{"id":4873,"date":"2022-03-16T10:30:48","date_gmt":"2022-03-16T10:30:48","guid":{"rendered":"http:\/\/CAIiEAjVSTKIb316HFz9OgJHfkUqGQgEKhAIACoHCAow3cCjCzCgy7sDMKy5hAc"},"modified":"2022-03-16T10:30:48","modified_gmt":"2022-03-16T10:30:48","slug":"whats-on-tap-for-marijuana-tech-platform-weedmaps-parent-qa-with-ceo-chris-beals-marijuana-business-daily","status":"publish","type":"post","link":"https:\/\/thcinct.com\/?p=4873","title":{"rendered":"What&#8217;s on tap for marijuana tech platform Weedmaps&#8217; parent: Q&amp;A with CEO Chris Beals &#8211; Marijuana Business Daily"},"content":{"rendered":"<div><img decoding=\"async\" src=\"https:\/\/thcinct.com\/wp-content\/uploads\/2022\/03\/whats-on-tap-for-marijuana-tech-platform-weedmaps-parent-qa-with-ceo-chris-beals-marijuana-business-daily.png\" class=\"ff-og-image-inserted\"><\/div>\n<p>CEO Chris Beals has positioned WM Technology among the nation\u2019s largest marijuana e-commerce and advertising platforms.<\/p>\n<p>The parent company of Weedmaps closed 2021 with record annual revenue of $193.1 million.<\/p>\n<div class=\"google-ad-wrapper banner-ad position-leaderboard\">\n<p>ADVERTISEMENT<\/p>\n<\/p><\/div>\n<p>Irvine, California-based WM Technology also <a href=\"https:\/\/finance.yahoo.com\/news\/wm-technology-inc-reports-fourth-210200908.html\" target=\"_blank\" rel=\"noopener\">recorded a sharp jump<\/a> in net income, to $152.2 million versus $38.8 million in 2020.<\/p>\n<p>The company\u2019s average monthly paying clients, meanwhile, rose 5% in 2021, to a record 4,337.<\/p>\n<p>\u201cClients\u201d include cannabis retailers that use the company\u2019s online ordering and point-of-sale platform as well as other services under its WM Business unit.<\/p>\n<p>At the end of 2021, the company also counted 15.7 million consumers \u2013 or \u201cmonthly active users\u201d \u2013 who accessed its website or mobile app or used its technology to order products and have them delivered.<\/p>\n<p><em>MJBizDaily<\/em> spoke with Beals about WM Technology\u2019s strong financial performance last year \u2013 although <a href=\"https:\/\/www.nasdaq.com\/market-activity\/stocks\/maps\" target=\"_blank\" rel=\"noopener\">its stock (MAPS)<\/a>, like those of other cannabis companies, is down roughly 70% since last June. That\u2019s when Weedmaps <a href=\"https:\/\/mjbizdaily.com\/cannabis-tech-platform-weedmaps-goes-public-with-579-million-infusion\/\" target=\"_blank\" rel=\"noopener\">went public<\/a> on the Nasdaq through a merger with <a href=\"https:\/\/mjbizdaily.com\/digital-issues\/february-2021\/?paged=54\" target=\"_blank\" rel=\"noopener\">blank-check operator<\/a> Silver Spike Acquisition Corp.<\/p>\n<p>Beals discussed what\u2019s on tap in 2022 and how Weedmaps navigates the highly regulated cannabis sector.<\/p>\n<p>He also confirmed the company is no longer part of a <a href=\"https:\/\/mjbizdaily.com\/weedmaps-subpoena-underscores-us-government-scrutiny-of-marijuana-industry\/\" target=\"_blank\" rel=\"noopener\">federal probe<\/a> believed to have centered around California cannabis companies.<\/p>\n<p><strong>What were the main growth drivers in 2021, and what\u2019s the business outlook for 2022?<\/strong><\/p>\n<p><strong>&nbsp;<\/strong>People coming back and shopping in this marketplace. Their average purchase size is high.<\/p>\n<p>There\u2019s really nothing else out there like us. In times like these, the strong get stronger.<\/p>\n<p>And I think you really see that with the client growth, the user growth and those continuing trends.<\/p>\n<p>We\u2019re guiding the market to 32% to 37% revenue growth.<\/p>\n<p><strong>Is that guidance a mix of new markets coming on board or other factors?<\/strong><\/p>\n<p>Over 90% of our revenue is recurring in nature. As new markets open, it can take time for them to really get their footing.<\/p>\n<p>There\u2019s always these sorts of delays on license issuance.<\/p>\n<div class=\"columns col-lg-12 col-md-12 col-sm-12 con_cta_wrapper\">\n<p><b>Growing is all about the lighting: <em>MJBizDaily<\/em> Lighting Buyers Guide&nbsp;<\/b><\/p>\n<div id=\"lp-pom-text-456\" class=\"lp-element lp-pom-text nlh\">\n<p>Read our exclusive guide for strategies and tips from expert cultivators who have amassed decades of experience studying horticulture lighting.&nbsp;Curated by <em>MJBizDaily.<\/em><\/p>\n<p>Inside:<\/p>\n<ul>\n<li>Horticultural professionals debunk 8 common lighting myths in cannabis<\/li>\n<li>How cannabis extraction companies can reduce energy costs<\/li>\n<li>Why experts say the future of horticultural lighting is in LED technology<\/li>\n<li>Cannabis lighting Glossary of Terms<\/li>\n<li>Buyers checklist<\/li>\n<\/ul>\n<\/div><\/div>\n<p>A lot of our growth this year is by increasing our penetration with clients\u2019 licenses that are already out there.<\/p>\n<p>Roughly half of all cannabis licenses are on our marketplace, or 55%, to be precise.<\/p>\n<p>A big part of the growth is just attacking that remaining 45%.<\/p>\n<p><strong>What are the biggest benefits and challenges of going public?<\/strong><\/p>\n<p><strong>&nbsp;<\/strong>One of the biggest benefits, especially for us going public on the Nasdaq, is just the visibility.<\/p>\n<p>The legitimacy it brings, the sort of recognition that this is a company that\u2019s really run in a best-in-class way.<\/p>\n<p>Going public brought a lot of attention and, frankly, brought in a lot of new investors who never invested in cannabis before.<\/p>\n<p>The world turmoil going on and the tragedy happening in Ukraine, obviously, when you\u2019re a public company, you\u2019re more directly impacted by the sort of public-market turbulence.<\/p>\n<p><strong>How has your business evolved as new cannabis markets open?<\/strong><\/p>\n<p><strong>&nbsp;<\/strong>One of the big evolutions was just an expansion of the power capabilities of the marketplace, the ability to help consumers understand what these different types of products are.<\/p>\n<p>We\u2019ve invested heavily in the compliance components.<\/p>\n<p>One of the big expansions was adding WM Business, which is the suite of power tools that goes along with the marketplace.<\/p>\n<p>We spend a ton of time improving the transactability of the marketplace.<\/p>\n<p>We\u2019re really investing heavily in these kinds of power tools that complement the marketplace.<\/p>\n<p>That\u2019s been a really big differentiator, especially in newer markets, where you see businesses really trying to use a broader suite of tools to attack all the opportunities much earlier in their lifecycle.<\/p>\n<p><strong>What are some new business initiatives or pilot projects underway at Weedmaps? <\/strong><\/p>\n<p>We are going to make investments in some strategic opportunities that we see driving outsized growth.<\/p>\n<p>Increasing the breadth of our offering for brands, letting them better power e-commerce analytics for brands, helping them better normalize their brand information and reach consumers directly.<\/p>\n<p>We\u2019re also focused on winning the Big East. The <a href=\"https:\/\/mjbizdaily.com\/northeast-governors-meet-to-create-regional-adult-use-cannabis-plan\/\" target=\"_blank\" rel=\"noopener\">tri-state area<\/a> (New York, New Jersey and Connecticut), I think, can rival California in terms of cannabis market size.<\/p>\n<p>Keep in mind when California opened, only about 15% of cities and counties opted into cannabis legalization under Prop 64.<\/p>\n<p><strong>What\u2019s the business strategy of operating in a big cannabis market versus a small one?<\/strong><\/p>\n<p><strong>&nbsp;<\/strong>These new states that are opening, the density that they have, whether it\u2019s high, whether it\u2019s low, the regulations they have, there\u2019s usually a past analog where we\u2019ve been incredibly successful at a macro-region level within one of the states.<\/p>\n<p>We don\u2019t generally look at any state in its entirety.<\/p>\n<p>We look at subregions within it, because that\u2019s how we split it up \u2013 our revenue, sales, customer support and success teams.<\/p>\n<p><strong>What international opportunities lay ahead and what\u2019s Weedmaps\u2019 current business internationally.<\/strong><\/p>\n<p><strong>&nbsp;<\/strong>We were early on in Spain and built a dominant presence and continue to have a dominant presence in Spain that started back in probably 2011.<\/p>\n<p>We intentionally scaled back our presence in Spain and sort of in the (European Union), just because the markets weren\u2019t growing as quickly as the opportunities we could attack in the U.S.<\/p>\n<p>We\u2019re seeing an increased attention to cannabis legalization, expanded cannabis legalization in Germany and other EU jurisdictions.<\/p>\n<p>Looking at places like Mexico. That feels at times like a perpetual waiting game.<\/p>\n<p>We\u2019ve seen Thailand, some movement starting to happen in Southeast Asia.<\/p>\n<p><strong>What are the challenges in the California market or opportunities?<\/strong><\/p>\n<p><strong>&nbsp;<\/strong>One of the big questions in California is going to be: Do too many people let their grow go fallow? Do too few?<\/p>\n<p>But that\u2019s ignoring the broader thing that 20% to 25% of cities and counties have opted in, and that\u2019s just got to go up.<\/p>\n<p>The closest thing to a silver bullet in this case is you\u2019ve got to increase the number of retailers.<\/p>\n<p>You\u2019ve got to service these kinds of cannabis deserts where there\u2019s nothing around.<\/p>\n<p>Otherwise, you\u2019re going to have a 100% illicit market if there\u2019s not a store nearby.<\/p>\n<p><strong>What advice do you have for ancillary cannabis businesses? <\/strong><\/p>\n<p>We have to be customer-centric. We have to meet the customer where they are.<\/p>\n<p>The value prop of the marketplace is undeniable, and it\u2019s incredibly outsized.<\/p>\n<p>But if we can\u2019t explain that in a way that the customer cleanly understands, that\u2019s our problem, not theirs.<\/p>\n<p>You really have to get your hands around the compliance in all these jurisdictions and quickly be omnipresent in a compliant fashion.<\/p>\n<p>That\u2019s a pretty big lift. Because you\u2019re an ancillary service provider doesn\u2019t mean that there\u2019s not heightened scrutiny.<\/p>\n<p>We have to be twice as buttoned up, twice as precise, twice as crisp on what we do, because there\u2019s still this unfortunate stigma around cannabis, despite the fact that\u2019s a $25 billion industry.<\/p>\n<p><strong>Discuss the protocols Weedmaps has in place to distinguish licensed operators from unlicensed ones. <\/strong><\/p>\n<p>We have a trust and safety team that reviews all business listings.<\/p>\n<p>Someone asked me this the other day, and I was really hard-pressed to think of another scaled marketplace that firmly puts itself \u2026 as front and center of vetting who is on the marketplace as we do.<\/p>\n<p>That\u2019s going to be a real strength for us and a differentiator going forward.<\/p>\n<p>One thing we\u2019ve even discussed is if there\u2019s a position for us to basically turn verification into a service, something that we project outwards to other ancillary businesses that are trying to figure out how to get their heads sort of around this issue.<\/p>\n<p><strong>Weedmaps was involved in a federal subpoena in 2019. Has there been any resolution there? <\/strong><\/p>\n<p>It was withdrawn in the first half of last year.<\/p>\n<p><em>This interview has been edited for length and clarity.<\/em><\/p>\n<p><em>Chris Casacchia can be reached at&nbsp;<\/em><a href=\"mailto:ccasacchia@hotmail.com\" target=\"_blank\" rel=\"noopener\" data-feathr-click-track=\"true\"><em>ccasacchia@hotmail.com<\/em><\/a>.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>CEO Chris Beals has positioned WM Technology among the nation\u2019s largest marijuana e-commerce and advertising platforms. The parent company of Weedmaps closed 2021 with record annual revenue of $193.1 million. ADVERTISEMENT Irvine, California-based WM Technology also recorded a sharp jump in net income, to $152.2 million versus $38.8 million in 2020. The company\u2019s average monthly paying clients, meanwhile, rose 5% in 2021, to a record 4,337. \u201cClients\u201d include cannabis retailers that use the company\u2019s online ordering and point-of-sale platform as well as other services under its WM Business unit. At the end of 2021, the company also counted 15.7 million&#8230; <\/p>\n","protected":false},"author":1,"featured_media":4874,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"fifu_image_url":"","fifu_image_alt":"","footnotes":""},"categories":[2],"tags":[],"class_list":["post-4873","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-featured"],"jetpack_featured_media_url":"https:\/\/thcinct.com\/wp-content\/uploads\/2022\/03\/whats-on-tap-for-marijuana-tech-platform-weedmaps-parent-qa-with-ceo-chris-beals-marijuana-business-daily.png","_links":{"self":[{"href":"https:\/\/thcinct.com\/index.php?rest_route=\/wp\/v2\/posts\/4873","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/thcinct.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/thcinct.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/thcinct.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/thcinct.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=4873"}],"version-history":[{"count":0,"href":"https:\/\/thcinct.com\/index.php?rest_route=\/wp\/v2\/posts\/4873\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/thcinct.com\/index.php?rest_route=\/wp\/v2\/media\/4874"}],"wp:attachment":[{"href":"https:\/\/thcinct.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=4873"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/thcinct.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=4873"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/thcinct.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=4873"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}