ST. LOUIS — When the ballot initiative to legalize medical marijuana in Missouri got underway, Kurt and Beth Heidrich got moving.
Kurt Heidrich has a professional background in genomics and sequencing, and Beth has culinary and marketing expertise. "We decided to go for it," he said.
They personally financed the considerable costs of preparing and making license applications — more than $250,000 in total. "We went for broke," he said.
It paid off. They won one of the 86 manufacturing licenses issued by the state and one of the 60 growing licenses for their new company, Kindbio.
They chose a location in north St. Louis, leasing about 50,000 square feet in a 550,000-square-foot warehouse at 7110 N. Broadway. The area is in a federal Enterprise Zone, qualifying them for tax credits and extra points on their marijuana license applications.
"We got the license approvals in December. By mid-February we had estimates on startup cost and began raising capital," Kurt Heinrich said. "A week later, we were told to stay home. It was a challenge to schedule meetings with anyone. Some commitments came through, others fell through."
The sudden scarcity of capital due to the pandemic forced them to change their financing strategy. "We lowered our capital goal and switched from a pure equity raise to take on debt financing," he said.
He declined to say what the capital goals are, but said they are half of what they were. The state required the Heidrichs to show they had more than $450,000 in cash for the applications, and they raised more than $400,000 from angel investors, he said.
On the plus side, he said the fledgling industry is proving to be larger than expected. A study had predicted 30,000 people would sign up for medical-marijuana patient cards, he said. It has been more than twice that. "That's a lot of patients with no product on the shelf," he said.
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