Cannabis Software Stack: Who Leads the Back Office Sector?

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What is the back office sector of the cannabis software market like and which company will be the leader in 2020? Cannabiz Media looked at the data in the Cannabiz Media License Database and published the answers to these and other questions in the Cannabis Software Stack report last month.

Let’s take a closer look at some of the data from this report and see what the Cannabiz Media research team has learned about the back office sector.

Define the licensing option in each state

The Cannabiz Media team has found 332 unique Washington companies that connect to METRC or Leaf Data Services. Using the Cannabiz Media license database, we determined how many licenses they can link to in those states (i.e., the “licensing opportunity” or the potential addressability market in a state).

To determine this license opportunity, we’ve added active, pending, and applied licenses for the corresponding activity. For example, to develop the license option for point-of-sale software, we involved active, pending and applied pharmacies and retailers. The four software sectors are:

  1. Back Office (95 companies) – This sector includes solutions for complex operations that can be used by different types of licensees such as ERPs, seed-to-sale, compliance and supply chain / logistics.
  2. Activity (68 companies) – These are characterized as solutions designed for specific license holders such as point-of-sale, grow software, delivery and laboratory information management systems.
  3. Transaction (31 companies) – These solutions revolve around B2B and B2C transactions and include financial institutions, financial compliance, marketplaces and payment processing.
  4. Advisory ((60 companies) – This group consists of consultants who can advise on the technical integration and data analysis of companies.

Based on the above findings, the market map looks like this:

The breakdown of the back office cannabis software

The back office sector is the largest that we found in our research. This includes companies that offer ERP, seed-to-sale and supply chain / logistics solutions. We have grouped these together because the solutions are typically comprehensive and used by licensees in different parts of the value chain.Main results for the back office sector:

  • We have identified 95 companies in the back office area.
  • They make 419 connections to 15 states.
  • 77 of the 95 companies (81%) are connecting in California.
  • Back Office includes the following categories:

• Seed-to-sale


• Supply chain logistics

• Attention

• Regulatory solutions

The Back Office Leaderboard contains the most affiliated companies that we have found. Because of the nature of their products, these seed-to-sale and ERP vendors benefit from customer support in many states. Their solutions are robust and complex, and this makes them attractive to multi-state operators who need to manage remote operations. Leaderboards for the Transactions, Activity, and Advisory categories can be found in the Cannabis Software Stack Report.

Ranking of the back office sector

Why this information is important

The information in our report is useful to a wide variety of stakeholders in the cannabis industry:

  • Regulators They can gain insight into the size and scope of the software landscape and learn about many of the companies they may work with.
  • Existing providers can use the information for both competitive and business intelligence – and to find future partners and acquisition candidates.
  • Investors can use it as a list of potential acquisitions or partners for their portfolio companies.
  • Existing license holders can use it to measure software vendor footprint. With this data, they can see which companies are one-state wonders.

Another key factor in our analysis is that since Cannabiz Media tracks the number of licenses in each state, we can create a sense of competitive intensity. For example, if 40 point-of-sale providers chase 400 licensees, there will be a lot of competition. The bottom line is that this information can be extremely valuable to stakeholders across the industry.

What’s next?

In the coming weeks I will be releasing the industry leaderboards for the remaining three sectors (Transactions, Activities and Consulting). So stay tuned to the Cannabiz Media blog.

Cannabiz Media customers can stay up to date on these suppliers and other new licenses through our newsletter, alert and reporting modules. Subscribe to our newsletter to receive these weekly reports in your inbox. You can also schedule a demo for more information on how to access the Cannabiz Media License Database yourself to delve further into this data.

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