What’s Driving Growth In Cannabis? Legalized States.

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Roy Bingham: We stopped anticipating federal legalization having an impact because the states were making change happen anyway. And that change was driving growth one state at a time. So we focused much more in our modeling on the individual state activities. And then we have this concept that at some point, the Fed will make a move. But as far as consumers are concerned and consumer appetite and size of industry, it may not have a particularly big impact.

Rena Sherbill: Hi, again, everybody. Welcome back to the show. It’s great to have you listening. As always super excited to bring Roy Bingham on the show today. He’s CEO and Co-Founder of BDSA. Followers of the industry will recognize BDSA as suppliers of a lot of data on the industry. Roy gets into it today. But a lot of companies, a lot of dispensaries, a lot of consumers, a lot of investors take a look at that data they released in the fall, a semiannual market forecast. There’s a lot of great data that they’re putting out there. Roy gets into it today, how we can think about it as investors, how we can look at the landscape and think about it in terms of investing along with the data that we’re seeing.

There’s a lot to keep in our minds as investors and certainly broad picture about the industry and different data points is something that is certainly an essential part of that picture. So I’m excited to have Roy on. I’m excited to talk more about data than we usually do. So hope you enjoy it.

Roy, welcome to The Cannabis Investing Podcast. Really happy to have you on the show.

RB: Thank you very much. Pleasure to be here, Rena.

RS: Yeah, it’s nice to have you. I feel like we obviously talk about investing on this podcast. So we talk to analysts and company executives. It’s nice to talk to a data guy such as yourself. We don’t have a lot of data people on the show. So talk to us about BDSA.

RB: Well, I hope I won’t be terribly dull. I mean, data people aren’t famous for being interesting, either. But maybe we can pull out some fun insights.

RS: So I hope so, I hope so. Some of that British humor will get us through I suppose, in the cold dark world of data.

RB: Yeah. So we started the company in 2015, in Colorado with data from a single dispensary. And the point of that was to understand which brands are growing, which categories of products are what share of the market and what’s got the most energy behind as far as consumers are concerned. Now obviously, one dispensary was just a starting point. We now have thousands of dispensaries across the nation that are our data partners, and we provide them a service which enables them to decide which products to carry in that dispensary, so that, that they’re meeting consumer demand more effectively.

And that means how much of the store in terms of categories do you dedicate, to which kind of products and then also, which are the leading brands or the fastest growing brands or the ones that consumers find most exciting, so that when they come into the dispensary, they’re satisfied. At the end of the day, the last thing you want is someone who came into the dispensary with a particular product in mind, they couldn’t find it. And they went down the road to another dispensary. And then you might have lost, lifetime value of a customer or thousands of dollars.

So that’s the service that we provide for dispensaries. Now of course, this information is really valuable for the multi-state operators and brands as well. And that’s sort of what I used to do way back in my career, was develop new products for market opportunities. So the first thing is, how big is a category? How fast is that category growing? How competitive is that category? What are the price points and other product attributes that I need to be able to achieve in order to succeed in that category, so that you’re not launching into a big uncertain future, but rather you’ve defined the size of the category and the specific attributes and everything that you need in order to be competitive.

And that’s the leading brands and the multi-state operators who use our data for those purposes, as well as people outside the industry, some tobacco, alcohol, CPG companies that are looking at this space. And also financial institutions as well who are considering making investments into the area, and they want to know how particular companies are as well as macro trends for the industry.

So in addition to what I just described, the retail sales tracking data, we also do consumer insight, because our client said to us, well, that tells us what’s happened recently. And we have trending data, of course now for seven years. But what we’d like to know is what’s going to happen in the near future? Well, the best way to get at that is to understand what consumers want, what’s driving their behaviors. And so we serve thousands of consumers in order to get a sense of how their attitudes are changing. What are their behaviors, interests? Which products are they choosing, and why are they choosing those products, so that our clients can have this insight into the near future?

RS: Is that — sorry, could I just — I just wanted, is that in person? Is that over the phone? How do you collect that data from consumers?

RB: Those are primarily internet surveys. We do, do telephone calls, and we have done groups as well, more for the qualitative insights. But for the quantitative, it’s completing surveys online,

RS: And is — sorry, I just want to — I want to pick at that. Is that is that — like, how are you getting the consumers online? Is that from shopping on whatever online retail they’ve experienced?

RB: That’s a great question. But actually, no, the answer is that we need to do statistically significant surveys in every state, or at least in every state that matters in our surveys, all the adult use states and some of the medical states as well. And so we have to identify a demographically balanced portfolio of individuals, and then survey them. Well, the only way that we can do that is by working with a partner, which has a massive database of consumers who complete surveys. So we will work with them to identify thousand consumers that meet that demographic balance, and then ask them the questions.

RS: Got it. And what is the respondent percentage?

RB: Well, it’s good because our partner works with these particular people, obviously, for surveying for a lot of other reasons, as well, they have incentives to complete the surveys. But we also have checks and balances to make sure that they’re not just checking 1, 1, 1, 1, 1, or automating a response or something like that. So yeah, the survey responses are good. At the end of the day, what matters to us is that we got that statistically significant population survey.

Then our third service is really partly derivative of what we do with retail sales, tracking and understanding consumers, and it’s our market forecasting. It’s probably what we’re best known for, actually. And we started back in 2016, estimating the size of the cannabis industry in the United States, based upon our own data and data from states and other sources. And then we built that into a model for the United States. And then Canada added on, of course, and then eventually the rest of the world. And we’re tracking developments in 40 countries around the world as well.

Obviously, North America still very much the dominant market at the present time. And so our clients, of course, who are looking at the strategic level and saying, where should I be thinking about investing for the future, use that data comprehensively.

RS: And in terms of like working with clients, like be that companies or dispensaries? Is that, I’m sure at the beginning, it was more you reaching out to them. But is it that way now? Or is it people more reaching out to you?

RB: That’s a good question. I think we’re quite well known by our target group of both dispensary partners and by the leading brands. And we work with about with over half actually, the top 100 brands, and most of them multi-state operators as well as hundreds of thousands of independent dispensaries. So I think we’ve got fairly well known. It certainly was in the beginning, going out individually to prospective clients explaining the service.

The biggest challenge at the beginning was actually getting people to understand why is it useful? There were a lot of great entrepreneurs in this space, but they were doing things by gut feel, by thinking about what would be of interest as a product to them or to their immediate friends and family, that kind of thing, which is always the case when you get started. Then we have to say well, this analysis will augment your own intuitive feeling about market opportunities.

Now a lot of people have come into the industry from CPG, from beverage, alcohol and tobacco and they’re used to using data like this. Our mentor companies if you like are Nielsen and our partner IRI, which are extremely well known in that space, who pride in providing this kind of data. And quite a lot of the people that come into the industry will say, I just couldn’t do my job if I didn’t have IRI or Nielsen like data. So that’s great for us, because that means they actually seek us out.

RS: So speaking of what you were, you spoke earlier about what you’re best known for, is these market reports. So you released one in the fall? I think there’s a lot of kind of interesting points. I think, for me, one of the more interesting points is the notion of what legislation has brought, and how kind of the newer markets are doing better than the older markets, which is something that we’ve been talking a lot on the show kind of the problems with the mature markets.

Primarily, we’ve been talking about California, but I think you could put Colorado in there as well, in terms of seeing a decline. Can you talk to us a little bit about how people are extrapolating that data or how you see that data in terms of Biden’s comments in terms of the developing federal picture. How does that kind of have to do with this data point in terms of the newer markets coming online or doing better?

Also with the fact that it seems like we might be getting closer to federal legal legalization? I don’t know if you — I don’t — I mean, I know close is a relative term. But within the scope of that being somewhere in the near future, how are you looking at that?

RB: With regard to federal legalization, we realized several years ago, that guessing what the federal government was going to do, or trying to project or even listening to the experts talk about, it was a bit of a mug’s game. And so we stopped anticipating federal legalization having an impact. It was also easier to assume that there was not going to be significant federal change, because the states were making change happen anyway. And that change was driving growth, one state at a time, of course.

So we focused much more in our modeling on the individual state activities. And then we have this concept that at some point, the fed will make a move, but the reality is by then you will have 40 odd states with legal medical use and 20 plus probably with legal adult use, including the most populous most of the most popular states. And therefore, the main changes that federal legalization will introduce are more structural to the industry, they’re more about banking reform and banking capabilities and capital flows coming into the industry that enable the major players in the industry to progress normally, as well as the ability to do cross border. And that of course, will have a profound effect on the overall industry.

But as far as consumers are concerned, and consumer appetite and size of industry it may not have a particularly big impact.

RS: Do you feel like the more that the states develop, kind of this growing patchwork of federal legalization, even though it’s not federally legal? How do you feel like that develops for these companies? Like as these new markets go online, are companies searching out the newer markets because of these data points? How are they kind of looking at the growth strategy there?

RB: Well, you tend to have a different philosophy among the major players. I think you have some who have — most of them have got started in limited license states in Illinois and Massachusetts, up in the Northeast, etc. Some of them got started out in California or Colorado, but majority that we’re working with are in those limited license states where there’s value attached just to having a license. I mean, there used to be value attached to just having a license in Colorado, for example, but since there are thousands of such licenses, their value is limited. And so we’re essentially saying, I need to go to the next state that is going to have licenses on a limited basis, and I need to be one of the active applicants for licenses in those states or I need to purchase licenses in those states.

And of course, the growth comes from those states initially. As you said, we’ve got now California contracting, Colorado contracting, Nevada has been contracting for some time. Most of Oregon, most of the western states are not growing at the present time, largely because of price contraction. So volume is stable. But prices are coming down across the board in those states. Then we’ve got middle states that are — have been adult use legal for two or three or four years like Illinois and Massachusetts that continue to grow as penetration grows, and as more licenses are granted.

But then you’ve got the explosive opportunities, like New Jersey and New York, for example. Now of course, anybody who’s running — a major player in this industry wants to be in those states where you’re going to see multibillion dollar markets created over the next few years.

RS: So it’s interesting, specifically on the east coast with what’s happening in New York? I mean, there’s a couple, I think, points to pick on there. I think one is, are people racing? I think people were racing to get there, and now it seems like people are racing to get out of there in terms of these deals falling apart. These like, the Verano and the Goodness Growth deal fell apart, and the Sun Wellness deal fell apart.

A, I guess, how are you analyzing that data in terms of the licenses? And who’s getting those licenses? And how many years it might take for companies to see kind of a return on their investment there? And then also, I’ve read that you’ve said, and I would say, you’re in good company with this opinion about consolidation being a benefit, a positive for the industry, and we’ve seen these like big deals fall apart? How are you seeing that affect the industry? And what are your thoughts on, I guess, New York specifically, but that notion of depending on how legalization develops in the state, how beneficial that is for the bigger companies?

RB: Well, the first thing is, we assume that the regulators have looked at what’s happened in other states, and talked to their peers in other states, and recognized the rational way to organize the granting of licensing and the management of the industry in those states. We tend to be very cautious about what timeframe they introduce things in and that somewhat depends upon the momentum behind the legislation in the first place, state by state. But often, implementation takes an awful lot longer than you might imagine it was going to take, and it’s multi-stage as well.

So initial granting of handfuls of licenses, and then 50 licenses, and then like Illinois, another 100 licenses, can take many, many years. We assume — well, we estimate and project consumer demand in the state. And of course, we take into account the neighboring states and the amount of travel that people are able to do, and whether or not they can purchase in a nearby state and therefore, benefit that state but not benefit their local markets, and we adjust accordingly. And that’s a factor of course, especially in the northeast, where you’re talking about relatively small and geographically states that are interconnected by commerce quite a lot.

So we take those factors into account to estimate how big the legal market should be. And of course, the big factor you have to take into account there is the illicit market and the development of the illicit market and the enforcement, if there is any, and to what extent enforcement is going to reduce the illicit market. So you have states like Colorado with a lot of history. There wasn’t a very well developed illicit market in Colorado. In California, obviously, a very well developed illicit market that has not been aggressively regulated.

In some respects, the state has actually helped the illicit market by imposing a very high burden of taxes and other regulations on the regulated companies in the industry and thereby making a great advantage for the illicit operators.

In New York, we see a lot of people operating in the illicit space, in the gray market. There doesn’t seem to be a lot of consequences to that at the present time. And so one of the challenges for the regulated market is going to be dealing with that embedded industry that’s there and growing the market, as opposed to two-thirds of the market still being in the illicit space two or three years from now, or four years from now, which it could well be.

So that’s a big variable that we take into account. And based largely on what’s happened in other industries, plus any sign that we get about the regulatory environment and how it’s going to affect it.

RS: I mean, do you think that, or do you know that? I think my sense is that a lot of people shopping for cannabis right now in New York think that they’re going into legal storefronts?

RB: Yeah, that’s my impression as well. It’s a tricky one for us to survey. We can’t really ask that question. We can’t ask people about whether they’re doing something that is illegal.

RS: Yes, yes, I am.

RB: Well, we could, I suppose. But we wouldn’t have confidence in the accuracy of the answer, of course. So we do ask them questions that don’t solicit that answer. How much do you consume? How often do you consume? Who influences you in your consumption behavior? And all sorts of other questions that enable us to get at the size of the illicit market relative to the size of the regulated market. And also the appetite, frankly. We try to get some sense of whether people feel that they would switch and the need to switch when a regulated market’s available to them.

RS: What is the sense like why would people switch? Or when would they switch?

RB: Well, I think it’s actually two — there’s several aspects to this. Of course, there’s switching and then there’s new adoption. Switching is important, because it’s the majority of the heavier consumers and more knowledgeable consumers, etc. But there’s new adoption by people who are not materially purchasing in the illicit market at the present time. And also that probably includes a lot of tourists and visitors and all sorts of people who are coming in, encountering cannabis sold in a legal way for the first time. And like, oh, I’d like to try that. Or, I remember that from college days. I’d like to try it again and see what all of the fuss is about.

Switching is more difficult in a way because people have an established supply chain, they have products that they are satisfied — well may be satisfied with. Or maybe there are five out of ten. And that’s the big one is they say, oh, well, I’ll get better products. Either, I’ll get higher potency, if I like flower, I’ll get concentrates that I feel are more likely to work with a particular type of vaporizer. I’ll know that the products are tested at the state level and regulated properly.

I’ll be able to get edibles, which are relatively not so available in the illicit market, for example. And it’s a small percentage of people who change their behaviors. And then the marketers get going and start to put out the message. Oh, why don’t you place an order online here or swing by our dispensary on your way home or something? And that starts gradually but inexorably to change behavior. But it’s an uphill battle for the regulated industry.

RS: So what is your sense from, I guess looking at the industry, but also talking to the industry players in terms of these broken mergers, acquisitions? What is your sense of going forward from this? Do you think it’s specific to New York? Or do you think it’s a broader issue?

RB: I got to say, I’m not really directly involved in any discussions about specific transactions very consciously. We work with most of the major companies in the industry. We don’t want to know anything about their private business and their decision making processes. So we’re very much a data service to them. And we augment that data service with training and advice that we give them on how to use our tools. And we have quite frequent interaction with our clients, usually on much bigger picture types of topics.

But no, their exact thinking with regard to which market opportunity they’re going to pursue and how, is not something that we are usually privy to. But of course, you can see that there’s a big opportunity, but there’s very high cost associated with it. And therefore, negotiations have a tendency to break down. Partnering in general is a very complex matter. With the very limited capital that’s available to the industry at the present time, you can see why it’s difficult to execute.

RS: Yeah, absolutely. It’s also interesting to see, kind of there was, I think, promise of so many deals being done. And not only are their broken ones, but I think there’s also a dearth of actual, deals being announced. And I think, it seems to me it speaks a lot to the capital constraints, also, the state of the markets and all of that. And it’s certainly not helped by all the onerous taxes and whatnot, the companies are also paying. So yeah, I imagine, although all those things come into play.

RB: Yeah.

RS: Kind of moving from the states a little bit, you also focus on the global markets. We talked a bit this summer about Germany going legal. And that’s obviously something people are excited about. What are your thoughts on the developing international picture? I guess, maybe specifically Europe, but how — I know that there’s growth ahead, but how are you seeing that develop?

RB: Cautiously for the most part. So as you can tell from my accent, I’m actually from what is no longer Europe really, anymore, Britain. I spent quite a bit of time over there in the early days, 2017 and ’18, for example. And what I heard, when I was talking to people from throughout Europe is, oh, it’s all about medical. Don’t even talk about adult use or recreational use, because the regulators will be terrified if you start talking about that.

And it’s really only in the last year with Germany, that there’s been a major country talking about the adult use or recreational use. And that is, of course, the inflection point. So many companies have tried, have established substantial infrastructure in Europe for a medical market that hasn’t really become significant, including, even the German market has not become very significant yet.

And now we have one country that is probably leading the way with recreational use, and a few followers. But if you look at France, Britain, no significant progress in terms of even the opening up of a real medical market. The UK is incredibly limited in terms of use cases for medical cannabis. And so we’ve been very cautious about it. Again, like I was saying about state by state, country by country. And it’s a long, slow dragging process. There are signs of life at Germany, Mexico, looks like it could be a very significant market in due course. But we’ve also been seeing that regulatory process going on for the last five years as well.

And so, North America still will represent 75% of the global market, we think even five years from now.

RS: It’s interesting. I’ve also — I thought Mexico was, going to be online much, much sooner. What are your thoughts about Europe in terms of the lack of adoption? Do you feel like it’s a cultural thing?

RB: No, actually, I’m not sure that it is, no. I actually think that a lot of people got into the cannabis space from the pharmaceutical industry in Europe. And they have a very, very different mindset. And their mindset is to regulate cannabis somewhat like pharmaceuticals. And therefore proprietary positions are very important and long development cycles and high cost and not really thinking about consumer demand in the same way.

I was quite shocked by that difference. And I thought, well — I don’t think the consumers in their attitudes, behaviors and beliefs in the UK, France, Germany, for example, or Italy, or Spain, are massively different from the U.S. But I think that there are regulatory and industrial powers that have slowed things down and changed them to the detriment of the European market and the European consumer.

RS: Do you think that is ebbing, their power to kind of block that is ebbing?

RB: Not dramatically unfortunately, fairly cautious about that. They see it has a substantial growth opportunity for the pharmaceutical space or the biotech space. And they won’t give that up easily.

RS: Do you think that’s by and large a global issue?

RB: I can’t speak really to Asia, and India. I’m not an expert in those markets. They haven’t come very far so far. Obviously, you have to take that into account. In North America, well, there’s still a major debate, isn’t there about rescheduling versus descheduling, and the implications of that are pretty dramatic. If you reschedule, then the pharmaceutical industry is going to say, well it’s our market opportunity. But you’ve already got this very well developed state by state legalization structure.

So they have to accept that. I don’t see that going away. But it is possible that by descheduling, the Feds don’t help the industry — sorry, by rescheduling. By descheduling that would be helpful, of course.

RS: Do you have an opinion based on — I mean, I don’t know if they’re — if you collect — I don’t think that you collect data on the legislative process, like, who’s voting what and how are they voting? But do you have a sense of how you think that’s going to go? Or does this go under the category of no predictions…?

RB: No predictions from us. There are many people who have far more data sources than we do, who seem to have opinions and those opinions have been, were not necessarily wrong, but their timing has always been wrong so far.

RS: Yeah. One thing I wanted to ask, I’ve been struck talking to a lot of people growing cannabis, or kind of on the other side, talking about how they wish that it wasn’t that consumers weren’t all about THC content. And yet, there’s so much of the marketing and the labeling. And also, I saw that that’s one of the reasons why people can choose the cannabis is the THC content.

RB: Yeah.

RS: Do you think that’s like a chicken and egg thing? Like, are consumers looking at it because it’s there? And they’re like, I want high THC, because I want to get high in an adult use market? Or do you think — how are you — how do you think about that data point? And how important do you think it really is to the consumer.

RB: So it is a very, very important determinant of decision making about a particular product that people select. It always comes up number one, or number two, or number three, in our surveys, along with price being a factor. So far, the things that CPG does to address this are not really working yet in this space, which is to do with brand. So there are some people, some consumers who are now becoming brand loyal, or at least interested in being consistent with their brand. But it’s a small share of the market so far.

Therefore, the criteria that people are using is value. And of course, the value is often measured relative to THC content. So that is a major factor that the industry will want to overcome. And if we look out west in the mature markets, you’ve got two factors at work here. You’ve got oversupply, and that’s driving prices down. And the main instrument that people have got to compete with is high THC content. And so, yeah, it is a major consideration. Now not such a factor of course with other form factors.

So flower in the mature markets is somewhere around 35% by revenue of what is sold. Concentrates are now up in the 30% to 40% share of market. And there of course you’re talking about a 500 milligram, 1,000 milligram concentrate oil, which may have varying percentages attached to it. Consumers don’t seem to be quite so aware of the value and potency trade off when it comes to concentrates. And then of course, you’ve gotten about 15% of the market being in the form of edibles where that’s really their standardization. You’re talking about 10 milligram edible, typically, or a five milligram or some very low, low potency products.

And that is much more about consumers’ tastes and preferences these days. So that’s where we’re seeing a bit more brand loyalty. With brands like Wyld and Wana actually getting recognition and people seeking them out.

RS: Do you think that there’s more brand loyalty when it comes to gummies, as opposed to flower?

RB: Yes, yeah. Yeah, I do see that significantly. And what’s interesting, of course, is gummy consumption is it’s not as high. So it’s not a frequently purchased item, compared to flower. People aren’t going to the dispensary three times a week in order to purchase gummies. But when they do they’re often remembering the gummy that they had last time or the time before that they thought was good. And they’re going back for more of that.

RS: Interesting. What do you feel like is something that consumers are paying attention to, that you see companies trying to catch up with, or do you see something like that?

RB: Yeah, so with edibles in general, I still think that there is more appetite than the 15% or so share of the market, pun intended. I think that there are new adopters, and virtually every well-established consumer is purchasing some edibles as well. But new adopters will tend to choose edibles or vaporizer concentrates as their first introduction to the regulated market. And I think that they’re still looking for that consistent result, predictable result that they feel like, they felt like last time when they enjoyed the product that they knew how quick onset would be that they knew the offset would happen in a certain timeframe.

And a number of companies are coming out with significant improvements, both with edibles and beverages in that space as well. Beverages, a lot of expectations around beverages taking off, but it’s still less than 2% of the total market at the present time. And I think that’s partly challenged by the consumption environment. So since you don’t have a meaningful number of on-premise consumption opportunities, yet. It’s not like going down the road to the pub. Sorry for that. I was just in London a couple of weeks ago, and the pub is ubiquitous and still marvelous, actually.

RS: Do you feel that the data bears out? Or is it too soon to tell about, I guess, success or what consumption lounge would bring for a company?

RB: I don’t think there are enough data points really to determine whether that’s a material driver in the market yet. We do know from surveying consumers that many of them show an interest in a consumption lounge environment, and would certainly want to try it. But we also know that most consumers consume at home, and very often alone as well. So that’s not a social experience. And so…

RS: Is that true? Is that a data point that most people consume cannabis alone?

RB: Not most, a significant percentage of the total consumer alone, yeah. Yeah. And so it’s a different experience if you’re going into consumption lounge and having a social experience that some will not want to do. Some will coexist out with their at-home consumption and some may say, okay, this is where I want to be every time. That I doubt frankly.

RS: I want to ask you kind of what your most salient data point might be for investors, but I also am curious, you’re talking to companies outside of the cannabis space like be it tobacco or wherever they’re coming from. What is your sense of what the industry looks like, given your background and also just given who you talk to? Well, how do you see it kind of developing? Do you feel like it’s going to be companies coming outside and figuring it out or partnering? Or is it going to be a mix of outside and inside?

RB: Well, the first characteristic of the industry is growth. Now this is a relatively tough year, because of the challenges for the more mature markets that we talked about, yeah. Well, we estimate that the industry, the US industry will grow at 7% this year. And we see it growing at a compound of 12% for the next five years. To those of us in the cannabis industry they met, that doesn’t sound particularly spectacular, because we’re used to more rapid growth than that.

But the reality is, if you’re coming at this from tobacco and CPG, those are excellent growth rates. And therefore they speak to a lot of opportunity. I worked in the natural products, dietary supplement space for a long time, nearly 20 years. I got started in that space when Whole Foods Market had 17 stores. And so of course, over a long period of time, there was dramatic consolidation of that space. But there still exist independent health food stores all over the nation, as well, as they coexist alongside of Whole Foods, a major player, and there are still thousands of branded products.

Whilst there may be an 80-20 rule, 20% of the brands are 80% of the volume, there’s still a lot of independence and startups and new products in that space as well. So I see some similarities to the industry with which I was so familiar. And I do see the likelihood that there will be a handful of consolidators of the retail experience, primarily. And ultimately, consolidators tend to deal with the majority of their volume with major brands, whether it is their own brand, their own house brands or whether it is major players who are very active in sales, marketing and driving demand.

I don’t see why ultimately, this industry won’t look like most other CPG categories, if it were not for the regulatory factors that we all think will go away one day.

RS: Yeah, I think that might be a nice data point for investors, kind of you had two answers in one there. If you want to — if you want to speak to any data point you think might be salient for investors, or if you want to share anything before we go, but I’m very appreciative of your time. I feel like this has been a nice a nice perspective on the industry.

RB: Yeah, thank you. So to investors, I would just say keep your eyes on the growth of the industry in North America, the rest of the world. I don’t see massive investment opportunities in the near term. But in North America, you will see the emergence of major successful brands and multi-state operators and ultimately good investment returns. It’s all a question of when.

RS: Yeah, well, thanks, Roy. I really appreciate it and continue to look for data from you, and appreciate what you are doing for the industry, making it more secular. Thank you.

RB: Thank you very much. Thank you, Rena. Yeah, bdsa.com, and follow bdsa.com for anybody who wants to learn more about what we do and the data that we can provide.

RS: Thanks so much for listening to The Cannabis Investing Podcast. Subscribe or follow us on Seeking Alpha, Libsyn, Apple Podcast, Spotify or Stitcher. And we’d really appreciate it if you left us a review on Apple podcast. It helps other investors find our show and makes us feel fantastic. If you have feedback or questions, we’d love to hear from you at rena+pluscanpod@seekingalpha.com.

Nothing on this podcast should be taken as investment advice of any sort. I’m long Trulieve, Khiron, Isracann BioSciences, The Parent Company, Ayr Wellness, and the ETF MSOS. Subscribe to us on Libsyn, Apple Podcast, Spotify or Stitcher. Thanks so much for listening and see you next time.

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