Jane West is raising a Crowd SAFE at a $15 million valuation with no discount. This isn’t an egregious valuation, but it doesn’t represent a striking deal for investors. Jane West’s 2019 revenues (the most recent year reported) were just over $200,000, and $15 million is a steep revenue multiple for a consumer products business. While Jane West has some intrinsic brand value, ultimately its products are competing against a wide landscape of other marijuana brands, and it doesn’t benefit from extensive proprietary intellectual property. As a result, Jane West’s price rating is only middle-of-the-road.

The marijuana market is undoubtedly booming. A CAGR of 17.8% over the next seven years is nothing to scoff at, nor is the market’s $17.5 billion valuation in 2019. However, even a booming market can still be relatively niche. Thinking practically, not every individual has an interest in buying weed or weed-related products, even if cannabis is now legal. While many people are avidly committed to their lifestyle of cannabis consumption, many others are not. Only 12% of Americans smoke weed, dramatically limiting Jane West’s market potential. The brand’s obtainable market size is even smaller because competition among cannabis brands is intense, and it seems like new CBD and weed companies launch every week. 

While Jane West is playing in a rapidly expanding market, the universe of those who are interested in cannabis products is still relatively niche. Moreover, Jane West has to do battle with popular, well-funded competitors and a host of upstart brands trying to capture attention from the same small pool of consumers. Therefore, Jane West’s market rating is middle-of-the-road.

Jane West was founded by Jane West herself, the company’s CEO. West was a corporate events manager when she started using her events expertise to create Friday night cannabis hangouts in Colorado. As these were the early days of legal marijuana, West was fired from her corporate job for the press she was receiving for these popular cannabis parties. She even received criminal charges for exceeding legal consumption at those events. 

West spun her newly-found public persona into a full-blown personal brand as a cannabis entrepreneur. She founded a women’s cannabis industry network and launched her eponymous cannabis brand shortly after in 2013. Now she’s the CEO of Jane West and still seems to be involved in other cannabis-related ventures related to her fame within the industry. 

The other half of the Jane West team is Kate Csillagi, vice president of sales. Csillagi has strong expertise in cannabis sales. She previously served as the vice president of sales for GRAV, another cannabis accessories company, for almost ten years. 

The Jane West brand undoubtedly benefits from the person Jane West’s industry recognition, and an experienced vice president of sales is also an asset. However, the founder Jane West doesn’t have any meaningful business experience or business credentials. While she is undoubtedly passionate about cannabis, she can’t leverage any specific expertise as the head of a consumer brand or growing startup. Therefore, the company’s team score is only slightly above average. 

Jane West has a specific point of view on what cannabis consumers lack: well-branded, stylish products that make smoking weed or ingesting CBD seem less intimidating and more accessible, particularly to certain demographics like women. The company seems to have a correct read on the space. Many weed brands are aggressive, masculine, hipster, or all three, catering to those with deep experience with cannabis. Jane West’s artful glassware and simple, day-vs-night branded products do connote a different cannabis experience than that of its competitors. 

However, Jane West faces countless competitors. The marijuana industry has been hailed as arguably one of the fastest-growing, biggest-opportunity industries of the modern era. Enterprising entrepreneurs have rushed into the space to create weed delivery companies, weed-growing companies, weed accessories companies, and every other type of marijuana company under the sun. Jane West is vying for consumer attention among a crowded landscape of cannabis brands, and its products aren’t defensible. Any company with a bit more traction could begin offering similar product lines, and Jane West could be seriously threatened. 

Jane West is well-branded and clearly differentiated from competitors. However, the sheer volume of competition in the marijuana industry, combined with Jane West’s low product defensibility, limits the company’s competitive advantage. Therefore, Jane West’s differentiation score is moderate. 

Jane West has built a nationwide presence with partners in many U.S. states and Canada, plus a merchandising agreement that will promote the brand internationally in 2021. In addition, Jane West sells direct-to-consumer through a couple of branded e-commerce sites. These channels generated $202,814 in revenue for 2019, the last year of financials available. That year, the company posted a net loss of $374,839. While 2020 financials aren’t yet available, founder Jane West (the person) responded to a Republic discussion question indicating that 2020 revenue roughly doubled from 2019. 

Jane West has also enjoyed fundraising success. The company has raised $1.8 million to date, the combination of a $1.3 million seed round and a prior $500,000 crowdfund raise on Republic. 

While 2020 financials aren’t yet available, it seems that Jane West was able to increase revenue substantially from 2019 to 2020. While this growth is encouraging, the company is still nowhere near reaching profitability at this time. However due to the combination of decent revenue and past fundraising success, the performance score for Jane West is its highest across all five metrics.

The cannabis industry is a hot topic these days, and a huge number of entrepreneurs have taken advantage. The marijuana market is becoming oversaturated with brands that all have a take on the best varieties of weed, the best smoking accessories, the best CBD products, etc. There simply aren’t enough cannabis consumers to justify the number of products available in this space. 

While Jane West does offer distinctive products that might well appeal to less experienced cannabis consumers, the company still faces harsh competition from a huge landscape of other cannabis brands. That’s evident in the company’s progress. Jane West launched the brand in 2016, and revenues in 2019 were still just over $200,000. 

Jane West has won some loyal customers and will likely continue to generate attention due to founder Jane West’s personal brand in the cannabis space. However, there are signals that growth is stagnant, and investors might not be able to reap a return on their investment at this steep valuation.

While there are a huge number of companies competing for a limited number of cannabis-friendly consumers, Jane West does have a unique stake within that landscape. Jane West is actually trying to expand the market of cannabis customers through accessible products that encourage women and other demographics who are unfamiliar with marijuana to give it a try. 

Jane West products clearly strike a chord with some consumers and cannabis partners. The company reportedly doubled revenues in 2020 and has struck a merchandising deal that will put Jane West products in front of customers in many countries worldwide. Jane West seems to be employing a broad strategy of product development and distribution, selling a wide range of products across a variety of channels and countries to create a widely-known brand. This approach, combined with the company’s differentiated branding and product lines, could propel Jane West to capture more value from the growing cannabis market.

Jane West is a cannabis brand selling weed products and marijana accessories in a number of states and countries. The company was founded by Jane West, who has made somewhat of a name for herself as the rebel cannabis consumer. With West’s leadership, her eponymous brand has extended to numerous product lines and numerous revenue streams (royalties, merchandising, etc.). 

On the other hand, Jane West hasn’t grown explosively since its founding in 2016, and it doesn’t have a wide moat to defend itself from the crowded landscape of cannabis brands vying for consumer attention. It’s also worth noting that, while the marijuana industry is touted for its explosive growth, only 12% of Americans actually smoke weed. That’s a narrow market to be bombarded by so much competition. Therefore, Jane West has been rated a Neutral Deal. 

For questions regarding the KingsCrowd staff pick or ratings for this company, please reach out to support@kingscrowd.com.