California’s biggest THC delivery service is getting into the $600 million CBD business

One of the many ways of consuming CBD.
One of the many ways of consuming CBD.
Image: Reuters/Eduardo Munoz
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Over the past four years Eaze, a San Francisco-based tech platform for on-demand cannabis, has delivered nearly 3 million packages containing cannabis-enhanced edibles, tinctures, topicals, and vaporizers—not to mention cannabis flowers themselves—to more than 350,000 customers throughout California. Most of these products were purchased for their ability to deliver THC, or tetrahydrocannabinol, the chemical compound naturally found in cannabis that creates the psychosomatic effect expected of marijuana products. But now, a different compound in marijuana is starting upstage THC.

“THC has always been the one that everyone talks about,” said Eaze communications chief Sheena Shiravi. “And now all of a sudden it’s CBD.”

That’s why Eaze is getting into the business of CBD (cannabidiol), cashing in on the craze for the compound that has been shown in small studies to alleviate nausea, insomnia, muscle pain, and post-traumatic stress syndrome. It’s also the active ingredient in a seizure medication recently approved by the US Food and Drug Administration.

Starting today (Nov. 14), Eaze will sell products enhanced with hemp-derived CBD on a new website, to be shipped to customers in 41 states. CBD shows up in cannabis but it can also be found in hemp, which is essentially cannabis bred to have little to no THC. In states where cannabis is not yet legal, people can legally try out CBD derived from hemp. (Eaze will only ship to 41 states because certain states have regulatory barriers to entry.)

The site’s name, Eaze Wellness, suggests the lucrative market where the burgeoning legal cannabis industry and the multi-billion dollar promise of self-improvement overlap. Industry analysts at the Brightfield Group estimate the US market for hemp-derived CBD will be worth $591 million in 2018, and that it could reach a staggering $22 billion by 2022. 

Eaze reports that sales of high-CBD products through its California delivery service have doubled since January 2018. “CBD is always a fantastic starting point for anyone who has been reading about cannabis in the news and wants to get into it,” says Shiravi.

Shiravi says Eaze Wellness will aim to reach cannabis-curious consumers with its own “shoppable” articles about CBD. It’s a “Goop-inspired” approach, she says, referring to Gwyneth Paltrow’s lifestyle site that peddles high-end supplements and accessories alongside articles about mindfulness, diets, and connecting with the deceased. (Shiravi is quick to add that Eaze is careful not to make medical claims.)

The site is launching with about 100 different products from 20 or so brands, ranging from bath bombs and lip balms to pain-relief patches and sublingual sprays. (Also, CBD for pets.)

It’s more good news for the hemp industry, which is optimistic that hemp-derived CBD will be removed from the Drug Enforcement Administration’s definition of marijuana, thanks to a farm bill provision championed by senate majority leader Mitch McConnell. If McConnell’s provision were to pass, it would remove any shadow of a doubt about hemp-derived CBD’s legality, and be a boon for the business.

“It’s interesting to think about what it could be,” McConnell said of hemp on Friday (Nov. 9). “I don’t want to overstate this—I don’t know whether it’s going to be the next tobacco or not, but I do think it has a lot of potential.”

This post has been corrected. An earlier version estimated that Eaze had delivered 4 million packages over the past four years. The number is closer to 3 million.