The Daily Hit is a recap of the top cannabis business stories for April 5, 2022.
On the Site
The disgruntled investor lawsuit against Parallel cannabis initially hit the public records as a heavily redacted document. The Judge in the case apparently denied the redaction request and Green Market Report got a look at the complaint in all its glory or gory detail. Notably, the actual debt amounts are spelled out along with other details that weren’t gleaned from the previous review. There are several issues alleged in this lawsuit and it is broken down as such. Read more here.
Cannabis data firm Hoodie Analytics (Hoodie) announced the close of its inaugural round of fundraising at an undisclosed amount, along with key positions on its strategic advisory board. The inaugural round was led by Greenlight Ventures, Satori Investment Partners, and individual investors Bart Swanson, Steve Weisman, Brian Schindlere, Lorne Gertner, and Jim Belushi. Hoodie said the raise positions it to expand its product and sales efforts. Hoodie’s inaugural round also marks the first investment out of Arcview’s new Seed Fund which operates with sponsorship from Entourage Effect Capital. As part of the financing, Gregg Steinberg, Jim Belushi, Mitch Kahn, and Lorne Gertner will join the Hoodie Strategic Advisory Board. Read more here.
The troubling trend of regulatory problems persists in California as the state targets legal cannabis but lets illicit businesses thrive. In recent months, operators have warned of an industry on the verge of collapse as regulations and the unlicensed market throttle legal operators. Meanwhile, with high taxes and little incentive to go legal, many operators and consumers remain on the unlicensed side of the supply chain. Read more here.
Aleafia Health Inc. (TSX: AH, OTCQX: ALEAF) is going to be laying off employees as the company looks to save money and stick to its revenue goals. Aleafia said it can save $4.4 million by cutting more heads and becoming more efficient. The company said by implementing these efforts in this quarter, it can reach its previous guidance for revenue between $53 and $63 million for the current fiscal year. Aleafia also said that Adjusted EBITDA breakeven profitability is expected to occur in the second half of 2022. Read more here.
As cannabis legalization spreads across the country, businesses are desperate for willing workers and drug testing is one area where they are making concessions to fill their rosters. Cannabis employers can have drug testing and use policies just as stringent as those outside of the industry, and in any industry, when employees are found to have violated these policies, the consequences are real. In some cases, this can result in job loss, demotion, or losing out on a new job opportunity altogether. In more serious cases, when an employee tests positive for marijuana after being involved in an incident leading to injury or property damage, lawsuits often result, with outcomes that seldom favor the employee. This possibility is a major deterrent for those who choose to make marijuana or even CBD part of their health or recreation regimens. Read more here.
In Other News
Metrc, the most trusted and experienced provider of cannabis regulatory systems in the U.S., announced a new contract with the state of Mississippi to support the regulation of its medical cannabis market. This marks Metrc’s 21st government contract to date nationwide. Read more here.
AROYA, a METER Group company, reported record growth in FY2021, exceeding $10M in revenue from sales of its end-to-end cannabis production platform. Demand for cultivation and production platforms like AROYA that utilize sensors, software, and data analytics is spiking within the cannabis industry. Analysts from AheadInsight project that the cannabis technology industry will continue to grow exponentially at a CAGR of 33.17 percent and attain a market value of $107.67 billion by 2025. Read more here.