Markets

Cannabis Fundamentals With Kim Rivers, CEO, Trulieve (Podcast)

Listen on the go! Subscribe to The Cannabis Investing Podcast on Apple Podcasts, Google Podcasts, Spotify, and Stitcher.

By Rena Sherbill

Today, I am happy to be joined by Kim Rivers, CEO of Trulieve Cannabis Corp. (TCNNF), a vertically-integrated company based in Florida. Prior to Trulieve, Kim spent several years in private practice as a lawyer where she specialized in mergers, acquisitions, and securities for multi-million dollar companies. She has also run a number of successful businesses ranging from real estate to finance.

Topics include:

  • 4:45 - Kim is a recovering lawyer, the daughter of a police office and assistant principal so cannabis was not a clear path for her. When Florida first passed CBD law, Trulieve started as a business venture but needed additional support and approached Kim after she had a successful exit in a repositioning of a hospitality portfolio.
  • 9:20 - How law background helps navigate the intricacies and challenging hurdles of regulatory regimes. Helps with trying to think proactively as changes come about in the industry. TCNNF now has general counsel.
  • 10:45 - Florida cannabis legislation in 2020. Read further than the headlines as it's a nuanced issue. But even if legislation is delayed plans for growth in Florida are still full steam ahead. A delay also allows more time to prepare. Florida also one of the fastest growing medical cannabis programs. Also looking ahead to other states.
  • 13:40 - Plans to expand in Massachussettes - purchased an early stage license and building that out and expecting it contribute to revenue in 2020. Wholesale also allowed in MA which is exciting. Added a director of Wholesale most recently from Kellogg's.
  • 15:30 - What Trulieve has learned in Florida that helps them expand into other states. Scaling a company - incredible revenue growth between 2018-2019; employees went from 10 to 3,000 - navigating through that teaches many lessons. Success is embedded in a company's supply chain. Pushing through plateaus of growth. Focus on customer experience. Because Florida forces vertical integration it allowed TCNNF to apply those lessons in MA.
  • 19:25 - Trulieve one a few companies to be profitable. Founded on financial discipline. Ensuring there's ROI on dollars deployed. Never want to worry about making payroll. Financial discipline is critical as they don't have the advantages of traditional bank lending and the rates they provide. Creating efficiencies along the supply chain. Being strategic and mindful as capital is not readily available externally, have to create it internally. Descheduled cannabis is a matter of when, not if - but implementation will take some time.
  • 25:45 - Hopeful that SAFE Banking Act would have passed before 2020, but it will have to happen before mid-year if it's going to happen before a Presidential election. Deschedulization will depend on who wins that election. As more states go online it will push the federal government; what happens in the Northeast will be a watershed moment.
  • 29:35 - Grizzly short report on TCNNF published in late 2019. Company's full rebuttal on their website. Trulieve suing Grizzly for libel - trying to set a precedent for other companies - even though they're not SEC regulated yet, US law should still apply.
  • 35:00 - Being a female CEO is still unfortunately rare in all industries, cannabis included. Stated and implemented goal of diverse hires; diverse voices lead to more robust thinking. Creating purposeful change. The importance of female mentorship.
  • 44:50 - What happens in the market day to day and week to week is disconnected from what's happening in the business. Matter of time before markets become more rational which is somewhat dependent on companies uplisting to US exchanges and as US and Canadian companies decouple. Takes more work to analyze a cannabis company, have to look at true operations and business fundamentals, but the market demand is real.

See also Washington Real Estate Investment Trust 2019 Q4 - Results - Earnings Call Presentation on seekingalpha.com

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Latest Markets Videos