By Rachel M.
After much coaxing, cannabis is finally out of the closet (literally). The masses want legal supply but the competition is fierce, and the market is unstable. To compete, companies are looking to greenhouses for year-round, high-quality production at ultra-low operational cost. Translation: the hope for beautiful margins. With that said, these margins come at a significant capital cost as greenhouses are expensive to build. The construction and outfitting of a commercial-sized, high-tech greenhouse for growing cannabis can cost millions of dollars. In Canada, this is in addition to the $5-10 million to get a cannabis cultivation company up to code and federally licensed.
While consumers and investors can both rejoice in greenhouses’ high-quality output, it takes money to make money. Unfortunately, women don’t seem to have the same access to this capital as men – even more so than mature industries across North America.
In 2020, it seems perfectly reasonable that the emergence of a brand-new industry would provide opportunities abound for leaders who equally represent consumers… right?
If only that were the case. Unfortunately, this wondrous opportunity for a better stab at equal representation is looking more and more like a Miss Universe Pageant: a select few women who symbolize the gender-normative ideal of success, competing against one another while being judged publicly. One can only speculate the standard to which women are held in cannabis boardrooms… literally… we can only speculate because they don’t appear to be there. A 2019 study by Marijuana Business Daily found only 7% of board members at public cannabis companies were women. This figure pales in comparison to the Canadian average of 12-15%1.
Unfortunately, this wondrous opportunity for a better stab at equal representation is looking more and more like a Miss Universe Pageant: a select few women who symbolize the gender-normative ideal of success, competing against one another while being judged publicly.
Even the trailblazing women who beat the odds and launched their own companies are now being cast aside. After 48North had already suffered the departure of one half of their double female Co-CEO team, Jeanette VanderMarel at the end of 2019, the sudden departure of their remaining CEO, Alison Gordon presumably cut the number of female CEOs in the top 100 public cannabis companies from a mere 82 down to 6. VanderMarel resigned, and Gordon was released without cause and replaced by Charles Vennat, who held the position of Chief Corporate Officer prior to his promotion.
For better or worse, the decreased risk of a normalizing cannabis industry leads to greater interest from leaders in traditional fields. Cannabis lawyer, Trina Fraser, identified that the migration of executives and investors from male-dominated industries such as mining, technology, and finance bring “traditional ways of thinking and doing business that largely leaves women out of executive decision-making.”1
Men are not the only ones making the moves to cannabis, female executives are too. Unfortunately, by no fault of their own, these women have developed their professional selves in industries with cultures long-dominated by their male counterparts. By trailblazing a path in the cannabis industry, these women are setting an example for others, but in doing so, many become complacent to the “Boys’ Club”. These women are the unicorns: they’ve earned their place at the top, but their position is often used as evidence by companies that gender discrimination does not exist, at least not within their organization. Simply because a woman has overcome adversity in male-dominated industries does not mean the adversity is non-existent.
While these unicorns are challenging the status quo, it still takes money to make money. In 2018, the Academy of Management Journal published We Ask Men to Win and Women Not to Lose, a study by Columbia and Harvard business schools. This study revealed that investors ask male entrepreneurs to answer promotion-focused questions surrounding hopes and advancement needs while asking women prevention-focused questions concerning losses and financial security. The study illustrates that those who are asked growth-related questions raise significantly higher amounts of funding than those asked questions related to assurance and maintenance. As a result, throughout the course of the study, the female women entrepreneurs raised $2.3 million while their male counterparts raised $16.8 million3. With results like these, it should come as no surprise that the July 2020 Bedford Consulting Group report found only 8% of 437 public cannabis executives are women4.
This study revealed that investors ask male entrepreneurs to answer promotion-focused questions surrounding hopes and advancement needs while asking women prevention-focused questions concerning losses and financial security.
Across all industries, women own 40% of US companies5, but only receive 2.2% of venture funding6. In an industry defined by opportunity and growth, where standing still means falling behind, we need women to have financial support to progress their ideas, brands, and services. Without proper funding, women-owned cannabis companies are trapped under the glass.
In an industry defined by opportunity and growth, where standing still means falling behind, we need women to have financial support to progress their ideas, brands, and services. Without proper funding, women-owned cannabis companies are trapped under the glass.
And don’t even get us started on how many of those companies that raised institutional capital have minority founders…. but we’ll save that for another article.
Despite all of the above, cannabis is praised for being unlike other industries, and many people claim (often to our faces) that it has unlimited potential for women. In fact, there is a common belief that the glass ceiling does not exist. Perhaps this notion is right: based on the industry we see today; the glass ceiling does not exist because the greenhouse is too expensive to build.
Photographer: Hilary L. Yu
Model: Maxine Tamoto @mmaxinelucille
1 Beattie, Samantha. “8 Female CEOs, 92 Male CEOs: Canada’s Cannabis Industry Has A Problem.” HuffPost Canada, 14 Feb. 2019, www.huffingtonpost.ca/2019/02/14/cannabis-industry-leaving-women-behind_a_23669643/.
2 Lamers, Matt. “Men hold 93% of Canadian cannabis boardroom positions.” Marijuana Business Daily, 24 Mar. 2019. https://mjbizdaily.com/men-hold-93-of-canadian-cannabis-boardroom-positions/.
3 Huang, Laura, et al. “We Ask Men to Win and Women Not to Lose: Closing the Gender Gap in Startup Funding.” Academy of Management Journal, 20 Apr. 2018, journals.aom.org/doi/10.5465/amj.2016.1215.
4 Bedford Consulting Group. 26 May 2020. “Compensation Report: Cannabis.” https://bedfordgroup.com/news-insights/new-bedford-report-details-cannabis-industrys-executive-and-board-compensation-in-canada-u-s/
5 Hinchliffe, Emma. “Funding For Female Founders Stalled at 2.2% of VC Dollars in 2018.” Fortune, 28 Jan. 2019, fortune.com/2019/01/28/funding-female-founders-2018/.
6 “The 2018 State of Women-Owned Business Report.” about.americanexpress.com/files/doc_library/file/2018-state-of-women-owned-businesses-report.pdf.