A tech platform connects cannabis cultivators and dispensaries in regulated markets.
The global pandemic has brought to light the fragility of many supply chains. Product shortages in grocery stores, food processing slowdowns, and e-commerce businesses scrambling to meet surging demand all illustrate supply chain choke points. This week, I’m highlighting Midwest tech businesses that are helping to solve these problems.
The innovation: Chicago-based Leaf Trade is a platform for wholesale cannabis sales and product movement. It connects different players in the legal cannabis supply chain, primarily cultivators and dispensaries.
The problem: States recently have started legalizing and regulating cannabis markets, but licensed companies along the legal marijuana supply chain did not have a dedicated digital platform to communicate easily and efficiently for sales and distribution. That slowed transactions and allowed questionable black and gray market activity, even in states that imposed regulations. “Both parties were literally spending over half their time managing orders, and deliveries often weren’t arriving until 10, 14, or 20 days later. It was not efficient,” said Leaf Trade CEO James Yi.
The impact: Leaf Trade streamlines cannabis sales, packaging, and fulfillment in a space that previously relied on outdated processes via spreadsheets, emails, phone calls, and text messages for communication across the supply chain. Connecting the cannabis supply chain links with this software reduces the time spent on order management and delivery time, and it ultimately reduces costs.
The backstory: Yi founded Leaf Trade in 2017 after helping his brother John found NextME, an app (previously covered on Centered) that helps businesses manage their waitlists and appointments. Several years ago, a couple of people contacted Yi for tech help to streamline their cannabis operations. He realized the tech solutions they needed didn’t exist because the regulated industry was so new, and the way parties were handling orders to stock dispensaries was fragmented and inefficient. “The industry was not going to scale this way,” he said.
What’s next: Leaf Trade recently built out its hemp division. In April, it launched Leaf Pay, a platform feature to digitize and streamline sales payments. It is said to be the regulated cannabis industry’s first platform for ordering, fulfillment, and payment all in one. Leaf Trade has about 100 cannabis sellers and 1,000 dispensary customers in 16 states, and it intends to expand market adoption this year.
Do you know other Midwest tech businesses transforming supply chains? Let me know so I can highlight them in a future newsletter. Email email@example.com or connect on Twitter @centereddottech to share ideas.
Today’s tech headlines:
- Projects at Argonne National Laboratory in Illinois and the University of Michigan are among the nine to receive a portion of $27 million in funding from the U.S. Department of Energy to develop digital twin technology to reduce operations and maintenance costs by 10 times in the next generation of nuclear power plants. (U.S. Department of Energy)
- Gen3Bio Inc., a Purdue University-affiliated startup in Indiana, landed a $20,000 investment through the Elevate Nexus Regional Pre-Seed competition and a $20,000 pilot plant grant from The Water Council for its proprietary technology that transforms wastewater algae into profitable bio-chemical products. (Purdue University)
- St. Louis Park, Minnesota-based Yardbird, which makes outdoor furniture from plastic collected from beaches and waterways, raised $4.4 million in financing. (TechCrunch)
- A report from Crunchbase and Omaha, Nebraska-based Dundee Venture Capital lists Illinois and Michigan among the five states in the “Mighty Middle” — 25 states in the center of the country outside of traditional coastal tech hubs — with the highest total venture capital investments over the past 10 years. Minnesota, Ohio, Missouri, and Indiana also made the top 10. Chicago; Minneapolis; Madison, Wisconsin; and St. Louis are among the top 10 cities to bring in the most VC dollars. The report found $92.6 billion in venture capital investments in the region over the past decade, a 247% increase. (Crunchbase)