Online ordering of cannabis products is growing and has increasingly become a preference to buy them since the global pandemic began, according to Ross Lipson, co-founder and CEO of Dutchie, an e-commerce and online ordering platform.
Subscribe to the Crunchbase Daily
The 3-year-old Bend, Oregon-based company raised a $ 35 million Series B round from new investor Howard Schultz and existing investors Casa Verde Capital, Thirty Five Ventures and Gron Ventures. Including this new investment, Dutchie raised a total of $ 53 million, including a $ 15 million Series A in 2019, led by Gron, according to data from Crunchbase.
Lipson’s background is in the food order business. In 2008, he moved to Canada and launched GrubCanada.com. After building its business to thousands of restaurants in Canada, GrubCanada was acquired in 2012 by Just Eat. He later moved to Oregon and came up with the idea of Dutchie while usually standing at a dispensary.
Growth
Today, Dutchie connects customers with local cannabis retailers and capitalizes on trends that show the legal marijuana industry is one of the fastest growing in the world and is expected to reach $ 20 billion in value in 2025. Expected at the same time UBS that one-quarter of total U.S. spending to be online.
After increasing its Series A, the company spent time building its team and innovating its product to meet ever-changing consumer demands for online ordering, pick-up, delivery and digital payment solutions, Lipson told Crunchbase News.
With the financing of the Series B, the company will continue with those goals. Dutchie has 102 employees, and Lipson has a plan to double that in the next 12 to 18 months.
“Each round gives us the power to accelerate on the team and product,” he said. “We are unique to the cannabis sector, in that we have the opportunity to define the consumer and dispensary experience with our purchasing platform on a scale.”
Innovation
There is a need for innovation in the cannabis sector as demand grows, especially as menus and inventories change every day, Lipson said. One of the challenges is that the typical cannabis consumer requires a certain level of education to make an informed purchasing decision.
They want to category, know THC levels, see a photo of the flower and read a description of the product. However, a dispensary menu could have more than 500 items. With an online ordering menu, consumers can educate themselves.
To keep up with this, Dutchie integrates with a dispensary’s point-of-sale system and also helps it stand for new arrangements.
Dutchie works with 1,300 dispensaries in 25 states and Canada, helping them process 75,000 orders a day. Lipson estimates $ 2.4 billion in annual gross merchandise volume, as transact sales, are carried out by the platform.
“We are constantly looking to introduce new dispensaries and will provide them with more workflow tools while delivering value to customers,” he added. “We have found on average that people order 30 percent more online than in-store. Some customers are also not comfortable entering the dispensary, and it gives them a place to look at products and finally order. ”
What investors say
Karan Wadhera, managing partner at Casa Verde Capital, said in an interview that the company ‘gravitated’ to Ross’ energy and also liked to keep its track record in the delivery business.
Casa Verde Capital is cannabis-oriented and has so far invested in 19 companies, and Dutchie was unique in the space for e-commerce, which was ripe for innovation, ‘Wadhera said. In general, she distinguishes herself, especially as Ross and Zach (Lipson, his brother and co-founder) are aggressive with their goals and have exceeded expectations, ”he added. “We are confident in their ability to be a leader in this space.”
Photo of Dutchie founders Ross Lipson and Zach Lipson courtesy of Dutchie
Blogroll Illustration: Dom Guzman
