Ben Kovler is the heir to the Jim Beam empire and is also the majority shareholder of Green Thumb Industries, a marijuana producer that has thus far been very focused on the medical marijuana industry. Green Thumb Industries or GTI produces brands of marijuana like DW (Dog Walker) and Rosa that are commonly found in dispensaries in Nevada, Massachusetts, Illinois and soon in Florida.
Ben Kovler regularly refers to the marijuana legalization movement as the end of ‘Prohibition 2.0’, and intends on taking GTI public in Canada through a reverse merger. Reverse mergers are a common practice for cannabis companies and going public in Canada only makes sense since prohibition here in the United States on a federal level is still very real and Canada has already established itself as a world leader in the cannabis industry.
Kovler said he and Chief Executive Officer Pete Kadens, 40, hope to grow the business quickly before more U.S. markets open up. GTI operates 12 dispensaries in Maryland, Massachusetts, Nevada, Pennsylvania and Illinois, and has plans to expand to Florida. With products in more than 100 stores, the company’s revenue topped $20 million last year and should exceed $70 million this year, Kovler said.
Having closed a $45 million funding round this year, with backing from mostly U.S. investors, GTI is turning to Canada because the cost of raising capital there will be cheaper, he said. The company intends to use the cash to acquire or build facilities and licenses in more markets.
“A lot of people think this stuff is about liquidity and finding exits, and I firmly believe the bigger opportunity for us is to go to Canada and use that currency to increase our scale,” said GTI investor Sanjay Tolia, who founded Bengal Capital, a proprietary-trading firm. “It’s hard to do that if you’re not public.”
Big alcohol has already been feeling the strong influence of the cannabis industry and have begun to take action to counter losses from the popularity of cannabis. Constellation Brands purchased a near 10% stake in Canopy Growth, the largest of all cannabis companies, and other alcohol brands have already warned investors of potential future losses in revenue. GTI and Ben Klover will have real competition here in the U.S. with companies like Acreage Holdings already aggressively expanding their operations in anticipation of the national legalization many expect to come.