Midas Letter

Bitcoin (CURRENCY:BTC) and cryptocurrency advocate Andreas Antonopoulos literally wrote the book on Maserting Bitcoin was interviewed by James in Panama City, Panama during the Cryptobuyer Panamchain Conference.

Transcript:

James West:    My guest this segment is Andreas M. Antonopoulous. He is the author of Mastering Bitcoin. Andreas, thank you for joining me today.

Andreas Antonopoulos:     Thank you so much for having me.

James West:    Andreas, you spend significantly all of your time in the Blockchain/bitcoin universe. What is the difference – and pardon me for this most elemental question – between Blockchain and Bitcoin?

Andreas Antonopoulos:     Bitcoin is the original technology that uses a data structure called the Blockchain as one of its underlying components. And it uses that in order to achieve certain properties, and these properties are decentralization, censorship resistance, borderless operation, neutrality, and openness. That’s the definition.

The truth is that the term Blockchain has been hijacked, mostly by financial technology companies, to piggyback on the idea of these properties – these positive properties. But in fact, to enable mostly the banks to try to do business as usual without changing anything. So Blockchain is a marketing term that strips all of the interesting properties of openness, neutrality, decentralization, borderless action, and censorship resistance, and turns it into a slow, inefficient database that allows banks to remain in control of centralized, surveillance-focused money, without any of the interesting properties.

James West:    Hmm. That is one heck of an answer. The government, then, perceives bitcoin as a threat, because if a government loses control of its currency, historically, we’ve observed the government loses control. And so if bitcoin is, in fact, going to disintermediate the government-controlled currencies and thereby the way in which they remain in control, how is it that bitcoin can be allowed to survive by governments that control large military organizations and have demonstrated historically a willingness to suppress such subversive technologies?

Andreas Antonopoulos:     I think control is an illusion, and maintaining the illusion of control with the illusion of power is delusion. The bottom line is that technologies like bitcoin are not allowed; they simply never ask for permission. They exist despite government control, and historically, attempts by governments to control technologies have proven again and again and again to be utterly futile. The progress of knowledge, and the use of knowledge by people who have very little to lose to gain personal independence,

Global Energy Metals Corp (CVE:GEMC) (OTCMKTS:GBLEF) (FRA:5GE1) CEO Mitchell Smith is focused on developing future supply of both Cobalt and Lithium for the electric car revolution now underway.

James West:    Mitchell, thanks for joining me today.

Mitchell Smith: Thank you very much.

James West:    Mitchell, let’s talk a bit about the Global Energy Metals market and in particular, your company’s role in it. What is new? You seem to be doing lots more in cobalt and in lithium.

Mitchell Smith: We are, yeah. Our focus is cobalt-based. We’ve been involved in the cobalt sector for nearly 10 years, and Global Energy Metals is a company that was built to offer investment exposure for the cobalt market. And I think as people have seen, cobalt last year left other metals in its dust, and a lot of that was driven by the demand from the electric automotive industry.

James West:    Mm-hmm. Okay, so tell me a bit about your project portfolio.

Mitchell Smith: Sure. We have two projects; the flagship property is an asset called the Millennium Cobalt Project. It’s located in Mount Isa, Queensland, Australia. We are earning a 75 percent interest into the project through project-level expenditures from a group called Hammer Metals. Hammer Metals is a ASX-listed company, they were a 2015 Miner of the Year in Australia, so a very technical, a very capable team for us to be partnering with.

The other project we have is the Werner Lake Cobalt Project. That’s a past-producing mine in Northwestern Ontario. And we recently joined forces with a group called Marquee Resources for them to fund a $2.5 million development into the project spend into Werner Lake, which should prove out to be the resource is there and give a bit better understanding for the potential for that asset as well.

James West:    Sure. Okay, so would those two be your primary focuses then?

Mitchell Smith: These are our focuses right now, Millennium being paramount, but part of our strategy is to grow the company through acquisition, so we’re looking at other opportunities. We see Australia as being key to this, especially given its proximity to the Asian markets and given our partnership with one of the world’s leading battery manufacturers, Beijing Easpring Material Technology Company, we see their opportunity to provide future supply to that growing market.

James West:    Looking at the Millennium Cobalt Project, you know, the interesting thing about cobalt resources is that you never see big numbers. So I think it’s probably a perception in the market – and this is why I think despite the robust cobalt price, you don’t see traction with investors in any of the cobalt juniors. Now, I look at your resource at the Millennium Cobalt Project, 3.1 million tonnes at 0.14 percent cobalt, and that’s associated with 0.34 percent copper, 0.12 grams per tonne gold, etcetera. So is that typical of cobalt deposits?

Mitchell Smith: Yeah, when you’re looking at some of these primary cobalt projects – and we would consider Millennium to be a primary project because the economics would likely be driven off the cobalt – the assets tend to be a little bit smaller in that sense. Cobalt is generally found as a by-product of copper and nickel projects, so there are much larger tonnage projects out there, huge nick

LDJ Capital is a multi-family office, with their head office in New York, that has been involved in cryptocurrencies and crowdfunding since 2011. Founder and Chairman David Drake talks to James about Bitcoin—which is soon to reach its maximum of 21 million mined.

TRANSCRIPT:

James West:     David, thanks for joining me today.

David Drake:     I’m glad to be here. Thanks for having me.

James West:     Sure. Why don’t you give me a quick thumbnail on who you are and what you do at LDJ Capital?

David Drake:     All right. So I am a novice hockey player who grew up in Sweden, came over to the US on scholarships and stayed there for 27 years.

James West:     Wow.

David Drake:     And today, here, my family office, we got involved with crypto and crowd funding in 2011. So it goes back a while. We actually set up some of the first conferences up there.

James West:     That’s interesting. I’m going to have to come to one. So I’ve been studying crypto a little bit since about 2011, when a friend of mine, who was not somebody I would expect to have a high level of sophistication in all things capital markets, called me and said, “I just bought 50 Bitcoins for $8 each. Do you know about Bitcoin” and I said “No, I have no clue what you’re talking about” and he told me about it. Of course, the rest is history. He didn’t sell them. So I’ve been watching it, and I read your article published on December 19th that sort of features the idea that central banks in G7 companies are set to buy crypto in 2018.

This is extremely intriguing to me and very much to the core problem I have with cryptocurrencies and Bitcoin in particular, is that cryptocurrencies – or Bitcoin, let’s focus on Bitcoin – Bitcoin is essentially, the value is derived exclusively from the demand side, created by the people who are developing it and programming it and pushing it out there. Everybody who hears about it and adopts it and buys it is part of the demand equation, and the supply side of that equation is limited by the fact that, at the current phase of evolution in Bitcoin, there are 1,800 Bitcoins per month right now that are being created?

David Drake:     There’s 21 million in total that have been created.

James West:     That will be created…

David Drake:     In the next couple of years you’re reaching that max, and that will be the maximum.

James West:     Right.

David Drake:     Now going back to your discussions about, you know, G7, and what countries are planning to do is, you know, I think if I may just jump into it: I feel that look, a lot of countries have inflationary currencies, and Bitcoin is not, nor does it come with any debt. So we’re imagining that they’ll be able to create their own money market baskets with Bitcoin. And remember, Bitcoin is a $260 billion market cap, and #2 and #3, Ether and Litecoin, is only a $30 billion market cap. So there’s more liquidity in Bitcoin.

James West:     Sure.

David Drake:     And you know, also, it’s an appreciating asset. So you can see them wanting to put that into their own portfolio over time.

James West:     Right, right. So if I buy Bitcoin using, if I buy it using, say, Euros, or if I buy it using US dollars, then at that point, does not the Bitcoin become a proxy for the currency with which I purchased it, until I exit it?

David Drake:     Yes, but I mean, these currencies are, you know, 1,000 times bigger in volatility. I mean, market size. So hypothetically it could be, but yo

Dolly Varden Silver Corp. (CVE:DV) (OTCMKTS:DOLLF) (FRA:DVQ1) Vice President Ben Whiting talks to James about taking over management a year ago and designing the 2017 exploration program, which saw four new discoveries in a 100-year-old mining camp. Whiting explains why he thinks they’re important for the new year.

TRANSCRIPT:

James West:     Ben, thanks for joining me today.

Ben Whiting:     Thank you very much for the call.

James West:     So Dolly Varden’s been around for a long time. I remember hearing about this company, I think I was actually an investor at one point back in 2012, I guess it was? So what has happened with Dolly Varden over the years, and where are you at now? What’s exciting about Dolly Varden?

Ben Whiting:     Well, when you talk about Dolly Varden being around for a long time, I would take a jump back further than that. It was four Scandinavian prospectors found the project in about 1911, and its first production was in 1919 to 1921, when it was the richest silver mine in the British Empire.

James West:     No kidding!

Ben Whiting:     No kidding. It also had an involvement with Herbert Hoover, who was a mining engineer. His first project after the First World War was Dolly Varden. He later became President of the United States, but as a mining engineer, he was an excellent mining engineer. As for his politics, I’ll leave that to somebody else to decide whether he was a good President or not.

James West:     Sure, yeah.

Ben Whiting:     But he knew mines, and he knew that this was certainly a good one to work on.

Moving into it had production in the 1949 to 1959 as well, and that is the last time that it was in formal production. The time that you were referring to about 2012, was a reinvigoration of this mining camp, and drawing it back together and getting it listed on the stock exchanges.

James West:     Which is where we are today.

Ben Whiting:     That’s correct. Now, the current management team, we took over management of Dolly Varden and started our exploration and management in December a year ago. So in January is when I came on as the Vice President of Exploration to design the 2017 exploration program, and that turned out to be a wonderful program, with four new discoveries in a 100-year-old mining camp.

James West:     Wow, that’s interesting. Tell me about the resource that you’re currently working on at this time.

Ben Whiting:     Okay. The resource for 2015 was the formal resource on the property, so the discoveries that we’ve made in 2017 are not yet in a resource. But I’ll give you an idea of why I think they’re important: the 2015 resource has an indicated resource of about 32 million ounces of silver and an inferred resource of a further 10 million ounces of silver, so, around the 42 mark. But what we have is right beside one of the mines that was producing in the past, the Torbrit mine, we’ve reinterpreted the structural setting, and think of it like discovering more pieces of the puzzle here, from a geological perspective.

Where they were mining in the 1950’s at a high grade silver, and an excellent mining project, you step to the north and you come across a fault. Where the ore deposit would continue on t

22x is a startup fund that allows angel investors to invest in the top 30 Silicon Valley startup tech companies through one token investment. Head of Steering Committee and Founder of Judolaunch Chris Rawlings talks to James about the elite selection process and what investors can expect.

TRANSCRIPT:

James West:     Chris, thanks for joining me today.

Chris Rawlings:     I’m happy to be here, man. This is great.

James West:     Chris, I’d like you to outline for me what the Batch 22x ICO is all about.

Chris Rawlings:     We essentially put together equity in 30 pre-qualified early-stage tech start-ups, into one vehicle that we issue a token for, a digital token for, that represents equity in all of these start-ups. So we’re basically just simplifying the game of early-stage angel investing, you know, which normally means just means deal flow of hundreds of companies and you have to discern which ones to put money into. We’re pre-qualifying these start ups using 500 Startups, and allowing you to get access to 30 of the top start-ups with one investment.

James West:     Okay, that’s pretty simple and straightforward. Now, tell me a bit about what is 500 Startups for those who might not know.

Chris Rawlings:     500 Startups is actually the second-most well funded VC accelerator on the planet. There’s Y Combinator, and then there’s 500 Startups. So it’s an accelerator. For those that don’t know what an accelerator is, it’s a venture capital fund that gives you not just money, but resources, education, and most importantly, a network and community. But this is basically the best of the best. So 500 Startups has a 1.8 percent acceptance rate for the startups it allows into its fund and into its portfolio, which is lower than Oxford, Harvard or Yale or Princeton. So it really is the cream of the crop.

James West:     Okay. So you’re offering 5 percent of a selection of 30 companies in the 22nd class of the 500 Startups process?

Chris Rawlings:     Right, it’s Batch 22, yep. That’s exactly right.

James West:     So as an investor, I would want to know: what is the performance of the other 21 batches of 500 Startups, in terms of where they’re at today.

Chris Rawlings:     So would I! That’s the first question I would ask myself as well. And the answer is, so what wouldn’t make sense as an answer is to just take a simple average or median, because the whole game with early-stage angel tech investing is sort of, put crudely, the spray and pray model, where you’re taking as many quality deals as possible and getting exposure to as many quality companies as possible, fully knowing and expecting that 90 percent of them will fail.

So we could take the batch that Trulioo was in, for instance, 500 was the first money in for Trulioo, the API for messaging marketing, and you know, that company’s value is now in the billions, and it’s IPO’ed. So it would be, you know, an insane payout. You can take the batch that Makerbot was in, which got acquired in the high hundreds of millions. Again, the return on that, gosh, would be insane.

So this isn’t a fund where you put funds in and then we discern where, how to allocate them, and you have to trust us to make a decision; it’s actually complete transparency. So anybody that decides to invest in the fund, they can look into the companies themselves. They can say, okay, this batch has the top, for instance, the top motorcycle community app in the world, with half a million users and deals with top motorcycle manufacturers. Or, they can say, you

Talla Inc. has developed a bot platform with the ability to perform mundane tasks typically done by the HR department. The longterm goal, says CEO Rob May is “creating digital workers.” He also talks to James about his involvement in Half Court Ventures and in the space of artificial intelligence and cryptocurrency. 

TRANSCRIPT:

James West:     Rob, thanks for joining me today.

Rob May:     Yeah, thanks for having me.

James West:     Rob, let’s talk a bit about what you’re up to in the world of artificial intelligence and cryptocurrency. What is it that you’re doing?

Rob May:     Yeah, so Talla is actually one of the few companies playing in both of those worlds. So we started about two years ago and we built a bot platform that has the long-term goal of building digital workers. We did that through two things: Number one, we created a knowledge base which you can think of as the bot’s brain. So you put all your corporate documentations, all your policies and procedures and that kind of information, into this knowledge base, and you can use it like a regular knowledge base; you can just access articles and create articles the way you would, confluence or anything else.

But the difference is, the bots that you can deploy around it also know what’s in the knowledge base. So, for example, if you were to onboard a new employee and you write the information they need to know to be onboarded, you can define how that information gets dripped out to them through a bot. so you might have a bot say hey, on Day Two you need to know this thing, and on Day Three you need to know this block of content and fill out this form, and stuff like that. And these bots get smarter as they interact with your organization. So they learn when content is going out of date, they learn how content is related to each other, we can build knowledge graphs sort of behind this stuff, and you know, so we’ve had paying customers for that for a while, and that’s been a good product for us.

But what’s happened is, we realized that people were starting to deploy more and more bots in these organizations, and these bots were doing more and more types of work, and what’s coming is that these bots are going to start being deployed with reinforcement working models, which are models that learn and change over time. So now you have this problem of these sort of like pseudo-digital workers in your organization who are going to get smarter and change – how do you know what they’re doing when they’re talking to people, to your customers, to employees, or when the bots are talking to each other, how do you know what’s going on there?

And so we saw this as a great opportunity to store what’s happening here in a special way on Blockchain, because the beautiful thing about Blockchain is that it’s immutable. And so we chose the Ethereum Blockchain, and it launched a product, a network really, called Botchain. It’s a cryptographic layer that sits on top of this and manages a whole bunch of interactions for bots of all kinds – related to work, makes them auditable, and forces compliance and different stuff like that.

James West:     This is a complicated proposition. I mean, it’s technology on top of technology. So at the end of the day what this is doing is essentially making workflows more efficient in the corporate level while adding the immutability and certainty of transaction on top of it through the Blockchain Ethereum?

Rob May:     Yes, right. So Talla’s core product is focused on the former there. And the network that we’ve launched,

Hashchain Technology Inc. (CVE:KASH) (OTCMKTS:HSSHF) (FRA:1NQ) is a blockchain technology company that is currently focused on cryptocurrency mining, including Dash, Bitcoin, Bitcoin Cash, Ethereum, and other coins. CEO and Director Patrick Gray speaks to the Midas Letter about strategy and  the company’s competitive edge.

TRANSCRIPT:

James West:     Pat, thanks for joining me today.

Patrick Gray:     Absolutely.

James West:     Pat, it’s somewhat self-explanatory one would think, but what is it exactly that HashChain Techologies does?

Patrick Gray:     So HashChain Technologies is a Blockchain technology company that has multiple divisions. Right now, we’re strategically focusing on cryptocurrency mining, but we have a lot of exciting other things in the works around Blockchain technology solutions, some really exciting acquisitions coming up, as well as building our own IP in house.

The one thing I want to make clear is, we’re a Blockchain technology company, not just a pure cryptocurrency mining play, although we are focusing on that in the beginning because it makes strategic sense.

James West:     Okay. What are you mining?

Patrick Gray:     So right now we’re mining Dash, Bitcoin, Bitcoin Cash, Ethereum, Decred, and we’re looking at purchasing some other rigs over the next few months to mine multiple other coins as well. So we’re very diversified. I think there’s a lot of companies out there that are focusing on a few different coins, and it’s really important to me that we’re diversified in the space. At the end of the day, I don’t necessarily believe in any single coin; what I do believe in is digital assets. I know that digital currencies are the next evolution of money, and digital assets as a whole will be here in 100 years. And I can’t say the same about any individual coin today.

James West:     Yeah, well, I’m with you there 100 percent. Where do you do your mining?

Patrick Gray:     Right now we’re currently mining in Vancouver; we’re paying about $0.04 kilowatt per hour. But we have one in Montreal as well that we pay $0.03 per kilowatt hour; we’re looking at facilities in Newfoundland, where we would pay $0.02 per kilowatt hour, and we’re also looking at acquiring a facility in Northern Quebec where there’s a dam onsite where we’d be producing our own electricity, which is very exciting.

James West:     Yeah, that is exciting. I’ve talked to a few companies that are sort of putting their operations proximal to low-cost or zero-cost power sources, and that strikes me as pretty important when your highest input cost on mining is energy.

Patrick Gray:     Yeah, absolutely. So there’s approximately 1,000 megawatts being consumed around the world; the majority of that is currently in China. You’ve probably read that that may be changing. To be an optimal, efficient mining facility, you need three things: low temperature, low electric costs, high speed internet. And there’s only a few places around the world that have all three: places like Russia, Sweden, Iceland, and Canada. Only about 14 percent of the world is currently mining, and the most profitable places to mine, which means 86 percent of the world, is mining in less efficient places, which gives HashChain a huge competitive advantage as we will be more profitable.

Ja

Wildflower Marijuana Inc. (CNSX:SUN) (OTCMKTS:WLDFF) (FRA:RSP) is a cannabis company that sets itself apart with unique branding that isn’t “pigeonholed into a brand that reflected where cannabis came from, but more where cannabis was going,” says CEO William McLean. He talks to James about brand strategy, partnering with King Extracts, products, and more.

TRANSCRIPT:

James West:     William, thanks for joining us today.

William McLean:     Thanks for having me.

James West:     William, let’s start with an overview: tell me all about what Wildflower does.

William McLean:     Wildflower manufactures and develops products in the cannabis sector. We do it for both the regulated cannabis markets and the CBD/hemp based markets, mainly in the United States. We’re in over 100 stores in Washington and we’re in a handful of other stores throughout the US.

James West:     Oh, interesting. And so tell me about how you founded the company and how you got started in that segment.

William McLean:     Well, really what brought me to the industry was the opportunity of a new industry that didn’t have any brands that the consumers could connect with. We have a multi-billion-dollar industry here, and I come from a sales and marketing background, and quite early on I recognized the power of a brand and how people connected with it. And so with this new burgeoning industry upon us now, you see a real need for consumers wanting cannabis-based products and not really knowing where to go for them, and what companies to use, or to pick from.

So that was really our mandate, was to create a brand that was far-reaching. I didn’t want to be pigeonholed into a brand that really reflected where cannabis came from, but more where cannabis was going.

James West:     Typically your brands seem to be predominantly associated with the healthful benefits of CBDs as opposed to the psychoactive effects of THC, and is that something that is going to persist, or do you plan to become more of a sort of recreational brand line as well?

William McLean:     Well, I feel like – at the centre of our wheel, the hub of our wheel is cannabis and cannabis based products. So really CBD is one of the spokes in our wheel. It is, in my opinion, one of the biggest spokes; obviously, the recreational market is one of them as well. But if you look really at the size of the markets and how they’re developing, to begin with, you look at the nutraceutical industry – it last year did $265 billion in sales. And really, CBD-based products are that natural health based product and fits under the nutraceutical umbrella.

If you look at the cannabis space and arguably the numbers are just emerging, but you can say globally it’s somewhere between $50 billion and $100 billion industry. So I think it would really be a bad thing to ignore the health benefits of this plant, and how consumers are now looking for a more holistic approach to their health, and really looking at more of taking preventative measures and more natural things to ensure that they’re staying away from those more pharmaceutical, chemical-based products.

James West:     Okay. Interesting. I see that you have partnered with a company called King Extracts earlier this year, and what is the driving sort of logic behind that

Level Brands Inc. (NYSEAMERICAN:LEVB), a company dedicated to creating bold, unconventional and socially responsible branding for leading businesses, recently raised $12 million by selling 2 million shares. CEO Marty Sumichrast chats with James about the company, as well as their success led by Chairman Kathy Ireland.

TRANSCRIPT:

James West:     Marty, thanks for joining us today.

Marty Sumichrast:     Thank you for having me.

James West:     Marty, let’s talk a bit about Level Brands. You just completed a $12 million IPO through a Reg A+ offering on the NYSE; tell me about what Level Brands does.

Marty Sumichrast:     Level Brands is a licensing and brand marketing company that we have together with our leader, Kathy Ireland. Kathy services as Chairman Emeritus and Chief Brand Strategist, and we have four diversified business units; one of them is Kathy Ireland Health and Wellness, which is in the licensing space. One is I’M1, or Ireland Men One, which is the men’s line of kathy ireland Worldwide. And one is EE1, which is our Experiential Entertainment and Production Company, and then Beauty and Pinups, which is our disruptive haircare brand that we have. So that’s what we do at Level Brands.

James West:     Okay. So that’s quite a diverse sort of set of businesses under one set of brands. What is the value proposition for investors?

Marty Sumichrast:     Well, we like to think of ourselves first and foremost as a company that is tied to the licensing world and, of course, we have no better group to help us succeed than Kathy Ireland and her team at kathy ireland Worldwide. I mentioned Kathy’s role in the company; also the co-founder, Eric Sterling, is on my board of directors of Level Brands, he’s the co-founder of kathy ireland Worldwide. Stephen Roseberry is the President of kathy ireland Worldwide; he is the President of three of four of our divisions. Jon Carrasco, who’s the Creative Global Director of kathy ireland Worldwide, is our Global Creative Director. Tommy Meharey, who’s the managing director of I’M1, is the youngest board member of kathy ireland Worldwide, and Nic Mendoza, who’s the cofounder of EE1, is also a member of kathy ireland Worldwide and is the managing director over at EE1.

So people have said, wow, you not only have the playbook but you have the players. So our proposition is, kathy ireland Worldwide is a private company. It’s 100 percent by Kathy; it will never go public. So if you would like to participate with Kathy in the development of a company that she is involved with, Level Brands is the way to do it. Kathy has taken her business from a $50,000 investment to a company that is generating over $2.6 billion a year, according to Forbes, in sales; 17,000 SKUs, 55,000 stores worldwide. So you get all of that experience and know-how, together with three companies that were originally Kathy Ireland businesses which are now Level Brand businesses, we think we have a proposition which is very exciting for investors.

James West:     So does Level Brands act as a sort of royalty repository for the revenue that comes from all of these brands and stores? Or what’s the revenue model?

Marty Sumichrast:     Yeah. The revenue model is exactly that way. So Ireland Men One, I’M1, is in the licensing business, so we go out and sell licenses. We’ve been in business, that particular entity has been in business since January of this year, and we have been actively signing up licenses from everything f

Delta 9 Cannabis Inc. (CVE:NINE) (OTCMKTS:VRNDF) (FRA:V5D1) is one of the first Health Canada licensed producers and distributors of medical cannabis products. CEO John Arbuthnot talks about their production facility in Manitoba, as well as their unique growing method in retrofitted shipping containers.

TRANSCRIPT:

James West:     John, thanks for joining us today.

John Arbuthnot:     Thank you for having me.

James West:     John, let’s start with an overview: what does Delta 9 do, and what differentiates it from others in its sector?

John Arbuthnot:     Well, we are Delta 9 Cannabis. We’re a Health Canada licensed producer/distributor of medical cannabis products currently. We’ve been licensed under Canada’s MMPR and ACMPR programs since 2013, so we are one of the earlier licensed producers…

James West:     You were the fourth, if I’m not mistaken.

John Arbuthnot:     The fourth, yeah. We’ve been through the Health Canada system for quite some time now.

James West:     Well, that’s great. Okay, and so what does Delta 9 – is it a greenhouse operation, indoor operation?

John Arbuthnot:     We currently operate out of an 80,000 square foot production facility here in Winnipeg, Manitoba. We are entirely indoor or warehouse, and a little bit unique in terms of our production style. We are entirely hydroponic in terms of our actual output production, so we essentially remove the soil medium, deliver the plant nutrients right to the rooting system. If we do it right, we’re able to achieve accelerated growth rates and an increased yield.

As well as our facility design is very unique. We grow in what we call Delta 9 grow pods, which are effectively retrofitted shipping containers. We take a standard, 40-foot-high shipping container, install our own customized wall panels, coat the entire interior with epoxy, which gives us hospital-grade cleanable surfaces. We then install electrical, lighting and HVAC systems and security, and what we’re left with is a modular, scalable, now stackable unit, which is compliant with all of Health Canada’s ACMPR regulations.

James West:     Interesting! Okay, so what is the nature of your patient base? Are you focused on any particular segment, or is your audience sort of across Canada, or are they Manitoba-centric?

John Arbuthnot:     We’re currently distributing to about 2,200 patients across Canada. Now, about half of those are located here in our home province of Manitoba, so we are very focused on our home province here. In terms of market share in our own backyard, we have about 33 percent of the overall patient base here in Manitoba; actually, a little bit upwards of that. So we are big fish in our own pond, here.

James West:     Sure, okay. How many patients is that, roughly?

John Arbuthnot:     About 1,100 patients here locally.

James West:     Okay, great. So you took, you got your license initially in 2013, but it’s taken you till November of this year to become a publicly traded company. Why did you wait so long?

John Arbuthnot:     Well, you know, we walked through, I want to say the growing pains of the sector, the learning curve, as it were. We have, over the last three years, completely changed our room design from our original rather rudimentary room style