Taat’s (TAAT-CSE) no-tobacco/no nicotine sticks did $1.3 M in revenue in Q3, up almost 90% QoQ and almost 2000% YoY.
After raising $20 M and getting distribution all over the US and Europe, I think it’s going to keep growing—very quickly. A year ago they started in Ohio—just one state in the US.
Now they’re in 20 states. Re-stocking orders are already coming in fast. They have groups fighting over European distribution, and the first few large orders are already being fulfilled.
Most smokers—and I mean the vast majority—want to buy the cheapest stick they can. TAAT is cheap, it drags & draws just like a regular stick and it's NOT addictive--no tobacco and no nicotine.
This is all happening when the $800 billion to $1 Trillion industry is RUNNING away from combustible tobacco to something more ESG friendly. TAAT's hemp sticks fit that bill 100%.
It’s just a very cheap stick that happens to use hemp instead of tobacco. That sounds simple doesn’t it? But it’s not. Founder Joe Deighan spent years processing the hemp and having his own flavouring process/mix that gives smokers a near exact taste and smoking experience.
Recently, the product got MUCH better—they found a new way to chop the hemp up so it wasn’t as stringy and smoked a lot more like a regular tobacco stick. TAAT CEO Setti Coscarella says that’s making a BIG difference in people adopting TAAT.
(TAAT, by the way, is a great brand name because it’s the same in every single language.)
Even after setting up all these distribution channels, increasing production capacity and making hundreds of thousands of sticks—TAAT still has millions in the bank.
They had boxer Floyd Mayweather wear their merchandise at his most recent fight AND posted it to millions of followers on Instagram, and they’re on the sides of a racing car—all stuff that Big Tobacco companies can't do anymore.
TAAT is a simple story. It’s a cheap stick that no tobacco or nicotine. With no taxes or marketing restrictions, it could flood around the globe in a hurry. Funded with Asian cash, selling in Europe and the US and with Canadian management, it’s an emerging global brand.
The entire tobacco industry--all $800 billion - $1 TTTrillion--is trying to get away from combustible tobacco. This is opening up huge opportunities in the global smoking market.
TAAT has a great shot at being not a, but THE leader in this new space. (One of the biggest mistakes of my career is not just buying the leaders and letting them run.)
Another smoking alternative, JUUL, became a $40 billion valuation in 5 years. Taat may never see that, but it speaks to the opportunity.
And their latest quarterly says they are starting to achieve some serious growth.
DISCLAIMER: TAAT has been a paying client of the OGIB Corporate Bulletin in the last 12 months.
Keith Schaefer
Publisher, Investing Whisperer