- Growpacker Inc, a contract manufacturer of THC- and CBD-infused edibles and beverages, is starting a brand incubator and accelerator program to fast-track THC and CBD brands sold in California, according to a press release.
- CERIA Brewing Company, the brainchild of the former Blue Moon brewmaster and maker of Grainwave cannabis-infused nonalcoholic beer, is the first participant in the program.
- Those who participate in the accelerator are offered industry expertise and will have the opportunity to fast-track their market penetration in California. Growpacker will retain an equity interest in any participating brands and companies.
With 10 states and the District of Columbia allowing recreational marijuana use and 30 states permitting it medicinally, cannabusiness is arguably becoming one of the fastest growing industries in the United States. California is now going head to head with Colorado to establish itself as the nexus of development.
As one of the two major social lubricants — the other being alcohol — marijuana is unsurprisingly popular. In fact, the Specialty Food Association called edibles one of the top 10 trends of 2018, and according to Arcview Market Research data reported by Forbes, the U.S. marijuana edibles market has exploded in the past few years, with California consumers spending more than $180 million on cannabis-infused foods and beverages in 2016. In Colorado alone, BDS Analytics reported that edible sales jumped 67% between February 2016 and February 2017.
Now that the demand is there, cannabusiness has begun to operate like many other traditional CPG firms, which includes getting into the accelerator space. According to consultants A.T. Kearney, more than 75 food industry incubators or accelerators have been founded in the United States in just the past 10 years. American companies' fascination with accelerators comes with good reason. Now instead of spending years researching a single product, testing it and then rolling it out to a consumer base, large companies can simply make a deal to marry their expertise, leadership and cash flow with the innovations, culture and growth-appetite of start-ups that will potentially create many more successful products than they could ever do on their own.
Although Growpacker is not the first accelerator in the cannabis space, it is the most prominent now that it has taken CERIA under its wing. Although the nonalcoholic brewing company already has several partnerships, its choice to partner with this accelerator is likely due less to the need for expansion and more to the fact that former brewmaster Keith Villa will serve as a strategic advisor to for Growpacker’s cannabis beverage category. While serving in the advisory role, he will work to develop the THC-infused beer segment. With Big Beer taking interest through Constellation Brands' $4 billion total investment in Canopy Growth and AB InBev's $100 million partnership with Tilray, this is expected to become one of the fastest growing segments in the industry.
By starting in California, Growpacker is taking an easy foothold in the space. However, when it comes to scaling, things can get a little hazy. Smaller cannabis companies are being snuffed out as state regulations clamp down on their ability to afford licensing and taxes, and they aren't able to finance the commercial space to scale up. Beyond money, regulatory obstacles remain as states work to prevent health and safety problems — such as children mistaking edibles for regular candy and accidentally getting high. States are also enhancing efforts to standardize doses and make sure the raw product is free from pesticides or other chemicals.
Still, by participating in an accelerator, there is a good chance that these smaller businesses will be able to weather the expansion woes that they would be unable to face on their own. After all, that is the idea of an accelerator: trade industry knowledge on expansion for innovative ideas from entrepreneurs.