What is LeafWorks, Cannabis Market Challenges and Opportunities

What is LeafWorks?

LeafWorks Inc  is a biotechnology company that improves cannabis and hemp cultivation and the quality of downstream natural products in the supply chain through DNA ID testing. The company was founded in 2016 by two plant geneticists, Dr. Eleanor Kuntz and Dr. Kerin Law. The founders shared a passion for preserving plant biodiversity, had a unique understanding of the business of global botanical trade, and used their cutting edge expertise in plant genomics to generate the genetic tests needed. Thus, a new venture combining these aspects was formed.

LeafWorks’ Origin Story

Dr. Eleanor Kuntz, with a background in botany from Smith College and as a trained herbalist under the mentorship of Rosemary Gladstar – America’s godmother of modern herbalism – entered graduate school to specialize in the intersection of genetics between wild and cultivated plant species. Upon graduation with her PhD, Dr. Kuntz left academia to begin her career in plant sourcing and Best Agricultural Practices of plant cultivation to meet medicinal needs in the natural products industry. In this tenure, Dr. Kuntz learned that the most critical issue in the global botanicals is identity validation of sourced raw materials. In other words, how does one know that what is on the label is actually in the jar? Every time raw material changes either hands or form (i.e. processing leaves to powder), it is required to be retested to validate that it is that ingredient and only that ingredient. Unintentional adulteration and fraud are rampant in the global wholesale market, making this a massive challenge for the natural products industry. The historical testing technology, chemical testing, can be fooled with fraudulent material, making it more difficult to ascertain the true identity of the material. Dr. Kuntz recognized that cannabis DNA testing would solve these issues.

Dr. Kuntz met Dr. Kerin Law at the University of Georgia as a fellow graduate student where Dr. Law’s focus on global-scale plant genetic diversity and method development was a perfect fit to Dr. Kuntz’s vision for change in the natural products space. Upon Dr. Law receiving her PhD in genetics, the two teamed up to create LeafWorks. LeafWorks offers DNA ID tests and services that help people know what they are getting when they purchase a product in the natural product space, with an initial focus on cannabis DNAtesting. Cannabis was the wild west when LeafWorks began in 2016 and needed the supply chain validation and breeding tools that were available in other crops but not yet in cannabis. LeafWorks built those tools itself and now sells them to the public.

Cannabis Market Challenges

Challenges in the cannabis space include the regulatory hurdles that operators face when building a business and the fact that cannabis is a Schedule I plant, thereby making interstate commerce illegal. Additionally, an oversupply of the booming cannabis market caused the price per pound for wholesalers to go down, forcing many mom and pop and multi-generational legacy farmers to fold. 

Luckily for LeafWorks, however, DNA testing is a completely legal endeavor, because DNA is not regulated or scheduled. It’s simply a biological substance that’s part of this world. This means that LeafWorks can help any cultivator anywhere to help them streamline their operations and improve their plant production.

Cannabis Market Opportunities

According to Fortune Business Insights, the global cannabis market is booming and will keep growing to about $200 billion in size by 2028 with a CAGR of over 32%. There is huge potential to get involved in the space, but being smart about business differentiation and finding your niche is key. One area of market opportunity for anyone looking to make their mark is through plant breeding; in other words, creating plants that are superior in both quality and consistency. When you plant seed from other crops, the expectation is that they grow in specific ways, flower at certain times, and take a specific amount of time to develop. With cannabis, that is generally not the case. Consistency is all over the map, and supply chain optimizations are therefore  a tremendous opportunity for cannabusiness growth. 

On the consumer side, meanwhile, over 40% of respondents in an Eaze survey found that Generation Z, the fastest growing users in cannabis, use cannabis for mental health and stress. Identifying pain points that can make this experience better, more consistent and effective is a continuing opportunity in cannabis.

Advice to Cannabusinesses

The main advice that we at LeafWorks give to others is to be conscientious of and plan accordingly how to succeed in a rapidly changing market. Cannabis is a marathon, and certainly not a sprint. Focus on long term goals and make a plan to achieve it. Additionally, think critically about what expenditures will save you money in the long run to make your company leaner and more streamlined. As an example, the LeafWorks team sells aCannabis/Hemp DNA Sex ID Test  that can tell you if a plant is male or female within 7-10 days into cultivation as opposed to waiting to remove males months later. Growers need female plants to sell flower, meaning males are a waste of resources in this situation and so removing them sooner is better. While out of pocket costs for LeafWorks’ DNA tests add to the immediate cash burn, pulling males early to fill your farm’s space with just the females that make you money saves up to 20% of operational costs over the course of the harvest.

Similarly, as a business owner, you need to be proactive on the issues that can derail your profits. In cannabis, disease monitoring is a great example. Some folks only do disease testing when a plant is sick; however, some pathogens stay latent while it spreads. When an infection outbreak takes over, it’s too late. Hop Latent Viroid, for example, causes loss of yield by an estimated 20-30%. That can be millions of dollars of losses that could have been prevented with scheduledcannabis DNA testing . Pathogens like Hop Latent Viroid can be detected early to remove plants. Think critically about pain points that you will have in your business, and identify simple solutions to avoid or solve them.

Overall, cannabis DNA testing is here to stay. It functions to help those in the natural product industry overcome challenges to produce a quality product of known identity where the label matches the jar. Not only does this help consumers and patients obtain better health and wellness from these products, but it also generates true brand equity to have transparency in sourcing and quality products. ExploreLeafWorks to see more information about our services.