Dutchie, the Bend, Ore.-based creators of an e-commerce platform that helps cannabis dispensaries facilitate online orders, has raised $35 million in new funding, with backing from the likes of former Starbucks Chairman Howard Schultz and hip-hop star Snoop Dogg.
With its software and marketplace solutions, Dutchie says it processes 10% of all legal cannabis sales worldwide, and counts 25% of all legal dispensaries across 30 markets and 301 cities in the United States and Canada as customers.
Founded in 2017, the company has raised $53 million to date. Investors in the Series B round included Snoop Dogg’s Casa Verde Capital, and NBA star Kevin Durant’s Thirty Five Ventures, as well as Schultz, Thrive Capital and Gron Ventures.
The fast-growing company plans to use the cash to accelerate its business in every aspect, meeting demand that is being fueled in part by a shift in business and consumer habits during the ongoing pandemic.
“We’re seeing adoption rates for online orders, curbside pickup, and delivery soaring through the roof with widespread ‘stay at home’ orders,” Ross Lipson, Dutchie CEO and co-founder, told GeekWire. “Consumers are stocking up on cannabis like other non-perishable goods, and businesses have to offer alternative services to meet their needs.”
Dutchie has seen a 700% surge in sales volume during the pandemic, with numerous dispensaries across the U.S. requesting to be onboarded. Dutchie processes more than 75,000 orders a day and its marketplace — which features 51 Seattle-area dispensaries — looks like an Amazon for legal weed where shoppers can select from various brands and types of cannabis.
Dutchie is helping to facilitate more than $2.4 billion in annual sales and this week processed its 10 millionth order. COVID-19 is just speeding the inevitable, Lipson said, as more online ordering, deliveries and contactless transactions for cannabis purchases are allowed.
“It’s almost as if the cannabis industry jumped two years overnight,” he said.
Lipson said Dutchie is fortunate to attract investors with unique backgrounds and perspectives. He called Snoop Dogg a “cannabis pioneer” and credited Schultz’s immense success in building Starbucks into a retail icon.
Lipson has previous e-commerce experience. He started one of the first online food ordering operations in Canada in 2008, called GrubCanada.com, which was acquired by Just Eat in 2012. After moving to Oregon, TechCrunch says he came up with the idea for Dutchie while standing in line at a weed dispensary. He started the company with his brother Zach, who serves as chief product officer, and at launch in 2017 they were serving three dispensaries in Bend.
The company now has 102 employees, the majority of which are in Bend, and it expects to double that number by the end of 2021 as it hires a distributed team that can work remotely.
“One of our biggest uses with our new funding will be to recruit top talent from a variety of industries to help us further define the overall cannabis consumer experience,” Lipson said.
TechCrunch previously reported that “cannabis is one of the bright spots in the pandemic.” It ran a survey of cannabis investors and found that they are “keen on capitalizing while startups look for additional capital to fuel growth while valuations driven by the market correction are still low.”
