Exclusive Interview with Canix Co-Founder and CEO Stacey Hronowski
Cannabis ERP software company Canix was founded with the intention of reducing the cost of data entry for cannabis operators. The company’s platform is also designed to help operators calculate and optimize profit per gram, according to Co-Founder and CEO Stacey Hronowski. She gave New Cannabis Ventures an inside look at the Canix platform, the company’s growth strategy and funding. The audio of the entire conversation is available at the end of this written summary.
Engineering Excellence
Engineering excellence is one of the core tenets of Canix, according to Hronowski. Engineers make up half of the company’s team, bringing experience from tech companies like Facebook, Uber and Coinbase.
Hronowski has a background in both engineering and finance. She began her career at Cowen and Company before moving to H.I.G. Capital. Her engineering background drove her to explore the startup world. She took a consulting position with cannabis company California Dreamin’, where she helped to build a system to reduce the data entry burden for sales reps. Seeing how manual and error-prone the data entry process was sparked the idea for Canix.
Hronowski met her co-founder Artem Pasyechnyk at a party. They discussed her idea for an offline-enabled mobile app to help cultivators with data entry. Pasyechnyk, a senior engineering manager at Facebook at the time, joined her to work on the idea part-time. Together, they coded and launched a beta product, which garnered positive feedback. Pasyechnyk left Facebook and joined Canix full-time in March 2019. He currently serves as the company’s CTO.
The Canix Platform
The ultimate goal of Canix is to become the ERP of the cannabis industry. The company wants to provide a holistic product that supports all essential business operations for cannabis companies. Currently, the platform provides significant labor savings via its data entry features. It also leverages data to give operators inventory forecasting capabilities up to 90 days out.
The Canix platform includes an offline-enabled mobile app used for data entry in the field, a Bluetooth-enabled scale that sends data wirelessly to devices, RFID integration and a cloud-based web platform for reporting, invoicing and compliance.
With a strong engineering team, the company releases new features weekly. In the near-term, Canix expects to launch payroll integration and additional forecasting capabilities for cultivators.
Customers and Market Reach
Canix serves cultivators, manufacturers and distributors, as well as large vertically integrated operators. It has customers in seven states: California, Colorado, Oklahoma, Oregon, Massachusetts, Michigan, and most recently, Arizona.
Accelerating Growth
This fall, Canix won the TechCrunch Startup Battlefield event, which came with a $100,000 equity-free cash prize. The company is using that capital to help grow its team. It is looking to add two engineers this quarter, as well as a new sales team member and a new customer support representative, according to Hronowski.
The Canix team currently has 15 full-time people. Hronowski expects the company will double that number by the end of 2021.
In addition to building its team, Canix is looking to deepen its market reach in states like Michigan, Massachusetts and Arizona. The company plans to largely fuel its growth with organic strategies. It has a strong referral network made of its existing customers, and Hronowski expects this to continue to drive growth.
Funding
Canix went through the Y Combinator accelerator in the summer of 2019. The company has also raised a total of $1.5 million through investors like Floret Ventures, Emles Ventures and Altair VC. The company has a good relationship with its investors, and it will likely pursue equity fundraising in the future, according to Hronowski.
Growth Outlook
As Canix finishes out the year, it is planning to expand its platform to further support the manufacturing and distribution verticals. It is aiming to end 2020 with $150,000 in monthly recurring revenue. The Canix team carefully tracks customer retention, new sales, average contract size and number of deals per month as it grows.
Canix will experience the same startup growing pains as any other rapidly growing company. The team is set to double over the next year, and that presents communication and cultural challenges. But, Canix strives to create a sense of ownership for its team. All of its employees are in-house and on-site, which helps support invested product development and strong customer support.
Hronowski is looking forward to continuing product expansion as Canix works toward becoming a holistic software solution for the cannabis industry.
To learn more, visit the Canix website. Listen to the entire interview:
