St. Louis, Missouri
Employees: 3 (Parent company in Finland: 30)
Industry: Cannabis & Hemp
Products: Cannabis and hemp potency measurement system
President Dr. Chad Lieber is offering technology for a quick, cheap, and accurate testing for THC and CBD potency.
In 2012, Lieber left his job at a manufacturer of optical quality-control equipment for the pharmaceutical industry. His employer supplied 20 of the 25 largest companies in the industry at the time. "When they're making Advil, when the tablet comes off the line, it makes sure it has the right amount of ibuprofen," he says.
Lieber had seen a crossover with cannabis when the recreational ban was lifted in Colorado in 2012. "That it was doing that without the oversight of the FDA meant there was a lack of quality control and a lot of mistakes were possible," he explains. "It didn't take long to connect these dots and the lightbulb went on."
His first attempt at a startup involved a device with a sensor from Finland-based Spectral Engines. The sugarcube-sized spectral sensor was $2,000, versus $20,000 or more for the shoebox-sized status quo. It made Lieber's idea for cannabis-specific spectroscopy equipment financially feasible for the notoriously cash-strapped industry.
When his initial company "imploded" in 2017, Lieber received a call from the CEO of Spectral Engines and an offer to back a new company in Purpl. "We've come up with a better mousetrap," says Lieber.
That mousetrap is the Purpl PRO, a hockey puck-sized, smartphone compatible spectroscopy tester for growers, extractors, manufacturers, and dispensaries. The product uses a sensor from Spectral Engines; assembly takes place in St. Louis at Custom Technologies.
Users grind a cured sample of biomass (about a third of a gram) and control the test with their smartphone. "It gathers what we call an optical fingerprint," says Lieber. "There's a lot of machine learning and AI."
The infrared fingerprint takes just five seconds and delivers an accurate reading of THC and CBD potency. The technology is able to detect the amount of non-cannabis in a sample but does not identify contaminants.
Purpl PRO's accuracy was validated with its THC measurements compared to leading labs with a mean average error of less than 1 percent; the company published the results in a whitepaper.
Customers use it to select plants for specific traits and potencies. "The analogy I like to use: It's the difference between GPS and a map," says Lieber. "You're going to end up at your destination
Purpl Scientific's strategy is not to replace outside testing, but to make better decisions before turning to a third party. "There has to be some third-party testing done," says Lieber. "That's always going to be the case from a conflict-of-interest standpoint, you're always going to need third-party testing."
With potency testing for THC and CBD running a minimum of $50 per test with a one-week lead time, the $1,495 Purpl PRO is perfect for a pretest before the third party enters the picture. In a maturing market with decreasing margins, there's a need for this kind of efficiency.
Since the launch of the Purpl PRO in June 2019, the company "has seen a huge surge in uptake," says Lieber. There are currently 10 distributors selling the product; California and Canada are the top markets.
Purpl Scientific sold about 100 units in the first three months, and Lieber says he expects to soon sell twice that many on a monthly basis. Software updates will soon allow users to test extracts for potency and biomass for moisture. Lieber notes that the status quo for the latter involves "a scale and an Easy-Bake oven."
Some competitors' testing equipment have gotten bad reviews, but "an explosion of posts" on social media have given Purpl PRO high praise like "spooky accurate," Lieber adds.
Challenges: "This is inherently a skeptical market," notes Lieber, pointing to other entrants in the potency-testing space who didn't deliver in the eyes of buyers. "We're taking the exact opposite approach: We're trying to underpromise and overdeliver."
The federal classification of cannabis on Schedule I as a drug "with no currently accepted medical use and a high potential for abuse" is another barrier that impacts the ability of Purpl's customer to get financing and banking services.
Opportunities: "Cultivators are the primary market right now," says Lieber. Processors and extractors are the secondary market, but that could soon expand with a software update for Purpl PRO later this year that will allow for testing of extracts as well as flower.
Lieber says he sees manufacturers and testing as other potential markets, and notes that the device is "working its way down to the end consumer" and notes that there are "no labels on bottles" at dispensaries like there are at liquor stores. Law enforcement represents an additional opportunity, especially in states where officials want a quick and easy test to differentiate hemp from cannabis that's higher in THC.
Needs: "Right now, we need credibility, and we can't force that instantly," says Lieber.