Eaze Looks To Corner Medical Marijuana Delivery Market

Keith McCarthy, Eaze founder and CEO

Keith McCarthy, Eaze founder and CEO

It’s been a whirlwind week for Eaze founder and chief executive Keith McCarty. Since launching an all out media blitz last Tuesday for his new marijuana-related start-up, the tech entrepreneur and his company have generated a lot of buzz.

That’s because Eaze is a free on-demand healthcare delivery service that allows patients to obtain medical marijuana from a mobile device or computer. Based in San Francisco, Eaze can provide this service because medical marijuana is legal in California. In fact, medical marijuana delivery companies are quite common in the state.

Immediately, Eaze drew comparisons to Uber, the on-demand web application service that allows users to hire private drivers as taxis. There were the straightforward business profiles from old media like the San Francisco Chronicle. While new media like Tech Crunch took a Gonzo-style approach by having friends test out Eaze. The company even got some attention in the late night talk show circuit when Jimmy Kimmel brought up Eaze in his opening monologue on Aug. 1. It’s the type of media attention that tickles an investor’s interest.

And that’s key considering Eaze is facing some competition.  A Washington state company called Canary, founded by two students, also calls itself the “Uber of pot” because it uses a smartphone app.

“We’ve gained a tremendous amount of traction,” McCarty tells THC News. “It has exceeded our expectations. We are getting requests for hundreds of deliveries and have received more than 100 inquiries from people who want to be drivers.”

A former executive for enterprise social network Yammer, which was acquired by Microsoft for $1.2 billion, McCarty launched Eaze with his own money and from his apartment, although he says his team is geographically dispersed and that service will one day be available in states that have legalized pot for medical and recreational use. Right now, the company is focused on linking patients to dispensers in the Bay area.

“We are in the process of raising our first round to finance the expansion into other cities,” McCarty says. “We wanted to test out the blueprint first.”

Eaze works by establishing business relationships with local dispensaries as well as dozens of private drivers. Deliveries are free for patients, with driver fees and Eaze paid by dispensaries in exchange for gaining new business. Right now, Eaze is working with an undisclosed number of dispensaries. McCarty declined to name any of them, citing competitive reasons.

How the Eaze application looks like on an iPhone.

How the Eaze application looks like on an iPhone.

Each driver, who is subject to criminal background checks and must have a medical marijuana card, starts a shift by picking up a kit at a dispensary preloaded with eight ounces of pot, the most California state allows a person to carry. Eaze verifies customers’ legal rights to buy marijuana by reviewing images of their doctors’ notes and drivers’ licenses, submitted online. Drivers make $10 per delivery. While that may seem like a pittance, McCarty predicts that drivers could make as many as 64 deliveries in ten minutes. That’s $640.

McCarty says the most effective way to measure his company’s growth is to keep an eye on the number of drivers who sign up and track the time it takes patients to register for the service to the time the medicine reaches their doorstep. “Right now, we are getting people who are saying it is only 13 minutes,” he says.

Still, the company has a lot of work to do. Eaze is waiting for approval from Apple on its iPhone application and its Android application is still in development. For now, patients can only access the service via the company website, www.eazeup.com. There is a huge untapped market among mobile device users. It will be interesting to see how Eaze meets that demand. Another issue is the inability to accept credit cards since federal law still criminalizes marijuana. Banks take huge risks doing business with marijuana related companies and prefer to keep those relationships under the radar. But that is a problem also facing dispensaries and existing delivery services that take online orders.