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Grow With Jane

Journal and calendar for growing cannabis

$5,650

Raised from 37 investors

Min: $25,000

Max: $107,000

Security Offered

Convertible Note

Minimum Investment: $100

  • Graduate of CanopyBoulder’s Summer 2019 class

  • $180,000 raised in 2019

  • 25,095 monthly average users on the platform in February 2020

  • Introduced revenue-generating features in July 2019

Executive Snapshot

Grow With Jane is a mobile application created to help both novice and experienced cannabis growers cultivate their own plants. Since the app’s 2017 launch, average monthly users on the platform have increased to 25,095. Grow With Jane’s solution to help at-home cultivators - and its early user traction - helped it gain acceptance into CanopyBoulder’s Summer 2019 accelerator program. Since graduating from the CanopyBoulder program, the company has raised $150,000 in capital and is currently working on rolling out additional revenue-generating product features.

Terms

Investment Terms

Security Type: Crowd Note

Round Size: Min: $25,000 Max: $107,000

Discount Rate: 20%

Valuation Cap: $2 million or $2.5 million

Conversion Provisions: In connection with equity financing of at least $1 million, the Company has the option to convert the Crowd Note into non-voting preferred stock (Conversion Shares) at a price based on the lower of (A) a 20% discount to the price per share for Preferred Stock by investors in the Qualified Equity Financing or (B) the price per share paid on a $2 million or $2.5 million valuation cap. Please refer to the Crowd Note for a complete description of the terms of the Crowd Note, including the conversion provisions.

Perks

Perks

Investors that purchase the first 25,000 Crowd Notes, and thereby fund the first $25,000, will receive Crowd Notes with a conversion provision based on a $2 million valuation cap instead of a $2.5 million valuation cap. That means, in connection with equity financing of at least $1 million, the company has the option to convert the Crowd Note into non-voting preferred shares (Conversion Shares) at a price based on the lower of (A) a 20% discount to the price per share paid for Preferred Shares by investors in the Qualified Equity Financing or (B) the price per share based on a $2 million valuation cap (instead of $2.5 million).

Overview

Opportunity

According to a 2019 poll by Pew Research, 67% of Americans believe the use of cannabis should be legalized, reflecting a steady increase over the past decade. State governments have taken notice, and the legalization of cannabis for both recreational and medicinal purposes has increased throughout the U.S. Over the past few decades, 33 states, and Washington DC, have legalized some form of cannabis use in the U.S.i Additionally, Uruguay was the first country to full-legalize cannabis in 2013, followed by Canada in 2018.ii

However, while cannabis is now legal to purchase in some states and countries, the cost to do so may prohibit some users from partaking, with prices at dispensaries typically ranging from $100 to $400 per ounce in the U.S.iii One alternative to purchasing cannabis at a dispensary is to grow it at home, which can reduce the cost per ounce to around $60. Growing at home offers greater convenience, constant access, and control over growing methods (e.g. avoiding the use of chemicals or pesticides).iv According to a poll by Garden Research, 19 million households in the U.S. stated they would grow cannabis at home if it were legal.v As of October 2019, 17 states (including California, Colorado, Michigan, and Nevada) plus the District of Columbia allow some form of legal at-home cultivation of cannabis.vi

Initially launched in 2017 and incorporated in 2019, Grow With Jane is a mobile application designed to help both novice and experienced cannabis growers cultivate their own plants. It provides users with a journal and calendar, allowing them to track their growing progress and follow a detailed schedule built by the app. The app reminds users when to perform tasks such as watering, adding bug repellant, and trimming. Additionally, the app provides users with a ‘GrowLog’ through which they can display all the information collected on the plants throughout the growth process including pictures, methods used, equipment, and how users fixed any problems. With the proceeds from this raise, the company plans to release several new paid subscription features for potential additional revenue streams, and brand placement capabilities.

Press

Product

Grow With Jane is a mobile app designed for recreational cannabis growers of all skill levels. It guides users through every step of the process, from germination to flowering. Based on information provided by a user, the app keeps track of plants and reminds them when to perform actions such as water, add nutrients, add bug repellant, or trim. Additionally, the company is planning to introduce an online forum, where members can discuss their growing methods and progress.

Through the app, users can add cannabis plants to their journal and calendar by selecting from hundreds of strains of cannabis in the Grow With Jane system. Users input where their plant is in the growth process, ranging from germination to flowering. Users may also input optional fields such as:

  • Tree name
  • Number of trees
  • Medium type (e.g. soil, hydro, or coco)

Once the strain of cannabis has been added, users are prompted to input information about the environment in which the plant is growing. Environmental setup questions users can input into the system include:

  • Indoor or outdoor
  • Type of light used (wattage and color temperature)
  • Exposure time
  • Length, width, and height of plant

The collected data on cannabis strain and environmental conditions can be helpful to a new grower in identifying best practices and methods. Additionally, the information is used by the Grow With Jane system to generate a growth plan for plants. Users’ calendars will be populated with actions to be taken for healthy growth of the plant, such as when to water a plant, add bug repellant, add nutrients, and trim a plant. Users can also design plans themselves and share them with other users.

Grow With Jane provides users with a report called GrowLog. GrowLog displays all the information collected for the plants including pictures taken by users throughout the process, a log of events, when things went wrong in the growth process, and how the user fixed any problems. Users can share their GrowLog with other users. GrowLogs can also be made public, allowing visitors to the site to learn how some users are growing their plants.

All members on the Grow With Jane platform can access to the aforementioned features. However, the company has also begun introducing enhanced features for premium users. Currently, premium members gain access to features including:

  • Advanced planning features
  • Detailed graphs and statistics
  • Prioritized customer support
  • Access to private Discord server for premium growers
  • Unlimited amount of plants and environments
  • Unlimited high-quality photos

Grow With Jane is currently beta testing a social platform to connect cannabis home growers and create niche social networks based on data from home growers and other interested parties. Users will also be able to connect with brands and share their GrowLogs on the platform. This social space will be available in both the app and the website, and the company believes it will become an important aspect of their growth strategy.

Grow With Jane incorporates user security based on secure passwords as well as Google's Firestore and Firebase security systems to provide an up-to-date system of encryption for its users. Google's Cloud Firestore automatically encrypts all data before it is written to disk. The data is automatically and transparently decrypted when read by an authorized user.

With server-side encryption, Google manages the cryptographic keys on a client’s behalf using the same hardened key management systems that Grow With Jane uses for its own encrypted data, including strict key access controls and auditing. Each object’s data and metadata in Cloud Firestore is encrypted under the 256-bit Advanced Encryption Standard, and each encryption key is itself encrypted with a regularly rotated set of master keys. To protect user data as it travels over the Internet during read and write operations, Grow With Jane uses Transport Layer Security (HTTPS).

Use of Proceeds

Grow With Jane aims to raise a minimum of $25,000 and a maximum of $107,000 in this crowdfunding offering. The company plans to allocate 38% of the funds toward marketing, 33% toward software development, 24% toward operations, and 5% toward intermediary fees. The company has the discretion to alter the use of proceeds based on general economic conditions or a change in business needs.

Marketing

Grow With Jane intends to allocate the majority of the proceeds from this raise towards marketing, as it is looking to increase product awareness. The company plans to do this by working with a marketing agency to fine tune its image for both growers and companies in the industry. The company would also like to translate its product, website, and other branding material into other languages. In the future, the Company plans to sponsor events, such as expositions and public events for cannabis home growers, in the hopes of driving more traffic to its app.

Software Development

The company would like to hire more developers, both full-time and part-time, as it is currently constrained with its designing, planning, and documentation (i.e. documenting features to be released) due to the limited number of people on the team. Additional features the company would like to add include social features like basic comments, likes, and brand integration. It would also like to add more advanced analytical features to provide more insight to growers.

Operations

Within operations, the company plans to use the funds on general working capital to support the increase in staff and adding additional office space for the team.

Product Roadmap

Over the next year, Grow With Jane plans on releasing the following features:

  • Brand Connections – Q2 2020
  • AI image recognition system - Plans to begin rolling out features in Q2 2020
  • Enterprise business intelligence platform – Q3 2020

Automated and Contextual Growing Insights

Grow With Jane believes it has a privileged position in that growers report their growing activities to the app, from feeding and trimming to harvesting and cloning. This enables it to better understand and analyze the factors that come into play when taking care of a plant. The company thus has an opportunity to learn from and feed that information back to its users through tips and insights which could help a first-time grower start, or nudge a more experienced one in the right direction.

AI Image Recognition System

Grow With Jane is developing an AI image recognition system to diagnose sickness, identify plant gender, and send recommendations to users on the platform. The system aims to analyze an uploaded photo of a plant and assign a statistical probability to certain traits and overall health of the plant. Eventually, the company would like to offer B2B products from this development and sell access to its application programming interface (API).

Brand Connections

Throughout the growth cycle, there are several products central to the plant’s life. Those include seeds, fertilizers, soil mixes, lights, and tents. These products come with specific and sometimes complex instructions that growers might ignore or misunderstand once they have left the supply shop. Grow with Jane aims to connect the brands and producers with their users, allowing brands to provide specific recommendations on their products for their customers.

Enterprise Business Intelligence Platform

Once the company connects brands with its users, the next step will be to offer brands access to a web dashboard where they can understand how growers use their products and learn from growing trends. This platform aims to provide brands with important data, enabling them to make more informed decisions when it comes to marketing and product development.

Business Model

Currently, Grow With Jane operates with a freemium business model. Members can access basic features, such as journals and calendars, for free. However, premium features require a monthly subscription. Pricing for Grow With Jane is currently $7.49 per month or $34.99 for a year. As it moves toward a more robust product offering, it plans to roll out three different pricing plans including:

  • Learning Bundle: $7.49 per month or $34.99 per year
    • Prioritized customer support
    • Text and video content
    • Expert mentors
  • Planning Bundle: $7.49 per month or $34.99 per year
    • Advanced planning features
    • Exclusive grow recipes
  • Expert Bundle: $7.49 per month or $34.99 per year
    • Detailed graphs and statistics
    • Growing certificates
  • Full package: $17.99 per month or an annual price still to be determined
    • Includes all the features listed above

The three tiers of subscriptions (learning, planning, and expert) were built based on member backgrounds and preferences. Grow With Jane surveyed members and found 50% of their users to be novices (suited for the learning bundle), 35% to be intermediate (suited for the planning bundle), and 15% to be experts (suited for the analysis bundle). Pricing is subject to change as the company conducts more testing.

Eventually, the company would also like to offer advertising space to cannabis brands.

Grow With Jane also offers a variety of merchandise items for sale through its website. Items include clothing, bags, and hats. Pricing for these items range from $8.99 to $30.99.

User Traction

Grow With Jane’s app was initially launched in 2017, but the company was not incorporated until April 2019. Business functions did not begin until the incorporation of the company.

As of February 15, 2020, Grow With Jane was averaging 25,095 monthly users in February on its Android platform. In January 2020, the company was averaging 23,980 monthly users, up from 13,316 average monthly users in January 2019. In June 2019, the company launched its app for iOS (Apple devices). Due to Apple privacy agreements, the company does not have access to the same level of information for its iOS users. However, since June, its iOS app has been downloaded 8,110 times.

Grow With Jane released its paid services in July 2019, receiving eleven paid users in the first month. Through February 2020, the company added 296 paying subscribers, adding an average of 32.8 users per month.

Additional user metrics include:

  • Users have historically averaged 4 minutes per session in the app
  • Historically, approximately 87% of users were returning users and 13% were new users
  • More than 168,900 plants have been created on the Grow With Jane app
  • More than 1 million pictures uploaded inside the app
  • More than 160,000 plant logs have been registered
  • Users are concentrated in the United States and Canada, followed by South Africa and Argentina
  • Users are found on every continent
  • The majority of users are between the ages of 18 and 34

Historical Financials

Revenue

Grow With Jane introduced revenue generating features in July 2019 and to date has generated minimal revenue. However, the company aims to increase revenue as it introduces new product features and converts existing users into premium members.

Expenses

In January 2020, Grow With Jane incurred $28,472 in total expenses. Expenses have been increasing month-over-month from September 2019 through January 2020 due to increased spending on marketing and advertising, and office supplies. From inception in April 2019, Grow With Jane incurred $120,038 in total expenses for the year. Expenses peaked in August 2019 due to a one-time rent payment of $13,000 and higher than normal monthly expenses for office supplies. The company does not foresee rent expense being a large component of total expenses moving forward because it has moved operations to Argentina, where the cost of renting office space can be more affordable.

An expense breakout for the company in 2019 is as follows:

  • Office Supplies: $53,274 (44.38%)
  • Rent: $22,628 (18.85%)
  • Contracting Expenses: $10,046 (8.37%)
  • Meals and Entertainment: $7,994 (6.66%)
  • Legal & Professional Services: $11,006 (9.17%)
  • Travel: $5,649 (4.71%)
  • Advertising and Marketing: $8,389 (6.99%)
  • Other expenses: $1,051 (0.88%)

Net Income

In January, Grow With Jane incurred a net loss of $27,569. In 2019, Grow With Jane incurred a net loss of $117,427. The net loss has come largely due to the company still being in the early stages of releasing revenue-generating features. The company experienced its most significant monthly net loss in August 2019 due to a one-time rent payment of $13,000 and higher than normal monthly expenses for office supplies.

As of February, the company had approximately $28,473 in the bank. Since inception in April 2019, Grow With Jane has averaged a monthly burn rate of $16,111. Over the next few months Grow With Jane anticipates cutting expenses by around $6,000 per month until it completes this round of financing. With its current cash on hand and the planned proceeds from this raise, the company estimates it will have approximately five months of runway.  

Industry

According to Grand View Research, the cannabis cultivation industry is projected to reach $45.4 billion by 2026,vii up from $15.7 billion in 2018,viii representing a compound annual growth rate (CAGR) of 13.5%.ix Driving the growth, in part, will be the legalization of cannabis for medical and recreational purposes in North America and Europe. Uruguay was the first country fully legalize marijuana in 2013, followed by Canada in 2018.x Other countries where recreational cannabis use is currently under consideration include Mexico and New Zealand.xi

According to Garden Research, 33 million U.S. households – which represented 27% of the surveyed households – believe it should be legal to grow marijuana at home for personal use, and 19 million U.S. households – which represented 15% of the surveyed households – said they would do so if it were legal.xii However, cultivating cannabis at home does provide some challenges such as strong odors and attracting pests. But, like other forms of gardening, cultivating marijuana at home can be a relaxing and rewarding hobby. Several benefits to growing cannabis at home include:xiii

  • Affordability – Prices in dispensaries range from $100 to $400 per ounce. Growers can reduce their cost per ounce to around $60.
  • Constant access – Recreational and medical users can control their own access to the plant to ensure they have a steady supply.
  • Convenience – Users aren’t forced to go to dispensaries in order to get cannabis.
  • Purity – Growers can manage their own plants to ensure they aren’t moldy and avoid pesticides and chemicals.

Growing marijuana at home in the United States is illegal under U.S. federal law. However, according to the U.S. Sentencing Commission and the FBI, 99% of marijuana arrests are made under state law. As states across the country continue to liberalize cannabis laws, more and more people will have practical access to marijuana.xiv Furthermore, the Attorney General of the United States, William Barr, announced in January 2019 that he was not planning to target companies who comply with state laws in regard to cannabis, although he does maintain that he does not support wholesale legalization. Additionally, he called for the approval of more legal growers of marijuana for research.xv

A total of 33 states in the U.S. have legalized marijuana for medical use,xvi 11 of which currently allow adults to legally use the drug for recreational use.xvii A further rise in the number of states legalizing cannabis consumption (whether recreationally or medically) is possible due to more people becoming accepting of marijuana. In 2018, the marijuana industry employed 250,000 people. Additionally, the following states (and the District of Columbia) allow the public to cultivate their own marijuana plants at home under varying regulations:xviii

  • Alaska
  • Arizona – For medical purposes only
  • California
  • Colorado
  • Hawaii – Only specific patients or caregivers are eligible
  • Illinois – Only legal for people designated as cultivation center agents
  • Maine
  • Massachusetts
  • Michigan
  • Missouri – Only patients and caregivers are eligible
  • Montana – Only for those who are a registered cardholder
  • Nevada
  • New Hampshire – Only patients and caregivers are eligible
  • New Mexico – Only patients and caregivers are eligible
  • Oregon
  • Rhode Island – Only qualifying patients are eligible
  • Vermont
  • Washington – Only medical patients and designated entities are allowed to cultivate
  • Washington D.C.

According to a poll by Pew Research, 67% of Americans believe the use of marijuana should be legalized, reflecting a steady increase over the past decade. However, there are wide generational differences on views of marijuana legalization. A majority of millennials (76%), Generation X (65%), and baby boomers (63%) believe marijuana use should be legal. However, the silent generation has remained largely against legalization, with only 35% approving.xix

In 2018, venture capital financings in cannabis companies surpassed $1.6 billion, a record high, and a 193% increase from 2017. Deal count in 2018 was also record-setting, with 225 venture financings. 2017 also saw significant growth in funding towards cannabis companies, with nearly $555 million invested, a 143% year-over-year increase, across 173 total deals. Deal count surpassed 100 total deals for the first time in 2015, with 123 such venture financings, a 124% increase from 2014. Between 2008 and 2018, there has been $2.97 billion invested across 722 venture capital deals in cannabis companies. Over 70% of capital invested from 2008 to 2018 occurred in 2017 and 2018.xx​​​​

Source: Pitchbook

Competitors

GrowBuddy

Initially released in 2014, GrowBuddy is a cannabis growth journal app that helps growers record plant lifecycles. Through the app, users can track their plants by adding journal updates. Users can upload plant strain, how many days the plant has been growing, the wattage of lighting being used, and other information to the GrowBuddy app. Additionally, users can upload pictures of their plants throughout the growth process. GrowBuddy aims to use the data provided to help provide insight to growers on how to better manage their plants. The company also provides a forum where users can ask questions to other users. GrowBuddy’s marketplace enables cannabis cultivation brands to sell their products directly to users, as well as serving as a forum for reviews and product discussion for users. GrowBuddy generates revenue by taking a fee on products sold through its marketplace and from ads on its website. In the future, the company plans on releasing a premium subscription for users with advanced features.xxi​​​​

GrowDiaries

GrowDiaries is an online platform enabling cannabis growers to log and track their cannabis plant growth in an online diary. Users can input which strain of cannabis they are growing, the conditions in which the plant is growing, and what specific techniques they are using. The platform also enables users to compare their plant growth with other growers in the community and ask the online community questions. Users can either log their diary in “stealth mode” or make their diary public, so they can show off their plant growth to others. Each month, GrowDiaries gives out a prize to the top diary of the month. The winner gets gear and swag. GrowDiaries also allows brands to create diaries on the platform so growers can see how companies raise and manage their plants.xxii​​​​

GrowWeedEasy

Founded in 2010, GrowWeedEasy is an online cannabis cultivation resource which aims to teach beginners how to grow cannabis at home. The website provides visitors with a variety of tutorials, articles, and guides on how to grow, manage, and harvest their cannabis plants. Additionally, the website provides a forum where users can interact and ask questions about growing cannabis plants. Users can also submit photos and reviews of various strains of cannabis. The best pictures highlighting growing methods, plant problems, and plant budding are featured in the company’s newsletter. Since inception, GrowWeedEasy has reached over 32 million readers on its website.xxiii

Team

Nicolas Botti

Co-Founder and CEO

Nicolas has led Grow With Jane since its earliest stages as an idea in 2015. As CEO, he is in charge of business partnerships and user analytics, where he learns from users on what the company needs to do to improve its software. Nicolas has worked for over seven years in the insurance and banking industry as an outside IT, infrastructure, and operations consultant. He holds an undergraduate degree in business from Universidad Argentina de la Empresa (UADE).

Gaston Lozano

Co-Founder and Chief Product Manager

Gaston has been with the company since its idea stage, initially serving as the CTO. However, his vision of the product made him ideal to take over the role of Chief Product Manager. Gaston has experience as a full-stack software developer, with a specialty in e-commerce. He has led teams and projects both in Argentina and internationally. Gaston studied systems engineering at the Universidad Tecnologica Nacional in Argentina.

Daniel Kim

Co-Founder and Chief Marketing Officer

Daniel has been with the company since its idea stage and is in charge of both design and marketing. His day-to-day role involves understanding the products’ needs and make it easy to use, visually pleasing, and ensuring that it maintains a cohesive look throughout all of Grow With Jane’s content. Daniel is also in charge of designing all the A/B testing and experiments. He has previous experience as a movie director, user experience specialist, and designer. Daniel attended Escuela Nacional de Experimentación y Realización Cinematográfica (ENERC) in Argentina.

Roque Terrani

Co-Founder and Chief Technology Officer

Roque joined the team in its idea stage and was involved in forming the first concepts. Soon after, he became CTO to ensure the company could deliver a solution that realized the founders’ vision. Roque has previous experience as a full-stack software developer with a specialty in e-commerce. He has several Magento certifications.

Past Financing

This raise follows Grow With Jane’s $150,000 Convertible Note round with the same valuation cap ($2.5 million) and discount (20%).

Since inception, Grow With Jane has raised $180,000. The $180,000 consists of the previously described $150,000  and $30,000 in common stock. The $30,000 worth of common stock (i.e. 8% of the company) was issued to participate in CanopyBoulder’s 16-week accelerator program.

Discussion

Endnotes