Prohibition Partners Archives - Green Market Report

StaffJune 11, 2020
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8min48480

CBD & THC INFUSED DRINKS TO BENEFIT FROM “THE LIPSTICK EFFECT” AS CONSUMERS SEEK OUT SMALL LUXURIES DURING COVID-19 LOCKDOWN AND BEYOND

 

Prohibition Partners, has released a new report indicating that all segments of the beverage industry are now embracing cannabis-infused drinks, with  a clear potential for a growing consumer base as 16% of people who have not yet consumed cannabis-infused drinks say they will probably do so within the next 12 months. They estimate the global cannabis drinks market will be worth US$1.82 billion by the end of 2020 and that number will be infused by those looking for relief from the current COVID-19 pandemic.

“When facing an economic crisis, consumers will be more willing to buy less costly luxury goods. The underlying assumption is that consumers will buy luxury goods even if there is a crisis, but that these goods will be more budget conscious luxury. Cannabis infused drinks are an ideal example of this and Prohibition Partners has found that cannabis products are expected to benefit from this period of self-isolation,“ said Stephen Murphy, Managing Director of Prohibition Partners.

Consumers are stockpiling cannabis products in a bid to ensure that their supplies are secured indefinitely. As part of the “home entertainment line-up” in regions where cannabis is legal, beverages can expect to benefit from this trend in hard times to watch more television and spend more on little extras for their in-home leisure. The current stressors of 2020 have already proven to be a boost to cannabis-based products. Despite the current inevitable economic downturn, cannabis is still set to record impressive growth as consumers look for products to help them relax and de-stress and as the most popular format, drinks will likely be the greatest beneficiary.

Consumer demand is strong; the report finds that one in four consumers or would-be consumers of other cannabinoid-based products would be willing to try cannabis-infused drinks, and 28% of people who have already tried infused beverage consumers say they intend to buy more infused consumer goods in the coming three months.

“We are on the cusp of a drinks revolution, for hundreds of years, legal socializing has either involved alcohol, or sobriety; outside of caffeine and nicotine, ultimately you either got drunk, or you didn’t. The emerging cannabis drinks market is one of the most exciting sectors within the beverage industry; cannabis infusion will truly disrupt the drinks market and become a highly lucrative source of revenue for those who embrace it,” said Murphy. 

The cannabis beverage industry has been further driven by COVID-19 shining a spotlight on respiratory illness and lung disease in an unprecedented way in how people choose to consume cannabis. People are avoiding smoking and vaping in favor of other formats such as edibles, including drinks. Furthermore, governments throughout the globe will be searching for ways to bolster flagging economies and cannabis-infused beverages have the potential to deliver. 

Prohibition Partners has also found that working parents have been particularly responsive to the beverages; 2020 has seen them take on the roles of worker, teacher and parent all at once – their wish to reduce stress is evidenced by the fact that almost 70% of people who reported that they are likely to buy more infused products in the coming three months, have children under the age of 18. This indicates that parents may need an outlet to provide a form of escapism or herbal self-medication during the crisis. This is likely to also be a key reason that more than half of those who intend to purchase more cannabis-infused drinks in the coming three months are ages 25–44.

Claire Birks, Prohibition Partners Senior Analyst says “The global drinks market may be large but overall industry growth is slow with some analysts forecasting annual growth at around just 3%. Our research has found that cannabis-drinks, however, are poised for much bigger growth and point towards an almost 45% compound annual growth rate for the cannabis-infused segment of the drinks industry.

Federal US Government Statistics from April show a rise in stress-drinking directly resulting from the global pandemic and this has been mirrored across much of the world. Furthermore, a leading professor of Health at the University of Boston has warned that a spike in alcohol use disorders is on its way owing to a shift in alcohol purchase and consumption habits during the crisis.

The emerging cannabis drinks segment, however, could lessen that impact. Consumer research conducted by Prohibition Partners has found that four in 10 consumers who have or intend to purchase cannabinoid-infused beverages do so as a replacement for other intoxicating substances. 

How Cannabis is Disrupting Drinks Globally, is set to be discussed at the online global event Prohibition Partners LIVE – set to run in place of the annual Cannabis Europa on June 22-23.

 


StaffMay 1, 2020
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4min13320

Prohibition Partners LIVE, in partnership with digital investment firm MAZAKALI, has launched ProCapital, an exclusive investment-focused two-day interactive forum showcasing investment opportunities across the international plant-based medicines (PBM) space that includes cannabis and psychedelics.

On June 22-23, investors, operators, and entrepreneurs will gather together on one digital platform to connect with innovative businesses operating in these rapidly developing markets. ProCapital offers operators the opportunity to attract capital and investors the ability to make real-time investments and obtain guidance from those at the cutting edge of the cannabis and psychedelics industries.

“It is a turbulent time for the industry. Severe limitations are being placed on travel, mobility, and the natural operations of the cannabis supply chain. However, we continue to learn, educate, and innovate in a bid to deliver real value to delegates from every corner of the globe. With uncertainty brewing across the market, we are bringing together the global industry to help provide clarity,“ explained Stephen Murphy, Group Managing Director of Prohibition Partners after announcing the partnership.

The live event will be powered by MAZAKALI’s Digital Capital Investment Platform, ProCapital will offer curated opportunities and broker/dealer supported investment flow within the plant-based medicine (PBM) space. Licensed Investment Advisors will provide investors with the education and tools needed to build and implement optimal investment portfolios across cannabis and psychedelics.

“Against a backdrop of industry consolidation, physical distancing has also promoted exploratory travel across vast, virtual bridges of cooperation. ProCapital is born of the idea that synergistic partnerships accelerate efficiency gains, and that quality global education, networking, and investment will fuel this classic emerging market through its next growth stage. Sustainable value based on core fundamentals has replaced temporary euphoria-driven pricing, a return of rationale welcome to investors exploring what might prove to be the best performing asset class in the decade ahead,” said Sumit Mehta, Founder, and CEO of MAZAKALI.

While there has been a lot of talk about tight capital, many companies have managed to raise money. Investors are still committed to the industry, but only for the most deserving of companies.

Apply to pitch at the summer’s most influential global cannabis and psychedelics event:

  • CLICK: Set up an “Issuer Account” on the MAZAKALI Digital Capital Portal
  • SELECT: Pitch @ Prohibition Partners LIVE application
  • BEGIN: Submit an application online by May 15th deadline
  • RECEIVE: Your MAZAKALI Investment Committee decision within 5 business days

Attendees can expect to hear perspectives from leading investors, politicians, and cultural leaders. Delegates will have the opportunity to ask questions, schedule meetings, and make direct investments into curated and broker/dealer approved private companies through the MAZAKALI Digital Capital Portal.

Super early-bird tickets for Prohibition Partners LIVE are on sale now. To view the full agenda for ProCapital, as well as the other Prohibition Partners LIVE event streams, click here.


Debra BorchardtNovember 11, 2019
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5min12250

Cannabis Europa swept into New York City with some dazzle as the conference was held at a swanky members-only club that prefers not to be mentioned. Stephen Murphy, Co-Founder of Cannabis Europa said that the reason for choosing such a high location was to showcase the legitimacy of the industry.

Murphy is also the Co-Founder & CEO of NOBL Group and a Co-Founder of Prohibition Partners, a source of intelligence and insights into the European cannabis industry.  The attendees seemed to be a mix of Europeans keen to get the attention of the U.S. financiers and Americans wanting to learn more about the European cannabis markets. So much has been made of Canadian companies signing contracts overseas, that many wanted to hear first-hand what the landscape really looks like.

The reality is that the market is almost entirely medical marijuana and if the Americans thought that cannabis was complicated amongst the states, they should hear the differences among neighboring countries and then add a layer of EU on top. This is a steep learning curve on education as well. Some panel members noted that many in the EU believe CBD (cannabidiol) will get them high and that educating the public will be critical to any success overseas.

Stock Markets

Cannabis stock trading is almost non-existent. Typically, the exchanges in Europe will act in accordance with each other, but the Luxembourg stock market acted on its own to allow cannabis companies to trade there and for now, no other exchanges are interested. One panelist said that tots of institutions were considering it and that could open up next year.

“There are legal teams in London preparing companies for IPO’s,” said Murphy, “But there are limitations for what they can deploy in the U.S. and Canada.” He agreed that the junior exchanges were beginning to recognize quality cannabis companies. At the same time, the European companies have their sites set on the Canadian Securities Exchange (CSE) and NASDAQ.

Many Challenges

Murphy said that the focus remains on medical marijuana and getting access to the product for those that need it the most. He noted that Germany is the furthest along with regards to countries legalizing cannabis. Similar to the U.S., Murphy said that countries see cannabis as a way to help the economy by bringing jobs, reenergizing agriculture and helping depressed areas. The issue remains education as both residents and politicians have much more to learn.

“The European media is becoming more receptive and recognizing this as a legitimate industry,” said Murphy. Having the European media on the side of legalization has been a goal for the industry

William Muecke, a Co-founder of Artemis Growth Partners said, “It’s a tough market, but the quality companies rise to the top. The question will be pricing. Plus, there is so much time spent on educating the marketplace.”

That difficult sentiment was echoed by Jordan Lewis, CEO of Fotmer Life Sciences who said, “In the UK you can get a script filled for up to 3 months, but it’s hard to find doctors willing to write prescriptions and then find the product. We had to fly to the Netherlands to buy medical products and fly them back.”

European cannabis companies complained about the restrictions around the descriptions of their products and how they try to use influencer marketing since they can’t say much and even relying on testimonials can be difficult.

Murphy wants to foster more trans-American relationships. There may be a lot of promise in the European cannabis market, but it also sounds like the hurdles are numerous.


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