By Brad Weissberg/Oct. 17, 2017
Achieving simple business staples such as renting office space or paying vendors isn’t so easy with the stigma of cannabis attached. Often after explaining to a potential landlord that you are in the cannabis business the door is quickly shut. Paragon is out to solve both these problems.
“Renting space is a huge problem for startups in general; for cannabis startups it can be near impossible,” said Jessica Versteeg, CEO, ParagonCoin. “First you need to prove your financial worth and then once the landlord finds out you are a cannabis company you can forget it. Under federal regulations if anything goes wrong the feds can take over the building.”
Jennifer Versteeg, CEO, Paragon.
Payments are another huge obstacle, with most cannabis enterprises having to resort to a cash-only model for everything from payment from customers, to paying employees, without access to a bank account. “Even paying someone through a credit card or Paypal is technically federally illegal today,” said Versteeg.
This forces most cannabis enterprises to use good old fashioned cash, which is a huge security concern. “Having piles of money laying around is always risky,” explained Versteeg. “This forces most cannabis business to stockpile cash. It’s unsafe.”
Paragon has a solution to both problems. First, Paragon has introduced their own blockchain, which is the foundation of any cryptocurrency, called ParagonCoin.
Blockchain is like a Wikipedia page that everyone can see and update, explained Versteeg. “It’s documented. Everyone can see what’s been changed, when it was changed, who changed it; it’s an immutable ledger that can’t be forged. Blockchain is like a spreadsheet and excel put together. Real estate titles are on blockchain; farmer’s use it for crops; it can be used for anything.”
Blockchain can also be used for labelling purposes. “Let’s say you like a certain strain of cannabis. If the label has a QR code, you can scan it and it will tell you everything about that strain from seed to store. It will tell you where it was grown, what mother plant it came from, indoor or outdoor, is it solar or organic, were pesticides used, if so, what kind? What were the lab results? How much THC is in it? Was there mildew in it. All of this can be stored on the blockchain. This gives the consumer knowledge. As long as the info is on the blockchain, everyone has access.”
Patient ID is another issue Versteeg sees blockchain solving. “We need to get patient IDs in one place,” she said. “Right now you have Verified 420, HelloMD, and many others. They are different databases. We need to get medical marijuana in the same system.”
ParagonCoin’s vision is for its blockchain to simplify payments. “No one wants to have a lot of cash around. People around both sides of a transaction know there’s cash being exchanged and that’s dangerous.”
Another division of Paragon, ParagonSpace aims to solve the space-rental issue. “We are going to open co-working spaces where anyone in the cannabis community can come and share the space,” Versteeg explained. “In a traditional co-working space you can’t work comfortably, so instead of putting people in an awkward place and possibly being asked to leave, we’re building the space just for them. You won’t be judged.”
Versteeg envisions an in-house lab, and in-house lawyer, and conference room. “All of these things will be paid for in PRG tokens,” she said. “No cash.”
Real estate will be bought. “We’re looking at locations in Green Zones,” she said. The company has not purchased any land yet. Versteeg believes she is about “a year” from opening the first campus. So far, Paragon has raised $30 million in PRG tokens, but it’s not $30 million dollars. “Because of presales, some people bought PRG tokens at 10 percent or 25 percent off,” she explained.
Paragon has been active as a company for six months and has 20 employees. The HQ is in San Francisco.