While working as a consultant at Burling Bank, Chris Rentner watched as the bank's cannabis dispensary clients would regularly bring in bag after bag of cash. Due to the fact that credit card companies are hesitant to work with the cannabis industry given that the drug remains illegal at the federal level, many dispensaries are cash only.
"I was watching millions of dollars walk in the door in cash in duffle bags," Rentner said. "I thought, there had to be a better way."
To help with cannabis' cash problem, earlier this year Rentner launched Spence, a new cashless payment solution for the legal marijuana industry. The platform allows cannabis shoppers to create an account, connect their bank account, and pay at the dispensary using a unique QR code. Spence has a deal with cannabis operator PharmaCann, and is currently live at the company's Verilife dispensary in North Aurora. Rentner said the startup plans to expand nationally to all PharmaCann locations in the coming months.
Spence also offers its API to dispensaries or cannabis tech companies to use its payment processing technology in their own platforms, which can power curbside pickup or delivery, the startup said. It can also provide dispensaries with loyalty programs and notify customers of special deals.
Spence began as a project at Burling Bank and spun out as its own company this spring. Burling partners with Spence by processing funds for the startup.
The cashless technology also fits a growing need during the age of Covid-19, as retailers and customers increasingly prefer not to handle credit cards or cash.
"People have always known money was dirty," Rentner said. "(Covid) rubbed that idea 'money is dirty' right in your face."
Spence is among a growing group of tech startups that aim to service the burgeoning legal marijuana industry. Chicago startup CannaTrac has a similar approach to Spence with its platform that allows shoppers to pay via mobile device. Leaf Trade, a Chicago startup that’s building enterprise software for cannabis dispensaries and growers, raised $4.5 million in December. And Fyllo, a startup developing marketing technology for cannabis firm, has raised $26 million since launching last year.
