Cannabis is now a commodity, but commercial realities are kicking in
Published 18-APR-2019 14:43 P.M.
3 minute read
Hey! Looks like you have stumbled on the section of our website where we have archived articles from our old business model.
In 2019 the original founding team returned to run Next Investors, we changed our business model to only write about stocks we carefully research and are invested in for the long term.
The below articles were written under our previous business model. We have kept these articles online here for your reference.
Our new mission is to build a high performing ASX micro cap investment portfolio and share our research, analysis and investment strategy with our readers.
Click Here to View Latest Articles
Colorado opened the world’s first regulated recreational marijuana marketin 2014. That’s some five years ago.
A lot has changed since then, with regulations now extending to global markets and businesses opening up, on what seems to be almost a weekly basis.
According to Mark Bernberg of the Greenfund, “the global cannabis market is thought to be worth US$150 billion today. Barclays, in their European Consumer Staples Report in September 2018, suggests that this figure could increase to US$272 billion by 2028.
Clearly, cannabis is now a growing legal commodity and that means proper business practices need to be put in place.
Payroll, taxes, HR, proper financial management, product advertisements and everything else that comes with running a business is now in play.
However, the business climate for weed companies is difficult as they are slugged with high taxes, constantly changing regulations and deals that continue to be done within the illicit market.
The majority of companies are still made up of either growers or product manufacturers, think your edibles, topicals etc...
However, a new subset is emerging: facilitators.
As you may have read on Finfeed recently, EN1 has moved into the cannabis advertiser space after launching a product specifically designed to provide cannabis brands and advertisers with a medium to access display, video and native inventory.
Jadeo is an online platform that has seen a gap in cannabis advertisements and sought out to create a space where professionals, community members and those seeking more knowledge, can share experiences and information on Cannabis. We will look more in depth at Jadeo in a later article where we more fully examine marketing and advertising within the industry.
Hypur Inc. has an electronic payment technology that will now be accepted statewide in California for marijuana-related businesses (MRBs) and consumers of cannabis products.
Marijuana-related businesses throughout California will be able to accept electronic payments with Hypur, as well as request payments from suppliers. Meanwhile, consumers of cannabis products can use Hypur to pay for cannabis securely.
Without access to credit and debit card processing, the cannabis industry is forced to rely on cash or unreliable work-around payment products that put consumers information at risk, so a service like this is highly welcome.
"Herbl is ecstatic about the addition of Hypur to the California cannabis ecosystem. Hypur will allow the cannabis industry to thrive in the state with accessibility to secure marijuana-related purchases,” said Mike Beaudry, CEO of Herbl.
The industry is rapidly growing and those who fail to adopt proper business practices or embrace technologies that can expand their reach, will thrive. Those, who don’t, will die.
Some fear the suits are taking over. Yet the suits provide necessary business acumen to ensure that the cannabis industry maintains its multi-billion dollar trajectory.
For those start-ups in the cannabis industry, it’s time to act like a business.
General Information Only
S3 Consortium Pty Ltd (S3, ‘we’, ‘us’, ‘our’) (CAR No. 433913) is a corporate authorised representative of LeMessurier Securities Pty Ltd (AFSL No. 296877). The information contained in this article is general information and is for informational purposes only. Any advice is general advice only. Any advice contained in this article does not constitute personal advice and S3 has not taken into consideration your personal objectives, financial situation or needs. Please seek your own independent professional advice before making any financial investment decision. Those persons acting upon information contained in this article do so entirely at their own risk.
Conflicts of Interest Notice
S3 and its associated entities may hold investments in companies featured in its articles, including through being paid in the securities of the companies we provide commentary on. We disclose the securities held in relation to a particular company that we provide commentary on. Refer to our Disclosure Policy for information on our self-imposed trading blackouts, hold conditions and de-risking (sell conditions) which seek to mitigate against any potential conflicts of interest.
Publication Notice and Disclaimer
The information contained in this article is current as at the publication date. At the time of publishing, the information contained in this article is based on sources which are available in the public domain that we consider to be reliable, and our own analysis of those sources. The views of the author may not reflect the views of the AFSL holder. Any decision by you to purchase securities in the companies featured in this article should be done so after you have sought your own independent professional advice regarding this information and made your own inquiries as to the validity of any information in this article.
Any forward-looking statements contained in this article are not guarantees or predictions of future performance, and involve known and unknown risks, uncertainties and other factors, many of which are beyond our control, and which may cause actual results or performance of companies featured to differ materially from those expressed in the statements contained in this article. S3 cannot and does not give any assurance that the results or performance expressed or implied by any forward-looking statements contained in this article will actually occur and readers are cautioned not to put undue reliance on forward-looking statements.
This article may include references to our past investing performance. Past performance is not a reliable indicator of our future investing performance.