HelloMd has partnered with SeedInvest to crowd source a capital raise. Since launching the campaign last week, the cannabis website has brought in over $71,000 towards its goal of $1.5 million.
This micro-cap company connects medical marijuana patients with doctors, but goes farther by providing an online marketplace for patients to buy products. It charges doctors a fee for registry and listing services. It also earns revenue from charging patients a consultation fee for a virtual medical consultation. The marketplace will charge a 15% commission.
The founder Mark Hadfield said on the site, “For the last 22 months, it’s been one line item of revenue; connecting patients with doctors over a live stream. Patient pays $49 and meets with a doctor and they have a consultation. It’s all been derived in California. Moving forward, we are in the process of a pivot – the most ambitious of which is to be a marketplace with hundreds of sellers selling cannabis products to our large number of patients – that’s the primary focus for the pivot for this year.”
So far the site has grown rapidly with 130,000 members and it has been adding approximately 9,000 per month. It's primary location is California, but it is rolling out nationwide. In smaller states where it is harder to find doctors willing to recommend medical marijuana, this could be especially beneficial.
HelloMD competes with other doctor service sites like Eaze. Nugg and Presto Doctor, but only Eaze provides a marketplace option like HelloMD. The site tries to set itself apart by also offering articles and a community feature for patients. Eaze doesn't offer community features or content. So, Hello MD feels it is unique in offering all of these services within one website. Plus, as the market gets flooded with hundreds of CBD products from numerous companies, consumers may want to be able to have a place to go to find out which products can best meet their needs.
While HelloMD is the name of the website, the company is actually called Ondello, Inc. It's unaudited financial statements state that “The Company has incurred net losses of $410,572 and $388,039 for the years ended December 31, 2016 and 2015, respectively, and current liabilities exceed current assets by $1,685,318 as of December 31, 2016.” On a positive note, HelloMD does have money coming in with net revenues in 2016 of $1.9 million and employees that are willing to defer salaries.
What is also working in its favor is the current political climate for marijuana. Politicians tend to look more favorable upon medical marijuana, which is where HelloMD is anchored. The site does intend to capitalize on adult use marijuana in the future, but it's focus on the medical side could protect it. The site also doesn't touch the plant, which keeps it on the ancillary side of the cannabis industry.
If the company meets its fund-raising goals, it will primarily use that money to pay future wages, general working purposes and repay debt. The nice part about the SeedInvest site is that the company seems very transparent about its financial statements and the SeedInvest people vet the companies they allow on their website. Potential investors are clearly made aware of the risks of their investment.