It was only just last week that the CBD company announced an acquisition of Apothecanna. This week, another piece of the puzzle falls into place for HempFusion (TSE:CBD.U)(OTCMKTS:CBDHF). Dr. Jason Mitchell is with us again to discuss HempFusion Wellness’ latest piece of exciting news about acquiring the largest woman-founded CBD product company, Sagely Naturals.
Here’s some highlights from the interview.
Sagely talks with HempFusion have been in the pipeline for months
Dr. Mitchell kept this hand of cards close to his chest, but for those who feel like it may have been a recent development, he assures us that this is not so.
“What [people] don’t know is that we’ve been working with these two companies for over eight months now,” he says. “We reviewed multiple companies because … we have a strategy that we know we believe is a winning strategy. But we have to have certain elements of synergy to occur. In fact, in the beginning of last year, I said consolidation is inevitable in the business of CBD. This business cannot support 3500 brands. But it can support some well-rounded well-positioned enterprises that have things covered succinctly and are compliant.”
How Sagely plays into HempFusion’s needs – and vice versa
“We haven’t focused on reaching specifically women, and I think that’s such an important audience,” Mitchell says. “Not only for the vast reasons why CBD is so wonderful, but just the fact that in truth when looking statistically, 80% of consumer packaged goods shoppers, especially in the area of health and wellness, are women. And the reason is they do their homework, they do their research, they’re interested in means of taking care of themselves different. I hate to say it, but for us guys? We don’t think like that.”
Sagely Naturals, on the other hand, has needs much like Apothecanna that HempFusion can fill. Since their business is almost exclusively topical, Mitchell says, “…we’re going to be able to install an ingestible program in both companies that meets the needs of their consumers and it helps them have an immediate opportunity for expansion.”
Co-founders will be staying with the company
Both Kerrigan Behrens and Kaley Nichol, the co-founders and co-CEOs of Sagely, have signed employment agreements to stay.
“I wouldn’t want to do this without them, because they’ve got such an inspired vision I want to make sure we fuel that vision and build it,” Mitchell says.
HempFusion not “just bolting on revenue” by acquiring Sagely
Some skeptics may see the acquisition as a means to bolster revenue figures, admits Mitchell. But he says, “…If we’re doing that, by Apothecanna and Sagely, in the last 10 days, based on 2020 revenue, we’ve just tripled our revenue. Okay. That’s exciting for a minute, but what are you going to do now? You still gotta grow the enterprises. You gotta create value in the marketplace so that shareholders and industry feel that it’s a worthy investment. Shareholders need to feel that we have a plan. The plan is not to just bolt on revenue.”
But Dr. Mitchell also adds for investors, “…look at our prospectus. We told you what we’re going to do. Now we’re doing it in real time.”