According to a recent Yahoo Finance report, female-led cannabis companies face significant challenges when it comes to raising capital, compared to their male counterparts.
As the cannabis industry continues to grow, female-led cannabis companies are finding it increasingly difficult to raise capital. This is largely due to the high costs associated with running a cannabis business, which can be prohibitive for female entrepreneurs. In addition, many investors are still hesitant to back women-owned businesses, especially in the cannabis industry. This creates a major obstacle for female entrepreneurs seeking to start or expand their cannabis businesses.
“What has ended up happening is that as states have adopted more limited license models, it’s become much more expensive to get in the game,” Nancy Whiteman, CEO of Wana Brands, recently told Yahoo Finance. “And so, it favors the people who’ve traditionally had access to capital, which are men — white men.”
“It’s a little disheartening. 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,” Whiteman said.
The current state of diversity in the cannabis industry is troubling, according to a 2021 MJBizDaily report. The report found that only 19.9% of cannabis businesses are owned by women, only 8% of cannabis CEOs are women, and only 5% of executives at cannabis-focused investment firms are women.
Additionally, female cannabis business executive representation in the industry dropped from 36.8% in 2019 to 21.1% in 2021. This is below the 29.8% women executive count found in 2020 across all other industries.
The report also found even if women do secure major funding, “women-owned businesses often receive less funding and fewer resources — such as mentorship and strategic guidance — than their male counterparts.”
The lack of diversity in the cannabis industry can be attributed to a number of factors, including the high risk and regulatory uncertainty associated with the industry, a shortage of capital available to cannabis businesses, and the fact that most cannabis businesses are still early-stage startups. However, some experts believe that the lack of diversity is also due to a culture of male domination in the industry.
The lack of diversity in the cannabis industry is a concern. Efforts must be made to ensure that all voices are heard in order to create a thriving and sustainable cannabis industry.
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