Marijuana Business Magazine April 2020

April 2020 | mjbizdaily.com 19 Has the market correction overall been what the industry needed? The companies in this sector needed to have some rationalization. It’s an easy argument to make that many companies were obscenely overvalued. There was mismanagement by companies, and valuations and assets were not grounded in reality, and so people overpaid for other assets. There needed to be discipline in the C-suite, and they got it. The entire industry is going through a 2.0 in terms of management teams. What is the longer term outlook? There are three obvious channels of investment: the recreational market, the medical channel that continues to grow, broaden and deepen with research and (possible) U.S. Food and Drug Administration approval. There is a massive medical science element that is still very interesting, and then there is the entire lifestyle, nutraceutical and experiential wellness element. Some of the biggest companies in the world will come in whenever they are comfortable with the regulatory environment. This is a global marketplace; this really is a consumption story that runs across all demographics and cultures and, eventually, this is going to become very sophisticated. Then it will be classic CPG investing with a focus on distribution, logistics and branding. What types of investment do you focus on with your ETF? Our ability to invest in the sector is still challenged by the limits of the federal dynamics. I am forced to build only a portfolio of names that I can invest in. We focus on the management teams, the balance sheet and how companies are positioned—particularly with regard to the United States. Many ETFs are not actively managed and so are therefore not able to adjust to changes in market conditions. I may be biased, but I think you need to be active. Nick Thomas covers finance for Marijuana Business Magazine. You can reach him at nickt@mjbizdaily.com. Biomass Drying System Solvent Recovery System Remove Solvent from CBD Typical Recovery of Solvent is 37%-52% by Weight Production from 30-280+ GPH Solvent Removed to Less Than 0.4% From Spent Biomass Stainless Steel Wetted Parts Eliminate Hazardous Waste Stream UL PLC controls Low Maintenance- Constructed for Maximum Duty Cycles Explosion Proof - Class 1 Div 1 UL PLC Controls Easy Maintenance Design Explosion Proof-Class 1 Div 1 Small Footprint Create Useable Biomass ROI Typically < 1 Year Screw Conveyor Feed and Discharge Available Food Grade Options Available Production from 94-489+ Gallons www.cbmills.com Sales@cbmills.com 800-522-7343