Irvine-based Beleaf, which has raised $2.5 million to develop a mobile application for the cannabis industry, is seeking another $2 million for marketing and product launch.
The pitch?
“It’s hard to find trusted information for medical marijuana,” Chief Executive David Cheng said.
Since the cannabis industry isn’t yet legal at the federal level, advertising for TV, radio and other media come with their own set of rules and each state has its own cannabis advertising regulations. Also, Facebook and Google do not allow drug-related advertising on their sites.
California’s marijuana advertising regulations stipulate that “any advertising or marketing placed in broadcast, cable, radio, print, and digital communications shall only be displayed where at least 71.6% of the audience is reasonably expected to be 21 years of age or older, as determined by reliable, up-to-date audience composition data.”
These restrictions leave marijuana dispensaries and brands without effective means to target online customers, said Cheng, who is on the board of directors at St. Joseph Heritage Healthcare.
The platform plans to use blockchain so secured marketplace transactions can take place.
His platform will permit publishers to create content without censorship, allowing community members to approve all content.
“Good content will be voted up, bad content voted down,” Cheng said.
Good content publishers would then be awarded with tokens or products from brands, which would drive better content.
“We want to provide trusted information using blockchain technology while generating affiliate advertising and consumer spending within the platform,” he said.
“It’s a win-win,” Cheng said. “Consumers will be able to access high-quality, useful content; brands would benefit from having a trusted platform that generates new customers.”
Cheng’s other roles include chief executive at Pathfynders Corp. and a general partner at Redds Venture Investment Partners, both are based in Irvine.
The U.S. cannabis industry generated $9.7 billion in North America in 2017, up 33% over the prior year, according to a report by Arcview Market Research.
