Here’s another way to bring in the holiday cheer
November 8, 2016 was a red (green?) letter day for marijuana legalization, bringing the grand total of states allowing medical marijuana use to 28 (plus Washington DC), and the total of states allowing recreational use to eight (again, plus Washington DC). As more states jump on the bud bandwagon, a new breed of business innovator continues to emerge: the cannapreneur.
Eager to make their marks and stake their claims in this still fledgling industry, cannapreneurs are creating startups at a rapidly growing rate. A search for the term “marijuana” on the startup’s best friend, AngelList, currently provides 861 results. With so many new cannabis-related enterprises, it can be difficult to know which ones are worth hitting up, so here are the top ten.
San Francisco’s Eaze is a medical marijuana delivery service that follows the Uber method of employing drivers and promises delivery “in minutes.” The service founded by Keith McCarty in 2014 is free for patients (the partnering dispensaries are the ones that foot the bill), and Eaze currently offers to help customers get a medical marijuana license online for just $30. One wonders how the recent legalization of recreational use will affect that part of the business model.
This is by far the most successful startup on the list: It has raised $24.5 million in total funding, and raised $13 million in Series B financing in October.
One of two home-growing systems on this list, Grobo boasts that it’s the easiest and most advanced way to grow both food and “medicine” indoors. Basically, all you do is put seeds or cuttings in the very stylish unit, use an app to tell your Grobo what you planted, and sit back and let the system take care of everything. It monitors the health and needs of your plant and adjusts the growing environment accordingly.
Grobo isn’t even available for pre-orders yet, but signing up for their emails will net you a discount off the $1,299 price tag when it is. The Waterloo, Canada company was founded in 2014 by Bjorn Dawson (CEO) and Chris Thiele (CTO) as a response to witnessing the difficulties Canadians faced in trying to grow their own medical marijuana. So far, the startup has publicly raised $300,000 in three rounds, though it raised an undisclosed sum in a seed round in August.
This is the other home-growing system, and while it’s very similar to Grobo in function and ease of use, it has a few points of differentiation. Leaf looks more like a refrigerator than a piece of furniture (and one that has taken its aesthetic cues from Apple). It also is very “medicine” focused in its marketing, comes with a drying setting, and can be pre-ordered for a down payment of $300 (out of the total cost of $2,990) right this minute! Leaf was co-founded in April 2015 by Yoni Ofir and Eran Mordechay after Ofir, an Israeli military vet, decided to start growing his own marijuana to treat his anxiety. The company is based in both Tel Aviv, Israel and Boulder, Colorado and raised $2 million in seed funding in July.
For those who either like to do all the work themselves or who want to grow in significant quantities, GrowBuddy is the perfect app. Marketed as being “built for growers, by growers,” GrowBuddy is a secure grow journal that will help users track every piece of data needed to perfect their cannabis-growing skills. The company also created a grower’s marketplace, so growers can directly research and purchase anything they might need for their gardens, and a grower’s community Q&A forum called Case Files. Rob Rusher and Co. released the beta of this completely free app in 2014 and have continued to build on it from their Denver, Colorado locale. So far, they have raised $1.17 million in a March venture funding round.
Potbotics has produced not one but three revolutionary products. However, only one is really consumer grade: PotBot. The “virtual budtender” is primarily an app — though several kiosks exist — that takes all the information a user provides (age, sex, symptoms, and conditions), runs it against scientific and medical data, and recommends “the appropriate cannabinoid levels, medical cannabis strains, and consumption methods” that will best suit their needs. It then goes a step further by either finding a nearby dispensary that carries said strain or aids the user in making an appointment with a clinic that could provide a prescription. The now bicoastal software and technology company was founded in 2014 when David Goldstein became interested in his father’s work with pre-Alzheimer’s patients. In August 2015, they raised $2.4 million in debt financing.
Crowdsourced data is a big deal these days, and Leafly employs it to create “the world’s largest cannabis information resource.” The site provides users with information, reviews, and ratings on a vast multitude of strains, products, and dispensaries. It also helps them locate dispensaries, keep up with the latest cannabis culture goings on, educate themselves, and keep track of their own reviews and recommendations. Brian Wansolich, Cy Scott, and Scott Vickers founded the Seattle-based company in 2010 and sold it a year and a half later to Privateer Holdings. In 2015, Leafly’s founders launched a new cannabis startup called Headset.
Even though a lot of startups are geared toward consumers, the B2B sector is booming as well. Flowhub is “Colorado and Oregon’s first custom built, METRC compatible POS.” It’s an easy-to-use point of sale system that helps marijuana-based business or medical facilities keep track of all the important things while remaining in compliance with state regulations via the POS’s seamless reporting integration. CEO Kyle Sherman founded the company in Denver in late 2014 after getting frustrated with the current cannabis inventory management systems available. He and co-founder Chase Wiseman raised $500,000 in seed funding in April 2015.
Why reinvent the wheel (or the business model) when you can merely adjust it for your specific product? In 2015, Marshall Hayner founded Trees, a high-class Amazon for cannabis in the San Francisco Bay Area. The company’s current purchase methods allow customers to pick from one of three boxes (ranging in price from $149 to $399) and then decide which top shelf strains they’d like included. Then the buyer texts Trees pictures of his photo ID and medical recommendation, enters in payment information (They accept bitcoin!), and waits for the product to be delivered right to their door that same day. Now that recreational marijuana use is legal in California, it will be interesting to see what changes Trees makes to the company.
If Trees is Amazon and Eaze is Uber, then Billowby is the Zappos of the cannabis community. This online headshop is determined to bring you the best selection of smoking accessories at the best prices with the best customer experience. Shipping is fast and discreet (though not free) and returns and exchanges are pretty easy as long as you have not used them in any way. (They emphasize that a lot.) David Matthews founded this San Franscisco-based company in 2014, raising $250,000 in seeding funding. He wanted to launch the startup after realizing “that there wasn’t a dominant brand in the industry that appealed to the mainstream audience.”
One of the best things about a community is connecting with like-minded folks, and there’s no better way to do that than via social media. Enter MassRoots, a Denver-headquartered “social media platform committed to creating a judgement free network for cannabis enthusiasts to safely and openly express themselves.” The free platform founded by Stewart Fortier, Sebastian Stant, Tyler Knight, Hyler Fortier, and Isaac Dietrich in 2013 isn’t a chaotic free for all, choosing to emphasizes legal compliance and respect. It also helps users stay abreast of the latest pertinent news and keep up with their dispensaries of choice.
It is the only company on the list to have gone public. If interested, you can check here for more information about MassRoot’s stock performance.