Leaf shape Joining the SPAC party.
The Seattle-based online cannabis market plans to go public through a deal with New York-based Merida Merger Corp, a special purpose acquisition company Company announced on Monday.
Merida will adopt the name Leafly and its common stock will be listed on the Nasdaq under the ticker symbol LFLY. The transaction will value the combined company at a corporate valuation of US$385 million.
Leafly’s online marketplace was established in 2010 to allow customers to purchase and select cannabis products from licensed retailers.The startup also acts as Educational Resources, Its platform has more than 125 million annual visits.
Leafly is the latest company in Seattle to go public with the SPAC investment route. Mergers have become a popular alternative to the traditional initial public offering process, providing a faster way to go public. Seattle-based pet custody market Rover began trading last week after completing a $1.35 billion SPAC transaction.
“Over the past ten years, we have focused on building a unique, legal market, while emphasizing on educating consumers and enabling them to retain cannabis products from legal and reputable suppliers,” Leafly CEO Miyoshita Yoko Said in the press release. “Through this transaction, we look forward to entering the next stage of the company’s journey-creating a more personalized consumer experience, creating more value for our retail partners, expanding the brand on our platform, and as legalization continues Expand our influence in the local market. “
Miyashita is a former executive of Getty Images. After joining in 2019, he served as the company’s general counsel and took over as CEO in August 2020. Leafly was spun off from Privateer Holdings, a Seattle cannabis investment company, in 2019.
The company currently has approximately 160 employees and has survived some layoffs in January 2020. It has laid off 18% of its employees, or 54 positions. The CEO at the time Tim Leslie Attributed to the “technology and market reality of the cannabis industry”. Two months later, the company laid off another 91 employees, citing the uncertainty caused by the coronavirus pandemic.
The company raised $23 million in new funding in June as sales in the cannabis market increased, as more states legalized cannabis, and dispensaries were declared an essential business during the pandemic. To date, Leafly has raised $38 million.
Leafly’s revenue mainly comes from monthly subscription fees paid by cannabis retailers to list and access e-commerce tools on the platform. The company stated that more than 7,800 brands use its services. It also makes money through advertising.
Americans spent approximately $18.3 billion on cannabis products last year. The legalization trend of cannabis is accelerating the market, especially on the East Coast. Several states have recently legalized cannabis.
Cannabis fever is attracting investors. Dutchie, a cannabis e-commerce platform based in Oregon, announced $200 million in new funding in March. The company’s valuation is $1.7 billion. There is another marijuana company, Miscellaneous sketches, Went public earlier this summer and officially started trading.
According to the press release, Merida SPAC is sponsored by Merida Capital Holdings, and the proposed transaction has been unanimously approved by Leafly and Merida’s board of directors. According to customary closing conditions, it is expected to close in the fourth quarter of 2021.