
Eaze Adds LA-Based Cannabis Startups to Its Equity Program and Platform
Tami Abdollah is dot.LA's senior technology reporter. She was previously a national security and cybersecurity reporter for The Associated Press in Washington, D.C. She's been a reporter for the AP in Los Angeles, the Los Angeles Times and for L.A.'s NPR affiliate KPCC. Abdollah spent nearly a year in Iraq as a U.S. government contractor. A native Angeleno, she's traveled the world on $5 a day, taught trad climbing safety classes and is an avid mountaineer. Follow her on Twitter.
More than a year ago, Darius Kemp, then a community manager at cannabis delivery app Eaze, realized the platform didn't have any Black-owned products on their menu.
Today he is Eaze's head of equity and change, spearheading a program for change and to prevent that from ever happening again.
"Eaze is the largest legal marketplace for cannabis and because of that, it's our responsibility to help correct the governmental and societal problems created by the war on drugs and the over incarceration of Black & brown bodies," Kemp said in an interview with dot.LA. "It's how you fight racism in the long run, (you) create communities that are self-sustaining, that don't depend on the oppressor."
As a continuation of that effort, the San Francisco-based company announced Wednesday that it is expanding its social equity program menu into Los Angeles, featuring local cannabis brand products owned by Black people and people of color.
Eaze's platform could go a long way to evening the playing field, essentially putting a "small Black soda company next to Pepsi and Coca-Cola," Kemp said.
Localities across California have worked on criteria for social equity licenses, aiming to prioritize people underrepresented in the industry for cannabis-related opportunities. The rules for each locality are different, but all social equity brands that take part in Eaze's program must have a social equity license or be actively engaged in the application process.
Eaze's Social Equity Partners Program provides social equity brands with "wraparound" financial and operational support to help them scale and become sustainable, including financing and payment structuring, discounted partner portal data analytics, access to Eaze's supply chain, and marketing and PR support. Since last fall, social equity brands have sold nearly $1 million in products on Eaze's platform.
The social equity partners menu already includes Northern California brands Cloud 9, KGB Reserve and SF Roots, which debut in Los Angeles Wednesday along with new L.A.-based brands dreamt and Blaqstar Farms, plus Bay Area-based James Henry SF and Oakland Extracts.
Bryant Mitchell is the founder of L.A.-based Blaqstar Farms.
L.A.-based Blaqstar Farms was founded in 2012 by Bryant Mitchell when only medical marijuana was allowed locally. They worked to provide a medical-grade, non-pesticide flower. Mitchell was raised "with a foot grounded very deep in social injustices" during the war on drugs, he said. He watched family members go to jail. His father was the first Black police officer in Orange, Texas, another factor in making him who he is today.
"I always tell people, 'I'm a social equity candidate, but I want to be the guy known to bring one of the best experiences in cannabis', and that's what we strived to do," Mitchell said.
Eaze's platform has handled over 6 million deliveries and boasts over 600,000 users. It is a very large stage for what are often smaller companies.
"People are hesitant to deal with smaller brands," Mitchell said. "We're not looked at as prudent; we're looked at maybe more of a risk to deal with, as opposed to a benefit. (But) when a company like Eaze cosigns and does what Eaze has done with Blaqstar, it does validate the company in many ways."
Mitchell said Blaqstar has never raised funds and so doesn't have the deep pockets usually necessary for the exposure, marketing and backing that Eaze brings.
"I can't make light of the amount of people, the amount of resources, the amount of money, the amount of marketing, that I've personally seen Eaze put in," Mitchell said.
Blaqstar is selling some of its homegrown flower and pre-roll products on the app primarily in Southern California until it can scale up for larger distribution.
"A lot of people see social equity and they're all approaching it in different ways, and no one is doing it exactly right yet, but you appreciate the companies like Eaze that are trying to get it right and making the sort of effort to do it," Mitchell said.
dreamt's founder first started using cannabis as a sleep aid while studying for her PhD at the University of Southern California, but found it ineffective.
As most large banks continue to shy away from cannabis — it's still illegal on the federal level — access to capital is even more of a challenge for entrepreneurs who want to work in the industry. That's why Eaze last September also launched Momentum, a business accelerator focused on helping underrepresented cannabis business founders.
Carolina Vazquez Mitchell's (no relation) company was in its first cohort, and her brand dreamt is part of the new social equity partner menu unveiled Wednesday. Vazquez Mitchell first started using cannabis as a sleep aid while studying for her PhD at the University of Southern California, but found it negatively impacted her breathing or was ineffective.
Years later, in 2019, she would go on to found dreamt, a cannabis product dedicated to improving sleep with science. It's the first brand-line for L.A.-based Ciencia Labs, a company co-founded by Vazquez Mitchell, who also serves as its chief scientific officer.
"As you can tell from my accent, I'm not from here, I came here 10 years ago, I don't have an MBA, I didn't start a business before, and my background is in science," said Vazquez Mitchell, who hails from Guadalajara, Mexico, and originally worked in the world of genetics and pharmacology.
Carolina Vazquez Mitchell's company dreamt is part of Eaze's new social equity partner menu.
Vazquez Mitchell said she is trying to use science to make cannabis products better, even if that means disrupting existing cannabis culture by making a pharmaceutical-like product to help with sleep.
"Cannabis helps, but it's not perfect," Vazquez Mitchell said. For example, it impacts REM sleep, which is essential for memory, learning and creating new synapses for a healthy brain and a healthy sleep cycle, she said. dreamt added additional ingredients to synergize with the cannabis to improve upon sleep without the negative drawbacks. The company's vape pen, and tincture are available on the menu; it's also created a drinkable shot and is working on a gummy.
"I'm an immigrant, I'm a woman, I look very Mexican," Vazquez Mitchell said. When she arrived as a researcher at the University of Southern California, her "first challenge" was understanding English. "Not a lot of people believe that a Mexican, with broken English, will be successful in science or any other industry."
But she worked hard to prove them wrong. She went on to create products for Pepsi, Quaker, Taco Bell and Gatorade as a food scientist and has developed more than 50 cannabis products, including dreamt. Last November, she landed a $50,000 grant in November from Eaze as part of its Momentum program.
Momentum is announcing applications for its second cohort this fall, said Eaze spokeswoman Elizabeth Ashford.
"I'll throw the gauntlet out to MedMen, Harvest, Caliva and everyone," said Eaze's Kemp, calling out other major cannabis companies. "Give me a call or go out and do your own thing (for social equity). There's no secret sauce here. There's basic business and real social impact."
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Los Angeles is home to around 5,000 startups, the majority of which are in their young, formative years.
Which of those thousands are poised for a breakout in 2021? We asked dozens of L.A.'s top VCs to weigh in. We wanted to know which companies they would have invested in if they could go back and do it all over again.
Boiling
<img lazy-loadable="true" src="https://assets.rebelmouse.io/eyJhbGciOiJIUzI1NiIsInR5cCI6IkpXVCJ9.eyJpbWFnZSI6Imh0dHBzOi8vbWVkaWEucmJsLm1zL2ltYWdlP3U9JTJGaW1hZ2VzJTNGcSUzRHRibiUzQUFOZDlHY1EwRjdlRzlxY3JFd1lNVS12T2VTWng1NFd6VFdWUktaMFpyQSUyNnVzcXAlM0RDQVUmaG89aHR0cHMlM0ElMkYlMkZlbmNyeXB0ZWQtdGJuMC5nc3RhdGljLmNvbSZzPTEwMDImaD1jOGIyM2Y5YWNhNGNhNDY3NzZhNmUzNTU3MWI2YzAzNjcwOTU1Nzg0ODQxZDdiZGIyZjAxMzUxNjdkN2I5NWY2JnNpemU9OTgweCZjPTE2MDM4MjI5MTgiLCJleHBpcmVzX2F0IjoxNjY1MTY5NTcxfQ.iTVRhSe0UulUxSyMUZ4QA7_0njADdWe3QEJ28-xW6m0/img.jpg" id="a03b9" class="rm-shortcode" data-rm-shortcode-id="03faa4898896a9ce5be09d51dc104b73" alt="Pipe logo" />Pipe
<p><a href="https://www.pipe.com/" target="_blank">Pipe</a> provides financial services to help cloud service companies tap into their deferred cash flows, allowing them to continue growing without taking on debt or giving up ownership. For subscription-based businesses, this makes it "as if all of your customers converted to annual plans overnight," according to the company.</p><p>Founded by Harry Hurst, Josh Mangel and Zain Allarakhia, the company <a href="https://dot.la/pipe-taps-60-million-seed-extension-2646245409.html" data-linked-post="2646245409" target="_blank">raised $66 million of seed funding earlier this year</a> in a deal led by Craft Ventures and Fin Venture Capital.</p>Clash App Inc.
<p>Created by former Vine-r Brendon McNerney and entrepreneur and marketing expert P.J. Leimgruber, <a href="https://www.clashapp.co/" target="_blank">Clash App</a> is a short form video platform similar to TikTok, but without built-in sound libraries. It's geared toward empowering creators with innovative monetization options and inclusive communities.</p>XCLAIM
<p><a href="https://www.x-claim.com/" target="_blank">XCLAIM</a> has created an electronic platform where bankruptcy claims that take a notoriously long time to process can be digitally traded. Founded in 2018 by Matthew Sedigh, who has operated in the corporate restructuring field for more than a decade, the company says "rather than wait years for the bankruptcy court process to issue payment distributions, creditors can now access immediate liquidity by selling their claim to interested buyers." Earlier this year, it raised a $4 million seed round led from Luma Launch, First Round Capital and Freestyle Capital.</p>Simmering
<img lazy-loadable="true" src="https://assets.rebelmouse.io/eyJhbGciOiJIUzI1NiIsInR5cCI6IkpXVCJ9.eyJpbWFnZSI6Imh0dHBzOi8vbWVkaWEucmJsLm1zL2ltYWdlP3U9JTJGaW1hZ2VzJTNGcSUzRHRibiUzQUFOZDlHY1JlR3QzLWlHSmFtYVJnLXNwSXVYcDc5N0xOdnpTYWhYYVloQSUyNnVzcXAlM0RDQVUmaG89aHR0cHMlM0ElMkYlMkZlbmNyeXB0ZWQtdGJuMC5nc3RhdGljLmNvbSZzPTYwNiZoPWU3NzNhYTkwODZkNmE4OWQwMWU0ZjZkODk0ODU1ZWEyZDIzMmU3YTYyNzJjYTU3Mzk3MmI0NmQ0NjAxMDY3YzMmc2l6ZT05ODB4JmM9MjQ3NDg5MDE0MiIsImV4cGlyZXNfYXQiOjE2NzAzMzU0NjB9.iqCUfvVUI22AGAz-QYPiS7XFb26sw3mGaU8seorLqxQ/img.jpg" id="44f84" class="rm-shortcode" data-rm-shortcode-id="cbdc9b0cdf21d3873eef2a40647ae810" alt="Freck Beauty logo" />Freck Beauty
<p><a href="https://freckbeauty.com/" target="_blank">Freck Beauty</a> manufactures beauty products intended to make the user feel seen. Remi Brixton, the company's chief executive officer, founded the startup in 2015 when she was in search of a freckle makeup product. When she couldn't find one, she launched her own, the FRECK OG. The East Los Angeles-based company raised an undisclosed amount of seed funding in a deal led by KarpReilly and Stage 1 Fund earlier this year.</p>The Skills
<p><a href="https://www.theskills.com/" target="_blank">The Skills</a> wants to be the <a href="https://dot.la/the-skills-2649267338.html" target="_self">master class on sports </a>and life. The Los Angeles-based startup launched two months ago and offers classes from gold medal Olympians — including swimmer Michael Phelps and volleyball player Kerri Walsh Jennings — and Grand Slam tennis Champion Maria Sharapova. In December, it closed a $5 million seed round backed by Boston-based Will Ventures, Global Founders Capital, 8VC, Maveron, Hack VC and Correlation VC.</p>Mapped
<p>Founded by Shaun Cooley, former chief technology officer of Cisco's Internet-of-Things (IoT) and Industries division, <a href="https://www.mapped.com/" target="_blank">Mapped</a> provides IoT services in El Segundo.</p><p>The company raised $3 million of seed funding in a deal led by Greycroft earlier this year, putting its pre-money valuation at $9 million. </p>DataPlor
<p>Created in 2016 by Geoffrey Michener, <a href="https://www.dataplor.com/" target="_blank">Dataplor</a> indexes micro-businesses in Mexico (and will soon be expanding to other countries in Central and South America) and sells the data to larger companies.The company relies on contractors in those countries to collect the information from local businesses. It raised $4 million from ff Venture Capital, Quest Venture Partners and Space Capital earlier this year and expects to use it to expand into more Latin American countries. </p>Grow Credit
<p>Launched by serial entrepreneur <a href="https://joebayen.medium.com/a-black-founders-guide-to-raising-a-2m-institutional-seed-round-a8687f95087f" target="_blank" rel="noopener noreferrer">Joe Bayen</a>, <a href="https://growcredit.com/" target="_blank">Grow Credit</a> helps customers improve their credit score by providing credit for subscription services like Netflix and Spotify. Their MasterCard can help consumers with thin or damaged credit scores and the small line of credit can be upgraded for a fee. The company closed a $2 million seed round earlier this year with participation from Mucker Labs.</p>Outer
<p>The two-year-old Santa Monica-based company has seen business boom during the pandemic as retail stores shut down and online orders surged. The direct-to-consumer outdoor furniture brand <a href="https://dot.la/outer-furniture-raise-2646187491.html" data-linked-post="2646187491" target="_blank">uses backyards as showrooms</a> and <a href="https://dot.la/how-outer-aims-to-disrupt-the-outdoor-furniture-industry-2647872107.html" data-linked-post="2647872107" target="_blank">raised $4.3 million in a seed round</a> earlier this year led by Mucker Capital. Founded by Jake Liu and Terry Lin, a former designer at Pottery Barn, <a href="https://liveouter.com/" target="_blank">Outer</a> aims to appeal to Restoration Hardware and Pottery Barn shoppers. </p>WhatNot
<p>A livestreaming reseller of collectibles like FunkoPop vinyl figurines, Pokémon cards and sports cards, <a href="https://www.whatnot.com/" target="_blank">WhatNot</a> taps into a growing retail trend and promises that the collectibles are verified, much like sneaker reseller GOAT. </p><p>The startup secured $4 million in seed funding this month from Scribble Ventures, Wonder Ventures, Operator Partners, Y Combinator, Liquid 2 Ventures, Twenty Two Ventures and other investors. The company plans to use the funds to expand into video games, comics books, designer toys and vintage fashion.</p>Fourthwall
<p><a href="https://fourthwall.com/" target="_blank">Fourthwall</a> is the developer of an internet platform that helps content creators launch fully-branded websites focused on interacting with fans. Their website tag phrase is "Make a living doing what you love," which is complemented by their model, which provides creators 100% ownership of their website and brand.</p><p>Founded by Walker Williams and Will Baumann, the company has raised $4 million to date, from investors Defy Partners, Lightspeed Venture Partners and Initialized Capital Management.</p>Shop LatinX
<p><a href="https://shoplatinx.com/" target="_blank">Shop LatinX</a> calls itself the "leading beauty, fashion, and lifestyle ecommerce designed by and made for Latinas." The brainchild of two Los-Angeles-based Latinas, Brittany Chavez and Raquel Garcia <a href="https://dot.la/techstars-la-2646304264.html" data-linked-post="2646304264" target="_blank">launched their website</a> before Black Friday in 2016. It features more than 200 brands.</p>First Resonance
<p>Founded by former SpaceX software engineer Karan Talati and Neal Sarraf, <a href="https://www.firstresonance.io/" target="_blank">First Resonance</a> promises to ease the workflow for manufactures with software intended to provide greater visibility into production and test product development lifecycle. The company raised $1.75 million of seed funding last year from Wavemaker Partners, Stage Venture Partners and PLG Ventures, among clothes.</p>Vurbl
<p><a href="https://vurbl.com/" target="_blank">Vurbl</a> offers curated, one-stop-shop of what it calls the best audio on the internet, which can include podcasts but also goes well beyond that from religious sermons to court arguments. The new platform founded by CEO Audra Gold is being built with the <a href="https://dot.la/vurbl-raises-1-3-million-to-build-the-youtube-of-audio-2647713757.html" target="_self">$1.3 million pre-seed round Vurbl closed in September</a> led by AlphaEdison with participation from Halogen Ventures and Ten13.</p>PocketWatch
<p>Former Disney executive Chris Williams founded <a href="https://pocket.watch/" target="_blank">the studio</a> that produces family-focused content from YouTube stars. This year it launched clock.work, an advertising agency designed to help major brands reach kids. Investors include Viacom, Greycroft, Third Wave Digital and United Talent Agency, along with strategic angels including Robert Downey Jr. and Jon Landau.</p>PocketList
<p><a href="https://pocketlist.app/" target="_blank">The app</a> allows renters to see and share apartments that will soon be available before they're listed — reducing the time properties sit vacant and potentially heating up competition among apartment hunters. It launched <a href="https://dot.la/renter-app-2646416605.html" data-linked-post="2646416605" target="_blank">earlier this year</a>. The company has $2.8 million in seed funding led by David Sacks' Craft Ventures along with Abstract VC, Wonder Ventures and angel investor Spencer Rascoff, co-founder of Zillow and dot.LA.</p>Quilt
<p>The audio-based social platform promises to be the spot for "live, supportive, feel good conversations—just like hopping on the phone with a friend when you need it most." It lets people start a conversation around any topic or join by listening. <a href="https://www.beta.wearequilt.com/" target="_blank">Quilt</a> raised an undisclosed amount of venture funding from Freestyle Capital in 2019.</p>Tonebase
<p>Founded by Abhi Nayar, Chris Garwood and Igor Licthmann, <a href="https://www.tonebase.co/" target="_blank">Tonebase</a> provides high-level music education online. Yale School of Music alumnus Garwood and Lichtman<a href="https://news.yale.edu/2018/01/22/first-person-how-we-are-bringing-high-level-music-education-masses" target="_blank" rel="noopener noreferrer"> told their alma mater that it built with the idea </a>that it was "a way for people everywhere to learn from the very best musicians around the world — individuals who, due to their busy performing and teaching careers, are traditionally accessible to only a select few." The company has raised an undisclosed amount from Launch fund, e.ventures and other undisclosed last May. </p>Second Spectrum
<p>Launched in 2013 by Jeff Su, Yu-Han Chang and Rajiv Maheswaran, <a href="https://www.secondspectrum.com/index.html" target="_blank">Second Spectrum</a> already has deals with the NBA and English Premier League. This year it scored another one with Major League Soccer to use its optical tracking system to evaluate and analyze performance. </p><p>Second Spectrum puts their tracking cameras inside the stadium. Machine learning and AI-powered analytics provide detailed data that helps coaches and others better understand the game from player speed and deceleration to shot velocity in near real time. That technology can also be used on broadcast platforms to give fans more insight. The company raised about $20 million backed by CAA Ventures, Raine Ventures and The Chernin Group in 2018.</p>Toucan
<p>Founded by CEO Taylor Nieman, Shaun Merritt and Brandon Dietz, <a href="https://dot.la/slingshot-aerospace-ceo-2646797521.html" data-linked-post="2646797521" target="_blank">Toucan</a> is a Chrome browser extension that lets people learn a new language. It scans websites you visit and translates some words into the language you want to learn. The Santa Monica-based company most recently raised a $3 million round backed by GSV Ventures, Amplifyher Ventures, and Wonder Ventures, among others. </p>Serve Automation
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