Market Analysis

By Eric Vengroff, Senior Financial Analyst, Cannabis Daily

Imagine if you were like Rip Van Winkle and fell asleep, somewhere in Canada, during the fall of 2015.   Instead of waking up 20 years after the American Revolution, you woke up just three years after the Canadian federal election, otherwise known as the Canadian Cannabis Revolution.

You wake up, are handed a mobile device open to the browser and find out that the three most heavily traded stocks on the TSX that day are growing weed. There’s a Canadian company growing weed on the New York Stock Exchange…

You get dressed and head out to a cannabis trade show.  You come back with a bag full of material on marijuana companies, products, and vacations (and two free grinders).

Two weeks later, practically on the heels of the Lift & Co. Expo at the Metro Toronto Convention Centre,  the 2nd Annual O’Cannabiz Conference and Expo, opens, also a Friday/Saturday affair.

Most of us have been to at least one trade show, consumer expo or county fair.  Sometimes it’s hard to tell what you’re at, as each has elements that are similar to one another.    Depending on the event, you’d be likely able to find a combination of seminars, demonstrations, vendor booths, literature, swag and giveaways.  So too with the O’Cannabiz Conference and Expo.  What stood out for me about this show was that two of the three title sponsors were not growers, retailers, or other lifestyle product or service – they were an accounting firm and law firm respectively.  If that doesn’t signal a turn to the mainstream, nothing else will.  MNP, Aird & Berlis, as well as numerous other firms at other shows are beginning to showcase their cannabis practices in increasingly visible ways. And they are there to talk business, probably with the some or most of the other exhibitors. They were joined by PR firms, recruiters, security companies, insurance brokers, and of course the growers, and the companies that supply them -fertilizers, lights, fans, harvesting and measurement equipment.  Blended into the mix were producers of all manner of technology, devices, lotions and potions, clothing, edibles and drinkables, etc.  Welcome to Canada, the land of cannabis opportunity.

Panel discussion at O’Cannabiz conference. The future is looking pretty green according to them.

As mentioned earlier, the show ran Friday and Saturday.  I can’t say what the rationale for this odd pairing of days to run a trade show, but this is a very new type of show, given the category. Considering that both Lift & Co. and O’Cannabiz employed the same combination of days, I suspect a pattern emerging.  I call it the ‘mullet’ of trade shows because I think the intent is ‘business in the front, party in the back’.  In other words, both shows appeared to have the business component on Friday, and the lifestyle component on Saturday.   Good idea on paper, perhaps, and in this early, ‘wild west’ phase of the business, it may even work for the show organizers.   Long term, I believe that shows of this kind, to the extent they matter, or persist on into the future, will likely have to split along intent.  I concede that it is possible that someone interested in a $20,000 harvesting machine, or a $25,000 gas chromatograph may also be interested in a $19 plastic bong, but perhaps not in the same venue, eventually.   Both events appeared well-attended on the Friday, but whereas the former event had the benefit of a few years of previous events running in the MTCC, conveniently located downtown (albeit with expensive parking), the latter event, at the International Centre,  appeared quiet on Saturday, despite the ad push.   Perhaps the strong business orientation of the O’Cannabiz show kept the consumers at a distance.

In the coming days and weeks, we will feature profiles and interviews with some of the participants of this show and we hope you will stay tuned.