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How raising capital in cannabis technology enables scale

On this episode of BofC Live, we connect with Socrates Rosenfeld, CEO of Jane Technologies. Jane recently announced a capital raise of $100 million and we wanted to connect with Rosenfeld to talk about his company’s technology, their unique approach to connecting cannabis consumers and products as well as how the capital raise would enable Jane to scale and grow.

Learn more about Jane Technologies.

Listen to this episode of BofC Live, and all BofC Live episodes, as a podcast:

BofC Live Transcript

Rosenthal: Welcome to BofC Live, the daily video and podcast series of Business of Cannabis. BofC Live highlights the companies, brands, people and trends driving the global cannabis sector. Find out all that we do at businessofcannabis.com.

Coming up on BofC Live, we sit down with Socrates Rosenfeld, he is the CEO of Jane Technologies. They completed a $100 million capital raise and we wanted to have him for a conversation about what that means for the company in terms of scale.

Thank you for being here. You’ve been busy. Never a dull moment in this industry. For those that don’t know, although it’s hard to miss, tell us a little bit about Jane, then we’ll get into the background and the capital raise you just completed. But give us the quick snapshot of what Jane is for those that don’t know.

Rosenfeld: Sure. Quick snapshot is Jane is the largest e-commerce provider in North America. Now providing e-commerce tools and platforms for brands and retailers across 37 state markets in the US across Canada were in about 2,100 dispensaries and work with hundreds and hundreds of brands essentially trying to make shopping online for cannabis very simple for the consumers and then very simple for the sellers as well.

Rosenthal: Well it is simple and as right before we were coming on, I was on Jane, I was like, “oh let me see if I could, I was using my old address in San Francisco” and I was like one click away from ordering something to address that I no longer live at. I am kind of excited about this thing and maybe you know because they’re California, but Big Pete’s Cannabis Peanut Butter Cookie.

Rosenfeld: One of the O. G. Companies here based in Santa Cruz. They have an unbelievable edibles line and there’s Big Pete and Pete Jr who is his son and they do some unbelievable things.

Rosenthal: A great brand. I bought them. I almost bought them which is funny because I never would be able to get them but maybe I should keep them on hold at the store until uh until I get there. So we learned a little about Jane. And then of course last week it was impossible not to notice that obviously you guys completed and announced a big capital raise $100 million. Talk about what that means. We were chatting before we came on like what it’s like raising that kind of capital versus what it’s like raising the first several dollars that you raised to start Jane. Talk a little bit about that journey.

Rosenfeld: We were just talking about this and something I was sharing with my team last week where the feeling of remember that first $25,000 check was actually from a friend from the Army. And he’s like, “I have no idea what you’re building Soc. But man, I believe in you and here here’s some money.” I remember getting that and being so exhilarated that I actually get to go and build this dream. Give me just a little bit more time.

And the mechanics and the feeling was the exact same of raising $100 million. It’s just now on a bigger scale with more sophisticated investors who, you know, ask more challenging questions and really kind of have built visionary businesses themselves and so really kind of pushing us to think big, which is wonderful. The stakes are obviously higher, right? We’re going to have to do bigger things for this industry. But at the end of the day, the feeling is the same Jay where we get to put more capital back into the business which ultimately allows us more time and space to go and pursue this dream and make it into a reality.

Rosenthal: Well that’s very compelling. And obviously it’s a lot of capital to do that. And I wonder as you look at the landscape of what’s happening in the U. S. and Canada and even around the world, what excites you today that sort of maybe you weren’t even expecting, you know, 3, 4 or 5 years ago?

Rosenfeld: Yeah, it’s definitely all of them. What I, what I think is the most unexpected thrill out of all this is cannabis is no longer a second class citizen when it comes to technology right? Like five years ago, it was like, “hey, what basic services are you going to be able to provide?” It’s like an online menu. Like that’s pretty basic. And it was back in 2017 when we started the company. But now, since the growth of this industry has come on so quickly and the innovation has come on so quickly and quite frankly, the retailers’ expectations and demand for their technology is as it’s been wonderful to watch. It has now really created this very interesting ecosystem whereby cannabis, the cannabis industry, the technology being built here specific for this industry is inspiring other retail verticals to follow suit, you know, “to go” was was it was the thing that you only did for restaurants, but now look at what’s going on in alcohol, Look at what’s going on in convenience, goods, groceries, et cetera. Obviously accelerated through the pandemic. But now the future of retail is digital. And we always said that that was going to be the case 5 or 6 years ago when we started the company, but to think that now it’s not only a reality, but the cannabis industry in the tech companies in the cannabis industry doing some wonderful things or perhaps inspiring others are building technology that other platforms will be able to use is really, really exciting. I think it’s a long time coming that this industry is being viewed as a first class citizen on parallel with other retail verticals in the world.

Rosenthal: I actually want to specific to you and and how you built your team and more specifically, I guess because you are obviously in the hotbed of sort of tech and getting those people on board. There’s lots written about finding the right tech people to work in your space and being able to have access to them but, but there’s lots of competition. How are you finding that ask of employees to say, “You can write your destiny, but we want you to come to Jane.:

Rosenfeld: What a great question Jay. And this is something that I’ve realized: the best engineers, the best salespeople, the best employees can really go anywhere. And there are very few of them are driven by money to be honest with you. There are a few of them are driven by quote unquote perks of a business. What I’ve seen obviously those things are nice, you know, taking care of employees is number one, that includes paying them well, but really, and taking care of them, but really what gets the employees here at Jane excited and quite frankly what has cemented our culture here at Jane is the fact that we get to pursue something that we believe in, that we get to pursue something that protects the integrity of a plant. That helps a lot of people that we get to revolutionize the way e commerce has been constructed since the onset of the dot com era. Where now we can actually enable first party sellers with digital tools rather than having them to rely on marketplaces that perhaps exploit them. This is what excites us. And I think quite frankly at the end of the day, they can come to a space where they can be authentically themselves and in a time where where a lot of us are working remote and it’s COVID and there’s global warming and wars all over the world, man like to build a company where people number one share the same values in terms of where they want to take this industry, but also sharing the same values and how we want to get there. That’s what attracts not necessarily the best employees, but the right employees and that’s who we’re looking for and I love each and every one of the 90 or so members that Jane currently today.

Rosenthal: I want to ask you about that because um, I would say maybe it’s been a month, six weeks, maybe two months. There’s been lots of news at the intersection of cannabis and technology, not only about big capital raises like yours, but I think maybe that’s indicative of where the industry is going is sort of touched upon and where the the maybe the previous several years was about, you know, cultivators and how big there are sort of capacity was going to be. And then, you know, the MSOs and how many states there were going to be in, but it really seems to be the interest or maybe the new interest in sort of the underpinning of an industry like the technology you’re talking about. Is that is this the evolution of just industries overall? Like it’s the the producers and manufacturers and then it’s the technology and then it’s the data. Is this a cycle that you are predicting in its best case scenario and then now that you’re sort of living in?

Rosenfeld: Yeah, man, this is the best interview I’ve been on a long time. I would argue that you’re right. There’s an analog then technology gets involved and then shapes it and then now creates this kind of new paradigm. And we’ve seen that in retail, right. We’ve seen big box stores now get disrupted by the Amazons. And now perhaps Amazon is looking at omni channel like go puff and companies like that saying, hey, wait, now there’s this physical environment that they need to play with. Absolutely. I think this is inevitable. One of the things that we keep in mind though, and have been since day one at Jane was there should not be this like zero sum game where you see a lot or other retail verticals where it’s like, “oh, hey, thanks restaurant for building this wonderful restaurant cooking, beautiful food. The tech company is now going to take over and we’re going to take all the data and the customers and you’re just going to be an illicit seller.” Or, “Hey, thanks brand for selling on Amazon. But guess what? We now know as Amazon, taking a look at your data, we’re gonna undercut you and create our own product.” Right? Like that’s not where we’re headed. And quite frankly, I don’t think that’s the world we want to create, certainly not in the cannabis industry. And so since day one, we’ve called our retailers are partners or brands are partners. It is a partnership. We have no intention of ever opening up our own dispensary or creating our own brand. We let our partners do that. Our retail partners, our brand partners and let’s go work together to create and provide for them tools that will help them scale their business for the next generation on a global scale because that’s ultimately what we all want, right?

We want cannabis out there in the mainstream done right. And I think the only way you can do that is through this marriage of offline and online, and we take our role very, very seriously. But we take it as as partners of this industry, not as the sole takers of this industry.

Rosenthal: Well, we had a chance to meet like this maybe six or eight months ago, connected to a friend in Santa Cruz. But I’m glad to obviously watch you grow by leaps and bounds. And it’s great to see you uh in this format as well. And so thank you for your time. Congrats to you and the team and keep on trucking because it’s going to be a wild ride.

Rosenfeld: You know that? Thanks so much Jay, great, thank you. We’ll talk to you soon.

Rosenthal: If you like this program, please review us on an Apple Podcast or wherever you heard the show. It helps support the work we do. Mhm. We’re able to do what we do because of our ongoing partners, including Alterna Savings, Cannabis At Work, Cannabis Benchmarks, CannDelta, Gallagher in Canada, Headset and Torkin Manes LLP. Find out all that we do at businessofcannabis.com

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