AP Photo/Rick Bowmer
Alfalfa farmers Diane and Russ Jones look on during public hearing on medical cannabis at the Utah Department of Agriculture and Food Wednesday, June 5, 2019, in Salt Lake City, Utah.
Introducing Cultivated, our new weekly newsletter where we're bringing you an inside look at the deals, trends, and personalities driving the multibillion-dollar global cannabis boom. Sign up here.
Happy Friday!
This week was dominated by a slew of cannabis earnings. Two of the biggest kahunas, Tilray and Canopy Growth, reported larger losses than expected causing their share prices to tumble and weighing on the sector as a whole.
My colleagues at Markets Insider have more on Tilray, which beat expectations for revenue but showed a much larger than expected loss. Canopy Growth, for its part, took a whopping $1.28 billion loss for the quarter, its first without former CEO Bruce Linton at the helm.
Beyond earnings, we got fresh details on cannabis-delivery startup Eaze's hunt for more VC money, and spoke to the CEO who got Credit Suisse on board with cannabis.
I'm also excited to announce that in several weeks BI will be hosting its first ever cannabis webinar with marijuana analytics company Headset.
Earlier this year, Headset raised $12 million and inked deals with market research firm Nielsen and accounting firm Deloitte.
You can join Headset CEO Cy Scott in an exclusive BI Prime webinar on September 5th at 2 PM EST as he takes readers through his pitch deck and explains how he convinced VCs, including early Juul investor Poseidon Asset Management, to buy in.
Poseidon partner Emily Paxhia will also weigh in about the unique challenges of investing in cannabis and how she picks winners in a crowded market. I'll be moderating the conversation. You can sign up here.
I'll be off next week, so the next edition of Cultivated will hit your inbox on August 30. I'll be canoeing down a section of the Yukon River in Northern Canada for a week with a couple buddies, so please wish me luck!
-Jeremy
More stories from around the BI newsroom:
Buzzy cannabis-delivery startup Eaze is looking to raise a new round that could value it at $400 million
We got the details on Eaze's new fundraising round.
The buzzy cannabis delivery startup is making the rounds to mainstream VCs and cannabis-specific funds, looking to raise $50 to $75 million. The new round comes just months after the startup raised $65 million.
Cannabis could become a $60 billion industry in the US. That's more than double the market for vitamins and supplements.
Legal cannabis in the US could become a $60 billion market if federal prohibition is repealed, according to a new report from the Toronto-based investment firm Echelon Wealth Partners.
That's more than double the total market for vitamins and supplements in the US.
A group of Wall Street veterans just raised $250 million to chase down deals in the red-hot cannabis sector. Its CEO explains how it got Credit Suisse on board.
Silver Spike Capital last week raised $250 million for a cannabis-focused investment firm through a special purpose acquisition company or SPAC. Credit Suisse acted as the sole book-runner on the SPAC, becoming the first bulge bracket investment bank to lead a US cannabis offering.
The firm is expected to raise additional capital over the next year for a direct lending arm, a private equity fund, and a hedge fund for public markets opportunities, CEO Scott Gordon told me in an interview.
Capital raises, M&A activity, partnerships, and launches
- Canopy Rivers, the VC arm of Canadian marijuana giant Canopy Growth, has received conditional approval to list on the TSX Venture exchange. I interviewed Canopy Rivers' President, Narbe Alexandrian, in February about his market outlook.
- Cannex and 4Front officially closed their merger, creating 4Front Ventures. See my interview with Josh Rosen, 4Front's CEO, from back in December when the merger was first announced.
- Cannabis agricultural technology company Seedo is entering into a partnership with Namaste Technologies, to introduce Seeod's home-growing device to European markets.
- NASDAQ-listed CBD company Neptune Wellness Solutions has closed its acquisition of Sugarleaf.
- Front Range Biosciences, an agricultural tech company focused on cannabis, is acquiring Steep Hill's genomics research and development team.
Executive moves
- Auxly Cannabis Group Inc. President Hugo Alves will succeed Chuck Rifici as CEO, effective August 27. Rifici co-founded Tweed Marijuana Inc, the company that became Canopy Growth, with Bruce Linton.
- Former MedMen COO Ben Cook has joined Calyx Peak Capital as its COO. I interviewed Calyx Peak's CEO Ed Schmults in December.
- Stevens J. Sainte-Rose, a veteran of Coca Cola and Walgreens, will join Surterra Wellness as chief human resources officer.
Chart of the week
This one comes from Echelon Wealth Partners analyst Matthew Pallotta. Using data from market research firm Euromonitor, Pallotta estimates the potential size of the US cannabis market as an approximately $60 billion consumer category, when (or if) federal prohibition is repealed.
That could be a conservative estimate, as Pallotta notes, because more consumers may come into the fold as THC and CBD-containing products enter the mainstream.
"We note that one of the most unique and attractive aspects of the burgeoning cannabis category, relative to
other high-growth consumer segments, is that significant demand for the products already exists," Pallotta wrote in his report.
Shayanne Gal/Business Insider
Stories from around the web
Shayanne Gal/Business Insider
California's largest legal weed farms face conflict in wine country (NPR)
Lender to fund container pot shops on Canadian indigenous lands (Bloomberg)
Joe Biden is coming for your legal weed (Vice)
Hemp becomes a booming crop for New York farmers (WSJ)
Ads pitching CBD as a cure-all are everywhere. Oversight hasn't kept up. (NYT)
Mag Mile high: Cannabis companies are scouting Michigan Avenue for pot shops (Chicago Tribune)
'Just not selling': Canopy's results take hit as some retailers struggle to move oil and gel products (Financial Post)