Cannabis.net has been flying under the radar with private funding so far, but with the November elections coming and the mass marijuana movement growing, this website is poised to be an industry giant. I got to sit down with the CEO of Cannabis.net, Curt Dalton, for 5 questions about the cannabis industry and online investment right now.
One.
Curt, in your mind, what is the best way to play or invest in the marijuana industry right now?
Curt: Great question and I think many investors are being blinded by irrational exuberance right now as they try to join the green rush. I think investing online in web traffic and sites is a great play as you do not have to touch the flower, as we like to say. When you are investing in marijuana and you touch the flower, you must deal with many state and local laws. I would sit back and wait to see who the winners are, say, in the edible space, in the plastics space, in the lab space, and then make a better-informed decision. It is the wild west out there as far as business plans, growth models, and management teams. I have no idea who will win those battles, but I do know that internet traffic is always god, and it goes double for a niche like this where you can’t buy advertising at traditional places yet.
What areas should investors avoid?
Curt: I would stay away from growers and owning the flower. The cost of cannabis bud and flower is only going to come down over the next 5 years with all the world wide growing. I talked to one grower and he said the whole sale price of a pound of cannabis in Colorado this season was $800. That is crazy. When you factor in growing costs and paying pickers and trimmers, there is almost no profit left in that pound of leaf. Margins are compressing quickly on the plant, so on the flip side, edibles are looking good because the plant is an ingredient, and when ingredient costs go down, your margins go up on the edibles. Plus, you can use subpar plants and stocks that you can’t get away with selling as straight flower at a dispensary.
Any areas that need to still be tackled or that companies could step into and thrive?
Curt: Sure, I was not on board with the Shark Tank group saying everything in marijuana has already been done. The banking sector still needs a good solution, the credit area still needs a good solution, and seed to sale technology still needs more players. The analytics space is getting crowded in the cannabis niche but there is still some opportunity there.
4. Where do you see the niche in 2 years?
Curt: Growing and growing. For us, being an online site that is keyword targeted to cannabis and marijuana, we just see the amount of internet searches doubling every 90 days as tens of millions of people start searching for cannabis worldwide. We have built our site to be the most advanced portal online doing full mapping for doctors, dispensaries, lawyers, vape stores, head shops, and cannabusinesses around the world. We added a full social network for users to interact and communicate, as well as a word wide blogging platform for writers around the world. We are the only site to do all three things, a social network, mapping, and blogging. Every dispensary that opens, every doctor that prescribes a mmj card, or any business in the cannabis space becomes a potential client of ours. That is not just US and Canada based, that is worldwide.
5. Why not go for funding earlier, and why wait?
Curt: We wanted to build a top-notch site and product first, launch it, and get our analytics going before seeking funding. We are currently in a new funding round right now and taking on investors. Now that we see the traffic and revenue, we can give a better, more realistic picture of our business model to investors. Our competition is doing around $3million a month just in listing fees for doctors and dispensaries, and since we have an exact match domain for the niche, and Google loves us, we think we can start taking some market share in 2017. Since we have one of the four exact match domains in the niche, our URL itself puts our valuation in the millions before we even built the site or made it to #1 in Google for the word cannabis and marijuana. So investors have good times ahead, we hope.
Thanks, Curt.
MAPH Enterprises, LLC | (305) 414-0128 | 1501 Venera Ave, Coral Gables, FL 33146 | new@marijuanastocks.com
