New Boulder-based cannabis VC partners with Israeli crowdfunding platform

BOULDER — New cannabis venture-capital fund 7thirty Fund LLC has partnered with OurCrowd, a global investment platform.

OurCrowd is a Jerusalem-based crowdfunding platform for accredited investors and 7thirty Fund is Boulder based. The new $30 million fund, launched in January, is focused on technology ancillary to the cannabis industry, such as ag-tech, SaaS solutions and research. The fund is managed by Micah Tapman, who previously helped run day-to-day operations at CanopyBoulder.

“The industry is larger now, and there is more room for VC funds to make good investments,” Tapman told BizWest, explaining his decision to step away from the day-to-day of CanopyBoulder in order to start 7thirty. “When Patrick [Rea] and I started Canopy in 2014, our original idea was a VC fund, but the industry wasn’t large enough to support it. We switched to an accelerator and micro-VC model. But the industry has grown to $1.5 billion in sales in Colorado alone; California had $2.5 billion in sales last year. The numbers point to these larger VC investments making more sense.”

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The decision to work together stemmed from OurCrowd’s desire to extend its outreach beyond Israel to international startups and more early-stage companies. OurCrowd operates as a platform across several different market verticals. It vets funding opportunities and then puts them on its crowdfunding platform, where 30,000 accredited investors representing 120 countries can choose to invest in a startup alongside OurCrowd. Its first investment was in 2013, and the company has made 117 investments thus far.

As the company has grown, however, it’s been more difficult to do deals that are less than are $1 million, given the expense of making investments. In order to invest in early-stage companies, OurCrowd started investing in venture funds on top of companies.

So when it came to investing in cannabis and its surrounding emerging tech, OurCrowd was looking for strong fund managers it could trust who had an expertise in the field. Kfir Kachlon, OurCrowd principal and cannabis-tech lead, decided on Tapman, who he had met several years prior.

“He had expertise in the space. With Micah having done 93 investments with Canopy Boulder, it was impressive for us to sit and talk with him,” Kachlon told BizWest. “He knew the science behind it, he was very knowledgeable and thinks about every detail. He understands the element of what cannabis is. So we decided to go with 7thirty and Micah and build something really interesting together.”

Kachlon said the two will look at making more investments in the United States, currently the biggest market for cannabis, as well as in Israel and other countries.

“Partnering with OurCrowd was a no-brainer,” Tapman said. “OurCrowd is one of the preeminent crowdfunding solutions for accredited investors. Israel is a leader in cannabis, with years of solid research allowed by its government. It’s a core focus for us. With their global reach and audience, working with them made a ton of sense.”

Looking ahead, Tapman said to expect a number of interesting investments for 7thirty, including ag-tech, enterprise resource planning systems, biotech safety testing, data and analytics, as well as research.

Kachlon said that he expects big things for the partnership, especially given 7thirty’s presence in one of the leading places for cannabis innovation.

“We are very focused on cannabis. We have never seen it as taboo, and OurCrowd has invested in it since the early days,” he said. “We are a big fan of Colorado, Boulder and Denver. What you have there is the power of very strong universities, and the talent you have there is exciting. To have an entity there for us, exposed to what you are building, I am very excited. We are very excited to do business together.”