PO Box 170 100 Theodore M. Klein
San Francisco, CA 94117 Chief Science Officer
www.Meristematic.com Ted@meristematic.com 302-379-1240
Employee headcount: 7
Projected 500K of
accrued revenue for
Funding sought: 1.5M
Pre-money value: 5M
Mike Stevens, CEO
Mike Smith, Finance
David Bennet, Legal and
Ted Klein, Chief Science
Dr. Phyllis Allen (former
DuPont Vice President)
One-line pitch: Meristematic will increase the profits of large-scale cannabis growers by at least
20 percent by economically providing them with a consistent and reliable supply of robust,
disease-free plantlets from our proprietary, high-throughput tissue culture process.
Business Summary: Meristematic was founded in 2017 with the vision of applying modern
horticultural techniques to cannabis propagation. Our tissue culture (micropropagation)
processes efficiently produces mother and starter plants without the use of pesticides and
fungicides, eliminating a major bottleneck for large-scale growers. Meristematic’s first-hand
knowledge of the cannabis cultivation sector fives us insight into the rapidly growing demand for
starter plants that meet customer demand for high-yield and quality. Our connections and
experience will allow us to take advantage of this growing market.
Management: Given the combined legal, business, and scientific experience of the Meristematic
team, we feel confident that we can build a successful micropropagation enterprise. Of particular
importance is Meristematic’s understanding of and long-standing connections with cannabis
breeders, nurseries and cultivators. We also have extensive connections with academic
researchers in plant biology and tissue culture that will be important in our efforts to continually
improve micropropagation processes.
Customer Problem/Opportunity: Demand for starter plants is far outstripping supply. Also,
traditional cloning procedures (growing plantlets from excised branches from a ‘mother’ plant)
cannot reliably supply clean starter plants free of pests and disease. Recent regulations limit the
range of effective chemicals used to combat pests, leaving the grower vulnerable to loss of
entire crops. Studies show that 80% of starter plants produced by traditional processes are
contaminated with pesticides and may not be suitable for sale. Traditional cloning from mother
plants also leads to decline of yield over time. Our tissue culture processes produce disease and
pest free plants with revived vigor. In addition, outsourcing plantlet production increases product
output by about 20 percent by more efficient space utilization. Combined with the reduced risk of
yield loss from disease and pests and their increased vigor, we anticipate that grower profits will
be increased by at least 20 percent.
Product/Service: We intend to produce cannabis starter plants that we will sell directly to
cultivators. We will also offer testing services to ensure that our product is disease and pest-free.
These tests will either be conducted by third-party labs or will be done in-house.
Target Market: We will first focus on the California market. There are at least 6,000 licensed
cultivators in California. International interest in Meristematic has also been significant during our
first year of development. Due to the scale of international cannabis cultivation, a micropropagation solution is in high demand.
Meristematic will explore the feasibility in a region where the import and export of cannabis plants is permitted, allowing access to
Customers: Meristematic’s target customers are wholesale purchasers of cannabis starter plants that run large to mid-sized
cultivation operations. These customers need solutions that improve plant vigor and quality. Our interactions with potential clients
indicate that they are excited about sourcing plants derived from micropropagation. We currently have 8 active clients. We have
been contacted by over 200 potential customers, so we are confident that we can grow our customer list as we ramp up production.
Sales/Marketing Strategy: Meristematic’s website brings in several potential customers each week. We have connections with many
large-scale growers in California and our research shows that they are interested in our product. Members of the team have
significant knowledge concerning market trends and have the ability to provide valuable guidance about strain selection.
Meristematic will be working with two freelance sales representatives that have extensive connections with potential clients
Business Model: We intend to sell starter plants directly to customers. The plants will be thoroughly tested to ensure quality and
genetic fidelity, services not offered by nurseries. To produce these plants, we will establish our own dedicated facility. This facility
will be capable of producing 3M plants per year. We anticipate becoming an attractive acquisition candidate for large vertically
integrated producers, should we decide to exit.
Competition: Cannabis micropropagation is an emerging technology. Segra (currently focused on Canada) and Front Range
Biosciences represent the most significant competitors. Conception and Finest are two newer competitors. To our knowledge, these
companies have yet to supply starter plants at significant levels.
Competitive Advantage: We have a strong team with established experience in cannabis micropropagation and a keen understanding
of process scale-up. Our proprietary technology is capable of fulfilling our production goals. The team has strong industry
connections that will lead directly to customer acquisition. We plan to maintain trade secrets about key aspects of our processes but
also see the potential for developing patentable technologies.
Financials: (5-year projections):
2019 2020 2021 2022 2023
Revenues $ 567,000.27 $ 11,907,005.67 $ 23,814,011.34 $ 38,102,418.14 $ 45,722,901.77
Expenditures $ 3,066,606.01 $ 2,339,996.00 $ 5,849,990.00 $ 8,774,985.00 $ 10,529,982.00
EBITDA $ (2,499,605.74) $ 9,567,009.67 $ 17,964,021.34 $ 29,327,433.14 $ 35,192,919.77