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Fast Grower Looks to Go Beyond Marijuana Apps to Maintain Pace

Lake Forest-based Internet and app marketer SearchCore Inc. has ditched the weed business and is mapping a new strategy in less-controversial but similarly fragmented markets.

The company, which said it sold its WeedMaps Media Inc. unit for a profit in late December, is now targeting recreational sports, manufactured homes and the tattoo industries.

Its new strategy is largely grounded on the success and technology of weedmaps.com, a finder site for medical marijuana dispensaries that drew more than 10 million page views per month, according to the company.

“We’re taking the same engine that helped grow WeedMaps, and we’re applying it to nonmedical cannabis industries,” Chief Executive Jim Pakulis said.

The company sold WeedMaps Media and its subsidiaries SafeAccessMD and MMJMenu.com to an undisclosed European company for more than $11 million, which included the assumption of debt and its office lease in Newport Beach.

SafeAccessMD is a software product designed for doctors who prescribe medical marijuana that provides electronic medical records and appointment scheduling, among other applications, and complies with federal regulations to protect patients’ healthcare data.

MMJMenu.com is aimed at the operators of medical marijuana dispensaries and features inventory control and tracking, patient information, patient check-in and online ordering.

SearchCore’s medical marijuana business sprouted up rapidly, accounting for the vast majority of its $11.9 million in revenue in 2011. Its 1,657% revenue spike over two years through June 30, 2012, topped the Business Journal’s annual list of fastest-growing public companies based in Orange County.

Uncertain Politics

Its recent divestiture moved the company out of the medical marijuana sector amid conflicting laws at the federal and state levels, which have created “uncertainty in the political area,” according to Pakulis.

SearchCore is listed on the over-the-counter stock market and doesn’t have analyst coverage. Its share price has traded below $1 for nearly a year, with a recent market value of nearly $17 million.

The company recently hired San Francisco-based investment bank Merriman Capital Inc. to shore up its financial standing for a possible move to a bigger board this year.

SearchCore’s recent deal to acquire the technology behind Sports Asylum Inc.’s mobile app Sportify underscores its efforts to become a clearinghouse for fragmented industries.

“Our template is to identify industries that we believe have a fairly large market cap and that are still fragmented or disjoined from technology,” Pakulis said.

Sportify, which is expected to launch in the coming months on Apple Inc. devices, fuses social networking with recreational-sports enthusiasts. The app and pending Web-based platform will allow users to connect, schedule, review and participate in some 90 different recreational sports in a covered geographic area. Sportify helps users find other players and locate recreational sports centers and courts, among other applications.

The beta test will run from Santa Barbara to San Diego, followed by a larger expansion to other cities.

SearchCore’s plan to generate sales include charging users a monthly or annual fee for advanced services, mobile and Web advertising, sponsorships from major sports brands, and revenue-sharing agreements with sports venues.

Manufactured Homes

The company plans to roll out a similar strategy for manufactured homes, a niche segment that peaked in 2007 and bottomed out two years later in the heart of the recession.

These types of homes are assembled on site and are much more affordable than traditional homes. The concept has been popularized locally with Newport Beach-based RSI Holding Corp.

SearchCore’s model would allow consumers to design or locate blueprints for a manufactured home, identify price ranges, and then have developers compete for bids.

The bid in the tattoo business will follow a similar template, where ink seekers can scroll through parlors, artists, their work, pricing and reviews, according to the company.

“There are regional players throughout the country, but there hasn’t been one major dominating force,” Pakulis said.

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