Green Thumb Industries Invests in Cann, Signs Production and Distribution Agreement
One of the top cannabis firms in the U.S. has made a key investment in the rapidly emerging cannabis-infused beverage market.
Chicago-based Green Thumb Industries (GTI), which has operations in 12 U.S. states, has signed a manufacturing and distribution agreement with California’s most prominent THC-infused beverage company, Cann.
“The cannabis beverage category is poised for growth,” GTI founder and CEO Ben Kovler said via a news release. “Consumers are increasingly entering the market seeking alternatives to alcohol with familiar consumption experiences. Cann sits squarely in this opportunity, delivers on the consumer need, and complements our brand portfolio with entry into the beverage segment.”
GTI has also made an undisclosed equity investment in the fast-growing company, co-founder Luke Anderson confirmed to THCnet.
“They have an understanding of where the beverage category is going, and they value brands which are differentiated and have consumer loyalty,” he said.
Cann produces an array of “social tonics,” which contain low doses of THC (2 mg) and CBD (4 mg).
According to Anderson, the partnership with GTI will enable Cann to expand its portfolio of drinks to multiple new markets, including Illinois and New Jersey, in the coming months.
Cann’s infused creations will also begin showing up at dispensaries throughout New England, Anderson added.
“Even though some of those markets are just medical, don’t allow edibles, or have no established beverages, we believe that every single one is viable because 80% of adult drinkers want to consume less alcohol,” he said. “Whether that is Colorado, Arizona, Florida or Maine, the story is the same. So, we look at every state as a potential future opportunity.”
Cann — which is backed by several celebrities, including Gwyneth Paltrow, Baron Davis and Casey Neistat — sold more 4 million of its 8 oz. aluminum cans in 2020 and generated over $3 million in revenue.
According to cannabis research firm Headset, Cann owns 24% of the infused beverage market in California. Monthly retail sales grew more than 1600% from $38,000 last January to nearly $650,000 last November.
“We roughly doubled every quarter of 2020, and finished with an incredibly strong Q4 that was beyond our expectations,” Anderson said.
However, Cann’s early investment partners — including Imaginary and JM10 — had been encouraging Anderson to start developing a national distribution plan and charting a course for increased revenue.
“We started looking in 2020 for the right partners to help us build facilities, manufacture and distribute the product in new markets,” Anderson explained.
The company met with several potential partners, but ultimately found the best alignment with GTI.
“They are really good at making products efficiently and putting them on shelves,” Anderson said. “GTI has an impressive footprint, as well as the resources, licenses, and the institutional knowledge. They are building FDA-grade manufacturing and distribution operations for all of their edible products.”
The two parties first met last summer, and the deal came together over the last six months.
In addition to expanded production and distribution capabilities, Cann will access to a sprawling network of GTI’s own cannabis dispensaries.
Founded in 2014, GTI currently operates 52 retail locations, including eight in Illinois, and distributes its popular consumer labels like Rhythm and Dogwalkers to 12 states. It owns a total of 97 retail licenses and is projecting more than $800 million in revenue this year.
While its portfolio includes flower, pre-rolls, edibles, vapes and topicals, GTI does not currently manufacture beverages.
Enter Cann, which has worked closely with California cannabis beverage co-packer Spacestation to scale operations over the last two years.
“We built the beverage capabilities with our license holders every step of the way,” Anderson said. “We have that knowledge, and we’re sharing it with GTI to ensure that the product is as good if not better than what’s been made before.”
Cann’s ready-to-drink beverages sell for about $24 per six-pack in California, however Anderson said those prices will be lowered to $18 next month.
The company also sold nearly one million of its concentrated liquid “Roadie” packages in 2020, which retail for $15 per 10-pack and can be mixed into any beverage.
The company also took on eight more celebrity investors, however Anderson declined to share names and investment amounts. An official announcement is expected later this year.
Additional information about the arrangement between Cann and GTI is included in the announcement below.
Green Thumb Industries and California’s #1 Cannabis-Infused Beverage Cann Announce Partnership to Expand Nationally
- Cannabis-Infused Beverage Category Appeals to New-to-Category Consumers as Alternate to Alcohol
- Cann Offers Portfolio of Micro-dosed Social Tonics, Low in Calories with All-Natural Ingredients
- Complements Green Thumb’s Brand Portfolio with Beverage Category Offering
CHICAGO and VANCOUVER, British Columbia, March 03, 2021 (GLOBE NEWSWIRE) -- Green Thumb Industries Inc. (“Green Thumb”) (CSE: GTII) (OTCQX: GTBIF), a leading cannabis consumer packaged goods company and owner of Rise™ Dispensaries, today announced an exclusive partnership with leading cannabis-infused beverage brand Cann to manufacture and distribute its line of cannabis-infused sparkling beverages beginning in Illinois this spring. Green Thumb and Cann will expand distribution to additional markets including New Jersey, which recently legalized adult-use cannabis sales.
“The cannabis beverage category is poised for growth. Consumers are increasingly entering the market seeking alternatives to alcohol with familiar consumption experiences,” said Green Thumb Founder and CEO Ben Kovler. “Cann sits squarely in this opportunity, delivers on the consumer need, and complements our brand portfolio with entry into the beverage segment. What’s even better is cannabis drinks can offer a superior experience, fewer calories and no hangover compared to alcohol. We are investing in the space and in the Cann team and we couldn’t be more excited to bring California’s #1 cannabis beverage brand to Illinois and beyond.”
Cann’s social tonics are low in sugar and calories and contain no preservatives or artificial sweeteners. Each drink is made of all-natural juice (not from concentrate), herbs, organic agave nectar, and micro-doses of cannabis CBD and THC extract designed to be similar in strength to a glass of wine or a light beer. Cann is available in three creative flavors: Lemon Lavender, Grapefruit Rosemary, and Blood Orange Cardamom and are sold in 6-packs of 8 ounce cans.
The brand got its start in Venice, California in 2019 and became a quick local favorite for those in Hollywood due to its appeal to the growing number of entertainers and media personalities looking for healthier alcohol substitutes that still come with a fun social buzz.
“There are a lot of people who want to incorporate cannabis into their lives recreationally without the fear of getting too high,” said Cann co-founder Luke Anderson. “Cann lets you rewrite the ‘bad edible experience’ you had in college and change your social drinking routine at the same time.”
Trends show that cannabis beverages are gaining in popularity faster than other cannabis categories. In California, cannabis beverage category sales grew nearly four times faster than total cannabis market sales between the period of January and December 2020. Over the same time period, Cann rose from fifth in market share to first with over 600% growth in sales (BDS Analytics).
“We’re ecstatic to partner with Green Thumb, the nation’s leading cannabis operator and brand innovator,” says Cann co-founder Jake Bullock. “We’re excited that their best-in-class management team believes in our vision to offer a superior alternative to alcohol. Cann social tonics create a refreshing, uplifting social buzz without alcohol’s negative effects. We believe that cannabis beverages will change the way people drink in this country – imagine drinking a few Canns instead of several beers, wine or cocktails and waking up the next day without a massive headache. We offer a much smarter, delicious choice.”
About Green Thumb Industries:
Green Thumb Industries Inc., a national cannabis consumer packaged goods company and retailer, promotes well-being through the power of cannabis while giving back to the communities in which it serves. Green Thumb manufactures and distributes a portfolio of branded cannabis products including Beboe, Dogwalkers, Dr. Solomon’s, incredibles, Rythm and The Feel Collection. The company also owns and operates rapidly growing national retail cannabis stores called Rise™. Headquartered in Chicago, Illinois, Green Thumb has 13 manufacturing facilities, licenses for 97 retail locations and operations across 12 U.S. markets. Established in 2014, Green Thumb employs over 2,300 people and serves thousands of patients and customers each year. The company was named a Best Workplace 2018 by Crain’s Chicago Business and MG Retailer magazine in 2018 and 2019. More information is available at GTIgrows.com.
Cann is the #1 selling THC-infused beverage in California according to BDS Analytics. Founded by Stanford and Harvard graduates, Cann is reshaping social drinking with their range of microdosed, non-alcoholic beverages that deliver a perfect, uplifting feeling every time. Vegan, gluten-free, and low in calories, each Cann has five all-natural ingredients with a strength that is similar to a beer or glass of wine. There are no artificial sweeteners or flavors, sugar substitutes, or cannabis taste. Cann’s social tonics won first place in BevNET’s New Beverage Showdown in 2019, following in the footsteps of mainstream grocery products like Health-Ade Kombucha, MALK, and RISE Brewing. The brand is also backed by mainstream celebrity investors, including Gwyneth Paltrow, Baron Davis, Rebel Wilson, Ruby Rose, Darren Criss, Casey Niestat, Tove Lo, and Bre-Z. For more information, visit www.drinkcann.com or @drinkcann on Instagram.
Cautionary Note Regarding Forward-Looking Information
This press release contains statements which may constitute “forward-looking information” within the meaning of applicable securities laws. Forward-looking information is often identified by the words “may,” “would,” “could,” “should,” “will,” “intend,” “plan,” “anticipate,” “believe,” “estimate,” “expect,” or similar expressions and include information regarding the filing of the Documents and the timing thereof. The forward‐looking information in this news release is based upon the expectations of future events which management believes to be reasonable. Any forward‐looking information speaks only as of the date on which it is made, and, except as required by law, GTI does not undertake any obligation to update or revise any forward‐looking information, whether as a result of new information, future events or otherwise. The forward‐looking information in this news release is subject to a variety of known and unknown risks, uncertainties and other factors that could cause actual events or results to differ from those express or implied. When considering these forward‐looking statements, readers should keep in mind the risk factors and other cautionary statements in GTI’s public filings with the applicable securities regulatory authorities on the SEC’s website at www.sec.gov and on SEDAR at www.sedar.com, including the risk factors set out in the 2nd Amendment to GTI’s Registration Statement on Form 10/A and its Form 10-K.