About a year-and-a-half ago, San Diego investor Eric Gomez set out to find local cannabis industries in which to focus his investment strategies. He didn’t have much luck.
After discovering the cannabis startup accelerator, CanopyBoulder, while at an investors’ forum in Colorado, he realized what needed to be done back home.
“I talked to the guys who run the program out there and said, ‘We really need this for the San Diego community,” said Gomez.
“We have a bunch of investors out here and a very active venture capital environment and we have no place to go to find good, fundable [cannabis] companies.”
The team at CanopyBoulder agreed, seeing (as Gomez puts it) the potential in San Diego’s “big market and growing start-up scene.” On October 10, that potential became a reality with the official launch of Canopy San Diego.
Billed as a “mentorship-driven, seed-stage investment program for start-ups in the legal cannabis-ancillary industry,” the new accelerator with a special interest in tech start-ups is being led by co-founders Gomez, Jack Scatizzi, Lincoln Fish and Wyatt Hinshaw.
“There’s not a whole lot of places for young companies to go and build in cannabis. There’s too much risk. There’s no banking, there’s no mentors, there’s no financial resources, so that’s the… role that we play,” said Gomez.
Canopy San Diego’s relationship with its Colorado counterpart connects it with the investor network Arcview Group, which has over 550 investors and has invested roughly $75-million into 121 companies.
“What we want to do here at Canopy is have a diverse portfolio… of tech companies, business service companies, media companies, some consumer good companies, and really allow investors to invest in the industry,” said Gomez. “If you invest in Canopy, you’re investing in the cannabis industry growth, which is 30 percent per year and that’s only in the legal sectors. So it’s going to be much larger than that once states and countries start legalizing.”
Assuming California passes a measure on the ballot this November to legalize the recreational use of cannabis, Canopy San Diego will certainly have its hands full in the months and years to come.
“For us to legalize recreational use would basically mean there’s a serious economy behind this industry, so investors will start looking at it, big business will start looking at it, and hopefully banks will start looking at it a little more seriously,” said Gomez.
“It really would be a huge, huge symbolic win for this industry and for attracting resources that the industry drastically needs to move forward.”
Canopy San Diego plans to launch with an initial cohort of 10 companies, with hopes to bring on as many as 40 companies over the next two years. Every company selected for the program will receive $20,000 in seed capital, office space, and mentoring from experts. The top three companies from each cohort will go on to receive $50,000 in follow-on funding from the accelerator.
“These two years beginning now are going to be very important for the industry and now’s the right time to get in,” said Gomez. “Whether you’re an entrepreneur, an investor or someone doing a career change…you want to get in before all the big money and big companies start coming in and putting up a lot of barriers to entry. So if you’re on the outside looking in, don’t wait anymore. Now is the best time to get in.”
Banner image: CanopySD CEO and COO Eric and Jack