Hemptown – 25 August

25 Aug 2020
 

Hemptown

Hemptown is a platform for industry consolidation and vertical integration. The company is working towards positioning itself as ‘The Procter & Gamble’ for the cannabinoid industry. Farming in Oregon since 2017, Hemptown is a leading cultivator of feminized hemp and is one of the largest producers of CBG globally. 

Hemptown faces competitors across their value chain, with most existing in the finished good/consumer packaged goods space. Hemptown’s vertically integrated structure, combined with their access to capital will allow them to acquire brands that need growth capital which is their major differentiation. On the cultivation side of the business, their focus on growing the highest quality, most compliant product is what sets them apart from the competition.

 

Traction

As an established and experienced operator, Hemptown is lead by a Fortune 500 management team, including past representatives from Kelloggs and Intel. In 2019, the company amassed $17.6m in gross revenue and raised $24m in funding that same year. 

Hemptown is currently in the works on a roll-up strategy with a strong M&A pipeline and plans towards full integration through the M&A pipeline. In fulfillment of their plans, they are already in advanced discussions with multiple targets and had recently signed an LOI with Hemp Smokables Group. Hemptown also anticipates the potential to increase consolidated revenue to over $100m. 

Every Hemptown USA product is grown to the highest standard and comes with complete compliance documentation along with third-party accredited lab Certificate of Analysis demonstrating purity and potency. Their Ultra Tested® line of products are subject to rigorous purity testing protocol, which far exceeds FDA requirements for testing. 

Following Hemptown’s acquisition of Kirkman Group, an established nutraceutical brand in business for over 70 years ($6m revenue (2019), $8m revenue (2020E)), they plan to further their vertical integration execution within the cannabinoid and nutraceutical industries. 

 

Team

Eric Gripentrog, CEO – Eric has worked in the Consumer-Packaged Goods industry for 27 years. He worked for the Kellogg Company for 25 years in several different roles, both domestically and internationally, and most recently leading Panera’s Consumer Packaged Goods division. He is known as a change leader. With a strong background in the development, marketing, and delivery of leading consumer packaged goods (“CPG”) brands. Eric is driving future growth of Hemptown as the company expands its footprint in the CPG space. 

Rob Fenty, COO – Rob is a 20-year veteran of leading fast-paced growth businesses. From 2011 to 2016, Rob was President of the Apparel and Accessories division and led corporate strategy for KEEN Footwear. Rob spent 8 years with Intel’s New Business Group leading the growth of businesses from $0 to >$100M.Rob has also consulted with leadership teams of over 100 leading brands, including Starbucks, Nike, Providence St. Joseph Health, Broadcom, and Oracle. Rob has an MBA from the Stanford Graduate School of Business.

Rod Wolterman, Co-Founder & Chairman – Rod Wolterman founded Hemptown’s Oregon Operation in 2016. Mr. Wolterman has extensive experience in the cannabis sector, having been active within the sector since 1998, when Provision 215 was approved to legalize medical cannabis at scale in California. Mr. Wolterman acted as a private equity investor in numerous medical marijuana dispensaries and cultivation operations in Southern California.

Michael Townsend, Co-Founder & President – Michael Townsend has extensive experience in corporate finance spanning over 25 years. Mr. Townsend is the founding partner of Altus Capital Partners, a boutique investment bank in Vancouver, BC, Canada. Mr. Townsend has been involved in raising over $180 million over the past 10 years. Mr. Townsend co-founded Patriot One Technologies Inc. and Body and Mind Inc. 

 
 

Funding

To further their growth initiatives, Hemptown is planning to raise USD $7m which will be used to complete M&A transactions ahead of a public listing. 

Their past financing history has included raising USD $24m in 2019 and with the most recent round being at a USD $104m valuation post-money. With their multitudes of successes, Hemptown has garnered over 700 shareholders. 

 

Revenue Model

Hemptown uses a diversified business model that focuses on being vertically integrated across the cannabinoid value chain.

Their revenue stream spans across the value chain and has the flexibility to adapt to shifting marketing depth.

 

Details

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