Cannabis Data: DECODED

My interview with a cannabis data insider...

Written by Jimmy Mengel
Posted June 6, 2019

I spent a chunk of last month in Copenhagen, Denmark, meeting with some of the biggest names in European cannabis.

I was there for the European Cannabis Symposium, which brought together breakthrough cannabis companies, politicians, and scientists from all across Europe.

One of the cannabis experts I met with was Ed Keating. He works for a data firm called Cannabiz Media.

He digs deep into the intricacies of cannabis data. And he’s uncovered a lot of information about where the industry is going. Through his company database, he can see where cannabis licenses are being bought up, where companies are putting their money, and pretty much anything you’d need to start a cannabis company in the U.S.

I learned a lot of behind-the-scenes facts about the industry. It's one thing to chat with CEOs, go on site visits, and read financial disclosures — which I do frequently — but it's quite another thing to have all of the actual data at your disposal.

You can recognize trends, dive into regulations, and really get an entire picture of where cannabis is going.

If you've ever invested in cannabis — or are thinking about doing so — I urge you to keep reading.

Here’s my chat with Ed Keating…

Jimmy Mengel: Hello Ed, I appreciate you taking the time to talk with me. It was a pleasure meeting you in Copenhagen — how did you enjoy your stay? As far as business trips go, I thought Copenhagen was pretty awesome.

Ed Keating: Hi Jimmy, it was a pleasure meeting you as well. As far as Copenhagen goes, I agree! I did a bike tour on Sunday morning and went around the city, which was just a blast. I rented a bike from the hotel and just went out and had a really good time.

It was a good visit and a beautiful city.

Jimmy Mengel: I’m glad to hear it. I learned a lot about the marijuana regulation business by speaking to you, so I wanted to give my readers an overview of the data you’ve been collecting and how difficult it is for upstart cannabis businesses to really get started.

So, can you give me kind of the cocktail napkin version of what you do at Cannabiz?

Ed Keating: Absolutely. So Cannabiz Media tracks cannabis and hemp licenses in the U.S., Canada, and — why I was able to meet you in Copenhagen — across the globe.

We focus only on licensed businesses. No gray market information makes it into our system. And what we really do is help our customers with their business sales and competitive intelligence needs.

So, let’s take a financial company, like Bank of America. They might be using us to build out a model to see who has how many licenses and where they're located.

Our customer may be a large multi-state operator that uses our system to find possible acquisition candidates.

The third case would be the ancillary businesses; they're using it to find customers. They can use our system to make sure they know where all the retailers and dispensaries are. That means they can sell more lights or greenhouses, security systems, et cetera.

Jimmy Mengel: That’s one of the things I find most fascinating about the cannabis market. Most people just think about producers growing cannabis, or creating products like beverages, edibles, or medications. But there is a massive industry in the “picks and shovels” companies that provide those other services like lighting, fertilization, and packaging — or like you do, data collection.

Ed Keating: We are certainly one of those ancillary companies.

What we've done is normalize this cannabis data across all the jurisdictions that we cover: Canadian provinces, U.S. states, and a growing number of other countries as well. So that's the big picture, or hopefully it's a 30,000-feet view in terms of what we cover and why.

If you were to check our main page that customers sign up for, right now we're showing almost 46,000 cannabis licenses and we provide a lot of information on them.

We've tried to make it so that users can find the information they need. So the real power of our system is that it lets you sort through all this data to find what you want. So in this case, if you were interested in just U.S. licenses and you only wanted those that were active, then we have a whole bunch of attributes on what information we have about that.

What kind of grow environment do we have? What's the canopy size? How many employees does the company have? What's their point-of-sales software? What kind of lighting?

We have state rules and regulations for every single state. My research team goes and does the work of trying to find out a lot of this information.

And it’s critical information for anyone in the cannabis industry...

Jimmy Mengel: I imagine this is a great way to look into the future, and see which companies are buying up the most licenses and properties. As an investor, that would be crucial intelligence.

Ed Keating: Yes, indeed. Let’s take Cresco Labs (OTC: CRLBF) for instance.

They're one of the multi-state operators and what we show is the contact information where they're located. You can even pull up a map to see where they've gotten licenses. So we’re really trying to help people find this information.

One of the powerful things that my team does, is we go and try and stitch together all the related licenses.

Where else did they have licenses? So you can see that there are around 80 of them all over the place — and we even include those that are denied. We think it's important to know that some of these companies are always trying to acquire new licenses or they apply in these competitive states, but they don't always win.

It just paints a more complete picture of what is going on with this particular company. And obviously they've got a ton of licenses, so you can make your own assumptions from that.

Jimmy Mengel: It’s fascinating to look at these figures. As an investor, I can already see the opportunities to use this data to determine where the next big markets will be — and which companies are staking their claims.

The more data we pull from the industry, the better off we'll be as investors. From this one encounter, I've already learned a ton about when, where, and how companies will operate. 

I'll bring you the rest of my interview with Ed next week. He has a wealth of knowledge that will help all of us cannabis investors.

If you'd like to learn more about Cannabiz Media, you can do so here.

If you'd like to find out where the next cannabis companies are operating, please click here.


Jimmy Mengel

follow basic @mengeled on Twitter

Jimmy is a managing editor for Outsider Club and the investment director of several personal finance advisories, The Crow's Nest, and The Adventure Capitalist For more on Jimmy, check out his editor's page.

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