Midas Letter

Labrador Gold Corp (CVE:LAB) (FRA:2N6) is an explorer-led company aggressively targeting Labrador’s under-explored gold potential. Technical Advisor Shawn Ryan was instrumental in starting a gold rush in the Yukon in 2010 and 2011. Ryan explains his role in creating best practices and describes the new exploration technique he created in 2011, Drones to Drills, a much more economical exploration technique than available at the time. Labrador is virtually unexplored for gold with only 10 gold occurrences recorded. Labrador Gold has two main projects in the region, the Hopedale Property and the Ashaunipi Property. The company’s summer drill program includes drilling 20 targets by September at one of these project sites. Ryan estimates the drill program will cost $500,000 and notes Labrador Gold has approximately $800,000 in the bank and is in the middle of a $1.5 million capital raise. Ryan hopes to find a deposit in the 2,000,000 to 3,000,000 ounce range to interest a large mining operation in the site.

Ed Milewski:  Well, good afternoon. Joining me now, we’ve got Shawn Ryan with us. Shawn, you’re a famous guy.

Shawn Ryan:   I’m a prospector.

Ed Milewski:  Shawn was instrumental in causing a gold rush in the Yukon back in –

Shawn Ryan:   Yep, 2010 and ’11.

Ed Milewski:  Yeah, 2010 and ’11. Very similar to the Yukon Gold Rush 100

Amyris Inc (NASDAQ:AMRS) (FRA:3A01) CEO John Melo explains how the company makes natural products in sustainable fashion, while speaking at the recent Paradigm Capital Biosynthesis Conference. Amyris employs a fermentation process using yeast derived from sustainable sugarcane. The company’s ingredients are used in a wide variety of products including skin care and fragrances. By developing the emollient squalene through a fermentation process, Amyris has significantly expanded the market for the vital skin care ingredient, without harming its natural source. Melo sees increased availability of existing ingredients as the most important result of metabolic engineering. He suggests that making cannabinoids through a fermentation process will make them a viable alternative to other substances and a potential solution to the opioid crisis. Melo addresses the company’s evolution from a renewable fuel company to a metabolic engineering company that is commercializing multiple products annually.

John Melo:    We make the world, one molecule at a time. We do it by re-engineering yeast, something that’s been around forever; but instead of yeast making wine or beer, we actually get yeast, through a fermentation process, to make natural products sustainably. Everything from products for skin care ingredients, flavours, fragrances, vitamins, and now, cannabinoids.

Green Relief Inc CEO Dr. Neilank Jha is thrilled to refocus the company as a purely medical cannabis operation. Green Relief intends to have positive cash flow in its first facility this fall and is oversubscribed on its current capital raise. While Dr. Jha is mindful of the necessary parameters for an IPO, as CEO he’s focused on creating value for current shareholders privately. Green Relief is expanding to meet patient demand for its high-quality products and the company just signed a lease to retrofit a 175,000 square-foot facility to increase production and biomass. He explains that Green Relief will expand its offerings at this facility to include soil-based products in addition to products produced using aquaponics. Dr. Jha discusses how Green Relief is now focused on medical cannabis only and believes the company’s subsidiaries such as Green Relief Genetics can not only optimize yields for Green Relief but other companies as well. Dr. Jha discusses the evolving medical cannabis space in Canada and notes that the clinic model many medical cannabis companies rely on is not necessary anymore as more doctors become increasingly comfortable prescribing medical cannabis.

James West:   I’m joined now by Neilank Jha. He’s the CEO of Green Relief. Neilank, welcome back.

Neilank Jha:  Thanks for having me, James.

James West:   Now, I feel kind of like I’m really blowing my own horn when I’m blowing your horn, here, because I’ve got, you know, increasing amounts of capital going into your company. I’m buying your product. Like, I’m basically a one-man promotional outlet for Green Relief! That being said, the reason I keep writing cheques to this company and keep buying their product is because it’s so damn good, and I say that having compared Green Relief’s Sunrise Oil, which if you go to their website right now, you can’t buy it. You can buy Sunrise Light, has come back into stock as of yesterday, but I bet you it’ll be out of stock by tomorrow, because everybody loves this oil.

And, like, what can we say about it? You can’t keep it on the shelves; why is that?

Neilank Jha:  Well, it’s a very high quality CBD product. We’re at 55 percent CBD, and it’s due to the Green Relief labs that we have, where we have very advanced extraction techniques with the liquid chromatography, the simple path distillation. We’ve invested a lot at Green Relief. We’re a medical-focused company on the quality of the product.

James West:   Okay. So Green Relief is still private; when is it going to go public?

Neilank Jha:  Well, James, right now what we’re doing is, we’re building value for our current shareholders privately. I was only brought on as CEO seven weeks ago. We’ve refocused the company to be purely medical, so we have Green Relief, the parent company, which does the cultivation, where we have our aquaponics facility in Hamilton. We just signed the lease and opened the doors to start construction of a retrofit of 175,000 square foot facility to increase our production, and there we’re going to be offering different offerings in the form of soil-based products as well, to increa

Demetrix Inc is a biosynthesis company producing rare, natural ingredients via fermentation. CEO Jeff Ubersax states that the company’s goal is to produce rare ingredients at a higher purity and consistency than traditional sources for use in consumer packaged goods in the pharmaceutical, health supplements, and cosmetics spaces. Ubersax reveals that the first ingredients Demetrix is planning to bring to market are cannabinoid-based. He credits the company’s seed financing round, in which Demetrix raised approximately $11 million, with allowing the company to put together an experienced team. He suggests that new technology, both on the plant side as well as the microbe side, will bring the cost of goods down; however, he believes that fermentation-derived products will be the most cost effective way to produce the rarest cannabinoids. Demetrix is in the midst of Series A financing and hopes to close this capital raise within the next couple of months.

Narrator:     Demetrix Inc is a privately held biosynthesis company. The company uses genetics and computing enabled deciphering technology to produce drugs and engineer strains to produce co-evolved and bio-inspired medicines and nutraceuticals.

Demetrix was founded in 2015 and has raised over $11 million in seed funding led by Horizons Ventures.

James West:   I’m joined now by Jeff Ubersax. He’s the CEO of Demetrix, Inc. Jeff, welcome to the show.

Jeff Ubersax: Thanks for having me. I appreciate your time.

James West:   Sure, Jeff. Let’s start with an overview: what is the business of Demetrix?

Jeff Ubersax: Sure. So at Demetrix, our mission is to help the world benefit from nature’s rarest ingredients. So we use a combination of advanced automation, biotechnology and computing tools to produce rare natural ingredients by fermentation, and you know, the intention of the company is to help pharmaceutical, consumer products, supplement, health and beauty companies access rare ingredients at a higher purity and higher consistency than they can get from any other source, from traditional methods.

And you know, our first products that we’re planning on bringing to market are cannabinoids, and I think, you know, a really important thing to know about this space is bringing products to market through fermentation this way is hard. There are a lot of challenges, and I think that our company is particularly well positioned to solve some of these, you know. We’ve got a really fantastic seed round of about $11 million that has really allowed us to hire an exceptional team that has already had experience in this industry for bringing seven different yeast-derived products to market through scales of hundreds of metric tonnes.

And then I think the third piece of that is really being able to build, you know, the incredible set of technology that’s really required to do this well at scale and to bring these products to the market very quickly.

James West:   Very cool. So, biosynthesizing cannabinoids through the fermentation process, recently we were both at t

Midas Letter Capital Markets Advisor Steve Misener, CFA, breaks down Canopy Growth Corp’s (TSE:WEED) (NYSE:CGC) (FRA:11L1) planned acquisition of Acreage Holdings Inc (CNSX:ACRG.U) (OTCMKTS:ACRGF). Misener believes the deal represents a win for both companies and suggests that Acreage had to act as liquidity issues and the fact that its stock was trading below its IPO price meant it would be less than favourable for the company to raise more equity. Acreage is now in 20 states and Misener suggests the buildout of that footprint may have seriously depleted the company’s IPO funds. Misener indicates that the market is not currently pricing in the company’s eventual share price when the sale is finalized because of the unknown timeline of US federal decriminalization. Misener believes this unknown is what is creating the discount between the potential for the Acreage shares when the deal is finalized and current prices. Misener suggests Acreage, which has not released a financial statement since its IPO, now has access to needed capital through Canopy Growth and Constellation Brands. The deal has provided necessary liquidity and access to essential capital. According to Misener, the deal makes Canopy even more attractive to fund managers, as it gives the company a much-needed US footprint.

James West:   I’m joined now by Steve Misener, CFA, one of Canada’s most recognized figures in the institutional investment space. Steve, welcome back to the show.

Steve Misener: Thanks, James, my pleasure.

James West:   Steve, we had some interesting comments in a conversation about the transaction whereby Canopy Growth is planning to acquire Acreage Holdings, and we more or less arrived at a similar conclusion, which is that at the end of the day, this is a win-win for both sides. My preference was to point out that this is why, that I don’t like to be involved with companies that have supervoting structures, because I can guarantee that Kevin Murphy, who exercised 83 percent of the votes, did not buy his shares at $25 a share like the IPO round holders. So how do you portray that as a win for shareholders of Acreage?

Steve Misener: Well, Acreage needed to do something, because the stock was down from the IPO price – I believe it was $25 last November, and given the liquidity issu

New Wave Holdings Corp is an investment company focusing on the competitive gaming and esports space. CMO Dan Mitre explains the growing gaming phenomenon and how esports is rapidly taking root in the North American market. New Wave recently entered into a binding letter of intent with Trueclaim Exploration Inc (CVE:TRM). Trueclaim will acquire a 100 percent interest in New Wave as part of a reverse takeover and Mitre anticipates the company going public within a few months. Mitre explains the value proposition offered by gaming teams, such as Team Tiidal and Team Lazarus, and monetization in the gaming industry more broadly. Mitre emphasizes that esports is a skill-based experience that removes buy-in variables, which impact results. Mitre suggests that New Wave is an attractive proposition for individuals looking to get into the gaming landscape as investors for the first time because the company’s experienced team actively vets industry opportunities.

Narrator:     New Wave Holdings Corp is a privately held gaming and esports founded in 2018, with offices in Toronto and Los Angeles. The company provides capital funds and support services to esports companies, organizations, teams, leagues, and esports technology.

The company is currently in the process of completing an RTO and plans to list on the Canadian Stock Exchange.

Ed Milewski:  Joining me now, Dan Mitre, CMO New Wave Holdings. CMO stands for Chief Marketing Officer. You’re a 16-year veteran of the space, correct?

Dan Mitre:    Correct.

Ed Milewski:  And you’re based in southern Cal, southern California, and that’s sort of the epicentre of esports. Fair statement?

Dan Mitre:    Yeah, I mean, I’d say esports is a global affair.

Ed Milewski:  You said earlier, you thought it’s bigger in Europe and in Asia, than it is in North America.

Dan Mitre:    Absolutely, hands down. I mean, you have Asia that’s a good 20 years ahead of us, plus they’ve adopted esports back with the Star Craft scene, and they have massive teams and massive organizations, and a great economy over there.

Europe is just behind them. Europe has very much adopted that; there’s an audience that loves to watch esports and playing esports, and now we’re seeing it hit the North American front. We’re still relatively in the incubative state, but you have massive companies that see the potential in North America and jumping on that. Same with New Wave Holdings.

Ed Milewski:  So it’s an industry I know, I know it’s growing rapidly. I keep getting newspaper clippings about, you know, women are now big into esports as a sort of a potential new market. But it’s big, it’s all over, and New Wave is a company that, it’s still private, but we’re going to go public here shortly. We’ve identified a company that’s now halted on the Venture, and I guess all the regulatory work is being done, and eventually Trueclaim, which is TRM, i

Ignite Cannabis founder and Instagram King Dan Bilzerian introduces viewers to his premium global cannabis brand, Ignite. Unlike many industry players, Ignite is not vertically integrated and plans to partner with leading growers and manufacturers to produce Ignite products. While Bilzerian is launching the brand, media personalities from a variety of industries, including Cardi B, Jai Paul, and Nikita Dragon, have also been involved in spreading the word. Bilzerian reveals the company is focusing on products with the broadest reach that can enter more legal jurisdictions. He discusses Ignite’s advertising campaign in the United States and discusses the benefits of not having a personal cannabis brand when it comes to entering the Canadian market. Bilzerian wants to develop a complete THC, CBD, and nicotine product to take on the e-cigarette market currently dominated by companies like Juul. He is committed to counting longstanding stereotypes about cannabis users and showing that cannabis consumption can be part of an active lifestyle. Bilzerian talks about using sativas as part of his workout routine in terms of benefits and drawbacks.

James West:   Dan, let’s start with how’d you get into cannabis in the first place?

Dan Bilzerian: Initially, how I started smoking cannabis? Or business-wise?

James West:   Both.

Dan Bilzerian: Eleven years old, golf course, tin can, first time I got high.

James West:   Eleven years old. Are you California born and raised?

Dan Bilzerian: No, actually. Tampa, Florida, and then I did, I bounced around a lot, but I grew up in Tampa.

James West:   Okay. I see people making a big deal out of the fact that you’re a trust fund kid. Does that piss you off?

Dan Bilzerian: No, not really. That actually helped me out a lot; that’s what helped me, you know, really make a lot of money in poker, because the thing about poker is, like, people just don’t want to play with people that can’t lose a lot of money, and so when I got into poker, a lot of people were focusing on being the best poker player and, you know, making all the perfect moves. And for me, I knew that if I just got in with like super rich bad players, then I didn’t have to be the best of the best, and it was okay to make some mistakes and, you know, give a little bit more action than you were supposed to.

So for me, having people think that, you know, that was my background was, you know, really helpful. My trust didn’t even kick in till I was 35, and I gave it away anyways. But –

James West:   You gave it away?

Dan Bilzerian: Yeah.

James West:   All of it?

Dan Bilzerian: Yeah, to my brother.

James West:   Really? That’s – can I ask why?

Dan Bilzerian: You know, I just didn’t really need

High Times magazine is the most well-known brand in cannabis and is the leading source for cannabis news, information, and culture globally. HighTimes Holding Corp Executive Chairman Adam Levin provides an overview of the company and an update on recent acquisitions. High Times has acquired key players in the cannabis media space such as Culture, Green Rush Daily, and Dope Magazine. Levin stresses that High Times is more than a media company and shares details of the company’s definitive agreement to buy Feria Del Canamo, S.L. (Spannabis), the largest cannabis trade conference in Europe. These deals ensure that High Times has the largest cannabis audience on the internet, with its publishing portfolio reaching 22 million cannaconsumers. In addition to its publishing assets, the company’s revenue model includes ancillary products, merchandise, B2B trade shows, and concert and event promotion, including the Cannabis Cup. The company is currently undergoing a Regulation A+ offering and Levin is thrilled High Times has secured over 20,000 retail shareholders, as he anticipates the company going public this quarter.

James West:   I’m joined now by Adam Levin. He’s the Executive Chairman of High Times Magazine, the best-known brand in cannabis in the world. Adam, welcome.

Adam Levin:   Thank you so much for having me.

James West:   You bet. I have been a reader of High Times on and off over the entire 44 year history. I’m 55, I started reading it when I was actually nine years old.

Adam Levin:   Amazing. I love it.

James West:   I learned how to grow cannabis from Ed Rosenthal, who was once one of the most prolific writers of High Times.

Adam Levin:   Not only one of the most; I mean, he’s still prolific as it gets. He’s probably one of the biggest names.

James West:   Yeah, he is. Actually I went and met him at his house and we shot an interview there that’s going –

Adam Levin:   Did he share some of his stuff with you?

James West:   He didn’t, because I was with all this film crew and everything. It wasn’t really copacetic, yeah. Okay, so you just led a group that has taken over High Times from previous management.

Adam Levin:   I did that two years ago today. Since then, we’ve made seven acquisitions in the space. We’ve bought Culture, we’ve bought Dope Magazine and media properties, in addition, Green Rush Daily. We just announced a definitive agreement to buy Spannabis, the largest cannabis trade conference in Europe.

James West:   Really?

Adam Levin:   And announced recently that we signed definitives to buy The Big Show. Beyond that, we’ve, it’s been a busy two years, but we’ve done, I don’t know how familiar you are with a Reg-A IPO, it’s like a mini-IPO.

James West:   Reg-A Plus?

Adam Levin:   Reg-A Plus.

James West:   Oh, I know Reg-A plus ve

Renew Biopharma Inc is a research company developing proprietary therapeutics to treat neurodegenerative diseases, traumatic brain injuries (TBI), and for pain management. CEO Mike Mendez provides an introduction to the company and explains its interest in developing treatments using biosynthetic cannabinoids. Mendez believes both the discovery of synthetic biology and the changing legal status of cannabis have created a “new frontier” of treatment development. Mendez describes Renew’s approach as “chassis agnostic” and reveals the company is more interested in developing specific therapeutics. Renew is currently producing cannabinoids and derivatives using microalgae and already has its first drug lead for the treatment of traumatic brain injuries. Renew’s focus on traumatic brain injuries meets a need in the medical space and Mendez notes that cannabinoids are a promising avenue because cannabinoid molecules can cross the blood-brain barrier. Mendez talks about the process for developing Renew’s research into FDA-approved medical treatments and highlights GW Pharmaceuticals (NASDAQ:GWPH) (OTCMKTS:GWPRF) (FRA:GW2A) for its leadership in the space.

Narrator: Renew Biopharma is a San Diego based synthetic biology company focused on creating pure, uncontaminated, and non-psychoactive cannabinoids to enable human therapeutic breakthroughs and improve human health.

The company relies on molecular biology and pathway engineering instead of using agriculturally-grown cannabis plants. Renew Bipharma plans to develop therapies for chronic pain management, Huntington’s disease, Parkinson’s disease, and concussion therapy.

James West:   Joining me now is Mike Mendez. He’s the CEO of Renew Biopharma. Mike, welcome.

Mike Mendez:  Thanks. Great to be here in Toronto.

James West:   Yeah, you bet. What are you biopharming?

Mike Mendez:  Well, you know, it’s big news on the streets: it’s cannabinoids.

James West:   Right.

Mike Mendez:  It’s new molecules. It’s kind of a new frontier. People now are thinking about ways to make cannabinoids, make therapeutic, make new molecules –

James West:   THC?

Mike Mendez:  Yeah.

James West:   CBD?

Mike Mendez:  But all kind of, maybe in a biotech play, in terms of it’s done through fermentation – so, outside of the plant.

Harvest Health & Recreation Inc (CNSX:HARV) (OTCMKTS:HRVSF) CEO Steve White discusses the consolidation effect in the cannabis space in light of Canopy Growth Corp’s (TSE:WEED) (NYSE:CGC) (FRA:11L1) planned acquisition of Acreage Holdings Inc (CNSX:ACRG.U) (OTCMKTS:ACRGF). He highlights that Canopy has created a blueprint for foreign acquisition of multi-state operators and emphasizes this strategy can be applied by all major companies, not just Canadian LPs. White believes the deal is positive for US MSOs like Harvest because valuations will increase. He discusses the valuation discrepancy between Canadian and US cannabis names and suggests that share price difference will keep Harvest focused on acquisitions in the US space. White addresses growing price competition in established markets and explains the importance of securing licenses in emerging jurisdictions quickly. He explains that Harvest protects its margins by growing its retail and wholesale footprint, which Harvest then uses to build its brands.

Narrator: Harvest Health & Recreation Inc. is a vertically integrated cannabis company with one of the largest footprints in the US. The company has recently entered into a binding agreement to acquire Verano Holdings LLC, one of the largest privately held licensed operators of cannabis facilities, for an estimated purchase price of $850 million USD. The deal is one of the largest US cannabis consolidations in history, and will give Harvest the right to operate up to 200 facilities across 16 states and territories.

Harvest Health & Recreation is listed on the CSE and trades under the ticker symbol HARV.