December 10 2022,
THE BIG IDEA
A bit late this week so let’s get to it:
- Yes, Cann has a plan
- Senate GOP kills SAFE banking
Hope you find it valuable,
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WHAT YOU MISSED IN WEEDWEEK CALIFORNIA PRO
Microdose beverage brand Cann loses money on every can it sells. When you’ve sold more than 10M — more units than any other infused drink brand, co-founder Luke Anderson says — that begins to add up.
The losses are under control, Anderson told WeedWeek. He said Cann is in the midst of a “predictable shrinking burn,” as it bets the groundwork it has laid will soon start paying off.
Despite this small footprint, Cann has become one of the best known brands in weed. This owes in part to Hollywood fashionista investors like Gwyneth Paltrow, Rebel Wilson and Rosario Dawson (who sits on the Cann board) and its stylized queer-centric advertising.
It has also attracted more than its share of haters. Comments from Luke that Cann targets “the future consumer” can rub OGs the wrong way. There’s also a fair amount of wondering how Cann expects to make money when it charges $24 for a six-pack containing 12 mg of THC. That’s $2/mg, more than 13x the price per mg in a $15, 100mg pack of gummies.
SAFE BANKING REMOVED FROM DEFENSE LEGISLATION
Industry hopes that federal banking reform would be included in a must pass defense bill fell flat this week after Senate Republicans undermined it.
- Minority leader Mitch McConnell (R-Ky.) described it as “making our financial system more sympathetic to illegal drugs.”
The bill in question had bipartisan support and included banking, gun rights and criminal record expungements
The next chance to pass banking reform comes up this week with the omnibus spending bill.
- The bill is reportedly close to the 60 votes it would need to pass the Senate in a standalone vote.
If banking reform doesn’t pass in this month’s lame duck session we may be waiting for a while. Republicans take control of the House in January 1.
- WNBA star Brittney Griner returned home after her 10-month imprisonment in Russia. The U.S. swapped her for notorious arms dealer Viktor Bout.
- Many retailers scrambled after mainstream financial providers shut off “cashless ATMs” this week.
- MSO Curaleaf violated federal law when it refused to bargain with a union in Illinois, a National Labor Relations Board panel found.
- The Wall Street Journal looks at the failures of equity programs.
- Nationwide, sales growth was generally anemic in October.
New Cannabis Ventures, CNBC
- LA law firm Dovel & Luner filed its third proposed class action lawsuit alleging inflated THC content on a California preroll brand’s labels. This one’s against Shryne Group, parent of brand Stiiizy. Unlike Dovel’s previous two lawsuits, against Jeeter and King Roll (StateHouse, formerly Harborside), this one cites independent lab tests rather than WeedWeek reporting. Stiiizy did not respond to requests for comment.
- Weeks after CEO Chris Beals’ departure, Weedmaps said it was laying off 175 employees, roughly 25% of its staff. The stock is down 80% on the year.
- The Boston Globe reports on Hop Latent Viroid. This highly transmissible and hard to detect blight hurts bud quality and yield, but has no known effect on human health. Researchers found that between 2018 and 2021 90% of California grows had at least some infected plants. It is now becoming common in Massachusetts.
State and Local:
- In its long awaited social equity lottery, Los Angeles selected 100 social equity applicants who can apply for retail licenses. Unlike in New York, a federal judge declined to stop the lottery on account of a lawsuit from a Michigan party suing to access to the market.
- A Portland Ore. business is selling ‘shrooms at retail, which the state doesn’t allow.
- In growing hub Santa Barbara Co. Dutch carbon filters are helping with odor issues.
- The Columbian Senate passed a legalization bill. The country’s industry hopes to become a significant exporter, which could make it a threat to North American growers.
Fun and interesting:
- Lindsey Bartlett checks out PAX Buds hash-infused flower pressed into bricks for the company’s devices.
- California brand accelerator Petalfast secured Eagle Eyes Transport as a distribution partner in Massachusetts.
- MSO Jushi borrowed $69M at 12%, with warrants.
- MG Retailer released its list of best industry employers.
- The N.Y. Times checks out the New York Growers Cup.
- Cannabis Now previews this weekend’s 2022 Harvest Ball in Sonoma County, California.