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LeafOps, Hometown Kids Hit the Big Time

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By: ACM Staff

“It’s no longer a dream. We did it and now we’re doing it. Now every day is the dream.”

That’s what Shane Donaway says about his personal rags to riches success with his tiny startup LeafOps. LeafOps, the two-person company he started with his sister-in-law Stephanie Yarbrough has now grown to more than 20 workers and was recently acquired by major national cannabis software player, Grow Flow. What was once just a good idea is now serving 35 dispensaries in a dozen different states.

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Shane, a web developer since 1998, studied at Al Collins Graphic Design School. Stephanie had been a realtor in Sedona. The two first met in the early 2000s when they both went to work for valley software giant, Knowledge Net, as it was just getting started. Watching the tiny startup grow from 5 employees to more than 500, inspired them to want to create their own company someday. “It was a great experience,” Stephanie explained, “It taught me exactly how to build my company. I knew I was learning the “how” of starting your own company. Now I just needed to figure out the “what.’”

Then one Super Bowl Sunday, while national software brand MJ Freeway was in the middle of one of their notorious multi-week crashes, Stephanie decided she’d had enough. A medical marijuana patient, Stephanie was frustrated by trying to shop in dispensaries whose point-of-sale programs were yet again down due to shoddy software. She called up Shane on the spot, in the middle of the game, and demanded he write a better program. “It was absurd there wasn’t anything out there that wasn’t any better or even reliable,” Donaway says. “It became my mission to bring modern software into the industry. I wasn’t thinking about getting rich, I just wanted to build something good.”

Though he was already working full-time, Shane threw himself into the project, spending the better part of a year researching competitors and working with valley dispensaries to identify their “pain points.” Donaway prefers what he calls an all-hands-on-deck strategy to helping new clients learn and embrace the software. The two decided to ask their clients to “drive how we built the software.” Shane explained, “That way we were using everyone’s best practices. Instead of training clients on how to use our programs, we let them shape it to their needs. Our installation process is very hands on, even with new clients.”

Since Shane was only working on a point-of-sale program, their company had to start out in dispensaries outside AZ. In AZ, the state requires that any software cover the entire seed-to-sale process. Further, Arizona’s state tracking system and the retail outlets’ point-of-sale programs are entirely separate programs and stores are required to enter patient data into the state program each time they make a transaction in addition to recording the sale in their own records. That disconnect initially slowed growth for LeafOps.

Then, on Nov 16, 2017, while Stephanie and Shane were languishing in their booth at the Vegas MJBizCon, they met people who asked them to adapt the software to interface with MJ Freeway’s “Leaf Data Systems.” Shane quickly made a few quick adjustments and relaunched the program.The first place they were approved to operate was Washington State, which separates cultivation or production companies from retail outlets. At that point, the Washington state program required all cannabis companies use a BioTrack-based system and was in the process of switching over to Leaf Data. Shane and Stephanie were ready. Not only could LeapOps keep track of stores all over Washington simultaneously, they could report to the state regulatory board in real time. LeafOps was the first third party point-of-sale program to be approved to work with the state system, and GrowFlow was the first approved to deal with cultivation. Shane laughs, “So, suddenly yeah, there’s this big old company was wondering how a little startup like ours could beat them to the punch. So that’s what got the conversation started.”

Shane and Stephanie were just as surprised as everyone else when they were approached by Growflow for the acquisition, but so far Growflow has been a good fit for LeafOps. The larger company was already committed to focusing on their new customers with a “Customer Success Team,” not merely online support. Since then the company has kept on adding clients and now serves companies in twelve different states.

When asked what the best part of getting acquired by GrowFlow was, there was no hesitation. In unison, the two both shouted, “Not to have two jobs.” For Stephanie, her big thrill is that they are now part of the AZ cannabis business community, meaning she gets to interact with companies and celebrities she once merely daydreamed about. For Shane, the GrowFlow’s purchase of LeafOps means his team is finally able to develop themselves in the AZ market.

Just the thought makes him smile, “It’s bringing the dream full circle.”

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