Marijuana Marketplace Tradiv Finds a Home in Boulder
As marijuana becomes increasingly mainstream, the online marketplace is becoming the potrepreneur’s next frontier.
Enter Colorado’s online marijuana wholesaler, Tradiv.com. Within a year of operating, the company has received $1 million from investors to launch its website and hire new employees, increasing its full-time staff to nine people.
“We’re like Amazon for marijuana wholesalers,” said Lisa Buffo, Tradiv’s chief marketing officer.
Tradiv is part of a growing number of businesses that are considered cannabis tech startups. With recreational and medical marijuana gaining more approval nationwide—23 states and Washington, DC, have legalized marijuana in some form—Tradiv and others are trying to bring a service to the Internet for an industry that can’t yet establish its own banking system beyond cash on hand. In October, the Federal Reserve said in a court filing that it wouldn’t accept any money connected to the sale of pot in the state because the drug remains illegal under federal law. The Fed made that motion after Colorado lawmakers and business owners attempted to set up the Fourth Corner Credit Union, a bank that would serve the state’s $700 million-a-year marijuana industry.
The Tradiv site, which requires a user login, is marketed to dispensaries, cultivators, and manufacturers of infused products, and carries a variety of flower strains, concentrates, and edibles that are either medical, recreational, or hemp-based.
Buffo said businesses must be licensed by Colorado’s Marijuana Enforcement Division to be eligible members. From there, she said managers can market their products for sale on the site by uploading a photo of the product with details about how it was tested and grown, and they can also make purchases on Tradiv.com.
Buffo said Tradiv raised money to launch its website relatively quickly because the startup did its homework, spending several months talking with cannabis business owners to see if there was a need to bring the wholesale process online.
“The answer was overwhelmingly yes,” she said. “Business owners are spending hours making phone calls or sending text messages to various vendors or suppliers trying to move product. Because the industry is so young, no one has built a software solution quite like Tradiv has to expedite this process.”
Geoff Doran, Tradiv’s co-founder, said that during the company’s beta-trial days, Tradiv worked directly with several dispensaries, cultivation facilities, and manufacturers of infused products to test its system.
“They gave us feedback on the features they’d like to use and told us how to build the best wholesale system for them,” Doran said. “In the end, we’ve built something that our clients want to use because it works for them.”
Tradiv also gives immense credit to CanopyBoulder, a Boulder, CO-based accelerator that provides cannabis-related startups with 12 weeks of mentoring and $20,000 in seed money.
“Because CanopyBoulder was partnered with the cannabis investor network, The ArcView Group, Tradiv had access to capital early on,” Buffo said. “The ArcView investors know the industry well and saw the need to get behind an online wholesale marketplace.”
Troy Dayton, CEO of The ArcView Group, a cannabis investor network with more than 500 members, said he had never seen investors rush to get money behind a project like they did with Tradiv.
“Even though they were only operating for a short period of time, the traction they were able to get with customers in that time was impressive,” Dayton said. “Also, some of the people that got in early on the deal were ArcView members that other members saw as particularly savvy investors. I think that helped other investors want in on the deal.”
Tradiv’s co-founders Doran and Aeron Sullivan were among the first to graduate from CanopyBoulder’s inaugural bootcamp.
CanopyBoulder has based its model on successful startup programs such as Boulder-based Techstars, which now has accelerators in nine cities, as well as accelerators focused on specific industries that are run in partnership with companies, including Nike, Kaplan, and Barclays.
Tradiv started as an idea in 2014 when its co-founders lived in Southern California. Tradiv’s staff, as well as ArcView, have credited the company’s success to the unique background of Sullivan, the company’s CEO. He is a former Marine Captain, who served in the U.S. military for eight years, both overseas and as an acquisitions officer with the Department of Defense, where he built enterprise-level software systems similar to Tradiv’s.
“Aeron is a really impressive entrepreneur that inspires a lot of confidence from investors,” Dayton said.
According to Buffo, it was CanopyBoulder that brought the startup to Colorado’s regulated market, which made Tradiv’s business model possible. In California, the site would not be legal.
Buffo said that since launching last month, Tradiv has signed up one to three businesses a day. She said the company anticipates that the site will have between 80 and 100 businesses signed up by early next year.
Tradiv will soon be launching a shipping feature, Buffo said, and has partnered with a company called Green Parcel Services to offer courier services to businesses as an option when they purchase products on the site.
So far, Tradiv can only serve Colorado-based businesses. But Buffo said the site is looking to expand to other regions that include Oregon, Washington, Nevada, Arizona, and regulated municipalities in California.