Converting Demand vs. Creating Demand

Investing in the cannabis space, quite often I receive the question “why did you choose to focus your investment group on cannabis?”

“Invest in what you know” is a solid answer but there was available and obvious data that was very helpful. In early stage investing you invest in companies with a new or novel product or service. Inevitably, the question of demand for the product or service needs to be addressed. Who uses the product? Will they continue to use it and if they do, how will they use it? You see where I’m going here?

Cannabis has been used by a silent majority for thousands of years and with each year that passes, the silence is evaporating into an unapologetic consumer base finding new and useful ways to enjoy the plant.

Most early stage companies are out driving new demand for the product. Cannabis companies have an opportunity to not only create new demand but to convert existing demand. Creating demand by bringing new users out of their silence or by trying cannabis products for the first time (or again). Converting existing demand through an existing user base that already purchases and uses the products through legacy channels. Most new industries have the former but not the latter. That opportunity was (one of) the deciding factors.

Sending Updates To Our Membership

Four times a year we send out an update to our entire membership. Today we sent the second update for 2023.

As a reminder, we operate a syndicate (or group of investors) that evaluate and opt to invest on a deal-by-deal basis. While members will receive confidential updates about the companies they choose to invest in, this update is sent to the entire membership. This is a chance for us to communicate with everyone who has shown interest in our thesis and investment strategy.

We typically follow this format:
1. Top of Mind - This is an opportunity for our Syndicate Lead to address the most impactful current topic for the syndicate.

2. Portfolio Updates - Quick hits on the companies we have invested in (concentrating mostly on publicly available information).

3. Informative Cannabis Industry Reads - I highlight a handful of articles from the last 2-3 months that cast a wide net as it relates to the cannabis consumer, removing the stigma, criminal justice and social equity and more. I try to be mindful that most people in our membership are not obsessing about cannabis everyday like we are.

This update’s Top of Mind focuses on revisiting our investment strategy. After 2 years, we thought it was important to maintain transparency with our investors and broaden membership. We wanted to share an excerpt from a this most recent update that fires us up:

“We are undeterred by the recent challenges that face the industry. This risk is built-in. We maintain strong conviction about our investment strategy, albeit, at a slower pace than originally anticipated. But most importantly, we have the strongest conviction in our portfolio companies who all find themselves in strong positions during challenging times.”

Trustworthy Advisors for Early Stage Cannabis Companies

Our advisory practice is focused on early stage companies. Our collective experiences punch above their weight class for this group of companies. We offer our services to a wide range of industry sectors from cultivation to software companies and everything in between.

We like to work with companies who value our time just as much as we value theirs. After spending a combined 15 years in the cannabis industry, here are a few things that make us different.

1. You can trust us.

2. We’re effective, respectful communicators.

3. We’re results-driven strategic thinkers.

4. We’re professionals. We don’t put up with nonsense.

5. We care about facts backed by data.

Please contact us at the link the comments section if you'd like to discuss working with us.

Real Ones Only.

No Nonsense.