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šø Cannabis Deals Are Getting Done šø
GM Everyone,
Yesterday was a red day across the board, giving up much of the gains we had gotten earlier in the week. However, people are overlooking one major thing: the broad market got smoked yesterday, no pun intended. You cannot have irrational expectations when we know it's a bunch of algos essentially trading this market right now and expect otherwise when the macro is cracking. Futures look red to flat this morning, so letās see how it goes.
Todayās letter can be read in 7 minutes and 45 seconds.
What's Driving the Market Today?
Futures are flat this morning after a megacap-led selloff; S&P and Nasdaq are at multi-week lows. Here are the headlines influencing the market today:
The S&P 500 has experienced its worst day since 2022 amid earnings season and China concerns.
Dow misses profit estimates due to lower prices and demand.
Ford's stock fell 11% due to profit disappointment and quality issues.
Bond yields fall as central banks in the US, Canada, and China increase rate-cut bets.
šø High Impact
Cannabis Deals Are Getting Done
The What - LeafLink, a B2B platform in the cannabis industry, has announced its acquisition of Dama Financialās banking division. This action by LeafLink marks a significant milestone as it aims to offer secure, compliant, and reliable banking solutions to the cannabis industry, addressing one of its most persistent challenges.
The integration of Dama Financial's banking division into LeafLinkās existing platform is expected to enhance the suite of services already offered to cannabis brands and retailers. LeafLinkās platform includes order and category management, payments, data and analytics, and advertising. With this acquisition, LeafLink positions itself to become a comprehensive B2B operating system for the regulated cannabis industry.
For years, cannabis operators have faced significant challenges accessing secure financial services due to federal prohibition. Many businesses have struggled with withdrawn services, minimal feature availability, and high costs. LeafLinkās acquisition aims to bridge this gap by integrating Dama Financialās expertise and established banking solutions into its platform.
āLeafLink provides customers with integrated tech solutions that make it easier to run their business, and over the last year, weāve released several products that will significantly improve our customersā operating performance and profitability,ā said Artie Minson, CEO of LeafLink. āAfter witnessing firsthand the negative impact the federal prohibition has had on operatorsā access to traditional banks, we are thrilled to add banking to LeafLinkās product suite. Very few companies and people have the expertise that Dama Financial offers to the cannabis banking space. By joining forces and incorporating Damaās banking product into our existing suite of services, we will be well-positioned to usher in a new era of efficiency and help address some of the biggest challenges cannabis operators face.ā
LeafLinkās recent increase in its Series D fundraising round from $100 million to $125 million underscores the companyās growth and expansion ambitions. This round included investments from notable firms such as CPMG, Nosara, L2 Ventures, Thrive Capital, and Tiger Global. These funds are expected to further bolster LeafLink's capacity to serve the cannabis industry with innovative and integrated solutions.
The Why - Dama Financial has been a significant player in the cannabis banking sector, having processed over $3 billion in transactions. It has provided access to FDIC-insured banking partners and various financial services, known for its transparency and compliance with banking and cannabis regulations. The integration of Dama Financialās banking solutions is set to enhance LeafLinkās platform significantly.
āThe cannabis industry is in need of integrated solutions at scale, and this deal is a great example of the benefits it will bring to our industry,ā said Patrick OāBoyle, CEO of GrowFlow (formerly Dama Financial). āLeafLink is in a strong position to take our established banking solution and build on it even further, offering the industry a unified financial services experience. The product lines not included in this acquisition will rebrand to GrowFlow, remaining focused on enhancing and growing our retail and wholesale product lines to service the cannabis industry.ā
LeafLink's acquisition of Dama Financial's banking division aims to solve the cannabis industry's banking challenges by offering a unified financial services experience. Rebranding Dama Financial's remaining products as GrowFlow indicates a focus on enhancing retail and wholesale services.
Big Takeaway
This is an interesting deal coming at an interesting time in the cannabis space. Dama has been a solid banking solution for the cannabis industry for years now, and everyone really began to know the name after they botched their testimony on Capitol Hill during a hearing regarding SAFE Banking. Many saw their remarks as lobbying against SAFE, which in their own self-interest kinda makes sense, but time and place are crucial.
Leaflink has been a cornerstone company in this space for some time now and has withstood the ebbs and flows of the sector, so Dama has presumably found a good home. It will be interesting to see what the future holds and if Leaflink chooses to execute any further acquisitions within the CannaTech space.
š Dog Walkers
Tilray Bolsters European Brand Portfolio
Tilray Brands (Nasdaq: TLRY; TSX: TLRY) received approval for its third medical cannabis product, Tilray Solucao Oral THC10, in Portugal, expanding its global operations to over 20 countries. This approval comes alongside significant expansions in Germany and Australia.
Organigram Expands Rare Cannabinoid Portfolio
Organigram Holdings Inc. (NASDAQ: OGI, TSX: OGI) has invested $1 million into Phylos Bioscience to expand its auto-flower and rare cannabinoid portfolio. This funding will help Organigram develop unique cannabis products, including high-potency CBG, CBC, and CBDV seed-based cultivars, enhancing its market position and product diversity.
Curaleaf Expands NY Retail Footprint
Curaleaf opened their 6th retail location in the New York market with the opening of their Rochester location. Operators have taken a careful approach to the New York market and this opening paired with the results that we are seeing and hearing from Operation Padlock bode well for the future of the state.
šļø The News
š Research
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šŗ YouTube
Biden Drops Out: What Are The Next Steps? | TDR Podcast
What we covered:
ā On this episode of Trade to Black where Co-Host Shadd Dales and Anthony Varrell will discuss the results of the cannabis rescheduling comment period compiled in a Headset report. In addition, Shadd and Anthony will share an update on all the news affecting Cannabis stocks. This will include updates on:
1. Organigram Holdings Inc. (NASDAQ: OGI) (TSX: OGI) continues focusing on THCV products through a strategic investment in Phylos Bioscience Inc.
2. A Florida update with more news regarding Ron DeSantis's misinformation campaign.
3. Dallas attempts at Decriminalization.