MJ Freeway Archives - Page 2 of 2 - Green Market Report

William SumnerWilliam SumnerSeptember 21, 2018
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5min15070

What kind of effect does adult use cannabis have on the medical market? The answer may surprise you. At the Green Market Summit, where some of the cannabis industry’s most prominent thought leaders were gathered, a discussion panel was held on the unforeseen consequences of legalizing adult use cannabis on the medical market. The following report “The Economics of Adult Use Marijuana on Medical Marijuana” was issued as a result of the panel members.

Moderated by Marijuana Policy Group co-founder Adam Orens, the discussion included Emily Paxhia, Founding Partner & Managing Director at Poseidon Asset Management; Jeannette Ward Horton, Vice President of Global Marketing and Communications at MJ Freeway; and Jessica Billingsley, CEO and Co-Founder of MJ Freeway.

Distinguishing this panel from all the other was the fact that it was the only all-female panel at the event. Although the panelists mused that someday such a panel would neither be significant or out of the ordinary, the audience reacted to the observation of the all-female panel with approval and applause.

Starting off the conversation, the panelists discussed the pre-adult use medical market and many of the early predictions of what would happen when adult use cannabis sales became legal. Although some predicted that the medical market would remain static, others, like MJ Freeway, predicted that the market would take a dip; which is precisely what happened. According to Paxhia, it was easy to see why.

“Living in San Francisco, some of those [cannabis] clinics, I felt like I was going to get sick from going in there,” recalled Paxhia. “I think there’s a number of reasons why people for a long time side-stepped getting medical cards. Once it became adult use, there were some very ready purchasers.”

As the adult use market began to mature in Colorado, Washington, and other states; the consensus became that adult use of cannabis would always kill the medical market. However, looking at the data, Horton and her partners discovered that after 12 months of legalization, the medical market actually grew by 45% while the adult use market only increased by 38%.

“People think the medical market is dead. Recreational shows up, people aren’t investing in those products, they’re not developing IP around those products, and they should be,” said Horton. “There’s a real medical market, and there are real medical patients, and that’s an opportunity I think people aren’t spending time on.”

Closing out the event, the panelists speculated on the future of the medical cannabis market and whether or not both the medical and adult use market would eventually fade away into just one unified cannabis market. Although it is a possibility, Billingsley was skeptical, stating that there would always be a need for medical cannabis.

“There will always be medical conditions that need a medical product that has some true efficacy for that condition,” said Billingsley. “It is a recreational substance, but it also has a truly efficacious benefit on the medical side.”

Stay tuned to find out more about happened at the Green Market Summit, as the Green Market Report gives you an in-depth look at the event throughout the week. Click here to read the previous recaps on cannabis banking, international cannabis, and an exclusive interview between legendary financial analyst Jim Cramer and The Green Organic Dutchman CEO Brian Athaide.


StaffStaffSeptember 20, 2018
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6min5570

Batu Capital Investments, Cresco Capital Partners and existing investors participate in raise for the largest global cannabis tech company

Denver, CO – September 18, 2018/ AxisWire/ MJ Freeway, the company which invented seed-to-sale technology and has the cannabis industry’s first enterprise resource planning product, announced the completion of its $10 million oversubscribed Series C financing. The financing, which will accelerate MJ Freeway’s growth in advanced technological build-outs, centered around increasing new product features for businesses and governments. The round was led by Batu Capital Investments, a tech-focused multi-family office managed by Emery and Evan Huang. Cresco Capital Partners, a private equity investment firm dedicated to investing in the cannabis industry, also participated significantly.

“The industry is maturing rapidly and needs software that can handle increasing complexity, with state-of-the art functionality and data security,” said Jessica Billingsley, Co-Founder & CEO of MJ Freeway. “With adult-use permitted in 9 states and medical in 30 states, MJ Freeway is uniquely enabled to support regulation at every level. Indeed, we are — and have been — the backbone upon which the cannabis industry is built. We thank our new and existing investors for realizing the tremendous importance of our enterprise.”

“MJ Freeway’s technology is vastly superior to other offerings in the marketplace. It supports the full range of cannabis business operations – from cultivation to manufacturing to dispensary – with the industry’s first fully-integrated enterprise resource planning (ERP) product, MJ Platform,” said Emery Huang, Senior Partner of Batu Capital. “We believe MJ Freeway is the market innovator and will maintain its market dominance through a clear technological edge over the competition.”

“Cresco Capital Partners has made significant investments in the cannabis space since 2015, and we believe MJ Freeway is the clear leader in the cannabis supply chain management SaaS market, positioned for dominance,” said Matt Hawkins, Managing Principal at Cresco Capital Partners. “The company’s innovative product line and experienced management team led to our decision to invest in MJ Freeway’s unparalleled tech platform.”

About MJ Freeway

MJ Freeway® is the largest global cannabis technology company having tracked more than $10B in sales with clients in Australia, Canada, Europe, South America, Switzerland, and the United States in 23 states and the District of Columbia. Founded in 2010 by technologists creating tech specifically for cannabis businesses, MJ Freeway’s tracking software includes patent-pending inventory control and grow management applications to streamline workflow and increase efficiency. MJ Freeway’s Leaf Data Systems software solution enables governments to track cannabis plants from seed-to-sale and ensure patient, public, and product safety. MJ Freeway also offers a complete suite of professional consulting services for cannabis businesses.  For more information, visit mjfreeway.com.

About Batu Capital

Batu Capital is a multi-family office managed by Emery and Evan Huang. We look for opportunities in cryptocurrency, cannabis, and big data that constitute either game-changing technologies or are late-stage/pre-IPO enterprises that have built wide economic moats.

About Cresco Capital Partners

Cresco Capital Partners is a private equity firm that is focused on investing exclusively in the legalized cannabis space. The firm has deployed over $25MM in the industry since 2015 and is currently raising their second fund.  Fund II has made six (6) investments thus far and will close its raise at $50 million.  Led by an experienced team of private equity professionals, the firm’s principals have over 20 years of investment experience collectively within the legalized cannabis industry. 

Media Contact:

Jon Goldberg
KCSA Strategic Communications
Tel. 212.896.1282
Email: jgoldberg@kcsa.com

 


StaffStaffSeptember 20, 2018
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4min7300

MJ Freeway, the company which invented seed-to-sale technology and has the cannabis industry’s first enterprise resource planning product, completed a $10 million oversubscribed Series C financing. The round was led by Batu Capital Investments, a tech-focused multi-family office managed by Emery and Evan HuangCresco Capital Partners, a private equity investment firm dedicated to investing in the cannabis industry, also participated significantly.

“The industry is maturing rapidly and needs software that can handle increasing complexity, with state-of-the-art functionality and data security,” said Jessica Billingsley, Co-Founder & CEO of MJ Freeway. “With adult-use permitted in 9 states and medical in 30 states, MJ Freeway is uniquely enabled to support regulation at every level. Indeed, we are — and have been — the backbone upon which the cannabis industry is built. We thank our new and existing investors for realizing the tremendous importance of our enterprise.”

MJ Freeway has tracked more than $10B in cannabis sales with clients in AustraliaCanadaEuropeSouth AmericaSwitzerland, and the United States in 23 states and the District of Columbia. MJ Freeway’s Leaf Data Systems software solution enables governments to track cannabis plants from seed-to-sale and ensure patient, public, and product safety. The company has had a difficult year as it has been forced to navigate software hacks that it believes has been at the hands of competitors. Still, MJ Freeway has continued to push ahead and defy its critics by signing more customers.

“MJ Freeway’s technology is vastly superior to other offerings in the marketplace. It supports the full range of cannabis business operations – from cultivation to manufacturing to dispensary – with the industry’s first fully-integrated enterprise resource planning (ERP) product, MJ Platform,” said Emery Huang, Senior Partner of Batu Capital. “We believe MJ Freeway is the market innovator and will maintain its market dominance through a clear technological edge over the competition.”

“Cresco Capital Partners has made significant investments in the cannabis space since 2015, and we believe MJ Freeway is the clear leader in the cannabis supply chain management SaaS market, positioned for dominance,” said Matt Hawkins, Managing Principal at Cresco Capital Partners. “The company’s innovative product line and experienced management team led to our decision to invest in MJ Freeway’s unparalleled tech platform.”


Video StaffVideo StaffSeptember 20, 2018

1min7340

The Green Market Summit hosted by the Green Market Report on September 14, 2018, featured a panel that looked into the effect of a legalized adult use marijuana market on existing medical marijuana markets. Panelists included Adam Orens of Marijuana Policy Group, Jeannette Horton and Jessica Billingsley from MJ Freeway and Emily Paxhia of Poseidon Asset Management.

The panel resulted in a new report issued at the Summit titled, “The Economics of Adult Use Marijuana on Medical Marijuana Markets.” The findings from the data provided by MJ Freeway noted that instead of adult use legalization cannibalizing medical marijuana markets, the medical markets turn out to be very resilient.


StaffStaffAugust 27, 2018
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8min9750

Green Market Report Partners with TheStreet.com Providing Investors with Exclusive Insight/Access to Leaders in the Cannabis Industry

NEW YORK, Aug. 27, 2018/AxisWire/ – The cannabis industry’s leading business and economic minds will gather in New York City to discuss the advanced economic state of cannabis at the Green Market Summit on September 14, 2018.

Hosted by the Green Market Report, the cannabis industry’s premier financial news organization, this one-day event will feature exclusive data and economic analysis focused on five key sectors in the industry: Banking, Cultivation, International Trade, Retail, and Seed-to-Sale Tracking.

“As the cannabis industry continues to evolve, we are witnessing dynamic shifts in how the industry is structured and regulated,” said Debra Borchardt, Chief Executive Officer and co-founder of Green Market Report. “The Green Market Summit presents a remarkable opportunity for investors and entrepreneurs to gain firsthand knowledge of how these changes will affect the economics of cannabis and their bottom line.”

“The speakers and report sponsors assembled for this conference represent years worth of unparalleled experience and knowledge in the cannabis industry,” added Cynthia Salarizadeh Co-Founder of Green Market Report and Managing Partner of KCSA Strategic Communications. “We couldn’t be more proud to play host to one of the most diverse and knowledgeable collections of cannabis experts to be assembled, and whose companies collectively play a part in every stage of the cannabis supply chain.”

WHAT: Green Market Summit: The Advanced Economic State of Cannabis
WHEN: September 14, 2018
WHERE: One World Trade Center, 285 Fulton St, New York, NY 10007

Located in the Financial District of New York City at One World Trade Center, the event is made possible through a partnership with TheStreet and the Marijuana Policy Group. The keynote event will feature TheStreet’s Jim Cramer, who will interview Brian Athaide CEO of The Green Organic Dutchman.

Other speakers for the event include:

  • Adam Orens, Co-Founder, Marijuana Policy Group
  • Cynthia Salarizadeh, Co-Founder and Chief Strategy Officer, Green Market Report
  • Debra Borchardt, Co-Founder and CEO, Green Market Media
  • Emily Paxhia, Founding Partner & Managing Director, Poseidon Asset Management
  • Javier Hasse, Author of Start Your Own Cannabis Business
  • Jeannette Ward Horton, Vice President of Global Marketing and Communications, MJ Freeway
  • Jessica Billingsley, Co-Founder and Chief Executive Officer, MJ Freeway
  • Lewis Goldberg, Managing Partner, KCSA
  • Matt Karnes, Founder and Managing Partner, GreenWave Advisors, LLC
  • Phil Carlson, Managing Director of Investor Relations, KCSA
  • Tahira Rehmatullah, Chief Financial Officer, MTech Acquisition Corp
  • Tyler Beuerlein, Vice President of Business Development, Hypur
  • Jonathan Rubin, CEO of Cannabis Benchmarks

The agenda for the event is as follows:

  • 8:00 AM – 9:00 AM: Registration & Breakfast
  • 9:00 AM – 9:50 AM: Economics of Cannabis Banking, presented by Tyler Beuerlein, Vice President of Business Development at Hypur Ventures
  • 10:00 AM – 10:50 AM: Economics of International Cannabis, presented by Daniel Pearlstein, Executive Vice President of Canopy Rivers.
  • 11:00 AM – 11:15 AM: Keynote Event, TheStreet’s Jim Cramer Interviews The Green Organic Dutchman CEO Brian Athaide.
  • 12:00 PM – 12:50 PM: Lunch, Sponsored by Acreage Holdings
  • 1:00 PM – 1:50 PM: Economics of Plant Tracking, presented by MJ Freeway co-founder and CEO, Jessica Billingsley, and Jeannette Ward Horton, Vice President of Global Marketing and Communications for MJ Freeway.
  • 2:00 PM – 2:50 PM: Economics of Cannabis Retailing, presented by David Dancer  Chief Marketing Officer for MedMen.
  • 3:00 PM – 3:50 PM: Economics of Cultivation, presented by a leading publicly traded Cannabis company  
  • 4:00 PM – 4:50 PM: Closing Panel, featuring KCSA’s Lewis Goldberg interviewing author Danny Moses, author of “The Big Short and Beyond.” 
  • 5:00 PM – 5:15 PM: Closing Remarks.

Tickets for the event and early bird pricing are still available, but spacing is limited. For more information, please visit: www.GreenMarketSummit.com

About Green Market Report:

The Green Market Report (GMR) is headquartered in the Financial District of New York City with an office in Los Angeles. GMR is poised to be the center for trustworthy business, financial and economic news and intelligence. The site offers coverage on financial matters including news briefs on business, cultivation, and extraction, cannabis company stock prices, and wholesale cannabis pricing. For more information, please visit www.greenmarketreport.com or email info@greenmarketreport.com. Follow us on Facebook, Instagram and Twitter @GreenMarketRpt.

Communications Contact:

Lewis Goldberg

KCSA Strategic Communications

lgoldberg@kcsa.com

 


Debra BorchardtDebra BorchardtJuly 10, 2018
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10min31240

Happy July 10. 710 is a thing for cannabis consumers. If you don’t know what that is, it’s okay. We’re here to help you learn. July 10 is or 710 is becoming a big sales promotion day and is growing in popularity. Cannabis consumers are always happy to find a new reason to celebrate and since 420 has been adopted by even non-cannabis consumers, 710 or Dab Day is the latest insider holiday.

If you turn the numbers upside down, it loosely resembles the word “OIL.” So, fans of cannabis oil as using that as an excuse to celebrate. Not convinced?

According to MJ Freeway, point-of-sale (POS) data from thousands of cannabis retailers across the U.S., Monday, July 10, 2017 sales were 15% higher than average Monday sales. The 15% increase can be wholly attributable to increased concentrate purchases. Concentrate category sales jumped 18% on July 10, 2017.  In the last three years, year-over-year 710 holiday sales growth has averaged 19%.

In addition to that, MJ Freeway predicts a sales spike of more than 25% today. Of course, these sales pale in comparison to 420 sales, but it is significant enough for dispensary owners to recognize it. Plus since 420 has been so heavily commercialized, it gives cannabis consumers a new secret handshake.

Cannabis oil can also be described as concentrates or extracts and has become one of the fastest growing categories for sales. It’s been well documented that flower sales have either stalled or declined as oil sales increased. MJ Freeway noted that the flower category share as a percent of total product sales has declined 14% since 2014. Comparably, edible category share growth is up 2% since 2014.

The company went on to say that on average, individual cannabis retail locations have experienced the following product sales growth since 2014:

  • Concentrate sales have grown 412%
  • Edibles have grown 272%
  • Flower sales have grown 149%

Flowhub Data

Cannabis data provider Flowhub has also picked up on this trend in sales growth. The seed-to-sale software company tracked a sample set of cannabis consumers on this holiday over the course of one year. They found that there was an 88% growth in concentrate sales when comparing 7/10/2016 against 7/10/2017 for the same sample set of customers. ($15,053.75 in 2016 and $121,802.14 in 2017). In comparison to an average Monday, sales of concentrates increased 34% on Dabs Day 2017, and in comparison to an average Tuesday, sales of concentrates increased 26% on Dabs Day 2017.

Promotions 

Cannabis oil companies aren’t missing the opportunity to use the holiday to promote their products. The Green Solution is offering up to two grams of NectarBee shatter, wax and pie crust concentrates for $24.95 each on July 10. If there isn’t a dispensary in your area, the online cannabis catalog on iheartjane.com currently has over 20,000+ cannabis products specific to the “extracts” category, which is the largest offering in the world.

If companies aren’t sure how to approach this holiday, MJ Freeway has created two retail guides:

 

 

 


William SumnerWilliam SumnerFebruary 9, 2018
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8min15180

The cannabis industry in Washington is in a crisis this week as technical issues concerning that state’s new seed-to-sale tracking system continue to cost business owners thousands of dollars in lost sales and diminishing inventories.

Dubbed Leaf Data Systems, the new software was developed by Denver-based MJ Freeway, which provides business management solutions and consulting services for the cannabis industry. Launched on the first of February, the system has been plagued by a slew of bugs from the very start.

According to the Seattle Times, some growers have complained that the system scrambled their shipping orders while some dispensary managers have been unable to receive order shipping manifests. In addition to slowing down or altogether halting daily business operations, some users haven’t even been able to log into the system at all.

Initially, the state was supposed to switch over to a new seed-to-sale tracking system in November 2017 but the technology company chosen as the vendor, Franwell, abruptly backed out of the contract. MJ Freeway was subsequently chosen to pick up the contract but was only given several months to put together a system.

In a letter to licensees, Washington Liquor and Cannabis Board deputy director Peter Antolin said that the source of the transfer/manifest issues was related to an unauthorized access of the traceability system.

The system intruder reportedly downloaded a copy of the traceability database and took undisclosed actions which caused the technical issue with inventory transfers. Although no personally identifying information was stolen, the WSLCB says that some information was accessed.

The intruder gained access to route information of manifests filed between Feb. 1 and Feb. 4 as well as transport information; such as the vehicle type, VIN and license plate number. Driver information was not accessed.

The WSLCB claims that the issue has been resolved and that it and MJ Freeway are working towards fixing the other technical glitches within the system, noting that there are several workarounds for the errors while the system is being fixed.

Despite the board’s reassurances, some cannabis business owners, like Cannasol Farms CEO Jeremy Moberg, are more than skeptical.

“I don’t believe it’s fixed,” said Moberg told MJ Biz Daily. “Not until I hear of retailers bringing in product.”

Moberg went on to say that he has approximately $18,000 in inventory sitting in a van because he cannot integrate his company with the Leaf Data Systems and that this week he’s had to lay off all but a handful of employees who are remaining to help him figure out the system.

“If you think about five days in this industry, it’s millions of dollars worth of transactions that are not happening,” Moberg added.

Some business owners have suggested that the state cancel its contract with MJ Freeway and go back to the contingency system left by the state’s previous vendor BioTrackTHC. But as the state continues to fix the technical glitches, cannabis businesses will continue to lose thousands of dollars; and while Washington’s cannabis industry will at some point return to normal, for many businesses, the damage has already been done.

The Back Story

 

 BioTrackTHC was contracted in 2013 to monitor the program with its seed-to-sale tracking, and by all accounts, it seemed to be working just fine. Then the state decided to open the program up to a public bid to see if there might be a better vendor for a better price.

In June the state selected Franwell’s METRC system to replace BioTrackTHC. However, when Franwell came to the table to begin the negotiations of planning the program takeover, talks quickly broke down. On June 9, Franwell walked away from the contract and never spoke publicly about it. One inside source said that basically, the state wanted more than what they were willing to pay for from Franwell. 

The state then chose MJ Freeway, which has had its own share of troubles last year. The company has suffered hack attacks, alleged security breaches (which the company denies) and systems failures. By winning the contract, it was also put in the position of trying to take over a multi-million dollar system with over 1,700 participants in a matter of months. No easy task for any software company. MJ Freeway issued a video response regarding the situation and trying to address market concerns.

BioTrackTHC was set to terminate its contract on October 31, but in early October the state began talking to BioTrackTHC to extend the contract. “Events occurred that brought up a potential security concern,” said Jeff Gonring, Director of Market and Communications for BioTrack. He was referring to security over data issues surrounding MJ Freeway. Regardless, BioTrack designed a work around for the state to use as it makes its transition. This band-aid approach has helped the customers and reduced BioTrack’s exposure to MJFreeway’s security problems that seem to plague the company.


Debra BorchardtDebra BorchardtOctober 31, 2017
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16min13900

Washington State’s marijuana program is a hot mess and the state only has itself to blame. The state monitors its legalized marijuana program by tracking the marijuana from seed to sale. Every single plant is tagged from its point of conception to its final use and sale through a sophisticated software program. The program is used by every license holder and covers thousands of transactions daily.

One of the reasons for such an onerous tracking system is that marijuana is still federally illegal. States have been allowed to operate marijuana programs that have been legalized at a state level so long as they abide by guidelines listed in a document from the Department of Justice called the Cole Memorandum. The goal of the memo was to make sure legal marijuana did not make its way into the black market or in the hands of children.

The state is changing vendors and the transition has gone very badly forcing businesses to manually keep track of the marijuana plants until the new vendor can take over. The problem is that anti-marijuana forces could point to this debacle as vindication that legalized marijuana is a bad idea because it can’t be properly monitored.

 BioTrackTHC was contracted in 2013 to monitor the program with its seed-to-sale tracking, and by all accounts, it seemed to be working just fine. Then the state decided to open the program up to a public bid to see if there might be a better vendor for a better price. This isn’t such a bad idea because states should always try to see if they can save their taxpayers money and always seek to improve programs. However, the execution went horribly wrong.

In June the state selected Franwell’s METRC system to replace BioTrackTHC. However, when Franwell came to the table to begin the negotiations of planning the program takeover, talks quickly broke down. On June 9, Franwell walked away from the contract and never spoke publicly about it. One inside source said that basically, the state wanted more than they were willing to pay for from Franwell. Then the state tried to throw Franwell and the cannabis businesses under the bus by saying that Franwell wanted to charge too much money for RFID tags that the businesses didn’t want. Thereby deflecting attention away from its poorly managed transition.

Another theory from a blog PA Marijuana Medical Watch suggested that the state made demands on Franwell that weren’t in the original Request For Proposal (RFP) causing them to walk away. This blogger believes the state decided to pick MJ Freeway’s Leaf Data Systems, a seed-to-sale software company because it is getting advice from the advocacy groups National Cannabis Industry Association and Marijuana Policy Project, both investors in MJ Freeway.

Whatever the reason, Franwell walked away from a lucrative contract with the state of Washington in nine days. The state then chose MJ Freeway, which has had its own share of troubles this past year. The company has suffered hack attacks, alleged security breaches (which the company denies) and systems failures. It desperately needed a win this year. However, by winning the contract, it was also put in the position of trying to take over a multi-million dollar system with over 1,700 participants in a matter of months. No easy task for any software company. MJ Freeway issued a video response regarding the situation and trying to address market concerns.

MJ Freeway insisted that its software problems were resolved in a matter of hours and that customers were back online quickly. They also point out in the video that the task they are taking on is very complicated and takes more time than what the state had allotted.

It’s a huge program with thousands of transactions every day and hundreds of businesses involved,” said Jeff Gonring, Director of Market and Communications for BioTrack. “This is not a simple transfer of data.”

MJ Freeway was set to take over from BioTrackTHC on October 31 but now isn’t expected to take over until January 2018. The state’s Liquor and Cannabis Board has come up with a contingency plan for November 1. It’s message to the businesses, “You must keep a record of all required activity associated with your business. If you have a third-party, commercial software provider consider contacting them to review your coverage. Some software systems may capture traceability transactions for later reporting which may minimize your manual reporting requirements.” In other words, sharpen those pencils for your spreadsheets. Not only do these businesses have onerous rules and regulations they have to abide by, they now have to manually track this information and then two months later transfer it to a new program.

“The whole situation is still pretty dynamic between the Washington State Liquor and Cannabis Board, many of traceability platforms active in the state and other marijuana licensees, new information seems to be coming through on an almost hourly basis,” said Mindon Win Special Operations Coordinator at BotanicaSeattle. “The marijuana industry here in Washington is banding together to come up with solutions that keep us in compliance and able to continue doing business.”

So, what about BioTrackTHC in all of this mess? The company was set to terminate its contract on October 31, but in early October the state began talking to BioTrackTHC to extend the contract. “Events occurred that brought up a potential security concern,” said Jeff Gonring, Director of Market and Communications for BioTrack. “We need resolution on that security concern before entering into an extension.” Gonring is referring to an email that was sent to Washington licensees last month from someone claiming to have sensitive data that seems to be proven as accurate.

We are concerned about the breach. We are currently in a co-mingled state and we need assurances from the LCB that it has been remedied. We can’t expose our system to that,” said Gonring. “There is enough smoke to give us concern there is fire.” BioTrackTHC is so concerned the company issued a public letter to the Washington State LCB. At this stage, BioTrach THC hasn’t officially agreed to the extension, nor has it declined.

The security breach that Gonring believes happened is outlined in the public letter. He noted that BioTrack began a data dump in August to MJ Freeway in order to assist in the transfer of vendors. Then in September, the licensees received emails saying that a hacker had gotten sensitive data from the Washington dispensaries and wanted to sell it. The data seemed to be real and the emails weren’t seen as an idle threat. BioTrack seems to suggest that the timing is not a coincidence.

In the meantime, the state has sent out spreadsheets to business owners.  The opportunity for human error is enormous. There are almost 20,000 pounds of marijuana that are produced each month in the state that must be tracked and traced. There were 3.8 million pounds of extracts produced in August in the state that must be accounted for and the state logged $1.3 million in sales for the fiscal year 2017.

The business owners seem to be the one group left out of this equation. They are at the mercy of the state and its mismanagement of the tracking system. “I don’t want to speak for everyone but we hope people recognize that marijuana businesses are invested in compliance with the state and it’s in everyone’s best interest to demonstrate our ability to run a regulated and monitored cannabis market under these circumstances,” said Win. 

It gives anti-marijuana forces fuel for their fire to claim that legalized marijuana can’t be properly monitored. They will argue that over the next two months, marijuana can end up on the black market because it can’t be properly tracked and traced. They could be right.

Washington State’s debacle could hurt the legalization efforts if this proves to be true, especially ahead of the holiday season which is when sales rise. The entire situation could have been either avoided by remaining with a program that worked without any hiccups or at least giving a vendor enough tie to properly prepare for a transfer of services. In the end, the problem must be owned by the state for creating this self-inflicted wound.


Michelle JanikianMichelle JanikianSeptember 14, 2017
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4min20040

Following two separate, significant security breaches over the last year, on Tuesday night, September 12, 2017, the state of Nevada announced that it will be changing its seed-to-sale track and trace compliance system from Leaf Data Systems to Metrc for all marijuana establishments. All Nevada cannabis companies, which includes dispensaries, cultivation facilities, and extraction facilities, have until November 1, 2017, to make the switch.

Nevada is breaking a five-year contract with MJ Freeway (creators of Leaf Data Systems) signed in March 2016 with this new deal. The original contract with MJ Freeway was estimated to be worth $603,393 for five years. The new deal with Metrc is estimated to be worth $816,000 for four years.

In late December 2016, Nevada’s Division of Public and Behavioral Health’s medical marijuana database was hacked. More than 11,000 medical marijuana applicant’s personal information was released on the internet.

Just days later, in early January 2017, MJ Freeway was hacked in a separate attack. This caused hundreds of marijuana businesses, like dispensaries, to go offline, making sales and transactions next to impossible across the U.S.  Then, MJ Freeway was hacked again in June 2017, when source code information was posted on Reddit and Gitlab.com. 

Nevada cannabis businesses are permitted to continue using other, approved seed-to-sale software as long as they transmit their data to Metrc.

Metrc, along with MJ Freeway and Biotrack THC, is the leading cannabis seed-to-sale tracking companies in the U.S., providing transparency and accountability to the industry. Metrc’s other state contracts include Colorado, Oregon, Maryland, Alaska, and recently, Michigan and Ohio. Metrc also bagged the big kahuna of contracts – California. The size of the state’s market is considered to be the biggest prize in the software market.

Metrc is owned by Franwell, an established track-and-trace technology company for agriculture and food products.

Since Metrc was founded in 2013, it has traced over 5 million cannabis plants.



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