Blackbird Archives - Green Market Report

Debra BorchardtJanuary 19, 2021
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Cannabis software company Blackbird and payment processor company AeroPay announced a strategic partnership to bring cashless payments to cannabis businesses for online ordering. Blackbird was sold in November 2020 by its parent Tilt Holdings (OTC: TLLTF).  Tilt agreed to sell Yaris Acquisition, LLC better known as Blackbird to Slam Dunk, LLC, a Nevada limited liability corporation controlled by Tim Conder, TILT’s Chief Operating Officer and a member of the board of directors of the company. The company said the total valuation of the deal was $15 million and selling Blackbird resulted in a cut of $3 million in expenses quarterly.

The partnership includes the integration of AeroPay’s payments platform into Blackbird’s white-labeled dispensary menus and the BlackbirdGo cannabis marketplace. The two companies said they also have plans to bring greater efficiencies to other parts of the cannabis supply chain such as physical retail and B2B.

“Cash payments have dominated the cannabis retail consumer experience until now,” said Tim Conder, CEO & Co-Founder of Blackbird. “As licensed cannabis operators, we know the benefits of moving toward cashless payments but also understand the challenges with banking as a cannabis business. Our partnership with AeroPay and the integration of our platforms allows our retail partners and their customers to easily accept digital payments and remove the hurdles associated with being a cash-only business. Additionally, AeroPay’s banking relationships will help eliminate barriers for our retail partners.”

Through the integration, cannabis patients and customers using Blackbird will be able to pre-pay online at the time of check-out for delivery or curbside pick-up orders. Payments made with AeroPay will be facilitated through a secure bank-to-bank transfer between the patient or customer and the business.

AeroPay is a financial technology company providing alternative payment processing solutions to state-legal cannabis businesses.  AeroPay has been approved to work in every state where cannabis businesses can legally operate as well as Washington D.C. AeroPay’s compliant solution offers a safe, simple, and streamlined way for patients or customers to pay their favorite cannabis businesses.

“Our approach has always been to create a better payment experience for both businesses and their customers,” said Daniel Muller, CEO & Founder of AeroPay. “Blackbird is a premier end-to-end logistics and delivery company in the cannabis space and our partnership allows us to do just that for the cannabis industry.”

Dispensary patients and customers ordering through a Blackbird white-labeled menu or the BlackbirdGo marketplace will have the option to pay with AeroPay. For first time AeroPay users, the sign-up process is two easy steps and happens directly on the menu at the time of check-out — customers simply create an AeroPay account and link their bank. For repeat users, payments can be completed with a single click.

While the focus of this integration with Blackbird’s menus is to improve the retail and consumer experience, both Blackbird and AeroPay also provide B2B solutions for the cannabis industry. The companies have plans to streamline the cannabis experience in other parts of the supply chain and lower the volume of cash by implementing digital payments.

“We’re excited about the future of our partnership with AeroPay as both companies have the ability to service the entire value chain,” said Conder. “This is only the beginning of a long-term relationship that has the opportunity to change the way cannabis businesses operate.”

“Payments have been especially inconvenient for cannabis businesses and we are thrilled to work with the team at Blackbird to create a seamless cannabis shopping experience that is safer, faster, and cashless,” said Muller. “Ultimately, we want to give cannabis businesses the ability to operate in the same manner as any other business would.”


Debra BorchardtNovember 19, 2020
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Tilt Holdings Inc. (CSE: TILT) (OTCQB: TLLTF) reported a decline in revenue to $40.4 million for the second quarter of 2020, which was a drop of 12% from the prior-year period.  The net loss was $4.6 million versus a net loss of $9 million in the previous quarter. The company also told investors that it sold its technology platform Blackbird.

“In the third quarter we saw sequential growth across our core Jupiter and plant-touching operations reflecting our diversified position within the growing U.S. cannabis industry,” said Mark Scatterday, CEO of Tilt. “We also reported record adjusted EBITDA that was positive for the third consecutive quarter, a result of our actions to right-size the business while strengthening our platform to scale as a preferred B2B partner to the cannabis industry.”

Sells Blackbird

When TILT first came together as a disparate group of companies, investors had a hard time understanding how all the pieces would fit. Management spent an inordinate amount of time explaining how these pieces would be synergistic. Now it seems, Tilt is going to focus on its biggest member of the family Jupiter, the vape company and is getting out of the tech platform business. Tilt announced that its subsidiary Baker Technologies, Inc. had agreed to sell Yaris Acquisition, LLC known as Blackbird to Slam Dunk, LLC, a Nevada limited liability corporation controlled by Tim Conder, TILT’s Chief Operating Officer and a member of the board of directors of the company. The company said the total valuation of the deal was $15 million and selling Blackbird results in a cut of $3 million in expenses quarterly.

“We continue to believe that the Blackbird platform offers a comprehensive technology solution capable of bringing cannabis brands, retailers, and consumers together on a single platform,” said Gary Santo, President of TILT. “Unfortunately, the marketplace for such solutions is fragmented and hyper-competitive with multiple players offering disparate systems at irrational prices and creating headwinds for sustained profitability.”

“Blackbird is effectively a start-up company contributing 4% to our revenue year-to-date while requiring additional capital and resources in order to achieve scale,” continued Santo. “Given the growth potential within Jupiter and our cannabis operations, we believe the opportunity costs associated with continuing to invest in the platform are not in our shareholder’s best interests. Upon closing, we expect this transaction to significantly improve profitability and free up cash flow that can be redeployed to grow our core businesses, while the proposed structure will allow TILT to participate in Blackbird’s future success.”

Focus On Jupiter

Following the vape crisis, Jupiter struggled, but it seems to have recovered and Tilt has decided to focus its efforts here. Scatterday said on the company’s earnings call, “In the third quarter, Jupiter returned to generating positive top-line growth and with its lean centralized and highly productive operating footprint, it continues to be a steady positive cash flow engine for TILT. Momentum picked up throughout the quarter as order patterns returned to normal and large customers continued to increase their order size. In September, we shipped the record number of total cartridges. Our disposable product category is still being impacted by the effects of COVID, where tourist centric markets like Nevada are still feeling the effects.”

 


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