Cura Cannabis Solutions, a startup that makes marijuana oil for vape cartridges, wants to be the first US company in the cannabis industry to achieve elusive "unicorn" status with a billion dollar valuation.
"We've had a lot of nicknames. 'Unicorn' is definitely a new one," said Cura president and cofounder Cameron Forni.
Cura is currently raising funding at a $400 million valuation, which represents a 1,300% increase from its valuation in 2016 and puts it ahead of the combined market value of the two biggest publicly traded marijuana companies in the US: Terra Tech and Kush Bottles.
The Oregon-based company closed the year with $40.5 million in sales, and it predicts revenue will rise to $120 million in 2018 as California's recreational marijuana market comes online.
Sales of recreational marijuana began in California on January 1, and the state market is expected to haul $3.7 billion in revenue this year as dispensaries pop up in new cities and counties. Cura, which operated in California's medical marijuana market, is positioned to piggyback on the market's success because it already has distribution there.
The vaping market is also exploding. In California, vaporizers account for 32% of sales on Eaze, a marijuana delivery service. In 2017, 72% of millennial Eaze customers bought a vaporizer.
Cura's colossal growth stems from a decision it made early on to focus exclusively on cannabis oil, a product that's highly concentrated in the chemical compounds found on the outside of the plant. The company does not grow its own marijuana, but sources it from third-party farmers.
The company's signature line of vape cartridges, Select Oil, uses a Japanese organic cotton wick that absorbs the oil through its fibers and delivers it to a heating chamber. According to Forni, the system allows users to take quick draws without the burned taste of a standard cotton wick.
Select Oil offers over a dozen formulations with various potencies, flavors, and desired effects. Its biggest seller is a $60 cartridge called Select Elite, which has the highest concentration of THC, the psychoactive ingredient in marijuana, of all its vape cartridges.
Cura has been able to scale quickly by having a broad supply chain. In 2017, there were 240 licensed marijuana farms in Oregon, and 180 of them sold all of their trim (plant material that's leftover from trimming the marijuana bud) to Cura for making oil, according to the company.
Some cannabis brands say that being vertically integrated — growing the plant that's processed for oil or other products — allows for greater quality control. Brands also pocket a bigger profit, because they don't have to share the revenue with farmers and middlemen distributors.
"What other industry does everything from production to processing to retail?" said Forni, who got into the cannabis industry after working on agriculture technology. "In cannabis, these companies want to be the best at everything. It's very difficult to be the best at everything."
Cura sells its products in California, Nevada, Oregon, and is eyeing an expansion to Arizona, Florida, New Jersey, and Ohio. It also provides oil wholesale to marijuana edibles makers.
Cura has been hiring like crazy to keep up with new market demand, growing from 200 to 285 employees since December. Forni spends much of his time commuting between headquarters in Portland and Cura's outposts in California and Nevada.
It's like "being strapped to a rocketship and trying to keep your eyes open," Forni said.
Cura's CEO, Nitin Khanna, has remained at the helm of the company in spite of allegations leveled against him. In 2014, Khanna settled a civil suit accusing him of sexual battery and rape.