Three Game Changers for Women Representation in the Cannabis Industry

The cannabis industry certainly aspires to better representation for women, and it can be said has delivered on at least some of its promises. For example, among U.S. cannabis companies, about 8% are run by women. While this amount is minuscule compared to male representation, it is considerably better than the 4.8% of women-run companies on Fortune's Global 500 list.

I've worked in the legal cannabis space since its beginnings as an executive as well as an entrepreneur/operator. I've witnessed firsthand the struggles of the growing industry to right the wrongs and the generational impact of social injustice and the war on drugs. As noted in a significant 2021 report, "The lack of equal representation [...] negatively impacts every level of the industry, from products to marketing to access and, ultimately, revenue and the creation of generational wealth."

Here's what women need, and are demanding, from the cannabis industry:

Investors

In business everywhere, women are at a disadvantage when it comes to access to financing. According to the Harvard Business Review, only 2.3% of venture capital funding went to women-led startups in 2020 — and that was down from 2.8% the year before. When one considers that women entrepreneurs started 49% of all new U.S. businesses in 2021 (a huge jump from a figure of 28% in 2019), the imbalance is clear.

And of course that institutional inequality is as present in the cannabis industry as in any other — and exacerbated by the continuing federal prohibition on cannabis, which puts traditional financing and banking options out of reach for all but the largest operations. As CEO Nancy Whiteman told Yahoo Finance, "When women in the industry raise capital, their valuations can be 30% to 40% less than similar male-led companies."

"It's a little disheartening," she told Yahoo. "You have this brand new industry. You'd think that it really has the opportunity to set a new path, but unfortunately at this point, it looks very much like a traditional industry."

Mentors

In a cannabis industry still dominated by men, women entrepreneurs are looking for mentors in all aspects of the business. These may include guidance on creating decks and prospectuses and what companies to connect with, to how to prepare for pitch meetings/pitch contests or have financial conversations.

The blindspots and lack of access that women face exist at every level of the industry. And none more so than cannabis, which has the dual challenges of being both highly regulated, while also disjointed and fragmented across the country. Guidance on diversity supplier programs, manufacturing and distribution resources, introductions to MSOs or larger ancillary companies —even advice on how to negotiate for better pay or higher investment or recommending a good accountant. These are all unspoken benefits of the "boys club" that continues to inhibit the advancement of women in the industry.

Women entrepreneurs and CEOs in cannabis want to see more women investors — who they believe will understand and support their investment rounds or start-up capital. According to the MJBizDaily report referenced above, women hold less than 5% of executive positions at cannabis-focused investment firms. And, although women's entrepreneurship is growing around the world, men still outnumber women three to one when it comes to business ownership. This lack of representation at the funding level certainly leads to the imbalance of women's opportunities to enter or grow within the industry.

Visibility

For as long as the cannabis industry has existed, women have created their own forums and communities to support and network with each other. Women-founded and/or -focused groups like Women Grow, Industry Power Women (Disclosure: I am a co-founder), WEIC, Blunt Brunch, Illinois Women in Cannabis, Tokativity, The CannaDiva, Cannaclusive, Cannamoms Society, Latina Cannapreneurs and more understand the need to create this community of support which in turn will invite more women to enter the industry.

But we still must demand seats at the big tables. Recently at MJBizCon, the oldest and largest cannabis industry event in the U.S., MJBizCon carved out programming, events, and other features dedicated to women, including a first-ever meta-conference from Women Grow, one of the first and largest national groups for women in cannabis.

For women and other underrepresented groups, it is vital to have a presence at these established events in addition to creating our own. It allows a unique opportunity to connect and create a greater business community within the larger established structure.

Women Grow President Gia Morón told Benzinga earlier this year that the new focus is to get women into rooms with investors and high-net-worth networking circles. "It is no secret the challenges women face in the industry, our goal now is to work with strategic partners ... who will assist us in addressing the gap in the market by creating pathways," she said.

As the industry expands, women continue to feel less seen and heard. Like the cannabis plant itself, without the presence of female representation, the industry itself cannot propagate. Despite the obstacles, women are still seeking careers, partnerships, and investments within the cannabis industry. In order to create a playing field of inclusions, there needs to be a focus to dismantle the all-boys club.