Observing plants growing in controlled environments probably didn’t appear to pulsate with opportunity, but for Fred Lindseth getting a high school research fellowship to study hydroponics set in motion a business idea that today is capitalizing on one the fastest growing new market opportunities out there.
It didn’t take long for Fred, a 3rd generation consumer product entrepreneur, to connected the dots and focus on the cannabis industry as a way to commercialize his passion for growth. Two years ago he started iDro to bring to market a smart home appliance (“cannabis hardware”) for growing cannabis in a home setting using hydroponics and other technologies that automate much of the growing process.
Overall, the cannabis industry is now worth U.S. $7.2 billion and is projected to grow at a compound annual growth rate (CAGR) of 17%, according to New Frontier, a data-analysis group focusing on the cannabis industry. The industry will be worth $24 billion and will create more than 300,000 jobs by 2020, asserts New Frontier. According to iDro (citing Greenwave Advisors’ estimates), the market could be as large as $87 billion should the entire U.S. move to legalize cannabis.
29 U.S. states have legalized cannabis for medical and/or recreational uses. California plans to legalize recreational/adult cannabis next year after years of success with legalizing it for medical purposes.
What is more intriguing about this cannabis hardware opportunity is its connection to a quiet national pastime with deep roots to a huge, mature market: do it yourself (DIY) gardening and lawn care. According to GardeningResearch.com, the now $36.9-billion dollar DIY yard and garden industry is growing at a slow and steady rate, led by millennials and by growth in food gardening, according to this year’s National Gardening Survey. So the idea of growing the things you need and desire is not as foreign as you may think. Also, the iDro device can grow other things like vegetables, too.
Using an iDro device takes a lot of the risk out of growing. It’s as simple as using an iPhone app to monitor moisture, humidity and nutrient parameters. In economic terms, payback for the $500 device can be as quick as one 3-5 month grow time for a fresh batch of sinsemilla.
iDro’s credentials for higher return on investment expanded greatly when Fred’s concept got accepted into CanopyBoulder, the first seed-stage business accelerator focused on the cannabis industry. iDro joined the 2016 spring cohort and emerged with a sharper focus on the fundamentals and $185,000 in seed capital. Today, the company aims to go to market with the support of a $500,000 series seed raise at a $2.25 pre-money valuation.
Another dimension worthy of praise is the company’s focus on design. For this aspect of product development, Fred attracted the interest of a key strategic investor: Ammunition, a product design and brand development company in San Francisco, CA. Robert Brunner, Ammunition’s founder, was Director of Industrial Design for Apple and named one of Fast Company’s “Most Creative People in Business.”