Article by Angela Stelmakowich, Growth Op
The past week in cannabis witnessed plenty of repositioning, everything from Kristen Bell landing a new retail agreement to Pure Sunfarms calling out potency labeling, Dutchie watching its valuation skyrocket and the U.S. industry seeing weed tax revenue swell.
Kristen Bell’s Happy Dance takes a twirl with beauty brand
The full collection of Happy Dance CBD products — co-founded by Toronto-based Cronos Group and actress/author Kristen Bell — have hit the shelves of 550 Ulta Beauty stores and on its website.
This will be the first time the line of multi-purpose, affordable CBD self-care products will make its way into brick-and-mortar retail, reports Cronos Group.
The line of three hemp-derived CBD bath and body products includes All-Over Whipped Body Butter + CBD (US$30), Head-to-Toe Coconut Melt + CBD (US$25) and Stress Away Bath Bomb + CBD (US$15).
“My goal in creating Happy Dance was to make trusted, high-quality, everyday CBD skincare products more widely available to busy moms and consumers everywhere at a price that wouldn’t break the bank,” says Bell. “Ulta Beauty is the perfect partner to make that dream a reality,” she notes.
One per cent of Happy Dance profits benefit A New Way of Life Reentry Project, a Black-owned, L.A.-based group that provides housing, case management, pro bono legal services, advocacy and leadership development for women rebuilding their lives after prison.
Potency labeling discrepancies mislead consumers
The CEO of B.C.-based licensed producer (LP) Pure Sunfarms is sounding the alarm about potency labeling practices among Canadian cannabis companies.
In a blog posted on LinkedIn, Mandesh Dosanjh writes that some producers are taking a “static” approach to labeling products, namely applying one pre-printed potency label across many batches based on a mid-point from test results, in a bid to save costs.
And that means displayed THC and CBD values may not be accurate for each individual batch, Dosanjh notes.
“Knowing very well that potency is one of the top criteria that cannabis consumers look for in making their purchase decisions, we believe this approach to labeling misleads consumers by creating a false impression about the potency of their dried flower,” he adds.
Writing “that does not sit well with us,” Pure Sunfarms submitted a complaint to Health Canada last month, BNN Bloomberg reported, breaking the news after obtaining a copy.
According to Bloomberg, the complaint states 18 separate batches of products sold under one LP’s brand are labeled at 20 per cent THC. The “statistical likelihood of this many lots coming back with identical test result potencies of precisely 20.0 per cent is extremely low.”
The complaint further suggests other companies may be engaged in “static” labeling. Dan Sutton, CEO of Tantalus Labs, praised Dosanjh, and added that he regards the situation as “ultimately tantamount to fraud. If @HealthCanada does not penalize this behaviour, it will signal many other bad actors to misrepresent potency for commercial gain.”
Weed tech platform valuation tops US$1.7 billion
Thanks to a recent funding round led by Tiger Global, the Oregon-based cannabis technology platform, Dutchie, now has a valuation of US$1.7 billion.
The investment injection will allow Dutchie to advance its mission, notes a company statement, including by continuing to attract top talent, helping with expanding into new markets and assisting in launching product developments to support cannabis dispensaries.
Beyond Tiger Global, the US$200 million raised included participation from new investors Drogneer and DFJ Growth and existing investors such as Casa Verde Capital, Thrive Capital, Gron Ventures and former Starbucks chairman and CEO Howard Schultz.
Ross Lipson, CEO and co-founder of Dutchie, told The GrowthOp last year that the service is an “intersection of my passion for cannabis and my experience in online ordering.” As of that time in Canada, Dutchie was providing online shoppers an alternative to the Shopify-hosted Ontario Cannabis Store, and had signed up stores in B.C., Alberta and Manitoba.
To further enhance its value to dispensaries and consumers, Dutchie announces it has also acquired cannabis-focused Greenbits and LeafLogix, both of which offer enterprise resource planning and point-of-sale software solutions.
“We believe we have a responsibility to help contribute to the next evolution of the industry” and “create opportunities and outcomes that benefit all of our partners and consumers,” Lipson says.
U.S. marijuana tax revenue reached US$3 billion in 2020
State and local cannabis tax revenue in the U.S. is trending upward and that climb should continue as more states legalize, but the rise will no last forever, caution new figures from the Institute on Taxation and Economic Policy (ITEP).
“Powered by an expanding legal market and a pandemic-driven boost in cannabis use, excise and sales taxes on cannabis jumped by more than US$1 billion (almost $1.3 billion) in 2020, or 58 per cent,” year over year, reports ITEP, which considered tax revenue data from 10 U.S. states where sales of recreational weed were legal last year.