Tens of millions of dollars are flowing into the Grand Valley to further expand and develop the area’s hemp production and processing.
EcoGen Laboratories, which recently began the planning process to develop the former Grand Junction Steel building into its national headquarters, announced that it had closed a private placement that raised $40 million.
It also announced its 2019 revenue topped $80 million.
“We are very encouraged by the strong support we’ve received from the institutional marketplace,” said Alexis Korybut, EcoGen co-founder, in a news release. “This investment is an important step forward that will allow us to further grow and expand our business.”
Private placements are a non-traditional way to raise funds, ANB Bank Regional President Vance Wagner said. They are not run through institutions like banks or stock markets, but rather through hedge funds or a collection of private investors. They can even take the form of a loan.
It has been nearly impossible for companies in the hemp industry to raise money through traditional means because of federal regulations that required extensive paperwork and documentation, according to a New York Times report. Those regulations were only lifted last month, despite hemp being legalized at the federal level since 2018.
“We’ve spent $26 million in the valley in the last two years,” EcoGen Facilities Development Director Keith Ehlers said last week when speaking about its new headquarters plan. “We’re really making this our central location.”
While it is still early in the permitting process, EcoGen plans to consolidate most of its operations, including administration, a fabrication shop and CBD extraction at its Grand Junction headquarters.
CBD is a non-intoxicating cannabinoid found in cannibis and hemp.
Combined with its greenhouse operations in Palisade and a 300-acre farm in Mack, EcoGen’s operations will span the valley.
It isn’t only investing in new capital, but also has been on a hiring spree, growing from around 70 employees last spring to more than 200 employees today, EcoGen Manager Ted Kelley said last week.
“When we first started, we were on a mission to create a state-of-the-art process to produce exceptionally pure CBD that set the standard for the industry,” said Joseph Nunez, EcoGen co-founder. “We’re proud to say that goal was quickly achieved, and this capital raise will allow us to expand that success into other verticals of the business.”