Salveo Invests in PathogenDx – WSJ
Cannabis-focused investor Salveo Capital has taken a minority stake in PathogenDx Corp., a provider of testing technology for the cannabis and other agricultural industries.
Salveo is participating in the funding round with firms that include Altitude Investment Management, Panther Opportunity Fund, Canopy Ventures, Tendaji Investments, PB Venture Group, Halley Venture Partners and FlatIron Group, according to a spokesman for Salveo.
Tucson, Ariz.-based PathogenDx provides pathogen testing kits to the cannabis, botanical, food and agricultural testing markets. The company’s product helps determine if plants or crops have been contaminated with pathogens such as mold, fungi or other viruses.
Jeffrey Howard, a managing partner at Salveo, said his firm began tracking PathogenDx about over a year ago. The firm came to know PathogenDx through its investment last year in portfolio company Front Range Biosciences Inc., a biotech company focused on tissue culture propaganda.
Mr. Howard said PathogenDx has been growing, specifically in California, where new rules and regulations put into place on July 1 require all cannabis products to pass a pathogen-based lab test.
“We’re seeing an influx,” Mr. Howard said of demand for the company's services. “Testing labs in California are swamped with business due to the new rules and regulations.”
PathogenDx primarily provides pathogen testing for cannabis, according to Mr. Howard, who said that demand for the service is likely to increase as more states legalize cannabis and the need for testing grows.
The PathogenDx deal is Salveo’s ninth since its inception. The firm launched at the end of 2016 and emphasizes investments in ancillary companies that serve the cannabis industry.
Most recently, Northbrook, Ill.-based Salveo invested in Flow Kana Inc., a marijuana processing-and-distribution company also backed by tech investor and musician Roger McNamee.