3 Private US Cannabis Companies That Are Gaining Serious Marketshare In Their Respective Cannabis Sector Verticals

3 Private US Cannabis Companies That Are Gaining Serious Marketshare In Their Respective Cannabis Sector Verticals

During the last year, we have seen a substantial increase in interest in the US cannabis market and this is a trend that is expected to continue.

Although the market was previously highly focused on the opportunity that is associated with public cannabis companies, we have been closely following the private cannabis market and are impressed with the level of quality on this side of the industry.

Today, we want to highlight 3 private cannabis companies that are highly focused on the US cannabis market. Going forward, we expect these businesses to evolve into leading operators and believe that these are opportunities to be aware of.

Gage Cannabis: Capitalizing on the Michigan Market

Earlier this year, Michigan legalized recreational cannabis and the state has been reporting impressive sales numbers since then. One of the reasons we are excited about the Michigan cannabis market is related to how it is structured from a license standpoint. Michigan is a limited license recreational cannabis market and we are favorable on how the structure benefits operators that are levered to the state.

Gage Cannabis is a leading player in the Michigan cannabis market and is an opportunity that we are excited about. The company is led by a management team that has a proven track record of success and we are favorable on the relationships that it has formed with leading cannabis brands in the US.

Of the relationships that Gage Cannabis has formed, we are most excited about the work that it is doing with Cookies, a leading lifestyle and cannabis brand in North America. Earlier this year, Gage announced that they will open Cookies, a new flagship cannabis dispensary in the heart of Detroit and we are bullish on the amount of value that can be generated between the two businesses. We see this as an attractive relationship for Gage due to the brand power that Cookies brings and will keep an eye on how it impacts the story over the long-term.

The Cookies store will be operated by Gage in an exclusive partnership with Cookies. In addition to the new Cookies dispensary, Gage will dedicate significant shelf space to the display and sale of Cookies products in their current locations in Ferndale and in Adrian, as well as its soon-to-open locations in Lansing, Kalamazoo, Battle Creek, Bay City, Grand Rapids, Traverse City, Centerline, among others.

From a management team standpoint, we are favorable on Bruce Linton being appointed as the Executive Chairman of Gage Cannabis. The former founder and CEO of Canopy Growth Corporation (WEED.TO) (CGC) has a proven track record of success and we are favorable on the experience that he brings to the Gage team.

Eden Empire: A Cannabis Retailer to be Aware of

A few weeks ago, Eden Empire Inc. and Rosehearty Energy Inc. reported to have entered into a business combination agreement that will be completed through a three-cornered amalgamation between the companies and this is an opportunity that caught our attention.

Last year, we met with the Eden’s management team and left the meeting with a high-level of conviction in regards to the company’s long-term opportunity and wanted to issue an update on it. Going forward, we believe that the cannabis company is well positioned to execute on previously announced initiatives and are favorable on the direction that the management team is bringing the operation.

Eden is in the business of investments and operations in the cannabis sector and engaging in retail, cultivation, extraction and activities in respect of cannabis in Canada and the United States. Eden is expected to become a fully integrated cannabis product company in Canada and the US. The company has an award winning and established nationwide brand, a substantial intellectual property portfolio, and a dedicated management team with over 20 years of combined cannabis industry experience.

In the near future, Eden is expected to be granted approval for licenses to operate cannabis retail stores, and cultivation and processing facilities in British Columbia, Ontario and Michigan. We are favorable on these cannabis markets and expect them to prove to be substantial value drivers for the business.

Following the completion of the amalgamation, Eden is expected to commence trading on the Canadian Stock Exchange (CSE). We believe that Eden represents a differentiated opportunity and are bullish on the markets that it is levered to. Over the next year, we expect the business to significantly advance and believe that it is an opportunity to be aware of.

Fyllo: A Leading RegTech Platform

Earlier this year, we issued an update on Fyllo after it reported to have acquired CannaRegs, a website offering subscription access to state and municipal cannabis regulations. The management team has been hard at work following the acquisition and has been laser focused on launching new products and services.

Last year, we met the Fyllo team at the New Orleans Marijuana Business Dailey conference and have kept a close eye on the story since then. During this time, the company has been nothing short of an execution story and we are favorable on the way the business advance in this period.

We believe that Fyllo is in the early innings of a major growth cycle and are favorable on the experience that the management team brings to the operation. Starting the Fyllo Founder and CEO Chad Bronstein, the leadership team has a strong technology background and we believe that the strength of the team will play an important role in the success of the business. A vast majority of the Fyllo leadership team is comprised of people that Bronstein has previously worked with in his career and we find this to be significant.

Currently, Fyllo is highly focused on the US cannabis market and we are favorable on the leverage that it has to this market. There are not many advertising technology firms that have capabilities that are similar to Fyllo and we expect this to play an important role in the success of the business. During a time where business is slow, Fyllo continues to execute on previously announced initiatives and we believe that it is an opportunity to be aware of.


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Authored By

Anthony Varrell

Anthony Varrell is Managing Director of StoneBridge Partners LLC. SBP continues to drive market awareness for leading firms in the cannabis industry throughout the U.S. and abroad.

Published at Tue, 05 May 2020 11:49:49 +0000

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