When we talked with Chris Driessen from SLANG Worldwide (CSE: SLNG) back in June, the company had just announced had entered into an agreement to acquire High Fidelity, Vermont’s largest medical cannabis company. In a great bit of news for investors, that deal has been finalized, literally as of about an hour before this interview. We welcome back Chris Driessen, President of SLANG Worldwide, and Shayne Lynn, President of newly-established SLANG Vermont (formerly High Fidelity) to this episode of The Dales Report to talk about plans to conquer Vermont’s coming adult market.
Here’s some highlights from the interview.
Who High Fidelity was, and the Vermont landscape coming
For investors unfamiliar with the Vermont cannabis market, the market is currently medicinal only – but adult use is coming. The bill for recreational use has been put in place and online sales for the adult market are anticipated to begin sometime in 2022.
Lynn explains that the medical program is pretty small in Vermont, only about 4500 to 5000 users. And Chris explains that like all cannabis cultivators currently in the state, High Fidelity was vertically integrated, with four operating dispensaries and a 28,000 sqft cultivation/ manufacturing/ distribution facility. High Fidelity also had established statewide home-delivery and a robust portfolio of CBD products and retail stores.
Why the acquisition of Vermont-based High Fidelity was a great move for SLANG
Currently there’s only five licenses to cultivate in the state of Vermont, and High Fidelity possessed two of them. And Driessen nailed it on the head when he says “There’s going to be a period of time where those are the only people allowed to play ball.”
“[High Fidelity] is a very vibrant business as it is this very minute,” Driessen says. But what excites SLANG is what’s coming. The Vermont adult use market is projected to be worth approximately 230 million. To own two of the five licenses when the adult market moves into Vermont will be a huge opportunity.
To this end, Driessen says SLANG will be adding a 50,000 sqft expansion facility to help service the adult use market in Vermont.
Driessen and Lynn figure SLANG could capture 30% of the Vermont retail market
After all, Driessen points out, right now Lynn and his group services 70% of the flower sale in the state. “And though it’s a small population state,” he adds, “it punches above its weight class when it comes to tourism.”
Lynn agrees; Vermont’s tourism industry services about 18 million tourists per year, and many of them are interested in the craft product aspect.
Online sales expected to begin in 2022 and preparation for adult use continues
Lynn says that the bill’s rollout is about three months behind, but the cannabis control board has been formed relatively recently and they’re collecting data to help create the rules and regulations.
May 2022 was initially expected to be the goal for beginning online sales, however it might be delayed a month or two, he anticipates.
There’s more at work than just the facility expansion, Driessen and Lynn explain. Staffing and new retail locations are also being addressed, and the strategy of introducing cannabis to people who are not already users.