06 January 2022 |

Weed In A Web3 World



Weed In A Web3 World

Breaking down what the cannabis industry might look like in a Web3 world…

Background Information

In 2011 Marc Andreessen, founder of Netscape & the venture capital firm Andreessen Horowitz which has $18 billion+ USD in assets under management famously coined the term software is eating the world.

In the years that followed, it has become much clearer what was meant by this statement with the rise of companies such as Google, Facebook & Amazon. Each with billions of customers around the world today.

In 2022, the updated version of this statement would be Web3 is eating the world, and I will be breaking down what exactly Web3 is, the current use cases, and what this could mean for the cannabis industry in the future.

I have been on a journey researching both of these industries for a number of years, and it finally looks as though they are on a collision course.

(The subjects I research each day)

What Is Web3?

Web3 is a technology that allows for the creation of new ownership structures.

What exactly does that mean? It means companies can work with communities to increase the value of the products they are creating, with community members having financial exposure to the projects success.

Today, in the earliest stages of this rapidly developing Web3 industry the primary use case is digital artwork with provenance to prove the history of who has owned this digital artwork; called NFT’s.

This is all but one application for smart contracts which is the technology that enables NFT’s and it’s important to separate the current applications vs the potential applications.

Before going further, let’s examine what the cannabis industry and the Web3 industry have in common, as well as the biggest differences.

The Commonalities

What do cannabis and Web3 have in common?

For starters, both industries are growing at a very rapid rate.

(Data from statista)

In the case of cannabis, we all know how fast the industry continues to grow, as an ever increasing number of nations allow adults to access legal cannabis products.

(Data from statista)

The cannabis & Web3 industry both have to solve for the amount of energy they currently use, with both industries receiving valid criticism on the environmental impact of growing cannabis indoors & powering Web3 protocols / networks.

Additionally, both industries are continuously criticized by policy makers, who commonly lack any fundamental understanding of these two emerging industries.

The Differences

While these industries share certain similarities.

The cannabis and Web3 industries have a great deal of differences.

While cannabis has been around for thousands of years with Emperor Shen Neng of China prescribing cannabis tea back in 2737 B.C, the the underlying technology being used to create the Web3 industry is brand new.

Additionally, cannabis is a consumer packaged goods industry whereby the focus is to provide consumers with physical goods that they love to consume.

In the case of Web3, the primary focus is to build applications for consumers on top of protocols ie. a set of rules encoded in software.

Example: The internet we use today is a protocol & Google, founded in 1998 by Larry Page and Sergey Brin in an application built on top of the internet protocol.

Two Case Studies

Number 1) Bored Ape Yacht Club:

As mentioned, the far majority of all successful use cases in the Web3 industry today is the creation of digital artwork, with Bored Ape Yacht Club (BAYC) representing the most prestigious brand in the space.

The goal of BAYC is to build a “Decentralized Disney” ie. a brands who’s IP is worth billions of dollars, however, as opposed to one centralized organization capturing all this value — the community captures this value.

(Each of these tokens is valued at more than $299,000 USD today)

Building Brands:

Okay Matthew, I work in cannabis; why should I care about a company seeking to become the Decentralized Disney?

Because when everything is said and done, a valuable brand is the best moat any cannabis company can have today, and in the future.

In a digital word, having the full support of a community goes a long way, and in the Web3 world we are seeing companies gain large followings very quickly as community members have incentives to promote the company / brand online.

I have seen no better examples as to how someone can build a brand online, than the approach BAYC has taken since its inception, a brand now valued at an estimated $5 billion USD despite being less than one year old.

Number 2) LinksDAO:

LinkDAO is one of the most interesting examples of a company leveraging all of the tools Web3 has to offer today.

The company’s goal? To buy one of the world’s greatest golf courses.

To accomplish this, they raised $10.5 million USD selling digital tokens (NFT’s) that offers holders a wide variety of perks such as input on key decisions, early access to the course they acquire and other interesting perks.

Community Capital

One of the biggest problems in the cannabis industry today is the limited access to capital, courtesy of cannabis being a Schedule I drug.

This problem has plagued the cannabis industry for many years, making it more expensive for cannabis companies to access growth capital, in addition to making it many multiples more difficult than it needs to be to fund a cannabis startup.

One of the most interesting features Web3 offers is the ability to raise capital from people who share similar interests to you from any where in the world — with much less red tape than crowdfunding campaigns are today.

Additionally, in the case of LinksDAO and BAYC, consumers are purchasing digital tokens vs purchasing equity — a key distinction.

This model is in its earliest iteration today, however, given the ease with which companies are raising capital in this space I suspect we will see this model enter the cannabis industry sooner than we think.

Closing Comments

The very first thing that impressed me about the cannabis industry was how quickly the industry was adopting new technology.

As a budtender 4 years ago, this meant having custom built cannabis point of sale software and having loyalty programs specifically built for cannabis consumers.

I suspect it may take over a year before we see this technology making any meaningful impact on the cannabis industry, however, I absolutely see a future whereby companies leverage this technology to obtain a competitive advantage to build better brands & to access additional sources of capital.


The Green Paper Summit: We’re thinking about hosting a cannabis mastermind workshop for execs and leaders to talk through how to tackle the biggest challenges and opportunities in the industry. Interested? Fill out this form

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