Cannabis Health Startup
The German company, Sanity Group, has closed on $44 Million Series A financing led by a Swiss VC and US-based Navy Capital and SOJE Capital. This brings the total investment in Sanity Group to $73 Million. Sanity’s cannabis-based platform is for mental health and chronic pain management, allowing the tracking of cannabis-based therapy digitally with a device. This device tells customers how much of the active ingredient (THC or CBD) is being administered. This is then registered in a therapy diary and allows for accurate tracking of dosage. Finn Age Hänsel, founder and managing director of Sanity Group, said: “A round of this magnitude shows that cannabis is increasingly moving into the mainstream of investor awareness, and represents an important milestone in our business expansion on our way to becoming Europe’s leading cannabis company.”
Sean Stiefel, CEO at Navy Capital, said: “The European cannabis market faces exciting developments in the coming months. Compared to the North American market, Europe is now where we were in the U.S. about four years ago. We want to bring our expertise and experience to the table. For our first investment in Europe, it was important for us to find a team that understands the market and has real industry experts in its ranks.” In the coming few years, this same technology will likely come to the US when similar adoption to Europe occurs.
Weedmaps SPAC
WM Holding Company, a leading tech and software provider to the cannabis industry, announced that it had completed its previously announced business combination with Silver Spike Acquisition Corp. The company was founded in 2008 and operated Weedmaps.com, a leading online listing marketplace for cannabis consumers and businesses. WM came under scrutiny in CA when they were listing illicit dispensaries on their site, a practice which they claim they've since eliminated. One must have a license number to list it on their website. WM has a history of growth since its inception. From the fiscal year 2014 through 2020, the Company grew revenue at a CAGR of 35% and expanded its gross margin rate from 92% to 95%. For the year ended December 31, 2020, WMH generated $162 million of revenue, net income of $39 million, and Adjusted EBITDA of $43 million. The transaction provides $579 million of proceeds comprised of $254 million of cash from SSPK’s former trust account and $325 million of cash from private investment in public equity (PIPE). The ticker symbol will switch from SSPK to MAPS sometime on June 16.
GM May Follow AMZN
After Amazon recently removed their drug test for employees, GM will consider it as well. Companies have faced significant challenges in finding employees to work in plants. GM needs to hire 450 temporary part-time employees at their Flint plant and another 275 at Fort Wayne. A GM spokesperson said the action is something that is being "discussed internally." The labor shortage has accelerated the inevitable acceptance of cannabis usage among workers in large corporations. These actions taken will most likely be permanent even past the labor shortage.
Clever Leaves forays into Mexican market via CBD Life partnership
CLVR entered into an active pharmaceutical ingredient supply agreement with CBD Life Holding SAPI de CV, an emerging leader in the Mexican cannabis industry, which offers a line of CBD Wellness and consumer products and medical cannabis products which are under development. Under the agreement, Clever Leaves will act as the API supplier to develop and manufacture CBD Life's medical cannabis products. Starting with CBD isolate, Clever Leaves targets the ongoing supplier of the required APIs for CBD Life's product manufacturing purposes. This marks its first commercial agreement in the Mexican market; CBD has significant distribution in Mexico with 18K+ points of sale. The medical cannabis market in Mexico could be worth $60M by 2024, as per Prohibition Partners for Latin America and the Caribbean (2020) report.
