BERLIN-headquartered Sanity Group has confirmed it has completed a $44.2m Series A financing round led by Swiss venture capital firm Redalpine – bringing total investment in the cannabis start-up to $73m.
It is the largest financing round to date for a European cannabis start-up.
The firm says the funding will primarily be used to build out its EU-GMP compliant research and production facility near Frankfurt as it looks to capitalise on the medical sector with a range of cannabis inhalers and remedial therapy being explored as well as shower gels, ointments and oils.
Cannabis has been allowed in Germany for the treatment of serious illnesses since March 2017 and can also be reimbursed by health insurance companies. Recreational use is still prohibited, however.
Cannabis Moving Mainstream
In its recent ‘Germany Cannabis and CBD Consumer Report’ Prohibition Partners found that during the first half of 2020 well over €75m worth of medical cannabis products were sold in the country and it says the figure for the full year is around €179m.
US-based Navy Capital, SOJE Capital and GMPVC, also participated in the funding round as Sanity Group sets its sights on becoming Europe’s leading cannabis company.
Finn Age Hänsel, founder and managing director of Sanity Group, said: “A round of this magnitude shows that cannabis is increasingly moving into the mainstream of investor awareness, and represents an important milestone in our business expansion on our way to becoming Europe’s leading cannabis company.
“We are very pleased about the trust placed in us by new and existing investors. Our thanks go not only to our new partners, but also to those who have been by our side for a long time and support us on our journey.”
Previous investors include HV Capital, TQ Ventures, Atlantic Food Labs, Cherry Ventures, Calyx, Bitburger Ventures and SevenVentures.
Sanity’s Celebrity Investors
In addition, Sanity Group has attracted prominent celebrity angels including music producers will.i.am, Scooter Braun and actress Alyssa Milano.
Sanity Group co-founder and managing director Fabian Friede added: “Our goal is to leverage the full potential of the cannabis plant and to research and harness the various cannabinoids.
“We are always on the lookout for partners who can not only support us financially in our endeavours, but above all are a good strategic fit for us.
“Redalpine’s investments in the life science and medical sector as well as Navy Capital with cannabis portfolio companies in the healthcare and consumer-goods sector, ideally complement our existing investor setup and cover the entire range of our business in the health, life science and consumer-goods sector.”
It is Navy Capital’s first investment in Europe. Sean Stiefel, CEO, said: “The European cannabis market faces exciting developments in the coming months. Compared to the North American market, Europe is now where we were in the US about four years ago.
“We want to bring our expertise and experience to the table.”
Sanity Group was launched in 2018 with the aim of providing people in Europe with newly developed cannabinoid-based medicines and health products. The firm currently employs 90 cannabis experts, physicians, pharmacists and biologists.
Its brands are Vayamed (pharmaceuticals), VAAY (CBD products) and This Place (functional cosmetics).
Main picture caption ; L- R: Sanity Group founders Finn Haensel and Fabian Friede