These days, it seems like everyone wants in on the green rush. Enticed by the prospects of a multi-billion-dollar industry, professionals from finance, pharmaceutical companies and even law enforcement are fighting for their corner of the marijuana market. Who would’ve imagined that former Republican House Speaker John Boehner would find his place at a marijuana company after he left Congress?
But don’t be fooled by the headlines. Making money in marijuana is harder than it seems with the myriad of bureaucratic hurdles involved in a tightly regulated, federally illegal industry. But these barriers didn’t intimidate 26-year-old entrepreneur Stephen Martin. A few years ago, he saw an opportunity to apply his intellectual property expertise in the cannabis space. It took him a few tries to break through, but in November, Martin found himself on stage in front of hundreds of investors. He was at the Arcview Group’s pitch forum in Las Vegas to sell investors on Redfield Proctor, his cannabis waste management startup — and he walked away with the top prize.
The Arcview Group is a cannabis investment and market research company which connects marijuana entrepreneurs to their network of investors. The company holds four or five live pitch events a year – a cannabis “Shark Tank,” if you will. After a stringent screening process where entrepreneurs get grilled by investors and refine their pitches through webinars, about 12 companies make it into the live event.
Not only did Martin qualify to participate, but he also pitched his business so successfully in front of 200 investors that he won the competition’s Best Pitch Prize and the Winners Fund – a $50,000 investment check. A spokesperson for Arcview said that these two prizes don’t always go to the same company and that it does not have a Winners Fund in place for 2018.
So how did Martin do it?
Identifying a Problem
Last year actually wasn’t the first time that Martin applied to the Arcview pitch forum. Before he was in the business of cannabis waste management, Martin had a business idea for the vaporizer space. He applied to the pitch competition and promptly got turned down.
“I managed to bulldog my way into [Canopy Boulder],” said Martin, referencing the cannabis startup incubator affiliated with Arcview. It turns out that his vaporizer idea would not work under Colorado’s marijuana regulations. But once he made it into the accelerator, he was surrounded by people from all corners of the cannabis industry.
“My first week there, I discovered the problem,” he said.
He listened to a cannabis cultivator recount a nightmarish story: The grower was using an industrial wood chipper to render cannabis waste “unusable and unrecognizable” per Colorado’s marijuana regulations. The wood chipper, which was inside at the time, caught on fire. As you might imagine, the ensuing havoc caused great distress to his operation.
The cultivator decided to move the wood chipper outside. Unfortunately for him, the state’s Marijuana Enforcement Division saw the move through the cameras that licensed marijuana businesses must keep on their buildings. The regulators told the grower that the wood chipper had to be moved back inside.
And thus, the idea for Redfield Proctor was born. Martin started the company during the fall of 2017, through a class at Canopy Boulder. Redfield Proctor helps cultivation operations by shredding the plant matter, recycling it into soil and finding an organization to make use of the new soil. The company also combines new technologies with Bokashi fermentation, a composting technique that uses microorganisms to speed up the process. Meanwhile, cultivators can rest assured that their plant material is going towards an environmentally friendly operation, all while staying compliant and saving money.
Martin hesitates to speculate about why investors took to his idea so quickly, but did say that he received one consistent piece of feedback from the moneyed folk: “I’m an investor who owns three grows and I can’t tell you how much we need this.”
“When you’re talking to investors who are intimately familiar with the industry and [they] see a need like that, it tends to appeal [to them],” said Martin. “We found a good solution that everybody liked.”
Another key selling point is that Redfield Proctor services other types of agricultural waste, not just cannabis, and investors frequently love to see innovation in the cannabis space that can apply to other areas of agriculture.
“One of the reasons that cannabis is at the forefront [of agricultural innovation] is that we’re dealing with a much more expensive crop,” explained Martin. “When you’re dealing with such an expensive crop, you can afford to buy more expensive equipment.”
Now, the company has clients outside the cannabis industry too as their waste recycling methods can be used on all types of organic matter. Redfield Proctor recently began awarding its soil certification – “Suitable for Cannabis Growth” – to identify those soils that the fit strict regulations around pesticides and chemicals in cannabis growing. Only one company so far has received the soil certification: Pittmoss, a company that snagged investment from three sharks on the “Shark Tank” television show in 2015.
Words of Wisdom
Aspiring marijuana entrepreneurs are often advised to take whatever expertise they have and apply it to the cannabis space. But Redfield Proctor’s story shows that success can be found if you just listen to what the industry needs from within. There are plenty of problems that still need solving, which don’t involve ousting Jeff Sessions.
When asked if he had any advice for aspiring marijuana entrepreneurs, Martin had two words: “Buckle up.”
TELL US, do you have an idea for a cannabis company?
Originally published in Issue 32 of Cannabis Now. LEARN MORE