AP Photo/Richard Vogel
A customer smokes a joint while having a salad at Lowell's Original Cannabis Cafe in Los Angeles.
Welcome to Cultivated, our 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 to get it in your inbox every week. If you want a discount to BI Prime to read my stories, sign up here!
Happy Friday,
Welcome to another edition of Cultivated! We're back after a week off for (American) Thanksgiving.
Across the industry, the story's the same: public cannabis companies are getting hammered, deals are stuck in the mud, but more people all over the world are buying cannabis legally every day.
To that end, Michigan made the first legal marijuana sales in the Midwest on Sunday. Illinois will follow shortly after on January 1. And countries as far-flung as New Zealand are weighing legalization bills.
In other news, I'll be at MJBizCon in Las Vegas next week. My schedule will obviously be pretty crazy but please get in touch if you'll be there and want to talk.
Last, we're continuing to report on the wave of layoffs in cannabis. If you have a tip, please send me an email. We can talk about moving our conversation to Signal, an encrypted chat app, or even going on background or off-the-record.
-Jeremy
Here's what we wrote about this week:
The CEO of the top-selling cannabis shops revealed how a strategy he shares with Starbucks is crucial to his success
Despite maintaining a low profile, the New York City-based cannabis company Ayr Strategies can boast about at least one superlative: Its dispensaries make more money than the competition, according to a report from the industry data provider BDS Analytics.
We talked to the company's CEO, the Wall Street veteran John Sandelman, to figure out why.
Wall Street stock traders are piling into bets against cannabis stocks, even as shares have plummeted
Traders are still bearish on cannabis stocks after months of turmoil in the industry. A report from the financial analytics firm S3 Partners showed that investors were increasing their bets that the stocks would fall, a practice known as short selling.
Shorts have added a net $1.4 billion of short positions in cannabis companies this year, according to S3 data through November 20.
You can now officially purchase legal marijuana in Michigan. Here are all the states where marijuana is legal.
Michigan residents can now purchase marijuana legally. Marijuana dispensaries opened for business in the state on December 1, marking the first day of legal recreational marijuana sales in the Midwest.
Illinois will soon follow. Governor JB Pritzker signed a legal marijuana bill into law in June, and recreational sales will start January 1.
Capital raises, M&A activity, partnerships, and launches
- Canopy Growth unveiled its full lineup of "Cannabis 2.0" products, including vape pens, CBD and THC-infused beverages, and chocolates. The company said it will stagger the rollout of products to "ensure a smoother rollout" and they'll start hitting shelves in Canadian dispensaries in January 2020.
- Cannabis infusion tech startup Vertosa closed a $6 million seed funding round, co-led by California-based AFI Capital Partners and New York City-based Welcan Capital.
- Chicago-based cannabis startup Leaf Trade raised a $4.5 million seed round led by Hyde Park Angels and Duke Software Investments.
- GrowGeneration Corp., a chain of specialty retail hydroponic centers, began trading on the NASDAQ on Monday.
- Kevin Durant's Thirty Five Ventures is joining the board of Toronto-based cannabis investment firm Canopy Rivers.
- Rapper Lil' Wayne is joining his former protegee Drake in hawking cannabis products. Weezy rolled out his brand, GKUA Ultra Premium, in which the high-THC products are tasted and approved by "Lil' Wayne himself."
Executive moves
- Former Canndescent CFO Tom DiGiovanni is joining Harborside as the company's new CFO. Former Harborside CFO Keith Li is staying on as VP of Finance.
- Holly Hamman is joining cannabis payroll startup Wurk as the company's CMO. She joins Wurk from Automox, a cybersecurity company.
- Katy Dickson, a former Mattel and General Mills exec, is taking over as president of Manitoba Harvest, which was acquired by Tilray earlier this year.
- Bhang's interim president, Jamie Pearson, is taking over as CEO.
- Alex Shah is joining Akerna as the company's CTO.
- Former Beboe CMO Kiana Anvaripour is joining Sweet Flower as the company's new CMO.
Chart of the week
Despite the tumult in the public markets, cannabis legalization is spreading around the US. Michigan started recreational cannabis sales on December 1, and Illinois is set to start January 1:
Shayanne Gal/Business Insider
What I'm reading
Hemp industry is cleared to do business with banks (New York Times)
I was a CBD guinea pig (Slate)
Cannabis in the Caribbean Part 1: Change is coming (Cannabis Wire)
Deals dry up with pot stocks limping into year end (Bloomberg)
He went from buffalo wings to cannabis and became the talk of L.A.'s marijuana industry (Los Angeles Times)
Did I miss anything? Have a tip? Just want to chat? Send me a note at jberke@businessinsider.com or find me on twitter @jfberke.
Featured Digital Health Articles:
- Telehealth Industry: Benefits, Services & Examples
- Value-Based Care Model: Pay-for-Performance Healthcare
- Senior Care & Assisted Living Market Trends
- Smart Medical Devices: Wearable Tech in Healthcare
- AI in Healthcare
- Remote Patient Monitoring Industry: Devices & Market Trends