Eaze Raises $35 Million, Plans to Launch Own Brands
Eaze, a California-based online cannabis marketplace and delivery service, has raised $35 million as it pivots toward a plant-touching business model and works to boost profits.
In a press release issued yesterday, Eaze said it had secured $15 million via a bridge financing round that was led by Rose Capital -- a cannabis-focused investment firm -- and DCM, a venture capital firm with over $4 billion under management. Both firms previously invested in Eaze.
The company also raised $20 million via a Series D funding round that was led by a firm called FoundersJT LLC, and said it has “secured the ability to raise up to an additional $20 million.” A valuation figure was not disclosed.
To date, Eaze has raised more than $200 million across nine funding rounds, according to Crunchbase.
The capital injection comes about six weeks after TechCrunch reported that Eaze was struggling to make payroll and planning a round of layoffs.
Nevertheless, Eaze is forging ahead and expanding its business to include a line of consumer brands as well as traditional distributor and retail operations.
“Verticalization is Eaze’s second act,” Eaze chief executive Ro Choy said via the release. “Until now, we’ve invested in proving our market fit, building an enormous and loyal customer base, and becoming California’s biggest marketplace for legal cannabis delivery. Now, we’re proving we can make this business work in a more sustainable and profitable way, while continuing to grow Eaze’s existing services.”
According to Eaze, it has 600,000 registered customers has completed five million legal deliveries. Last month, Eaze reported that signups increased 97% in 2019 and that first-time deliveries increased 74%.
A press release with additional information is included below.
Eaze Announces $35 Million Investment to Launch Vertical Operations and Increase Cannabis Access for 600,000+ Customers
Reports 71 Percent Annual Increase in Overall Deliveries and 74 Percent Annual Increase in First-Time Deliveries
SAN FRANCISCO -- Eaze, California’s largest legal cannabis marketplace, announced today it has closed a $20 million investment and secured the ability to raise up to an additional $20 million to complete its Series D funding, inaugurating Eaze’s verticalization and brand strategy to expand access to safe, legal, and affordable cannabis products.
The $20 million from Series D investors -- led by FoundersJT LLC -- joins a $15 million bridge round led by Eaze key stakeholders, Rose Capital and DCM.
Eaze Chief Executive Officer Ro Choy said, “Verticalization is Eaze’s second act. Until now, we’ve invested in proving our market fit, building an enormous and loyal customer base, and becoming California’s biggest marketplace for legal cannabis delivery. Now, we’re proving we can make this business work in a more sustainable and profitable way, while continuing to grow Eaze’s existing services.”
In January, Eaze acquired DionyMed Brand’s rights to retail licensee Hometown Heart (HTH) depots in Oakland and San Francisco, and now has oversight of HTH’s day-to-day operations. In the coming weeks, Eaze will launch its own line of consumer brands in partnership with local licensees while continuing to support a broad array of independent, world-class California brands and independent licensed retailers across the state.
Despite challenges to California’s legal cannabis industry, the company experienced significant growth in 2019, as reported in the latest Eaze Insights: State of Cannabis Report. Highlights for 2019 include:
- 97% annual increase in new sign-ups
- 74% annual increase in first-time deliveries
- 71% annual increase in overall deliveries
- 104% annual increase in customers age 50+
Eaze also announced the promotions of Megan Miller to Chief Operating Officer and John Curtis to Chief Financial Officer. Miller, who previously served as Eaze’s Vice President of Finance and Marketplace, brings a unique combination of deep financial planning skills and comprehensive understanding of Eaze’s business to her new role. Curtis, who has served as interim CFO since October 2019, has been instrumental in sizing Eaze’s business and charting the company’s path forward to verticalization.
To-date, Eaze has supported over five million legal deliveries, has 600,000 registered customers, and features more than 100 licensed brands through its network of retail partners.
Eaze, California’s largest marketplace for legal cannabis, connects adult consumers with licensed retailers and products. Eaze is on a mission to enhance safe access to legal cannabis, educate people about cannabis as a tool for wellness and drive smart cannabis policies. www.eaze.com.