Narbe Alexandrian did not see COVID-19 coming, and that’s okay. As chief executive officer of the cannabis venture capital firm Canopy Rivers (RIV.TO), he’s not in the business of predicting pandemics.
What he did see prior to 2020 were cracks forming in the business model that has dominated legal cannabis in Canada since its inception: vertically-integrated licenced producers.
Many of the largest cannabis players were having a tough 2020 before the economic wallop of COVID-19. So far, the year has been marked by mass layoffsand lacklustre financial results. Producers face scarce financing options, unforgiving capital markets and resilient illicit sales.
Plans for global expansion and trial-backed pharmaceuticals years in the making have been shelved as investors demand tighter controls on spending and clearer paths towards consistent profits. Just about everyone is pulling back.
For Alexandrian, it’s proof of something he’s been saying for a while now.
“Vertical integration doesn’t work,” he told Yahoo Finance Canada in an interview. “Prior to legalization, because of how the public markets were valuing these companies, everyone had to increase their footprint as quickly as possible. They invested in cultivation, extraction, consumer packaged goods, pharma with clinical trials, pet health, biosynthetics, and they bought retail stores as well. You can’t be everything to everyone.” [Read More @ Yahoo]
Your email address will not be published. Required fields are marked *
Save my name, email, and website in this browser for the next time I comment.
Notify me of follow-up comments by email.
Notify me of new posts by email.
by Hilary Bricken, Principle at Harris Bricken Not many people get excited about revisions and updates to the very dry National Institute of Standards and Technology (“NIST”) handbooks. For example, the NIST 44 Handbook contains the “Specifications, Tolerances, and Other Technical Requirements for Weighing and Measuring Devices.” The handbooks are adopted every year at the…
PRESS RELEASE SOUTH SAN FRANCISCO, Calif., Jan. 20, 2022 /PRNewswire/ — Dama Financial (“Dama”), the nation’s largest provider of access to banking and payment solutions for the cannabis industry, has entered into an agreement to acquire GrowFlow Corp. (“GrowFlow”), whose business management and compliance tools have processed more than $3.3 billion for cannabis retailers, cultivators, processors, and distributors. Combining Dama’s…
At the tail-end of our recent phone interview, I mentioned to Leonard Tannenbaum, founder, partner, and CEO of West Palm Beach, Florida-based AFC Gamma (NASDAQ: AFCG), that the term “boutique REIT” had popped into my head as he was explaining how AFC goes about its business and how it differentiates itself from other REITs in…
CLEVER Leaves, a multinational global cannabis producer, has been granted a licence to more than double its cultivation facility in Portugal as it looks to Europe to help boost revenues after a difficult debut year as a listed company. In December, the company announced that the Portuguese health authority Infarmed had greenlit the expansion of…