After selling his accounting software company Outright to website behemoth GoDaddy, entrepreneur Ben Curren thought he’d take a couple of years off. But three months into his break, he got bored. He decided to look back through his “idea book” where he would jot down various inspirations and saw the comment “look into cannabis.”
This was the genesis of the creation of Green Bits, that bills itself as the “Square” of cannabis. He did “look into cannabis” and his research showed him an emerging industry that had a huge number of complicated challenges on the retail side. His background in accounting, compliance and helping small businesses fit nicely with the skills required to tackle the industry problems.
Curren created a one-page flyer addressing the industry pain points and how to solve them. He sent it to license holders in Washington essentially saying, “Hey, we’re building this, are you interested?” To his surprise, people responded even though he didn’t have the product built. The process of asking potential customers what they needed as he was building it, helped Green Bits to deliver a strong end result. “This process helped us get our first 15 customers,” said Curren. This was 2014 before the dispensaries had actually opened. “These customers helped my funding to get this thing built,” he said.
Fast forward to today and Green Bits serves more than 800 legal cannabis retailers in seven states. The company processes more than $2 billion in annual sales through its point-of-sale system. In just a few short years, Green Bits is beginning to surpass its competitors in the number of dispensaries it works with.
The software is subscription-based and tracks inventory of marijuana for retail dispensaries and automatically provides information to the government in order to make sure the businesses are in compliance with state rules. The software also helps dispensary owners manage cash flow and inventory. The product can provide customer verification at check-in and automatically limits transactions from states where cannabis is illegal. Green Bits works with all the seed-to-sale tracking systems as well. Taking the information from these programs and then funneling that through to the proper authorities.
Curren wrote most of the original code himself with some help from his Outright coders that were working at GoDaddy.com at the time. These original founders worked during their off hours and took vacation time from GoDaddy as the dispensaries went live. They no longer work at GoDaddy.
The curse and the blessing for this serial entrepreneur was the limitation of licenses. The small number of licenses kept the company’s growth in check, but the blessing was that the slowness allowed Curren to bootstrap the company. “I didn’t have to dump in a half million dollars at once,” he said. “I could do small amounts as necessary to build the company. Now we’re around 45 people serving almost a thousand dispensaries.”
Beating The Competition
MJ Freeway and BioTrack are his biggest competitors. These companies were created earlier than Green Bits, but he wasn’t intimidated. “BioTrack and MJ Freeway pretty much ran all the dispensaries in the state of Washington. We went after the recreational market and they were in the medical. In less than four years, we took 80% of the market away from them” said Curren. “The same thing is happening in Oregon.”
The limitation of licenses is the biggest challenge for this growing company. “We need the market to be larger in order to be a large technology company,” said Curren. Ideally, he’d like to get to ten thousand dispensaries, but of course, there aren’t even that many in the country at this time.
While the Green Bits strives to protect its customers from the headaches of compliance, even this company concedes that the current situation in Washington state goes beyond what it can do. The transition from BioTrack to Leaf Data has been problematic. “It’s definitely challenging,” he said, “But Washington has the second most sales of any state. You’re moving from Biotrack that went from 5 dispensaries to 400. It grew slowly. Leaf Data has had to take it over right away when everything was already running.” Leaf Data has made the same argument when answering criticism over the problems of the transition.
Curren said it was 100% impacting businesses. He added, “It’s quite costly for us to work around these issues, but things have been improving over the past week.” In the meantime, Green Bits will continue to protect its customers from the pains of being in the cannabis industry.