Narbe Alexandrian didn’t see COVID-19 coming, and that’s okay. As chief government officer of the cannabis enterprise capital firm Canopy Rivers (RIV.TO), he’s not within the enterprise of predicting pandemics.
What he did see previous to 2020 have been cracks forming in the business model that has dominated legal cannabis in Canada since its inception: vertically-integrated licenced producers.
Many of the biggest cannabis gamers have been having a tricky 2020 earlier than the financial wallop of COVID-19. So far, the 12 months has been marked by mass layoffsand lacklustre financial results. Producers face scarce financing choices, unforgiving capital markets and resilient illicit gross sales.
Plans for world growth and trial-backed prescribed drugs years within the making have been shelved as traders demand tighter controls on spending and clearer paths in direction of constant income. Just about everyone seems to be pulling again.
For Alexandrian, it’s proof of one thing he’s been saying for some time now.
“Vertical integration doesn’t work,” he informed Yahoo Finance Canada in an interview. “Prior to legalization, because of how the public markets were valuing these companies, everyone had to increase their footprint as quickly as possible. They invested in cultivation, extraction, consumer packaged goods, pharma with clinical trials, pet health, biosynthetics, and they bought retail stores as well. You can’t be everything to everyone.” [Read More @ Yahoo]