PAX Labs in Talks to Raise Around $400 Million

PAX Labs, the maker of a popular line of devices for vaping cannabis, is close to raising over $400 million in a financing round that values the company at around $1.3 billion, according to two people familiar with the deal.

Initially, the San Francisco-based company had sought to raise $150 million in capital, according to a presentation for investors viewed by The Information, but PAX shifted course after encountering strong demand from investors who wanted to contribute more, the person said. The interest reflects optimism among investors that legalization of recreational use of marijuana will bring big growth opportunities for the market. PAX is projecting $113 million in revenue for 2019 and forecasting that it could jump to $1.2 billion by 2023, according to the investor presentation viewed by The Information.