Somatik is seeking funding for its cannabis-infused beverage business; the company has already partnered with Ritual, a San Francisco coffee business.
With recreational marijuana legal in eight states and medicinal use approved in 20 more, investors are seeing the potential to produce a different kind of green.
Growth industry: The cannabis economy is seen as the fastest growing big business in America, increasing 30 percent last year to $6.7 billion, according to ArcView.
Enter Oakland-based Gateway, a startup accelerator that invests in cannabis-related startups with potential for high growth. The accelerator just graduated its second class of startups, which include a range of companies that: make their own marijuana edibles, develop better plant trimmers and vaporizers, and match growers with workers who know how to trim marijuana plants (a high-demand and hard-to find skill) like Field.
- For its first $2 million fund, Gateway gave companies $30,000 in exchange for a 5 percent stake.
- A new fund, which has yet to close, will offer $50,000 in exchange for the same 5 percent stake.
- Like traditional technology accelerators, Gateway aims to pair founders and mentors, offer business coaching, and help startups go from an idea into a real business.
- For more on Gateway’s demo-day, here’s my story.
The downside: In addition to the usual risks with investing in startups, cannabis companies face the added risk that marijuana remains illegal at the federal level nationwide, with the current administration seemingly less inclined to look the other way. For a great look at all the complications, I’d point you to John Oliver’s Last Week Tonight.
credit:420intel.com
