One of the fastest growing cannabis-infused product companies in California, Plus Products, closed a $6 million Series B funding round. This round was led by Serruya Private Equity Partners (SPE) and Navy Capital Green Fund LP.
The beginning of Plus Products
Founded in 2015, by Jake Heimark, Roy McFarland and Justin “Crunchy” Crunchington, Plus Products tested out the market with their first official product the PLUS™ Gum. Each piece of gum provides 25 milligrams of THC, which delivers its effects within 15 minutes of chewing. After the successful response from their initial product, they moved the business to California and launched its second product, Plus gummies.
In 2017, they closed a $2 million Series A Round which was led by The Green Organic Fund and Verde Mountain Fund. Plus Products also received the eighth temporary manufacturing license in California and was one of the first brands to bring fully compliant products to the legal market. All Plus products are produced in the company’s 12,000 square foot food-safe cannabis manufacturing facility in Adelanto, California. This facility was adequately equipped for scalable food production with the funds from their Series A Round.
Headquartered in Toronto, Canada, Serruya Private Equity (SPE) is a family managed venture group that oversees the investment activities of the Serruya family. The Serruya brothers have over 30 years of experience in building global food and retail chains. SPE specializes in private equity and venture capital.
Founded in 2017, Navy Capital Green Fund provides investors with a cannabis-focused portfolio that’s uncorrelated with the overall market. The fund focuses on acquiring undervalued cannabis companies with strong fundamental and technical profiles.
Jake Heimark, CEO of Plus Products and I had the opportunity to discuss more on this round, where the funds would be used and even gained a bit of advice and insight on raising capital to share with the DCN community.
First off, congratulations on the raise, can you give us any insight into what the funds will be allocated?
Jake Heimark: The funds will be used to rapidly expand our production capacity, factory automation, working capital and new product development.
Can you give share with us the elevator pitch for Plus Products?
Jake Heimark: Plus Products is a branded cannabis products manufacturer. At Plus we have introduced fast-acting edibles positioned for a healthy and active lifestyle audience seeking a premium cannabis experience. All products are hand-crafted with high-quality ingredients without the gluten and calories found in competing edible products.
Serruya Private Equity Partners (SPE) and Navy Capital Green Fund LP. led this round, can you provide some insight into how these relationship evolved?
Jake Heimark: We actually were connected to Serruya Private Equity Partners and Navy Capital Green Fund LP through existing investors. One thing I learned coming from Silicon Valley is that you always have to be working on relationships with investors and potential investors and in reality, you never know where the funding will end up coming from.
In 2017, Plus Products successfully closed a Series A round which allowed the opportunity to expand into California. With the expansion, I would love to share with our readers, what that overall process was like?
Jake Heimark: Being in Colorado was a great initial start however with California’s long use of Medicinal Cannabis, and it made sense to come to California. We knew it would be a harder market to compete in, but we knew it would be the best opportunity for the Plus Product line.
When looking at the product line of Plus Products, it has mainly focused on gummies and gum, any interesting facts you can share with our viewers regarding any additional developments in the pipeline?
Jake Heimark: We have a new special edition gummy for the April holiday!
What advice can you share with our readers that you learned when going through the due diligence process?
Jake Heimark: Trust is the most important thing. You need to build a good company with good people and then find investors that align with them. When looking at the due diligence process and seeing the difference between how raising capital in Silicon Valley is to raising capital in the cannabis industry, I was so surprised at how in-depth the investors go in their due diligence process. What is extremely important is making sure that you have your documentation and team prepared.
Any tips or advice to offer to other entrepreneurs who are going or will begin the fundraising process?
Jake Heimark: The reality is you should never stop, fundraising becomes a 24 hour day job. When it comes to investors make sure you interview them as well and when you find the right ones, do consider their advice, many of them do have good ideas.
Thank you, Jake, for taking the time to give us some insight into Plus Products. I am excited to continue to see the growth of Plus Products. Before I let you go, what is one thing you would like to share that our readers may not be aware of?
Jake Heimark: One thing that we truly value at Plus Products are the people from sales to the production line. When you have a team, who take pride in what they do it carries onto the product which we believe is why the market has been receptive. Looking back to a year ago, we launched our gummy product line to a handful of stores, and now we are in 250 shops. We also are 1 of the top 10 edible companies in California.
To learn more about Plus Products, visit www.plusproducts.com.
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