Microsoft Breaks Into The Marijuana Business, Tech Giant To Develop Weed Monitoring Software

Twenty-five states in the country have already legalized medical marijuana in the US, while five of them allow for recreational weed. For the most part, corporate America has stayed away from the controversy surrounding marijuana… until now.

Now, Microsoft is trying to change the ballgame by developing software that will allow businesses to track down marijuana from “seed to sale.”

Make no mistake, there’s really a big business here. To date, five states — District of Columbia, Washington, Colorado, Alaska and Oregon — have already legalized recreational marijuana. This fall, five more states will vote on whether the use of recreational cannabis will be allowed.

“The software — a new product in Microsoft’s cloud computing business — is meant to help states that have legalized the medical or recreational use of marijuana keep tabs on sales and commerce, ensuring that they remain in the daylight of legality,” said the New York Times.

According to the article, most cultivators and distributors of recreational weed typically have a difficult time securing a loan from banks for their businesses. Although it’s not illegal in some areas, the controversy the industry generates is something that commercial banks do not want to associate themselves with.

But Microsoft’s entry into the burgeoning marijuana industry will give it an air of legitimacy in the eyes of corporate America. Whether that’s a good or bad thing is something else entirely.

Kimberly Nelson, executive director at Microsoft’s state and local government solutions, admitted to NY Times that the company sees a “significant growth in the industry.”

“As the industry is regulated, there will be more transactions, and we believe there will be more sophisticated requirements and tools down the road,” she said.

To develop the infrastructure for the marijuana business, Microsoft has partnered with Kind, a Los Angeles-based startup. The plan is to construct kiosks in selected states with machines that can “facilitate marijuana sales.”

Just to clarify, Microsoft is not growing or selling marijuana, but rather is developing software that can help businesses be more competitive in terms of their IT infrastructure, as well as helping the government monitor the activities for tax purposes.

The trick, however, is how to convince banks.

Under the present system, transactions at recreational weed centers are on a strictly cash basis only.

“Banks, being federally regulated, have mostly stayed well away, forcing marijuana dispensaries to either operate on a cash-only basis or work with special kiosks, such as those provided by Kind Financial,” said the report.

Kind CEO David Dinenberg said in a statement that the future of legal cannabis is very much fluid. Like tobacco and alcohol, the industry—whether medical or recreational—will always face strict regulation. But the company will “offer governments and regulatory agencies the tools and technology to monitor cannabis compliance.”

“I am delighted that Microsoft supports KIND’s mission to build the backbone for cannabis compliance,” he added.

The marijuana software that Kind is working on with Microsoft is dubbed “Agrisoft Seed to Sale,” which is described as bridging the gap “between marijuana-related businesses, regulatory agencies, and financial institutions.”

A spokesperson for Microsoft, meanwhile, told BBC that there should be no controversy surrounding the company’s foray into the cannabis business, as the role is merely Microsoft lending its cloud service to accommodate the software by Kind.

“Kind Financial is building solutions on our government cloud to help these agencies regulate and monitor controlled substances and items, and manage compliance with jurisdictional laws and regulations,” the spokesperson added.

Besides, Microsoft is not breaking any state laws, as the tech giant is based in Washington, where recreational marijuana is legal.

[Photo by David Ramos/Getty Images]