This Annapolis fintech startup wants to make it easier for banks to work with cannabis businesses - Baltimore


Jul. 18, 2019 6:45 pm

This Annapolis fintech startup wants to make it easier for banks to work with cannabis businesses

Solvent's technology aims to reduce the risk assumed with banking cannabis and CBD. The company raised $850,000 in seed funding.
Solvent cofounders (L to R) Brian Meyer, CEO Tony Richards, Niki Rogers, Jason Barker and Adam Gifford.

Solvent cofounders (L to R) Brian Meyer, CEO Tony Richards, Niki Rogers, Jason Barker and Adam Gifford.

(Courtesy photo)

With more states legalizing cannabis for medical use — like Maryland — as well as recreational use, the industry is growing. Yet many of the processes and regulations behind the business in areas where it’s been approved remain new, and without specific tools designed to navigate the landscape.

In the area of banking, for instance, ensuring that all transactions are safe and compliant and protecting against fraud is a priority of the U.S. government and other regulators. But for banks and credit unions who work with the legal cannabis businesses, there’s a lot of risk involved because it’s a new industry, said Brian Meyer, cofounder of Annapolis-based fintech startup Solvent.

And many of the processes that go into showing regulators the info that can ensure there’s no criminal intent and compliance with safety regulations are still manual, presenting another difficulty. The U.S. Department of the Treasury released a set of guidelines for banks that enable compliance, but there’s not technology that’s specifically designed meet the complexity of what’s required.

“At the end of the day they don’t have the tools they need to feel confident in banking cannabis,” Meyer said. So Solvent is developing financial technology designed to address this need, allowing for the banking functions that go beyond a basic account, as well as merchant services that are offered to businesses.

The startup was launched earlier this year by five cofounders: Meyer, CEO Tony Richards, Niki Rogers, Adam Gifford and Jason Barker. Meyer, Gifford and Barker previously worked together at another cannabis-focused company called THSuite, and identified the scope of the issue in the cannabis industry when it comes to banking and payments. They later came together with Richards and Rogers, who Meyer also knew from past ventures.

Building a team of 12 people that’s headquartered in downtown Annapolis, they’ve been talking to stakeholders and developing products that use machine learning, big data analysis and blockchain technology that can be applied to cannabis, as well as CBD and hemp.

One key area is in identity, as it’s important for banks is to know who they’re doing business with, Richards said. The company’s onboarding and underwriting product, called Terra, can take key business info, do a background check and gather other key to gather a complete picture. The information is then stored on a blockchain ledger.


The company is also gathering data about payments to be provided to regulators, as there’s also a need to provide information about individual transactions.

“We want to do some analysis on these transactions as soon as the card’s been swiped,” Richards said. This product, called Ventus, involves gathering data about the merchants and the people making the purchases, as well as the products. This data also gets stored on a blockchain ledger. With all of this data, the company can create a narrative that can in turn be provided to regulators to show the safety and compliance.

Blockchain technology allows the data to be stored in a way that protects it with the encryption technology that it’s built on, and present it in a narrative through the blocks.

Currently in a product development phase, the company is looking to launch its products, with its Ventus product for CBD set to be released later this summer, followed by the cannabis-oriented version.

The company is looking to build in Annapolis, where being close to the water is part of the draw. Solvent raised $850,000 in seed funding, led by B&B Partners, with participation from Edge Ventures and Marigold Ventures. The funding will help the company continue to hire in engineering, and Meyer said a priority is on attracting local talent.

Working in a few areas that are getting attention in the wider economy, the company is also looking to bring attention to its state.

“Not only Annapolis, but for Maryland as a whole, we feel like this is a great opportunity to put a flag in the ground and promote the State of Maryland as an up and coming hub for not only fintech, but also cannabis companies,” Meyer said.

Companies: Solvent

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