It began in a hen coop: Halo Labs – Hashish Enterprise Government

In 2015, in the heart of the Oregon side of the Emerald Triangle in Medford, two of Halo Labs (Halo) co-founders, Andreas Met and Phillip Van den Berg, are dabbing fresh from their split from Golden Leaf Holdings. founded the company in a chicken coop with co-founder and CEO Kiran Sidhu. Met owned the property and the team was looking for a safe place to begin mining BHO technology. The basket matched the bill.

It made sense for the management team to set up a company to focus on making products based on stabilized oils with natural additives to maintain viscosity and terpenes for taste and stability after experimenting with various extraction technologies (the team also had intense worked with CO2). in the heart of the triangle. Biomass raw materials were cheap and readily available, and Medford had a favorable regulatory environment.

Sidhu told me that the team found that BHO extraction is more efficient than CO2, but also likes the efficiency of CO2 in capturing terpenes. The Halo extraction team, which was the first to use high-speed centrifuges, has so far used several equipment suppliers including Precision and Extraction Tek; They also found that the colder the method, the better.

After starting on the cooperative and successfully distributing products at Rouge River Valley pharmacies, the team moved into a 16,000 SF self-funded facility in Medford that would allow Halo to expand on a larger scale to serve retailers in eastern Oregon as well . Halo also has its own 4-acre annex in Evan’s Creek, OR.

Andreas Met

To date, according to BDS data, Halo has captured 20% of the wholesale concentrate market in Oregon with its branded and white-label products, which add up to sales in approximately 50% of pharmacies in the state. Met, who spent years at Walmart, has found a sweet spot in contract manufacturing that will go well with his recent entry into California too.

What initially impressed me about Halo was the background of the management team. The team consists of a group of experienced professionals with extensive educational backgrounds and work experience.

Ivy-Leaguer Sidhu holds a bachelor’s degree in Computer Sciences from Brown University and an MBA from Wharton. As noted on his Linkedin profile, he is a seasoned cannabis manager, serial entrepreneur, and former M&A banker. In front

Kiran Sidhu |

Mr. Sidhu was the chairman, CEO and founder of Transact Network, a European Union e-money institution that was sold to Bancorp (NYSE: TBBK) in 2011. Kiran was previously CFO of On Stage Entertainment (NASDAQ: ONST) and contributes to a NASDAQ IPO. Prior to that, he worked in the strategic advisory group at PwC and in M&A at Merrill Lynch Capital Markets. “

Met, Halo’s COO and Compliance Officer, holds an MBA from the University of Wisconsin. Van den Berg, Halo CFO, is an investment banker who trained with Goldman Sachs. Chief Revenue Officer David Orr has an MBA from UCLA and years of experience in blue chip consumer products (CPG) with Johnson & Johnson and PepsiCo. Dr. Valery Krasnoperov, Chief Science Officer, has 30 years of experience in biochemical research and process implementation and leads the technology side of the business for Halo. The company’s second largest shareholder, Dr. Prakash Gill, is a renowned professor and scientist at the University of Southern California with a long history of clinical research and drug development.

With Gill’s help, the team developed proprietary precision dispensing technology that they believe will fundamentally change the swab market.

The company’s go-to-market strategy, which now includes entry into Nevada and California, focuses on owning its own licenses. To date, they have licensed facilities in Medford, OR (6 licenses, 4 additions, 1 manufacturing, and 1 wholesale), Las Vegas, NV (1 cultivation and 1 manufacturing), and the recently licensed facility in Cathedral City, CA. The 1,800 sf CA system was designed in a small space to minimize product movement on the floor, mainly for white label products. You have an additional 8,000 sf available to meet demand.

Halo expanded its business beyond Oregon with operations in NV in October 2018 and started processing in CA in November 2018. In order to drive the growth and sales of their branded products, they supplement their direct store deliveries with strategic sales partnerships. By 2018, Halo had gained distribution of its Exhale, Black Hat, Mojave and Hush brands through numerous pharmacy chains in Oregon and Nevada, and developed and supplied numerous private label brands for customers such as Cannacopia.

In CA, Halo expects to start generating revenue on its new facility from its wholesale supply relationship with Falcon International starting the first week of February 2019.

Halo is awaiting entry into new states and is currently reviewing options in Florida and Massachusetts. With the exception of Colorado and Washington, most states are currently on their radar screen due to property restrictions.

In terms of human capital, Halo sees the senior management team’s experience as good, but Sidhu admits they need to strengthen their middle management positions in 2019. On the immediate horizon, they’re looking for salespeople with a CPG, alcohol, or pharma backgrounds as well as a GM to carry out their Nevada expansion plans focused on growing to extract. You’re looking for a 20 acre site in the state as we publish it.

Looking ahead to 2020, Sidhu expects the liberalization of Canada’s oil restrictions to be an attractive option for their product and service offerings, and that Europe may open up by then. Halo announced this last December signed a letter of intent to partner with Bophelo Bioscience and Wellness Pty Ltd (“Bophelo Bioscience”), a Lesotho-based cannabis company. According to their press release, Halo will provide management services and expertise to build, design and operate cGAP cultivation and cGMP extraction facilities in order to receive a 20% stake in Bophelo Bioscience and a license fee for future extracted products.

With the goal of being recognized as a low cost, quality producer of extracted products, Halo will rely on the strength of process technology and product development and adhere to leading a lean and hardworking team that serves retailers and their consumers in the markets in which it is licensed were. As Sidhu told me, Halo has a stake in following its apparent fate and “pursuit of excellence” and the financial success of blue chip management. Halo has come a long way in 3 short years, not bad for some people who started out from a chicken coop.

Background information on Cannabis Business Executive

Name of the company: Halo Labs, Inc. (NEO: HALO)

Founding year: 2016

Ownership structure / operational units: Halo Labs, Inc. is 100% owner of ANM Inc, 100% owner of PSG Coastal Harvest LLC (CA), 100% owner of HLO Ventures (NV) LCC

Leadership team:

Scott Paterson, chairman

Kiran Sidhu, CEO

Andreas Met, COO & Compliance Officer

Philip Van Den Berg, CFO

David Orr, Chief Financial Officer

Dr. Valery Krasnoperov, scientific director

Headquarters:

Medford, Oregon

Website:www.HaloCanna.com

Industry segment / category: Producer and processor

Current markets / states: Oregon, Nevada, California

Number of locations: 4 facilities in 3 locations, Medford Oregon, Las Vegas, Nevada, Cathedral City, California x 2

Number of licenses by state:

  • Oregon Six Licenses (4 Cultivation, 1 Production, 1 Wholesale)
  • Nevada Two licenses (1 production 1 cultivation)
  • California One license

Current number of employees: 122 employees, 25 of whom were recently hired for the harvest (seasonal workers)

Market strategy / goal: Halo aims to become the leader in US cannabis extraction, developing and manufacturing leading oil and concentrate products.

Sales 2016: ~ $ 3.8 million

Sales 2017: ~ $ 10.3 million

Turnover 2018: ~ $ 12 million

Company revenue mix: Halo generates sales with both branded products such as HUSH, Exhale, Blackhat and Degenerates, while also seeing growth in its white labeling business, which is expected to exceed 50% of sales in 2019.

Expansion plans:

  • Commissioned in October 2018 in Nevada, the 8,000-square-foot facility spanning 2,000 square feet will expand into the rest of the facility in 2019
  • Launched in California in November 2018 at the first 1,800 square foot facility, the building will be operational in 2019 at the second 7,600 square foot facility in California

Financing strategy: Completed CAD $ 27 million financing on RTO listing in Canada.

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