RE:3 Ancillary Cannabis Companies Aggressively Growing ParcelPal: An Emerging Ancillary Opportunity
Last month, we highlighted a company that is well positioned to capitalize on the cannabis industry. The company, ParcelPal Technology Inc. (PKG.CN) (PTNYF) is in the early innings of a major growth cycle and provides on-demand local delivery services in North America. The company has strategic relationships with leading global conglomerates as well as leading Canadian cannabis retailers.
ParcelPal represents an attractive ancillary cannabis investment opportunity and we are favorable on it due to the relationships it has in place, the valuation, the growth prospects, and the management team. 2018 was a banner year for the company and we expect to see it build upon this success. ParcelPal closed the year with a run rate of over 3.5 million and has been continuously executing on its strategic plan, attracting potential partnerships, and looking at further city expansions.
In late January, ParcelPal Technology formed a strategic partnership with MADD Canada to aid in the continuous fight to prevent impaired driving. MADD Canada has endorsed ParcelPal as their official delivery service in Canada and we think this relationship will prove to beneficial to the company.
As part of the ParcelPal's national rollout campaign, advertising for ParcelPal's service will be seen across the country in various educational forms. MADD Canada and ParcelPal will launch a national awareness campaign focused on educating Canadians on the dangers of impaired driving and the options they have for getting items they want or need without having to drive for it. Customers who order cannabis or alcohol through the ParcelPal platform will be required to upload and verify their identities.
Last year, ParcelPal announced a strategic distribution agreement with Choom Holdings, Inc. (CHOO.CN) (CHOOF), a leading cannabis retailer in Canada. Under the agreement, the companies will jointly develop a roadmap for distribution within various provinces for recreational cannabis, will use their respective platforms to enhance user experience, and will create a delivery platform that complies with the regulations set forth by all regulating bodies in Canada.
We are favorable on this relationship and believe that each company adds strategic capabilities to the partnership. ParcelPal wants to be the Uber of cannabis for Canada and believes that Choom will enhance its national cannabis distribution and delivery strategy. Choom has a strategic relationship with Aurora Cannabis (ACB.TO) (ACBFF), whereby Aurora owns a significant portion of Choom and this could be a major catalyst for ParcelPal.
When looking at cannabis companies, there are a number of factors we look into before becoming interested. Some of the factors that we look for include: the strength of the management team, the type of products or solutions offered, the financial structure and valuation, and the growth prospects.
When it comes to ParcelPal, we believe that the company possess these traits and is well positioned for growth. The company is led by a strong management team that has been laser focused on execution and we are favorable on the recent developments. ParcelPal has secured several strategic relationships to help facilitate growth and we think the market underappreciates this opportunity.