While this primer is on how to change the world one bite at a time by starting a hemp food business, decide first if that’s even right for you, or if anything in hemp or Cannabis (“marijuana“) is.
Almost anyone can start one; even the bed-ridden can design and the hard-to-place worker can be trained. Are you a bright grower with a green thumb? A creative social media marketer? A successful salesperson? Love chemistry? Good with your hands? Like to design and build new equipment? Or develop new foods? A proven business manager or CPA looking for a change to something new and exciting? Good at operating or maintaining machines? Are you a great Chef or a lab rat or a programmer? A lawyer wanting in on the Green Rush? Good with plants but bad with people? Disabled but functional? Have an MBA or a Ph.D., a welding certificate or a commercial driver’s license? The young hemp industry has room for all of you and many more, from side hustle to part-time gig to new career to your very own startup.
Most of the products that will drive hemp acres in the future have likely not even been invented yet. This is like 1920 in the automobile industry, still in infancy. “Hemp 2.0,” the first billion-dollar segment of shelled hempseed as food, was invented in only 1996. The time is ripe.
Your hemp business journey, should you decide to embark upon it, can take you to a new world of fun, creativity, lucre, and infamy. It can also be a boring daily masochistic drudge and bankrupt you. Either is possible, it’s up to you to create what you want. But through it all, you at least have some control over the outcome, unlike a job. Making money is easy, but making a difference while making money is better. A good quality of life is underrated, especially by entrepreneurs, so use your business to improve yours while you help others.
But how to start? Ahhh, therein lies the Art, and it all begins with introspection. Consider your strengths and honestly assess your weaknesses. What are you good at, what do you want to do, and where do you want to be in 5, 10, 20, 40 years? Even your high school occupational aptitude test will reveal clues: mine said I would be a good entrepreneur or musician and I ended up doing well at both. Decide what moves you, what could be done better or differently, even what pisses you off… those are all clues where your passion for business will lie. You’re going to need that passion in the face of disapproving family, no time to date, late nights working, early morning flights, and too-little income at first. You must confidently work towards your goal, even when feeling overwhelmed and under-fed, hopeless. There’ll be a zillion reasons not to do it but none will matter to you. Learn to take the hits and keep on truckin’.
The life of an entrepreneur is not for everybody, but for those who value independence and control of their destiny above all, there’s no other path. I especially encourage people who consider themselves disabled in some way; control over your livelihood is quite possible in the hemp or Cannabis industry. Most people are trapped in limitations of their own making, not realizing they locked themselves in.
Even me, I essentially became unemployable due to severe Bipolar Disorder, which eventually became an entrepreneurial blessing: creative imagination, persistent will, and belief that “impossible” might be improbable but it is indeed possible. A genetic condition expressed as an inability to bullshit, a compulsion to help others, a pathological need for fairness and to expose hypocrisy, and a tendency to leave other people be, short of the above. Because I had my own business I could work around challenges and limitations, and leverage strengths. Working manically for days on little sleep, then not be able to get out of bed for a week.
If you’re like me, just know that your perfectionism is a gift of OCD, your persistence is a gift of ADHD, and your principles are a gift of ODD. Add profound curiosity, dogged persistence and the humble belief that you don’t know anything yet, and nothing can stop you (except one thing: YOU). Those on the Spectrum, disabled, or managing their condition all can still find or create jobs for themselves. One of the early Cannabis entrepreneurs in Oakland, CA was Richard Lee, and he ran his empire from a wheelchair. Those unemployable for whatever reason are some of the most passionate entrepreneurs. Leverage our neurodiversity like so many before, or at least just be nice.
If you aren’t the entrepreneurial type, then work for a person who is. Learn from them, the industry, your craft. At some point you might be inspired to set out on your own.
The job of master grower can pay $200,000 per year. Extractors, lab techs, trimmers, growers, warehousemen, retail sales, office clerks, marketers, bookkeepers, programmers, breeders, paralegals, production line workers, truck drivers, everybody can find a job in some aspect of the industry. As hemp becomes normalized, some day we’ll see overnight millionaires from employees granted stock options from the company once it goes public, just like in the tech space.
Be a broker of hemp products or arbitrage the prices of products, buy low sell high; run the business from your phone while sitting on a beach.
Good at growing? Then consider breeding. We don’t have all the cultivars we need yet. Breeding right, even genetic engineering using CRISPR might be the fastest way to build value after you register and/or patent your work. One advantage is you don’t have to rely on others on a day-to-day basis as much, except perhaps for testing.
Thinking of growing hemp, farming? Then develop your brand while you build out the acres. Test the marketing mix, nail down trademarks, even generate cash first to fund the farm. Later you could pivot to high-THC Cannabis using the assets created under hemp. Farming is hard and I’m lazy, so like Bill Gates suggested I found the lazy man’s way to do this, namely what’s in this book.
Are you good at designing machines? Then build a better extractor. There are improved processes and methods just waiting for someone to design and engineer. Maybe use A.I. to control a new type of equipment. Novel extraction techniques emerge often, but there’s also room to improve such things as trimming machines, or field clone planting machines, or hemp harvesters that preserve trichomes and seed, or fiber decorticators, or fiber spinners for nonwoven materials, or new ways to shell or reduce particle size, or process controls for extractors, or continuous processing, or a zillion other applications. You can even apply cannabinoid extraction tech to making food.
More of a nerd than a green thumb? Then develop tech solutions for common problems in the industry. Process control, compliance, quality assurance, research or marketing tools. Prefer books to plants? Scour the PTO for useful patents, especially expired ones. Or learn everything you can about an arcane subject, such as water rights. Be somebody’s solution, not headache. Scour ex/import data for ideas or leads of companies quietly doing the business.
Many embraced the production of hemp CBD, then CBG, then delta-8,-9, -10, and others. While sketchy in their production and thus quality, it’s still ironic to hear of stony hemp delta-8 THC vape pens and gummies sold to teens in gas stations across the South. That whole drug hemp segment is not really “hemp,” but a workaround created by the legal definition, a regulatory anomaly the product of cowboy chemistry and cojones and not likely to survive the next Farm Bill. “THCa weed” is a semantic scam, as all raw THC is actually THCa. Altnoids aren’t the problem, the dirty process converting foreign-grown CBD making bizarre Frankenoids is, and the fact that U.S. farmers don’t benefit. Some use strong chemicals on CBD to make THC vape pens sold to teens in gas stations in the South, and sell as much as $50 million/month all in bulk. And now many ignorantly “stack“ multiple synthetic Neocannabinoids from different vendors.
The synergy of the unknown compounds, plus the carrier liquids, interacting with heat while vaping is untested toxic soup and makes a mockery of the Cannabis industry mantra of “harm reduction.” Jack would freak tf out over them, far removed from the actual plant. Not even in our darkest, most prohibitionistic paraquat years like the Reagan ‘80s did people want synthesized THC. We knew it could be done, but why? Weed is grown in almost every county in the nation, just find a better plug. It’s amazing how fast this enshittification of hemp happened. Can we just get back to feeding and clothing people now?
Even if you’re allergic to it, you can still be in the Cannabis industry and never touch the plant. Or if the best you can do in the kitchen is burn water, you can still “write” a cookbook by asking for recipes from others, real Chefs. A few popular Cannabis cookbooks have already done that. Heck, you could even use the free tools I offer for download to start your own small business consulting practice!
Food, it’s still wide open too. Almost anything currently made in a food factory can contain hemp flowers, seed whole or shelled, hempseed oil or essential oil of flowers, CBD, and even in some places THC. Foods such as “Kush” hard candies with hemp essential oil, real cheese with flowers pressed in, or baked goods with shelled seed, perhaps with CBD.
Even my CannaSearch Daily has dozens of new hemp business ideas, as well as the Hemp Food Association‘s Breaking News but only for food.
I’ll make my pitch for Marketing grads now: we need more good ones, the industry suffers from its lack. This stuff ain’t gonna just sell itself, y’know. If you’re a good marketer, the industry is all yours. Great Marketers are Myth Merchants.
But don’t be naïve: for 95% of the businesspeople out there it’s a dirty nasty zero-sum war that takes no prisoners and eats its young. Therefore, find the other 5% who aren’t that, and collaborate. The sooner you discern one from the other, the better; the ability to judge character might be the most important skill of all in hemp! Character matters; Ferengis in tie-dye and dreadlocks are still Ferengis. Don’t be fooled. Tip: Look for an ethical crossroads for the potential collaborator to see how they respond. It does you no good if they’re just going to stiff you down the road like they do the others, you might as well know before you get involved. Another tip: identify the bad ones then see who hangs out with and promotes them. Good people don’t spend time with bad, but vultures do flock together. Bad always pushes out good.
Today, I think collaborations, alliances, and partnerships should last as long as the average Freelance Contract: 3-18 months. The market and the world are changing so fast, long-term commitment to yesterday’s technology and laws might be fatal. Co-branding, co-marketing, cooperative trade show booths, joint sales calls and promotion, and Guerilla Marketing done right with another company can be exponentially more powerful.
Every older hemp entrepreneur I know, and many natural food industry ones as well, started their careers by selling marijuana to their friends and peers. It was a lifestyle, not a career or job. The war on drugs created the biggest entrepreneurial boom in history, where one learns supply and demand, customer service, pricing, mathematics, inventory control, marketing, accounting, statistics, quality control, packaging, regulatory (non)compliance, and the rest that’ll come in handy later.
Society changes fast. Colorado went from “can’t buy booze on Sunday” to legal adult-use marijuana in just five years. Figure out where we’ll be in another five years out and go there now.
Too many follow their passion instead of their talent. Continue to do what you’re good at, just pivot to hemp. If you’re a CPA, don’t become a farmer just add hemp to your practice. Help hemp companies get grants or apply for USDA programs. If you’re a chef, don’t become an extractor but make hemp food instead. Bring what you are already good at to hemp.
Although your first employee hire is important, I think your first consultant is far more critical, especially in the early pre-money stage. Inevitably you’ll need one, and the wrong one will set you on the wrong path early, headed for a cliff, and you won’t realize it for months, even years. By then you are too invested in the project, literally and emotionally, to pivot. So choose wisely. I offer an inexpensive service to review your idea and give feedback, but it’s best used as early as possible so you don’t waste time compounding your Dunning-Kruger mistake because of the sunk cost fallacy.
As for your first employee, let me explain Michael Gerber‘s “the eMyth“ as it relates to, say, growers because it is one of the main causes of small business failure: just because you’re a good grower doesn’t mean you’re good at managing the business of growing. Those are two different skill sets; therefore, your first hire should be a business manager who can handle the back-end operations while you stay in the greenhouse. Insurance, payroll, banking, licenses, contracts, money in the postage meter, ordering toilet paper and soap, compliance, taxation, hiring and onboarding employees, opening and sending mail, replying to customers, emailing requested information, all those mundane minutiae have to be handled, but not by the best grower on staff. Leverage your wheelhouse not your woodshed, meaning do more of what you do best and farm-out the rest. Hire to cover your weaknesses, not duplicate your strengths.
Look to develop Best Practices within your company, in all aspects. Continuous Improvement in the process, even in marketing (see image). Leverage your core competencies. For instance, I was good at developing and marketing products, so I out-sourced everything else: a co-packer (a “contract manufacturer” who makes your products for you using your label, also called “toll processing,” “white labeling,” or “private labeling”) made and packaged the product. Common carriers were the logistics, brokers were the sales force, U.S. Cold Storage was our warehouse, distributors were store delivery, and merchandisers made sure the product on the shelf was set right. All my company did was develop the intellectual property (brands and recipes) and administer the business model, paper flow and bookkeeping, and the marketing.
Find ways of getting the product made for you versus making it yourself. I started in food by making my own products, then after six years, got them co-packed by others. There are pros and cons for both, but at the end of the day, co-packing is almost always better as it lets you concentrate on your core competencies, the things which you do best, and costs less to get started. Co-packing allowed me to scale faster than I could when making it in-house, at far less cost. In an Inc 500 company fast-growing environment (950% in 5 years), you need all the help you can get for positive cashflow. Besides co-packing, the other trick is to get paid by your customer before you have to pay your co-packer. Otherwise, the faster you grow, the even more cash you need to finance growth in Accounts Receivable and Inventory. And if you didn’t use co-packers, you would also need more space, equipment, and trained workers.
You could even be a performer and not a businessperson. Reese Witherspoon, Taylor Swift, and Dolly Parton are masters at business as much as music. Worthy of study as they aren’t MBAs. No doubt they hire well, that’s half the battle.
There are many ways of doing business, therefore the only thing that matters before starting is to ask the person in the mirror: where do you want to be, and when? Start at the end and work backwards to now. Decide how and when you want to exit, and build your company around that. The more detail the better, but one or two sentences will suffice. “Get sold for $5 million in 3 years” for instance. You can hang all kinds of ideas on that, ethical or marketing or differentiation or philosophical or technological or humanitarian or whatever. But decide where you want to be and when; everything else will flow from it.
One possible business goal is longevity for generations versus selling in 2 years. Another might be quick opportunistic sales as opposed to long-term branding. Or use a leveraged debt structure versus investors. The more detail the better, because it will define much about your company, and becomes the basis of the company culture. Its raison d’etre will flow from it— Mission, likely products, strategy, and even HR if an integral aspect such as a co-op.
Until you know where you want to end up, you have no idea where you are going. With a zillion possible paths and outcomes, how do you pick just one? Define what it looks like and it is more likely to end up looking just like that in the end. The power of intention is that strong, but before you can manifest it you have to be able to imagine it. Literally. And subsequent big decisions get easier when you have a plan and aren’t subject to every changing wind and whim. Sometimes your “Noes” are more important than your “Yesses,” and without a plan you won’t know which is which. Start marketing to your potential suitor (likely a competitor) now versus looking down the road, and ignore the others.
The above was excerpted from “Seedy!” by Richard Rose, a free ebook released in 2024. “Seedy!” or How To Start A Hemp Food Business reveals how to do well by doing good with hemp foods. Seedy! is 177 pages, 52,000 words, 200 images, and thousands of links. Cost: free. Value: priceless. Never before has an industry insider pulled back the curtain on the successful strategies used to create hemp’s biggest industry segment. Part how-to, part hemp history, part self-help guide.
Click here to download a free copy.