In Bob Pratt’s old line of work as an aerospace engineer, he helped develop supercomputers, launch vehicles, and satellites used by NASA and the European Space Agency. But after two decades in the industry, he decided to call it quits to shift into the marijuana business.
Officially, Herbalizer, the product he and his cofounders have been developing for the past four years, is an aromatherapy device that can be used with a variety of herbs, such as peppermint, sage, and lavender. Unofficially, it’s a high-end vaporizer that has been gaining traction in marijuana forums as a quicker, cleaner way to consume cannabis.
“I gave up a six-figure job to go and pursue this,” Pratt, 52, tells Fast Company, “but I would’ve never forgiven myself if I hadn’t.”
With more states weighing legalization of marijuana, weed is expected to flourish into a $10.2 billion market by 2018, according to the research arm of cannabis investment network ArcView Group. Hoping to capitalize on this so-called green rush, techies such as Pratt have switched careers, bringing their know-how to the once seedy world of marijuana.
There are a few parallels between designing high-tech space equipment and a next-generation vaporizer. The most obvious is heat: Satellites have to endure a drastic change in environment, and the Herbalizer’s components need to withstand heating to 445 degrees Fahrenheit in 10 seconds. When they worked at Maxwell Technologies in San Diego, he and cofounder Josh Young were both involved in thermal vacuum testing, in which they mimicked the space environment to test hardware, and made sure to follow thorough protocol to test their vaporizer.
“When you do thermal testing, you put a plan out there long before testing, get approval, update it, make sure it’s what you want to do, perform the test, and generally you have a successful test,” he says.
Their materials background also came in handy. Instead of high-strength alloy and aluminum used in space equipment, the Herbalizer team decided on a variety of plastics because of its curved shape. They chose inert materials that when heated don’t off gas, discharge harmful components, or emit any odors, he says, and relied on 3-D printers to produce prototypes to pitch potential distributors and show off the product at cannabis trade shows.
“For me, this product development for consumers is more difficult,” Pratt admits. In aerospace, he says “you watch yourself do a lot of good work for people–just pour your heart for something, but at the end of the day, you were just punching a clock.”
The opportunity to be a pot-preneur was also too great to resist for 22-year-old Sebastian Stant, who is building MassRoots, a private “dark social network” for cannabis enthusiasts to share photos and potentially meet up with like-minded people. Before joining the company, Stant spent a year interning at Sean Parker’s AirTime, since rebooted as OKHello, a group video chat platform based in New York City.
“To me, this is a brand new frontier,” Stant says. “I know coming on board was going to be a big learning experience. So much on the ground has not been covered yet.”
Cofounders Isaac Dietrich and Tyler Knight asked him to go full time in the fall, and Stant was convinced when he saw MassRoot’s growth, which at that time was doubling across metrics month-over-month. He says any hesitation he had to join this blooming industry was diminished because Colorado and Washington had already legalized recreational marijuana. “That’s definitely helped because you’re getting the state-level government giving the okay,” Stant says. “At the same time, we’re not in the manufacturing or production of marijuana. We don’t own a greenhouse.”
Before Ralf-Rainer von Albedyhll founded Next RX, the 57-year-old had built Secure.cc, an educational software company that developed an app to help booster clubs raise funds. After hearing about the drawn-out process required to register with dispensaries, he decided to try it for himself. He went to get a doctor’s recommendation for medical marijuana and proceeded to the nearest dispensary in Venice, California. The process required plenty of paperwork and the scanning of his identification card. “I came back two weeks later,” he says. “To my amazement, they couldn’t find my record.”
As a German living in California, he got to know the dispensary’s owner, also a German immigrant. Von Albedyhll said he could build better software to manage his database and asked the owner for five features he wanted. He returned a few days later with an iPad app, and asked the dispensary to join a beta test for RX-Pass, check-in software that would streamline the process for new and returning patients. Eventually he got another dispensary on board and cumulatively registered more than 10,000 patients. Though the city of Los Angeles has shut down both dispensaries, he’s still bullish on this space.
NextRX’s products, he says, could facilitate pot tourism in states that allow it. Dispensaries in Nevada, which is in the midst of debating the legalization of marijuana, could potentially use RX-Pass to verify the status of medical marijuana patients in other states. He says the company could also develop a feature to help dispensaries manage and file their taxes on a regular basis. There are, as well, ideas to roll out a universal rewards system for dispensaries that have opted in, sort of “like the Starwood hotels rewards system.”
For ad man Joe Hodas, 43, the decision to join a company that produced marijuana goods wasn’t one he took lightly. He got acquainted with Denver-based Dixie Elixirs and Edibles, which makes marijuana-derived drinks, food items, and topical products, about four years ago when it contracted the ad-tech firm where he was a partner to develop a logo. He kept in touch with Dixie’s CEO Tripp Keber over the subsequent years.
Hodas joined Elixir in January as chief marketing officer after half a year of contemplation. During that time, he reached out to about a dozen mentors weighing the offer. “I spoke to pretty much every advisor and mentor I had to get input on things like: ‘Do you think this will be a good career move? If it doesn’t work out, would this be a stigma to my next move? Do you think it’s stable? Do you think there are legal concerns because the feds don’t recognize it as a legal industry?'” he recalls. “Not one said don’t do it.”
But as a family man with three young kids, there were still concerns. It took some convincing to get his wife on board, and his children–ages five, 10, and 12–were worried this career shift meant he was a drug addict. “I talked [to the two older children] about the good medical benefits–that it’s legal in Colorado and therefore legal for me to get involved and that it’s not intended for them or children and all,” he recalls. The family set some loose ground rules, such as not bringing marijuana products into the home.
Todd Mitchem, chief revenue officer of pen vaporizer company o.penVAPE, also had to break it to his kids when he contemplated leaving his senior vice president role at Eagle’s Flight, a company that helps large companies, including Microsoft and Apple, restructure. His eight- and six-year-old children were less interested, but his curious 10-year-old son asked many questions and did his own research on the topic. “The most profound moment came about a week [after telling him about the job offer]. He came to me and said, ‘It’s just a plant,'” Mitchem recalls. Even his conservative father–a man who “lives and dies by Fox News”–was supportive of the move. “Remarkably, he said, ‘It seems like it’s a good business, so I think you should look at it seriously.'”
Though the 43-year-old says he’s been a “closet cannabis user” for more than 20 years, he’s always been shy about the pastime. “I certainly wouldn’t have been allowed into organizations like Microsoft and Apple if they knew about it,” he says. Furthermore, joining a marijuana company in a public-facing role would forever connect him to this world. “I knew it was going to be my legacy. It’s not like I’m able now to be a CRO at a tech company because they already know I’m coming in as a cannabis user.”
Leafly, a marijuana reviews site often hailed as the Yelp of weed, has its roots in tech as well. Before it was acquired by Privateer Holdings and relocated to Seattle, the company was founded in Orange County by three Kelly Blue Book engineers–Scott Vickers, Brian Wansonlich, and Cy Scott. As Privateer looked to build out its marketing teams, the firm sought leaders from the tech world with experience managing large brands.
Nathan Peterson, who oversaw T-Mobile’s social media program for two years and before that worked at Microsoft, joined the company in January as Privateer’s director of marketing. Soon after, he poached two of his former colleagues at Microsoft. Aviad Benzikry, a senior marketing manager at Tilray, another Privateer company focused on the Canada market, formerly led worldwide marketing programs for Windows. Paul Campbell, who was part of Microsoft’s social marketing team, joined as associate director of digital marketing at Leafly.
“My first real-world corporate experience at Microsoft was just a little bit stifling, but it still taught me good lessons,” Peterson, 31, says. Though he isn’t shy about how much he loved working at T-Mobile, he couldn’t resist the allure of this budding industry. “I was itching. ‘When will I take the jump back into the entrepreneurial space that I always dreamed about in college?'” he remembers asking himself. But telling his family–in particular his conservative businessman father-in-law–wasn’t an easy task. “He grilled me for a good hour to make sure I had done my research and understood what I’m talking about,” he says. “Afterward, he did his own research and said, ‘I think you should do it.’ That was a Hail Mary I didn’t expect.”
For the techies who have transitioned over to marijuana, the cultural differences are stark. “There’s different levels of professionalism for this industry,” Peterson says. “I would say that is the biggest culture shocks for me: when I would walk into a meeting and sit down.” In one instance, he had someone pitch him an idea by emptying a plastic bag of marketing materials on the table. “I’m laughing inside my head thinking this is crazy,” he says. “Less than a month ago, my boss would’ve killed me if my PowerPoint wasn’t pristine, and now I’m looking at a crinkled napkin for someone’s edible they want to launch.”
When Mitchem agreed to take a meeting with o.penVAPE, he wasn’t sure what he was getting into, expecting “a group of guys getting high all day making a business out of it.” Right away, the location seemed promising: the 14th floor of a high rise in downtown Denver. “They were like regular business people I’ve met with a million times, and they had a real plan and a real vision,” Mitchem says. “What they didn’t have was the structural stuff. They wanted someone to come in and help them understand the business.”
In addition to bringing their various expertise into marijuana, the techies who’ve migrated over to pot are trying to instill a level of professionalism, and that means occasionally donning a suit and tie. “This isn’t what everyone thinks it is,” says Bill Lupo, chief operating officer of Weedmaps and Ghost Group. “There are people here who are buttoned up and professional and understand the business.”
The 43-year-old, who previously served as vice president of digital at a marketing agency, joined Weedmaps and parent company Ghost Group to help the firms scale. He says the metrics, including $20 million in revenue, convinced him there was a steady future. “The culture here is definitely metrics-driven,” he says. “The risk was mitigated here by the fact it is a tech company that has been scaling for four years, and I would fit here with my skill set.”
Like a typical startup environment, running a marijuana tech company means working swiftly. “We’re first movers in a new business, so we have fast meetings on the fly, hallway meetings,” says Lupo. “It’s very fast tempo and paced, and we’re trying to keep that culture going forward.”
The difference is night and day for Mitchem. At the restructuring firm Eagle’s Flight, “they would make a decision today, implement it in 30 days, wait six months, and see how it goes,” he says. Now? “We have an idea in the morning, implement by noon, and it better be working the next day or day after.” Accustomed to the breakneck speed at o.penVAPE, he says it’s hard to imagine returning to a larger, slower organization.
That agility is also required in an industry that is rapidly transforming. “We don’t have to sit around and commiserate appropriately on committee structure. We get together and have great arguments because we’ve got to get this done,” he says. “Not only is the industry changing. The laws are changing. Different states are changing. The federal government could issue guidance at any moment. The banking system is still a mess.”
Still, even against a backdrop of uncertainties, Mitchem sees a future where pot is a part of everyday life–and not just in Colorado. “Some day,” he says, “we can walk into a restaurant and the waiter will ask: How would you like to recreate this evening? Would you like a glass of wine or some cannabis? I just think it’s going to be a part of the normal way of living.”