Their revenue climbed from $20,000 per month in 2009, to $400,000 per month in 2010. Meet WeedMaps.
We note that the subject contained in this article represents illegal activity in certain jurisdictions. Whilst we do not condone any acts which are contrary to any such laws, we understand that readers in those jurisdictions which have decriminalised cannabis may find this article of interest.
As we continue trodding along in Ancillary month here at The Green Fund, it would be impossible for us to not mention WeedMaps.
WeedMaps is one of the most prominent cannabis websites for both users and vendors alike, and yet, WeedMaps doesn't touch the cannabis plant at all, allowing them to enjoy a freedom that cultivators and distributors of cannabis don't get.
Founded in 2008, WeedMaps initially sought to provide individuals with information about their nearest medical marijuana dispensaries.
People often say "stick to what you know" and the founder of WeedMaps, Justin Hartfield, did exactly that.
As a recreational marijuana user and a budding entrepreneur, Hartfield came upon the idea for WeedMaps when he searched for his local medical marijuana dispensary and had little luck in finding one.
Instantly Hartfield recognized that this was a gap in the market, and he immediately took to building WeedMaps. The intention behind the site was to act as both a repository of medical marijuana dispensaries and a forum for medical marijuana patients.
Users could leave reviews about their experiences with each dispensary, as well as talk to one another about their experiences with medical marijuana.
Hartfield believed that WeedMaps could not only be of use to cannabis consumers, but also to the dispensaries who wanted to boost their profile.
The idea clearly had legs, and by the end of 2008, Hartfield had already drawn in 1,500 users a day to the site, as well as a growing base of dispensaries who could list on WeedMaps for free.
Kush n' Cash
By 2010 WeedMaps was signing up 300 new users a day and had started charging companies to list on its site, from $300 per month up to $1000, depending on how much visibility that dispensary desired.
Early revenues indicated that the neophyte brand had promise, and would only continue as the cannabis landscape evolved and grew.
General Cannabis acquired WeedMaps in 2010, which saw Hartfield's position change to Chief Web Officer.
After that, WeedMaps acquired Marijuana.com for a cool $4.2 million, and MMJMenu shortly after, which is a patient point-of-sales management software for dispensaries.
And finally, by 2013, Hartfield and others had purchased WeedMaps back off of General Cannabis. That same year the company is estimated to have grossed $25 million in revenue.
Now, WeedMaps is commonly referred to as the 'Yelp' of cannabis, and companies are paying up to $20,000 per month to list on the site.
Stems and Seeds
While Hartfield was making substantial profits, and now had a "business and brand that would be ripe for acquisition," he has insisted that he's an activist at heart, and his main passion is marijuana legalization.
Through WeedMaps, Hartfield has made several donations to help fight for the federal legalization of cannabis, including a $250,000 donation in 2016 which pushed for the recreational legalization in California.
However, Hartfield's passion for cannabis has sometimes caused him trouble, as the weed-tech entrepreneur has been allowing unlicensed dispensaries to list on WeedMaps. This caused serious dismay for dispensaries which have gone through the lengthy, expensive legal route, who felt they were being undermined by this behavior.
In fact, in early 2018, WeedMaps received a cease-and-desist letter from The California Bureau of Cannabis Control (BCC) asking the company to stop listing unlicensed retailers.
At the time the company simply refused, arguing that it was "not a Licensee subject to the Bureau's purview."
The company responded that they were simply a technology company that had the right to post about whoever they liked.
Though the pressure continued to build for Weedmaps, who is believed to have been advertising for nearly 2,000 illicit competitors of California's legal market for over a year and a half.
As of April 2019, over a year after the initial cease-and-desist letter, WeedMaps agreed that they would eventually filter out unlicensed vendors throughout the year.
The company has left itself until the end of the year to fully remove unlicensed advertisers, and while they may certainly take a financial hit from fewer listings, they clearly aren't going into the red anytime soon.
And far as an ancillary company goes, WeedMaps is one of the best examples that you don't have to grow pot to get involved with the cannabis industry. In not "touching the plant," companies avoid a lot of the headaches involved with ensuring everything is compliant with legal regulations, let alone the financial restrictions involved, as most banks won't deal with cannabis companies due to the federal illegality of the plant.
Stay tuned for more articles on ancillary cannabis companies throughout the month, here at The Green Fund.
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