Entrepreneurs create new way to shop for marijuana

Leafbuyer aims to be marijuana industry’s answer to sites such as Priceline

Posted 3/6/18

As the 2012 vote loomed on Amendment 64 in Colorado, two self-proclaimed soccer dads from Douglas County who said they had little knowledge of the product in question — marijuana — were paying …

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Entrepreneurs create new way to shop for marijuana

Leafbuyer aims to be marijuana industry’s answer to sites such as Priceline

Posted

As the 2012 vote loomed on Amendment 64 in Colorado, two self-proclaimed soccer dads from Douglas County who said they had little knowledge of the product in question — marijuana — were paying close attention.

Kurt Rossner, of Castle Pines, and Mark Breen, who lived in Castle Pines at the time and now resides in Centennial, were hunting for rapidly growing markets where they could launch a tech-based company.

“We wanted a hyper-growth industry,” Rossner said. “An industry that was just blowing up.”

They also wanted an industry that allowed them to work nationally and internationally. So, the duo started attending task force meetings regarding Amendment 64 and quickly brushed up on their marijuana facts.

“At the time we didn’t know anything about marijuana. We didn’t use the product,” Breen said. “We had to learn.”

Breen, 46, wanted to leave his career as an account executive for local TV stations in exchange for something new, he said. Rossner, 49, a longtime friend who built a tech career during the internet boom of the 1990s, came out of retirement to help him.

When Amendment 64 passed they set to work forming a business model on a whiteboard in Rossner’s basement. They recruited a web developer friend to help them in the process. Over the course of roughly eight months, they built a website similar to services like Trivago, Hotels.com or other sites that allowed consumers to compare prices and offers.

Theirs, however, was built specifically for the marijuana industry, and in 2013, their company Leafbuyer was born. From the site, consumers can find dispensaries near them, browse menus and shop the best area deals.

They’re different from their competitors, such as the marijuana review site Leafly, Rossner and Breen said, because they’re focused on helping people save money rather than providing product reviews.

“A lot of our competitors were building sites off the concept of Yelp,” Breen said. “We just found that the consumers really wanted to save money.”

Today, Leafbuyer users can compare prices and deals at more than 8,000 dispensaries in 26 states. The company plans to expand into any state that legalizes medical or recreational sales of marijuana. That number today stands at 29 states with some form of legalized cannabis.

“California becoming recreational is huge,” Rossner said. “That state is five times the market of Colorado already.”

But there’s a benefit from Leafbuyer for dispensaries as well, the men said, and not just for consumers.

Michael Scialfo, general manager at Rocky Road Aurora, said they have worked with Leafbuyer since the dispensary opened in 2015. Leafbuyer helps their business reach its customers in a regulatory environment that can make it difficult for dispensaries to use more traditional methods of advertising, Scialfo said.

He referenced the 30/70 rule as an example, meaning a dispensary’s advertising shouldn’t reach an audience where more than 30 percent of people are under 21.

“I like the regulations. I think they’re there for a really good reason,” Scialfo said, adding Leafbuyer helps them broaden their reach. “They’re another source, another vehicle for us to advertise with.”

Last spring, Leafbuyer went public on the OTCQB Market, an over-the-counter market for beginning-stage companies.

“We went from basically starting here on this table,” Rossner said while sitting in his Castle Pines basement, “to become, you know, an $80 million, publicly traded company.”

Soon, they hope to expand into the Canadian stock exchange, and have announced plans to incorporate blockchain, the same technology behind bitcoin, into their product. The technology will give them more insight and analytics into how consumers use their site, Rossner and Breen said, so they can show dispensary owners whether Leafbuyer is working for them.

“Blockchain is as big of a possibility as the internet itself,” Rossner said.

Leafbuyer has grown from two men and a white board in a Castle Pines basement to a company employing 35 people, operating offices in Los Angeles and Seattle in addition to its Greenwood Village headquarters.

Everyone involved wrote checks to get it off the ground, Breen said, explaining that leaving his corporate job to start a new company felt like a big risk. He and Rossner didn’t take a salary for two years. Now, they say, it’s starting to pay off. And they don’t have plans to slow down.

“We are raising capital. We are raising millions of dollars,” Rossner said. “We now are taking this to the next level.”

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