CANNAINVESTOR Magazine U.S. Privately Held Companies April 2018 | Page 69

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CIM: Are the risks for investors minimized due to the fact your Company is an ancillary business and do not “touch the plant?”

Nicole: Ultimately, Oblend is a technology company. Investor risks are minimized due to several factors including our ancillary business model and our ability to pivot to other industries if the need ever arises.

CIM: How much capital do you need short-term? How much do you need long-term?

Nicole: We are in the process of raising $3M to close our $5M Series A round. We will use these funds to build and conduct a beta test followed by our pilot commercial launch in late 2018. In early 2019, once we’ve confirmed our business model, we’ll raise our last round of financing to commercialize nationally. Since the majority of these funds will be used to build our sales channels & inventory, we anticipate that this last round of financing will be cheaper and sourced through an institutional lender, a royalty fund, or possibly an IPO. Our forecast shows that we’ll be cash flow positive within 18 months of our commercial launch.

CIM: Do you currently have any major investors?

Nicole: Our largest investor is White Sheep Corporation, a Toronto based cannabis fund. Hamish Sutherland, founder and CEO of White Sheep, is on our board and was recently identified as one of the rising stars of marijuana’s investment scene by Business Insider. Other notable investors include Lorne Gertner (Tokyo Smoke), John Radostits (Canndara Capital), and Brett Wilson (Dragen’s Den).

CIM: What would be investors’ exit strategy if they invest in Oblend?

Nicole: Given that the Oblend Platform is relevant to other industries and that we expect to reach a positive operating cash flow within 18 months of product launch, we have multiple potential exit opportunities. We could license our technology to major players in other industries, globally, or even sell licenses to producers within the industry to provide them with steady demand and differentiation. Additionally, we believe that our deidentified and scrubbed data will provide long-term value. We will be building a considerable data set based on use and user behavior including consumer demographics, what users are searching for, blending, how often, and in what form. Ours data will allow us to identify clusters of successful formulations and to identify other important relationships and correlations, all of which will be valuable not only to our user experience but for many other downstream uses. Finally, given Oblend’s multiple streams of recurring revenue, huge market opportunity, and high growth rate, it is a very attractive IPO or target acquisition.

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