Marijuana Business Magazine August 2019

Marijuana Business Magazine | August 2019 16 What would you say is the company’s/your biggest cannabis investment mistake, and what did you learn from it? The biggest mistake is that, in the early days, we focused on our short-term revenue as a company instead of taking more upside in the companies that came through. We had the opportunity to get upside in companies like Eaze, Ebbu, Tokyo Smoke, MedMen, Harborside, MJardin, Pax (Labs)/Juul, MJ Freeway, Anandia Labs and many more. But when they were coming through, we were a bootstrapped company and couldn’t sacrifice current revenue in exchange for upside. Luckily, we were able to still build the broadest portfolio in the sector with upside in more than 100 companies—but I kick myself every day for not figuring out another way to fund the company in the early days so we could have taken upside instead. Which cannabis sectors are you and Arcview particularly excited about right now? And which ones should perhaps be avoided? It’s hard not to be excited about the potential of the CBD market. The growth potential and the lack of legal barriers is remarkable, but there is a lot of hype snake oil in that market, so it is not for the faint of heart. This is also a very important time for anything involving solid IP. Things like genetics, finding uses for minor cannabinoids, creating products that have specific effects or changing the form of how cannabis is consumed. I think cultivation should be avoided. I know it is where most of the money is being made right now, so there could be a momentum play there. But if you are investing for building long-term value, it’s not in cultivation. Cannabis will eventually become a commodity BIG HITS Green Thumb Closes $105.5 Million Debt Financing Green Thumb Industries, a Chicago-based vertically integrated cannabis company, closed a $105.5 million debt financing, which will be used for general capital purposes, strategic initiatives and to retire existing debt. The company has licenses for 78 retail locations and 11 manufacturing facilities across 12 markets. Surterra Wellness Closes $100 Million Offering Surterra Wellness, a multistate medical cannabis company based in Atlanta, closed a $100 million share offering whose net proceeds will be used to fund acquisitions and capital expenditure. The company, which has operations in Florida, Massachusetts, Nevada and Texas, has been on an expansion spree, announcing a $100 million biosynthesis licensing deal with Intrexon on June 18. The $100 million raise follows a Surterra funding in November of almost $55 million as part of an overall plan to raise $165.5 million. Trulieve Raises $70 Million of Debt Financing Trulieve, the market leader in dispensary operations in Florida, closed a $70 million debt capital raise with net proceeds from the offering to be used for capital expenditure, acquisitions, indebtedness repayment and general corporate purposes. Trulieve, which is expanding into California, Connecticut and Massachusetts, currently operates 29 medical marijuana dispensaries in Florida with licenses for up to 49 such facilities. Jushi Concludes $68.2 Million Equity Raise as It Starts Trading on NEO Jushi Holdings, which commenced trading on the NEO Exchange in June, closed a raise of $68.2 million at the time the company went public. The money will be used for working capital. Jushi operates the Mend Nutraceuticals CBD brand that is currently sold in New York. Cresco Capital Closes $60 Million Raise Cresco Capital Partners closed a $60 million raise for its CCP Fund II, $10 million more than the cannabis fund’s initial target. The firm deploys capital across the marijuana industry, from plant-touching companies to ancillary services. MediPharm Raises Almost $60 Million in Share Capital MediPharm Labs, a Canadian infused product manufacturer, raised a total of $56 million (CA$75 million) in a share offering. Net proceeds will be used to fund ongoing capital expenditures at the company’s Canadian and Australian facilities for domestic and international expansions, research and development and general corporate purposes. Money Matters | Nick Thomas