The Cost Of Patient AcquisitionIn the last interview, Sean mentioned how the patient conversion process will work, with being reverted through a portal from either Namastevapes.ca or everyonedoesit.ca to namastemd, where within 15 minutes or so you will be granted a medical marijuana license. The entire application sounds like it will work as a smooth transition for patients to acquire a prescription, and anyone can get it. It`s just a matter of whether they want it. With the massive selection soon to be signed up in the years to come, they won`t want to go anywhere else.
Any way, I wanted to discuss the organic growth of the patient list, and how important it is that they will see this extensive growth without the extreme costs of patient acquisition. Essentially, I can see the entire system that has been developed as an almost free platform for acquiring customers...after of course the base costs of keeping the doctors and other staff employed, that is. I can already forsee a massive herd of investors flocking in to get their prescription so they can support their investment, so within the first week of NamasteMD opening, the growth will be completely f*cking nuts, just like their Black Friday weekend sales. Just to give you all an example of how much money they will be saving, take a look at Aurora, which acquired CanvasRx, Canada's largest medical cannabis patient outreach service, which at the time had 17 locations with more than 10,000 patients registered
with CanvasRX on August 10th 2016. Here were the details of the deal:
The Share Purchase Agreement provides that the Company will acquire all of the issued and outstanding shares of CanvasRx in consideration for payments up to a maximum of $37,500,000, the majority of which consideration may be satisfied, at the election of the Company, in cash or through the issuance of shares of Aurora, as determined at Aurora's discretion. The total consideration is subject to the achievement of all specified performance milestones over a three-year period. The Acquisition, which is expected to close shortly, will unite Aurora, one of Canada's largest capacity and fastest-growing licensed producers of cannabis, with CanvasRx, Canada's largest medical cannabis patient outreach service, which has 17 locations and has registered more than 10,000 patients.
Pursuant to the Offering, the Company issued a total of 57,500,000 Subscription Receipts. Each Subscription will convert without payment of any additional consideration and with no further action required by the subscribers, upon the satisfaction of certain escrow release conditions (the "Escrow Release Conditions"), including satisfaction of the conditions precedent to the Acquisition (other than the payment of the purchase price), into units. Each unit is comprised of one common share of the Company (a "Share") and one-half of one common share purchase warrant (each whole warrant, a "Warrant"). Each Warrant will entitle the holder thereof to purchase one Share at an exercise price of $0.55 per Share at any time up to August 9, 2018.
I cant recall how reading how many customers Aurora has reached as of lately, but last I recall seeing was over 20,000. So it took them about 15 months to double from 10,000 to 20,000. I can see us surpassing that number within the first year easily. Long story short with Namaste, they are saving a lot of money by sparing themselves more dilution for patients acquisitions, while other LP`s will have to spend massive amounts to gain theres. With an average of over 1000 customers travelling to the Canadian URL`s on a daily basis, I believe the conversion rate will be much higher than Sean`s modest 4% figure. Upon the opening of NamasteMD, I expect that they won`t even be able to handle the load of customers trying to sign up all at once. All of this added up in my mind seriously makes me believe that they really will for sure be profitable next year, and also gives them another head start among of all these other companies that are taking on massive debt in order to get ahead. With Namaste it will all be about organic growth through cost effective network systems being implemented on a global level wherever medical marijuana is legalized. For those of you who don`t know, Namaste controls 90% of the Australian e-commerce market for vapes, with I believe over double the daily traffic of their Canadian websites, so when a sales license is acquired over there we will see an even more rapid advancement of conversions for customers to patients. When this happens the growth will set this into a tailspin of epic proportions. This will likely happen next year I am guessing, as it has already been hinted towards in interviews before.