Cannabis tech firm BDS Analytics is planning a national expansion of its sales tracking software and an increase in personnel thanks to a $3.5 million funding round.
The raise capped off the Boulder, Colorado-based firm’s Series B funding effort – led by a $750,000 investment by CanopyVentures I, also based in Boulder.
Other leading investors included Altitude Investment Management and Panther Opportunity.
The new capital will allow BDS to launch its GreenEdge software nationally and enter new adult-use markets in the U.S. as more states adopt recreational rules, said Roy Bingham, the firm’s CEO.
“A market becomes interesting to us when it becomes an adult-use market,” Bingham said, “not because of the adult-use piece necessarily but because at that point the state allows third-party brands to move into these markets.”
Initially, BDS expects to expand into Arizona and Nevada, with longer-range plans for Michigan and Massachusetts. The company currently serves customers in Colorado, Florida, Oregon and Washington state.
“Eventually the plan is to have a completely national footprint,” Bingham said.
BDS’ GreenEdge sales tracking software integrates with dispensaries’ point-of-sales systems, allowing users to pull data and analytics on what consumers are buying, as well as track broader market trends ands sales.
BDS will also use the new funds to grow its marketing and sales force – bumping the company of 30 employees up to 40 by the end of the year.
Canopy Venture’s investment in BDS was the first in its recently launched $50 million Canopy Venture I fund – which Tapman expects will include placements with up to 20 early stage firms.
The venture capital fund, which launched in January, is a a subsidiary of Canopy, a Boulder-based cannabis-focused business accelerator. BDS went through the program in 2015.
“We’re looking for long-term value and disruptive tech that will change the way people do business,” said Micah Tapman, managing director at CanopyVentures. “Companies where the core is around innovation in cannabis but has the potential to trickle over into other industries.”
Bingham agrees that BDS’ GreenEdge platform has plenty of potential in other sectors, but for now he says the firm is focused on cannabis.
“We definitely have some adjacent opportunities in grow centers and garden-supply facilities,” he said, “but the reality is that the cannabis industry is growing at about 28% each year.
“I don’t know of anything else that’s more attractive than that right now.”