Exclusive Interview with Gary Cohen, CEO of Cova Software
Cova Software, a division of wireless software company iQmetrix Software Development Corp., is a compliant dispensary software company that commenced sales in August 2017. CEO Gary Cohen sat down with New Cannabis Ventures to discuss how the company strives to be the “lovable” software provider in the cannabis space, why the company focuses on the retail market, and future growth.
Cohen background spans decades in the tech industry, stretching back to 1986 when he was selling one of the first cell phones in Denver. Since then, he has worked with more than 10 different tech startups, watching software roll out and navigating the road bumps along the way. He brings this expertise and an unshakable optimism to his leadership role with Cova.
How Cova’s Solutions Work
Cova sells point-of-service software to cannabis dispensaries, and Cohen sees three elements of this service that help clients scale their businesses, the first of which is customer experience. Cova’s entire system is designed to engage and educate customers from the person who has never been in a dispensary to the more seasoned shopper. Retail is first and foremost about customer experience, and the company’s software aims to go beyond being a simple cash register. Second, the software is designed to be a powerful tool for anyone, including store managers and buyers, taking action to run the dispensary on a day-to-day basis. This means the system has functions like purchase order creation, inventory tracking, reorder limits, and more. Ownership is third piece of the puzzle. Owners have a robust set of tools at their disposal to set permissions for anyone who interacts with the software and strong, as well as reporting and analytics capabilities that allow them to drill down to metrics like sales per day, per hour, and sales per person. The entire system is designed to show and support retail best practices in the dispensary.
Cohen believes one of the constant challenges most companies face is the decision to make, buy, or partner for new technology. While there are a lot of capabilities he would like to see in-house, Cohen knows the limits of the company’s resources and the power of the right partners. That is why the company’s software has partnerships with companies like Baker, springbig, greenRush, and I Heart Jane. The company is also exploring other partnership opportunities with payment solution companies in Canada. The goal is to make successful partnerships and leverage them to provide customers an effective, powerful solution.
Serving the Retail Space
While many other software companies in the cannabis space offer solutions that span retail and grow, Cova remains focused solely on retail, which is its area of expertise. It serves the company to be the best-in-breed retail management software solution, rather than spreading its resources too thin and trying to cover the entire supply chain. The company will recommend other software solutions to its vertically integrated customers seeking advice on covering the grow and distribution portions of their business.
This focus has made the company successful. Right now, Cova has contracts with more than 200 stores in California, Colorado, Washington, British Columbia, Alberta, Saskatchewan, and Manitoba. The company focuses on limited markets where it completely covers compliance requirements. With that in mind, the company is looking at areas in the north east and west of North America.
The Cova Team
iQmetrix, the parent company of Cova, has more than 20,000 stores and more than 80 percent of the cellular dealer market in North America. Cova has a dedicated team of 35 employees in Denver and Vancouver, but, as a part of a larger company, it has access to more resources. An additional 20 people spend about 50 percent of their time on Cova, while the larger company’s 24/7 customer support service extends to cover Cova. Cohen hopes to bring on more dedicated people for first development and then for sales and marketing.
Funding and Revenue at Cova
As a part of iQmetrix, Cova has had access to funding, but Cohen expects that he will pursue additional outside funding at some point. Cohen expects the company to finish the year with a $3 million revenue run rate, but he is confident that number will increase substantially in 2019 and beyond as the market continues to grow in both the U.S. and Canada.
Cohen sees the market’s immaturity as one of Cova’s biggest hurdles to overcome. Many dispensaries are new to retail best practices, and, without a basic inventory system and understanding of those best practices, Cova’s solution can do nothing for a customer. But, increasing regulation will push the industry past this growing pain. Plus, Cohen sees the increasing move toward an enterprise model as advantageous for the company. In Canada, most of the companies he speaks with are talking about opening multiple dispensaries as opposed to a single mom and pop shops. Cohen sees Canada’s dispensary market as 80 percent enterprise and 20 percent mom and pop, while the U.S. is at 10 percent enterprise and 90 percent mom and pop. As more professional investors enter the space, it will continue to trend toward an enterprise model, and Cova’s solutions are built for scale.
Cohen is looking to be an active voice in the cannabis space with a bid for a board spot with the National Cannabis Industry Association (NCIA). He hopes to push for the advancement of technology in the space and increased legitimacy through reporting standards.
Listen to the entire interview. Cova Software is a client of New Cannabis Ventures.