COLORADO: As legalization of marijuana grows, so too is the outlook of companies catering to the pot business.
One such firm, WeedMaps.com, a website that allows users to rate and review medical marijuana dispensaries, expects to post $30 million in revenue this year and increase that by 20 percent next year.
The company was started five years ago by Justin Hartfield, a pot smoker who also has a degree in computer science from the University of California at Irvine.
“I started it because I wanted to find where the medical marijuana dispensaries were in my area,” said Hartfield. “It was a very selfish thing for me and my friends, and it turned into a business.”
WeedMaps makes money by charging dispensaries for access to certain information, the ability to respond to reviews and getting professional photos and videos posted. Hartfield said he expects sales of $30 million this year to grow at least another $6 million next year now that the company has rolled out a new Groupon-style “Deals” option.
“It’s different than Groupon. We’re not trying to take a cut of the deal,” he said, “we’re just offering our dispensaries premium access at the top of our ‘Deal’ page.”
Marijuana, long a verboten product for legitimate businesses, is now challenging the business establishment itself.
Last week, the Treasury Department’s Bank Secrecy Act Advisory Group met in Washington to discuss a topic important to Washington state. It’s debating when and how to allow banking for marijuana growers and retailers in that state, along with Colorado, since both of them have now legalized recreational marijuana.
Banking is considered the biggest challenge facing the traditionally all-cash pot industry. Banks usually won’t allow pot entrepreneurs to open accounts, since their profits are still considered illegal under federal law. The Seattle Times reported last week that Treasury Secretary Jack Lew acknowledged the urgency and “serious challenges” facing the industry, but no decision was made.
At the same time, pot-related businesses like WeedMaps.com, that don’t involve direct contact with marijuana—and therefore don’t violate federal law—continue to grow.
Hartfield said he accepts cash payments from dispensaries, and he would even consider being paid in the virtual currency, bitcoin. “Why not?”