The rap legend’s venture capital firm Casa Verde led a $15 million Series B funding round for Cansativa, a Frankfurt-based cannabis distribution platform that currently supplies German pharmacies. Argonautic Ventures and the family office Alluti, based in Munich, also participated in this funding round.
Cansativa will use the funding “to expand its medical cannabis product portfolio and develop its recreational platform ahead of legalization in Germany,” the company said in a statement Wednesday.
The investment “will allow us to achieve our ambitious vision of becoming the operational backbone of cannabis retail in Germany,” added Benedikt Sons, CEO of Cansativa.
If Casa Verde has already invested in Europe, for example in the Portuguese startup AceCann, the arrival of funding in Germany comes in a context of announcing legalization. The country’s new coalition government has pledged to legalize cannabis within four years.
Legalization is coming
This measure would give a boost to the legal cannabis sector in Germany, which is already by far the largest in Europe for its medical use. As one of the only countries where patients can obtain medical cannabis for free, Germany is expected to account for more than half of the continent’s medical cannabis consumption until 2024.
Founded in 2017, Cansativa is already well established in the market. The startup – which calls itself the “Amazon of Cannabis” – makes it easy for German pharmacies to buy medical-grade cannabis, taking care of the supply chain and logistics.
If and when recreational cannabis is legalized in the country, Cansativa believes it is well positioned to transfer its technology platform to this new market, as dispensaries would have much the same requirements as current pharmacies. According to Jakob Sons, co-founder and managing director of Cansativa, this new fundraising will be used to strengthen the company’s product and software engineering teams in anticipation of this new market.
“The most important thing is to improve and transform our existing B2B platform into a scalable technology product that will meet all the requirements of the future growth of the medical and, above all, recreational ecosystem,” he explains to Sifted.
15 tonnes of medical cannabis are consumed each year in Germany. Legal consumption for adults could reach 200 tonnes within two years of legalization.
Last year, Cansativa secured a four-year exclusivity deal with the German regulator, making it the only company allowed to distribute locally produced cannabis, and Sons says Cansativa is also the market leader in terms of the volume of imported cannabis it distributes.
Speaking ahead of the funding announcement, Yoni Meyer, partner at Casa Verde, said this positions the startup to become a dominant player in the market: “Cansativa is strategically positioned to become the leading medical cannabis platform in the most major economy in Europe… We strongly believe that this team will play a central role in the expected legalization in Germany and will have a decisive impact on the European market, which is expected to reach 3.6 billion dollars by 2025.”