging facility, testing labs, brick and mortar or online retail shops, delivery service, and more all under one roof. We expect to see many more medium-sized businesses moving towards this model in the near future.
- Drug testing - Law enforcement is able to test for alcohol easily, but marijuana-related DUIs are more difficult to crack down on since most tests show past use, not current levels within the body. With increased legalization, many employers are also interested in testing for marijuana, but the options are costly, intrusive, and may reveal what employees like to do in their spare time, which oftentimes isn’t necessarily breaking any laws. We expect more cannabis technology solution companies like Hound Labs to come up with easier, cheaper, and more accurate ways to test current intoxication levels.
- Cannabis-related payments - While several companies have tried to tackle this massive issue for both cannabis businesses and consumers, no one has made transactions and banking as simple and seamless as it is for other industries. Now wouldn’t it be nice to purchase cannabis products with Apple Pay like you would at the grocery store or shopping mall? We expect to see more innovative ways to get around the federal regulations and make things easier for marijuana businesses and smokers alike. Hopefully they can also show that cannabis sales can be a lucrative market for credit card processors and banks.
- Market research - It’s not just the gamers or hippie types that smoke weed these days, the 420 community comes from all backgrounds and walks of life. As cannabis opens up to new markets and segments of the U.S. population, market research will become increasingly important to help marijuana businesses stay relevant and keep up with consumer preferences and needs. We expect many more cannabis tech solution companies in this space in the coming years.
- High tech grow solutions - Whether it’s because smokers want to try a fun new hobby during quarantine or simply want to know exactly what they’re consuming, home growing is on the rise. Cannabis cultivation takes a lot of time, money, and knowledge to produce top tier nugs, but high tech grow solutions take out a lot of the guesswork and even enable beginners to have a fruitful first harvest. We expect to see innovative tech solutions for cultivators, specifically home growers in the future.
What cannabis tech solution companies closed in 2022?
Cannabis tech solution companies launch and close daily and with rising costs and a possible economic recession on the horizon, 2022 was a difficult time for most businesses no matter the industry. Most pulled through, but not without significant corporate restructuring and cuts to funding. The popular California delivery service Eaze for example laid off 20% of its employees in 2022, but hasn’t closed its doors just yet. Weedmaps, the cannabis advertising company, cut 10% of its workforce and the cannabis compliance software company, Akerna, laid off a third of employees. Canopy Growth Corp., a Canadian-based public company, shuttered the doors of its cultivation facilities. Despite this uncertain time, there is still high demand for legal cannabis products, particularly amongst females, where sales have increased by 55%. With the outlook remaining positive, the most popular cannabis tech solution companies are trying to remain profitable through this hopefully short economic downturn to come back at full force when the market recovers.
Has all this business talk got you thinking about driving to the nearest dispensary to stock up on the essentials and maybe see what cannabis tech solutions they’re using? Before you go, check out our rotating selection of high-quality smoking accessories like heady glass bongs, dry pipes, rolling papers, mini bongs, dab rigs, vape pens, e-rigs, herb grinders, rolling trays, and more!