Canix aims to ease cannabis cultivators’ regulatory bookkeeping

Growing cannabis on an industrial scale involves managing margins while continually adhering to compliance laws. For many growers, large and small, this consists of constant data entry from seed to sale.

Canix’s solution employs a robust enterprise resource planning platform with a steep tilt toward reducing the time it takes to input data. This platform integrates nicely with common bookkeeping software and Metrc, an industry-wide regulatory platform, through the use of RFID scanners and Bluetooth-enabled scales.

Canix launched in June 2019, and in a little over a year (and during a pandemic), acquired over 300 customers spanning more than 1,000 growing facilities and tracking the movement of 2.5 million plants.

Canix’s founders are upfront with the software’s goal: reduce labor cost. During a talk with TechCrunch, the founders stressed how growers could increase margins through improved labor costs.

Growers generally rely on enterprise resource planning platforms to track and forecast their crops, and Canix handles invoicing, costing and reporting while keeping the company compliant. Along with monitoring current inventory, Canix includes forecasting features. Starting with just plant clones, these prediction features will help growers predict yield 90 days away.

Before understanding Canix, it’s essential to know the landscape of growing legal cannabis in the United States. Growers have to adhere to strict oversight, including submitting paperwork each time a plant moves throughout facilities — and its lifecycle. This involves a lot of data entry, and most states require growers to submit this information in Metrc.

Metrc itself is a startup. The company launched in 2013 and now tracks cannabis operations in 13 states. In October 2018, Metrc raised $50 million. The platform is designed to track cannabis from seed to sale with a deep focus on compliance. It’s not an enterprise resource planning platform though some growers use it as such for the sake of simplicity. Though detailed and built for a modern agriculture operation, for some growers, inputting data into Metrc is often a labor-intensive job requiring cultivators to employ staffers to remain compliant.

Canix is designed for commercial operations that have a cannabis license. Several startups, including MJ Platform and BioTrack, are building similar platforms for this market, but Canix says the company’s focus on improving data entry makes it stand apart.

Stacey Hronowski and Artem Pasyechnyk founded the company after identifying a shortcoming in Metrc.

“I first started Canix when I was consulting for a Bay Area cannabis company,” said Stacey Hronowski, co-founder and CEO. “I was writing software that would connect their CRM and distribution systems, and reduce the double data entry they did every time they created an invoice. The company asked me to look into connecting the system I built to Metrc. I began looking at Metrc, and I was very surprised to find that growers were writing down barcodes on paper. That was when the initial idea for Canix came about.”

Hronowski met Canix’s co-founder Artem Pasyechnyk through a mutual friend at Facebook and they started building a platform. After the beta received positive feedback, the pair expanded to a full-scale operation.

Canix caught the eye of several critical investors in its short life. The company was part of Y Combinator’s summer 2019 program and, in May 2020, raised $1.5 million seed from Floret Ventures, Yleana Venture Partners, Altair VC, Mava Ventures, Nano LLC, and Andrew Freedman (former Colorado Cannabis Czar).