Eaze co-founder Keith McCarty raises $5M for his new B2B cannabis startup

Keith McCarty couldn’t stay out of the booming weed business for long.

The co-founder and former chief executive officer of the well-funded marijuana delivery startup Eaze has launched WAYV, a B2B cannabis logistics and compliance platform that delivers inventory to cannabis retailers. Today, the company is announcing its first round of funding, a $5 million seed round led by David Sacks at Craft Ventures. The round represents the former PayPal executive’s first investment in the cannabis technology sector.

Other investors in the round declined to be named.

McCarty and Sacks previously worked together at Yammer, a private social networking tool used by businesses created by Sacks in 2008. The company sold to Microsoft in 2012 for $1.2 billion, giving McCarty and several others enough cash to experiment. For McCarty, that meant exploring the hazy and uncharted territory that was marijuana delivery.

McCarty, however, mysteriously left Eaze right as the company gained significant traction. Neither the company nor McCarty ever explained the shake-up; McCarty was quickly replaced by another former Yammer employee, Jim Patterson, the founder and former CEO of Zinc. In a conversation with TechCrunch, McCarty didn’t clarify the nature of his exit.

He did say that the idea for WAYV came from observing the difficulties of cannabis supply chain logistics during his time at Eaze .

Headquartered in Los Angeles, WAYV connects licensed cannabis companies to licensed brands and provides next-day delivery of cannabis products — it’s essentially Eaze for the cannabis enterprise not the average cannabis consumer. The startup was founded last year and has so far delivered to retailers in California only.

As a second-time cannabis founder, McCarty said building WAYV has been a lot different than launching Eaze, which was one of the first big-name marijuana tech companies.

“Back in 2014, [Eaze was] one of the first to raise venture capital, it was kind of unheard of,” McCarty told TechCrunch. “Now, the majority of Americans favor legalization. For medical, it’s 90 percent and for adult recreational, it’s more than 60 percent. As we Americans continue to favor legalization and that stigma is removed, not just medical but also adult use, it’s going to draw attention and also investment.”

Venture capital investment in cannabis startups has continued to climb, most notably after the state of California voted to legalize recreational marijuana use in 2016. According to Crunchbase, $700 million has been funneled into the space since 2014.

“The industry is moving at such a fast cadence, it’s really exciting to be a part of,” McCarty added.

VC firms of Kevin Durant and Snoop Dogg back Dutchie, a new cannabis delivery service

Ross Lipson, the chief executive officer and co-founder of the on-demand marijuana and cannabis delivery service, Dutchie, had thought he was done with the online delivery business.

Instead, he’s launched a new delivery service that has just raised $3 million from Casa Verde Capital, the $45 million venture firm founded by hip hop impresario Snoop Dogg, and Kevin Durant’s Durant Company — among others — to take advantage of the growing demand for marijuana delivery.

It had been only five years since Lipson sold a food delivery business he spent a decade building when the inspiration for Dutchie came to him. And the idea was too compelling to shake.

Lipson was living in Bend, Ore., where he’d retired after selling his online food delivery business GrubCanada to JustEat, the European tech-enabled delivery giant, back in 2012.

Then, in 2015, after Oregon legalized recreational use of marijuana, Lipson began wondering if it wasn’t time to revisit the whole delivery space again.

For him, the conundrum for consumers looking to buy cannabis products was similar to the dilemma in-home diners faced when choosing what to eat. In the modern weed world (at least in places where marijuana is legal), consumers are so spoiled for choice they often go with a default option.

Before online delivery, ordering food meant turning to the neighborhood spot for everything from American to Ethiopian, Italian, Jamaican, Chinese, Indian, Thai, or Tibetan food. But with online delivery services, a whole city’s worth of restaurant options opened up to consumers (as long as they were in your delivery area).

The same, Lipson figured, was true of marijuana.

“We’re creating a tool that helps the user and consumer navigate the delivery space,” he said. “We’re educating the consumer to that buying experiences…. If you don’t have that online ordering tool in front of you you’re forced to choose a dispensary and take the information that that ‘budtender’ gives you, which is their personal preference.”

Right now, marijuana delivery is something of a land grab. In Los Angeles alone, services like Nugg, Ganjarunner, Kushfly, Eaze, HERB, Westside Organic, and Cannabis Express, all pitch delivery services for marijuana or cannabis infused products, oils and vapes to willing consumers.

Eaze, the biggest startup in the online delivery space, has raised at least $37 million to tackle the growing market for legal cannabis delivery since its launch in 2014.

Lipson, however, has seen this all before with food. He started Dutchie in 2017 (and yes, it is named after the song) in 2017 from Bend and has been slowly and steadily growing the business. The company signed on 50 dispensaries in Oregon to help prove out the product and just raised $3 million in a seed round from Casa Verde Capital, The Durant Company, Sinai Ventures and other angel investors.

The company currently operates in Oregon, Washington, and Michigan and is launching in Colorado, Nevada and California this month. It currently works with 100 dispensaries and has seen $2.5 million in gross merchandise volume in its first year of operations alone.

To further boost its expansion efforts, the company also signed an agreement with Canopy Rivers (the newly spun off investment and operating arm of $10 billion dollar Canadian cannabis company, Canopy Growth) to operate internationally in Canada. Asked why Lipson didn’t just try to float the business on the Toronto Stock Exchange to take advantage of the exuberance investors have for all things cannabis, the chief executive said he wanted to be more measured in his approach.

“There’s a lot of hype and speculation around the cannabis space especially in the public markets,” Lipson said. “It’s not a traditional way to go about a business of this size. We’re extremely excited and eager to partner with the investors that we did.”

With only 14 employees — many of whom work remotely — Lipson is hoping to roll out aggressively in the next few months across all states in which medical marijuana is legal as well and into Canada as well. 

“We’re priding ourselves on the concept of scalability,” says Lipson. Who’s relying on his co-founder, and brother, Zach, to help him execute. “That’s the underlying mantra of our strategy.”

That mantra of scalability was apparently what attracted Casa Verde, which took only two months to decide to lead the investment round into Lipson’s new venture. “I started talking to them four months ago,” Lipson said. “A month or two into it, they did the deal and took the lead and we’ve just been filling out the round with strategics.”

VC firms of Kevin Durant and Snoop Dogg back Dutchie, a new cannabis delivery service

Ross Lipson, the chief executive officer and co-founder of the on-demand marijuana and cannabis delivery service, Dutchie, had thought he was done with the online delivery business.

Instead, he’s launched a new delivery service that has just raised $3 million from Casa Verde Capital, the $45 million venture firm founded by hip hop impresario Snoop Dogg, and Kevin Durant’s Durant Company — among others — to take advantage of the growing demand for marijuana delivery.

It had been only five years since Lipson sold a food delivery business he spent a decade building when the inspiration for Dutchie came to him. And the idea was too compelling to shake.

Lipson was living in Bend, Ore., where he’d retired after selling his online food delivery business GrubCanada to JustEat, the European tech-enabled delivery giant, back in 2012.

Then, in 2015, after Oregon legalized recreational use of marijuana, Lipson began wondering if it wasn’t time to revisit the whole delivery space again.

For him, the conundrum for consumers looking to buy cannabis products was similar to the dilemma in-home diners faced when choosing what to eat. In the modern weed world (at least in places where marijuana is legal), consumers are so spoiled for choice they often go with a default option.

Before online delivery, ordering food meant turning to the neighborhood spot for everything from American to Ethiopian, Italian, Jamaican, Chinese, Indian, Thai, or Tibetan food. But with online delivery services, a whole city’s worth of restaurant options opened up to consumers (as long as they were in your delivery area).

The same, Lipson figured, was true of marijuana.

“We’re creating a tool that helps the user and consumer navigate the delivery space,” he said. “We’re educating the consumer to that buying experiences…. If you don’t have that online ordering tool in front of you you’re forced to choose a dispensary and take the information that that ‘budtender’ gives you, which is their personal preference.”

Right now, marijuana delivery is something of a land grab. In Los Angeles alone, services like Nugg, Ganjarunner, Kushfly, Eaze, HERB, Westside Organic, and Cannabis Express, all pitch delivery services for marijuana or cannabis infused products, oils and vapes to willing consumers.

Eaze, the biggest startup in the online delivery space, has raised at least $37 million to tackle the growing market for legal cannabis delivery since its launch in 2014.

Lipson, however, has seen this all before with food. He started Dutchie in 2017 (and yes, it is named after the song) in 2017 from Bend and has been slowly and steadily growing the business. The company signed on 50 dispensaries in Oregon to help prove out the product and just raised $3 million in a seed round from Casa Verde Capital, The Durant Company, Sinai Ventures and other angel investors.

The company currently operates in Oregon, Washington, and Michigan and is launching in Colorado, Nevada and California this month. It currently works with 100 dispensaries and has seen $2.5 million in gross merchandise volume in its first year of operations alone.

To further boost its expansion efforts, the company also signed an agreement with Canopy Rivers (the newly spun off investment and operating arm of $10 billion dollar Canadian cannabis company, Canopy Growth) to operate internationally in Canada. Asked why Lipson didn’t just try to float the business on the Toronto Stock Exchange to take advantage of the exuberance investors have for all things cannabis, the chief executive said he wanted to be more measured in his approach.

“There’s a lot of hype and speculation around the cannabis space especially in the public markets,” Lipson said. “It’s not a traditional way to go about a business of this size. We’re extremely excited and eager to partner with the investors that we did.”

With only 14 employees — many of whom work remotely — Lipson is hoping to roll out aggressively in the next few months across all states in which medical marijuana is legal as well and into Canada as well. 

“We’re priding ourselves on the concept of scalability,” says Lipson. Who’s relying on his co-founder, and brother, Zach, to help him execute. “That’s the underlying mantra of our strategy.”

That mantra of scalability was apparently what attracted Casa Verde, which took only two months to decide to lead the investment round into Lipson’s new venture. “I started talking to them four months ago,” Lipson said. “A month or two into it, they did the deal and took the lead and we’ve just been filling out the round with strategics.”