Why Dutchie matters

The persistent thesis that “touching the customer (and their data!)” Is now more important than “touching the facility” is playing out daily in new record ratings for Cananbis technology companies and websites with traffic. Data is the new Doobie. If you haven’t followed the full story and our ongoing journal of tech deals, check out this article on how “Apple just changed the marijuana industry forever”. A decision by Apple to allow certain cannabis apps in the App Store began with Cannabis 2.0, a new arms race to see who could create the “Amazon 2-Click” cannabis buying experience in a seamless ecosystem. Think Amazon orders for weed. Ratings and funding for cannabis traffic (data) as well as ordering and delivery platforms increased as the future of buying weed was now clear, it is expected like everything else on Amazon, online, via an app and in 48 hours or less .

First Weedmaps, the most successful cannabis company in history, got a valuation of $ 2 billion, then Leafly went public in a SPAC, then delivery platform EAZE got more money and bought and MSO (and just opened their first EAZE pharmacy). The guys from TECH were no longer the bottom fish on the totum pole. Their access to consumers and data was the future of cannabis sales, not the plant itself. Green Market Report was bought by Crain Publishing in a private deal. Jane menu management and ordering platform received a new round of funding of $ 100 million to reach a valuation of $ 1.2 billion. PotGuide.com was sold to a Canadian public company for $ 8.5 million. Dutchie trumped them all with a new raise of $ 350 million and a new valuation of $ 3.5 billion! We haven’t even gotten into the billion dollar reviews that wholesale and retail sites like LeafLink and LeafBuyer are now continuing with.

Getting and owning the consumer is now the golden goose, not getting and owning the plant. You can follow our updates on cannabis tech deals and funding here. The arms race heats up as monsters need to be created to eventually battle Amazon and CVS / Walgreens for future cannabis sales and customer data. Weedmaps is building a warship, Dutchie is in, EAZE is already selling its own weed to delivery customers (hello, margins!), Jane now also has access to capital to build an impressive trench around the traffic.

But who is Dutchie and how did they get here? Is it true that there would be no Dutchie if EAZE did the first day of the job? In the same sense, there would be no weedmaps today if High Times were faster and saw the future of the digital. Why are we all using the High Times map and pharmacy listing app today, which was a 20 year head start?

Dutchie is a technology platform founded by Ross and Zack Lipson and Zach in 2017. The platform supports the operation of pharmacies and offers consumers easy and safe access to cannabis. The platform also supports the increase in the positive social change that marijuana is bringing to the world.

Dutchie has come a long way since its inception. The company is valued at $ 3.75 billion after raising $ 350 million in Series D of its second major round of funding. This new rating more than doubles the one announced earlier this year.

In around March 2021, Dutchie raised about $ 200 million in Series C funding and reached a valuation of $ 1.7 billion. During that time, the valuation was eight times the $ 200 million achieved in the $ 35 million Series B funding.

Previous financing round (Series C)

The Series C funding round was led by Tiger Global and also saw participation from Thrive Capital, Dragoneer, Gron Ventures, Snoop Dogg’s Casa Verde Capital, former Starbucks chairman Howard Schultz, and DFJ Growth.

At the time of Series C funding, Dutchie was seeing strong growth. The company took advantage of the general boom in the cannabis industry amid the pandemic. And also benefited from the increasing legalization of cannabis in various states of the United States

At that time, the company was also able to take over the cannabis-related software providers Leaflogix and Greenbits. Dutchie also named Tim Barash, a former Toast CFO, as its new chief executive officer. Total funding at the time was $ 253 million.

Last funding round (Series D)

D1 Capital Partners led the latest funding round, which also included Dragoneer, Tiger Global, DFJ Growth, Gron Ventures, Thrive Capital and Casa Verde Capital. New investors such as Glynn Capital, Park West Asset Management and Willoughby Capital also participated in the financing. The latest round of funding brings Dutchie’s total funding to more than $ 600 million.

The new funds will be used to hire new employees, develop new products and open up new markets outside of North America. Dutchie currently employs more than 500 people in 40 states in the United States and Canada. In terms of technology, Dutchie leverages point of sale, e-commerce and seamless payment solutions. These technologies generate over $ 14 billion in annual sales in approximately five thousand pharmacies across North America. With this new funding, Dutchie will be able to do a lot more.

A better future for Dutchie

Dutchie CEO and co-founder Ross Lipson made some interesting comments in an interview with TechCrunch. He talked about Dutchie’s tailwind, fueled by the increasing adoption of cannabis, more states passing friendlier laws, and the health benefits of cannabis.

Lipsom claimed that cannabis really is a force to be reckoned with, which makes it the most exciting news for the company. He cited that the cannabis industry was the fastest growing sector in the economy with 35% growth over the years. Lipsom also claimed that they achieved 100% growth with their pharmacies. Dutchie currently has more than 5,000 pharmacies across North America.

In preparation for the future, Dutchie is constantly working to help the industry move forward by educating the public. Dutchie keeps the public up to date on the benefits of cannabis and supports more regulatory and legalization work. There is no doubt that marijuana is attracting huge investments and talent into the industry. And not only that, more and more startups are also bringing better technologies to the industry.

About $ 357 million was invested in several cannabis companies this year, according to Crunchbase. Many forecasters also claim that the cannabis industry in the United States would grow to a $ 100 billion industry by 2030.

The managing director of Poseidon Investment Management, Morgan Paxhia, was also optimistic about the future in an interview with TechCrunch at the beginning of the year. Paxhia said 2021 was an amazing year for the cannabis industry, but more is still expected to come on the scene. Paxhia expects capital flows to increase incredibly due to demand, new innovative startups to emerge, and good public markets to bring more IPOs.

Dutchie’s relationship with investors

Dutchie’s relationship with existing investors has been great so far. And one of the great relationships is that with D1 Capital. Dutchie has had a long relationship with D1 Capital for a long time. You maintain constant communication about customers and the overall business. And to keep up with the demands, both D1 and Dutchie decided it was right to accelerate the mission to simplify pharmacy operations.

To that end, Dutchie invested $ 100 million in research and development over the next year. Part of the new funds will flow here. In addition, Dutchie plans to have 500 employees in 40 states in the United States and Canada.

Now that Dutchie is in the Series D range, Lipson attempted to answer whether an IPO is part of the company’s future expectations. He said Dutchie was always in the business of considering all opportunities. Regarding the future of the cannabis industry, he assured that the industry would continue to experience acceptance in all areas. Especially as more people are trained to find the right modality and product, and more states are legalizing cannabis.

Other initiatives like the Safe Banking Act will enable banks to provide financial services to cannabis companies. Lipson reiterated that initiatives like this and federal cannabis legalization are sure to take some time. But Dutchie is optimistic that it will come at some point.

Bottom line

Dutchie continues to ride the wave of support for the legalization of cannabis in the United States, as well as favorable laws being passed in various states. Legal cannabis sales are projected to reach $ 24 billion by the end of 2021, and Dutchie has positioned itself for such opportunities. In fact, many previously disinterested companies are already starting to change their minds about cannabis; Prepare for opportunities that may arise while the smart few are already making the most of the industry’s existing opportunities. A good example is weedmaps, which recently went public and officially started trading this year. The future of the cannabis industry is really bright!