Happy Valentine's Day Cultivated readers,
We've been very aware that V-Day was around the corner for a while now because of all the themed press releases that have been sent our way. From pre-rolls in the shape of actual flowers to cannabis-based massage oil, there seems to be a lot out there for all the romantics.
Anyhow, let's get down to it.
We've updated our list of ongoing layoffs in the cannabis industry again this week with the addition of Supreme Cannabis, which cut around 15% of its workforce on Tuesday. And with Aurora's 500 cuts last week , our tally for cannabis layoffs stands at around 2,000.
Canopy Growth and Aurora Cannabis also reported earnings this week. Aurora's earnings, analysts say, were no surprise after the guidance they released last week.
Both Canopy Growth and its venture capital division Canopy Rivers posted quarterly earnings this morning, which we covered in our article here.
Canopy Growth surprised investors with a 49% jump in net revenue to C$123.8 million in the last three months of 2019. Canopy's stock soared about 12% in trading and other companies, like Tilray and Aurora, rode the wave as well.
Jeremy's off skiing in Utah this weekend, so Yeji is on point for earnings coverage. More to come!
-Jeremy and Yeji
Here's what we wrote about this week:
The buzziest startup in cannabis doesn't even sell marijuana.
Flowhub, a cannabis-tech company that helps retailers track inventory and process sales, topped Business Insider's recent list of the hottest startups in the industry. Founded in 2015, Flowhub has raised $27 million from investors and now works with more than 900 dispensaries in the US.
The US cannabis industry is projected to reach $85 billion by 2030, up from $51 billion now, and Flowhub which already operates across 12 states is set to benefit as more states legalize cannabis.
Legal cannabis is strenuously tracked, according to Flowhub founder and CEO Kyle Sherman. He said he likes to tell lawmakers on Capitol Hill that the US tracks legal cannabis better than it does uranium.
The once red-hot cannabis industry is coming back down to earth.
In the past few months, cannabis companies including venture-backed startups like Pax and giants like MedMen have announced a series of job cuts, amounting to over 2,000 workers in the sector as a whole.
Supreme Cannabis, a Canadian cannabis grower, on Tuesday said it was eliminating 15% of its workforce , including one-third of corporate positions, in an effort to cut costs.
We're continuing to keep track of layoffs in the industry here. Please get in touch if you have a tip.
The world's biggest cannabis company just gave a huge signal that the cannabis downturn may be coming to an end
Canopy Growth's latest earnings may just be signaling the end of the long downturn in the cannabis industry.
In its financial results on Friday, the company reported an unexpected 49% jump in net revenue to C$123.8 million in the last three months of 2019. The company also reported a narrower loss than analysts expected, according to estimates collected by Bloomberg News. That sent the stock soaring about 12% in trading on Friday.
The results come as a sign of good news for the industry. Other cannabis firms that have faced a difficult few months also saw their stocks rise.
Capital raises, M&A activity, partnerships, and launches
- European medical cannabis cultivator Sanity Group closed a $22 million Series A funding round led by Calyx and HV Holtzbrinck Ventures. Other investors include Scooter Braun's TQ Ventures.
- Acreage Holdings secured a $100 million credit facility from undisclosed investors, a $50 million private loan partially from CEO Kevin Murphy, and a $30 million private placement.
- KushCo, a publicly-traded maker of cannabis accessories, raised $16 million through a direct offering.
- Disruption Labs, the parent company to CBD company Reset Biosciences closed a $3.8 million seed round led by Andrew Garnock/AJR Consulting, a family office that has previously invested in the medical cannabis space.
- Flowhub hired Craig Gomulka as CFO and Scott Schell as CTO. You can read more about Flowhub in Yeji's story here .
- Former Molson Coors marketing executive Greg Butler has joined Cresco Labs as the company's chief commercial officer.
- Aaron Keefer, the culinary gardener for the renowned restaurant The French Laundry, has joined Sonoma Hills Farm as VP of Cultivation.
Chart of the week
The legal cannabis industry supports 243,700 full-time jobs in the US. Nearly 40,000 of those are in California, accounting for about 16% of all legal cannabis jobs in the country.
Check out the data from Leafly's jobs report here:
What we're reading
Q&A: The Food Giants Push For "Smart Regulation" of CBD (Cannabis Wire)
Nepal lawmakers seek to legalize growing, using marijuana (Associated Press)
Did we miss anything? Have a tip? Just want to chat? Send us a note at firstname.lastname@example.org or find Business Insider's cannabis team on twitter: @jfberke & @jesse_yeji . You can also reach Jeremy on encrypted messaging app Signal on at (646) 376 6002.
- From execs to budtenders, 2,000 people have lost their jobs in cannabis. We're keeping track of all the job cuts across the industry here.
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