Canopy Rivers Inc. (TSXV: RIV) is teaming up with LeafLink, Inc. to create LeafLink Services International ULC. The new venture will exclusively license and leverage LeafLink’s dominant business-to-business (B2B) marketplace and supply chain technology platform for deployment throughout regulated international cannabis markets.
In order to get the venture off the ground, LeafLink has made an initial capital commitment of $1 million along with an exclusive, royalty-free license for all non-US marketplaces for their proprietary B2B software platforms and service solutions. In addition to that, Canopy Rivers has committed an initial equity investment of $2 million. Canopy Rivers also has an option to invest an additional $6 million.
For the uninitiated, LeafLink is a software-as-a-service (SaaS) marketplace that simplifies the supply chain through its e-commerce platform. The company has a growing network of more than 950 cannabis brands, and penetration throughout ~2,800 cannabis retailers across 16 territories in the United States.
Retailers use LeafLink for managing their wholesale inventory, enabling them to shop multiple vendors in one cart, view up-to-date product and brand menus, review historical and open orders, discover new products, and request samples. LeafLink further serves vendors by offering supplementary tools such as order management, customer relationship management (CRM) platform, inventory tracking tools, and customized reporting systems, among other services.
“We have been very impressed with LeafLink’s deep market penetration and their understanding of cannabis companies’ needs and behaviors,” said Narbé Alexandrian, President of Canopy Rivers. “The number of brands and products within our new cannabis economy has been explosive, making it difficult for retailers to deal with multiple parties in an increasingly fragmented market. As regulated cannabis consumption and distribution proliferates around the world, LeafLink International will introduce the industry’s leading SaaS-enabled marketplace to the global stage to create a new standard for expediting the cannabis supply chain in regulated markets.”
By creating this new joint venture, Canopy Rivers will continue to expand its exposure across the cannabis value chain through a capital-light, market-leading B2B platform that is immediately scalable across legal jurisdictions. Canopy Rivers said it intends to integrate its network of complementary cannabis companies and global reach to drive growth for LeafLink International and assist in developing and deploying this technology as it continues to increase its global footprint.
“We are excited to join forces with Canopy Rivers – combining our industry-leading, B2B marketplace technology with their expertise and strategic network in the global cannabis market,” said Ryan G. Smith, CEO, and Co-founder of LeafLink. According to the company statement, LeafLink and Canopy Rivers hold approximately 82% and 18%, respectively, of LeafLink International after the initial transaction. LeafLink is backed by venture capital firms and strategic investors such as Lerer Hippeau, Nosara and Casa Verde Capital, LeafLink has raised more than $14 million to date.