Israel-based global investment platform OurCrowd announced it is partnering with U.S.-based 7thirty Opportunity Fund for the formation of a $30 million cannabis tech investment fund.
Led by Jon Medved, OurCrowd is a venture capital platform and leader in equity crowdfunding. Managed by a team of investment professionals, OurCrowd conducts its own due diligence on prospective investments before committing its own capital. It then invites from its 30,000 accredited members from more than 150 countries, and institutional partners to join in these select investment opportunities. To date, OurCrowd has raised more than $900 million and has invested in 170 portfolio companies and funds.
Driving the formation are a number of global factors including the recent legalization of marijuana by the Canadian government; the legalization of medical marijuana by the UK in 2018; Israel closing in on legalizing cannabis exports; and the fact that 95 percent of U.S. citizens live in states where cannabis has some level of legalization, either for medical or recreational uses.
This growing trend toward legalization and legitimacy is creating channels of investment opportunity not only in cannabis production but the tech supporting that production. For example, to get an idea of the scope, the single city of Denver has 4.2 million square feet of space allocated to the indoor growing of marijuana – and in New Mexico, a company called Bright Green Group is behind a $160 million, six million square foot state-of-the-art research and growing facility that eclipses other medical marijuana greenhouse operations in California, Massachusetts, and Illinois. Indeed, every square-foot will be in need of supporting technology – and that is not including the technological requirements needed by distributors, retailers, and consumers.
“As this industry grows, job opportunities grow, tax revenue grows and ancillary businesses grow around them,” Kris Krane, president of Boston-based 4Front Ventures told the Cannabist. “It’s been a real financial boon for the states where it’s been implemented.”
This new fund, which will be headquartered in Boulder, Colorado, will focus on investment opportunities in emerging cannabis tech companies related to agtech, medtech, retail, e-commerce, SaaS solutions, deep-tech research, and marketplaces across the Israeli, Canadian, and U.S. markets.
The explosive growth of the legal and medical cannabis market is quite impressive,” said Jon Medved, CEO, OurCrowd. “Canada recently legalized cannabis nationwide and Israel is in the final stages of legalizing cannabis export. The amount of serious medical research in cannabis is booming. This market will generate unprecedented global investment activity and returns for cannabis focused startups. Together with 7thirty, we plan to lead investments for serious companies who will pioneer technology for this important and growing market.”
The 7thirty Opportunity Fund is an early stage growth equity fund targeting private cannabis-related tech investments on a global scale. The fund is led by veteran cannabis tech investor, Micah Tapman, who has led investments in more than 90 cannabis related companies including Wurk, BDS Analytics, and Front Range Biosciences, which in October 2018 raised the largest cannabis biotech round to-date.
“The ability to work side by side with Micah and the 7thirty team is really exciting for us,” said Kfir Kachlon, principal and cannabis tech lead with OurCrowd. “OurCrowd has already invested in leading Israeli cannabis technology companies such as Syqe and Edenshield, and now together with 7thirty we look forward to combining our Israeli deal flow with their North American leadership in the industry to create a truly winning fund formula.”
Lynda Kiernan