In the business of medicinal marijuana, there are strains for almost anything that ails you. So far, though, female entrepreneurs have yet to find a variety that addresses a painful side effect of the booming legal pot industry: sexism.
“More sophisticated money is coming into the space, and with that comes all of the trappings and all of the challenges for women,” said Shanel Lindsay, who founded a medical-marijuana device maker called Ardent in Boston.
In the pot industry, the share of start-ups owned by women is shrinking, even as female entrepreneurs thrive in small businesses overall. Two years ago, women made up 36 percent of executives in cannabis-related companies, about average for small businesses as a whole. This year, the percentage of women entrepreneurs was unchanged, but female pot executives dropped to 27 percent, a survey by Marijuana Business Daily found.
It’s not entirely clear why women occupy a shrinking share of leadership roles in the cannabis field. It’s expensive to obtain a license to grow, manufacture or sell weed products in many states where it’s legal. It’s also difficult, if not impossible, to obtain traditional banking services or financing for anything that touches the plant, because it’s still federally illegal. Those factors favor entrepreneurs with more money to start with, and that’s often men.
The growing interest from big-money investors from Silicon Valley and Wall Street may also give men an advantage. Academic research suggests that investors prefer business pitches presented by male entrepreneurs compared with pitches by female entrepreneurs, even when the pitch is the same. Start-ups run by women are usually questioned about potential losses, while those run by men are asked about potential gains, according to a study published earlier this year in the Harvard Business Review.
Krista Whitley started a marketing firm that specializes in cannabis companies and products in 2015 with one investor. Her company, Altitude Products, has since expanded to other pot-related business lines, and in January, she tried to raise another round of capital. The process, she said, was characterized by “amazing misogyny.”
“One investor in particular told me he thought it was cute that I wanted to make money,” she said. “Men don’t get told that in the middle of their fundraising pitches.”
Eventually Whitley found another investor. Last year, her company had $1 million in revenue. This year, she expects to hit $10 million.
In Boston, Lindsay started Ardent with $500,000 from her mom and one other investor. She said she’s seen investment opportunities go to male entrepreneurs whose businesses were bringing in less revenue than hers.
“The numbers don’t lie,” she said. “It’s more difficult for women to get money and, when we do, we get less money.”
Giadha Aguirre de Carcer, CEO of Frontier Financial Group Inc., a firm that provides data and analytics on the cannabis industry, is sympathetic. Once during a presentation, an investor told her to put her curly hair up because he couldn’t focus as she was speaking.
“We tend to be distracting, period, because we often happen to be the only woman in the room or one of two,” said Carcer, who previously worked at JPMorgan Chase & Co. “Let’s be conscious of that and capitalize on it, but also don’t let it be something that takes away from what you say.”
In the business world, hierarchies of race and gender tend to reproduce over time, according to Heather Haveman, professor at University of California, Berkeley, who has studied emerging legalized cannabis industry.
“If the field of legal cannabis is becoming more corporate that might lead to a reduction in the women at the top,” Haveman said. “Corporate funders and the corporate advisers will bring their own lens to bear.”
To many female entrepreneurs, there’s still reason to be optimistic.
“The cannabis industry is really brand new,” said Nancy Whiteman. Before she founded Wana Brands, a Colorado-based edible company, she worked in financial services, technology and media, and those industries felt much more male-dominated. In marijuana, she said, “It’s not like there’s 100 or 200 years of history that has to be broken through.”
Several organizations and programs have focused on connecting women in the marijuana field, such as Women Grow. The three-year-old group plans to distribute a guide for female entrepreneurs at their annual summit in February.
“The marijuana industry is still primarily white male, but if the glass ceiling was 12 feet high in the banking industry, I think in marijuana it feels like it’s 20 feet high,” Amy Andrle, co-owner of L’Eagle Services, a Colorado-based cannabis dispensary that specializes in organic products. “There’s just a lot of opportunity to grow and excel.”