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Ionic Is Shifting The Approach To Consumer Brands In The U.S.

Jul 18, 2019 • 11:24 AM GMT+0000
4 MIN READ  •  By Anthony Varrell
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2019 has been a banner year for the US cannabis industry and this is a market that we have been closely monitoring.

Although one of the most popular ways to engage in the US market is through multi-state cannabis operators, we believe that the costs associated with these operators are astronomical and believe that there are better ways to capitalize on the US market.

If you are a vertically integrated cannabis operator in the US, you are responsible for the cultivation of cannabis, the processing of cannabis and the quality assurance testing of cannabis flower for the market.  Vertical integration also means product development, formulation and processing the dried flower into products like extracts and edibles. And finally, fully vertically integrated means operating retail outlets in the same state. The operational diversity in terms of human and capital costs are significant – and that’s just for ONE state.

To be a multi-state operator, you will need hundreds of millions of dollars to successfully scale the business along the entire line of operations and this still might not be enough capital to effectively execute within increasingly competitive State markets.

When we look at the current landscape of the US cannabis industry, we believe that the companies that own leading cannabis brands in multiple states will have an excellent opportunity but in a manner that is much less capital intensive than the MSO’s. These brand focused companies are not burdened by activities or capital requirements MSO’s have with the cultivation of cannabis crops, the building out of multi-million-dollar grow facilities, the arduous licensing process, and much more.

Although many people will assert that these multi-state operators have valuations that exceed $1 billion, the same argument can be made for future value of Mulit-State brands. Earlier this year, cannabis brand “Select”, a leading cannabis concentrate brand, was acquired for approx. $1 billion which proves that there is huge value in creating a leading cannabis brand.

Cannabis concentrates are the most attractive vertical of the cannabis industry link to your previous article and this product category has been recording strong growth on a year-over-year basis. This is a trend that we expect to continue in the years ahead and you don’t need to take our word for it since data providers like ArcView, BDS Analytics, and Headset have released data that reinforce our thesis.

According to ArcView, cannabis flower generated $4.2 billion in sales in 2017 while cannabis concentrates generated $1.9 billion in sales and edibles generated $1.0 billion in sales. By 2022, cannabis flower is predicted to be a $10.5 billion market, with cannabis concentrates expected to also be a $10.5 billion market and edibles to be $4.1 billion market.

We are favorable on the impact that the trends in cannabis concentrate growth will have on the companies that building brands in the cannabis concentrate and edibles in multiple-States and have been focused on identifying companies that will be benefit from these changes.

Ionic Brands (IONC.CN) (IONKF) is led by a management team that was able to identify and adapt to this transition and has been able to penetrate some of the most competitive cannabis markets by building and acquiring a portfolio of leading cannabis brands. The company has been highly focused on the cannabis concentrates with thier brands “Ionic” and “M” Stick and and edible products Zoots. The Company has grown from a base in Washington State down through the entire west coast into Oregon, California and Nevada.

When it comes to the branding opportunity for cannabis products, Ionic Brands is a proven operator that has been able to capitalize on the medical and recreational cannabis concentrate opportunity in multiple major markets. We believe that Ionic Brands has been executing on a national expansion plan and has had its finger on the pulse of the cannabis market.

If you interested to learn more about Ionic, MG Magazine, a publication serving the cannabis industry professional interviewed the Company. You can find the article hear:

Ionic Is Changing the Face of Cannabis and Creating a Social Revolution

https://mgretailer.com/business/marketing-promo/ionic-is-changing-the-face-of-cannabis-and-creating-a-social-revolution/

If you are interested in learning more about Ionic Brands, please reach out to support@technical420.com.

 

 

Pursuant to an agreement between StoneBridge Partners LLC and Ionic Brands Inc. we have been hired for a period of 90 days beginning July 11, 2019 and ending October 11, 2019 to publicly disseminate information about (IONC) including on the Website and other media including Facebook and Twitter. We are being paid $6,666 per month (IONC) for or were paid “ZERO” shares of unrestricted or restricted common shares. We own zero (0) shares of (IONC), which we purchased in the open market. We plan to sell the “ZERO” shares of (IONC) that we hold during the time the Website and/or Facebook and Twitter Information recommends that investors or visitors to the website purchase without further notice to you. We may buy or sell additional shares of (IONC) in the open market at any time, including before, during or after the Website and Information, provide public dissemination of favorable Information.

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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.

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