Profitable cannabis extraction co raising $1.5M for hemp CBD expansion

Pricing Details

Full Buy Out Price:
$5,000,000
Buy In Price:
$100,000
Ownership Percentage:
2 %

Property Details

Property Attached:
No
Property Is Movable:
No
Property Is Included:
No
Has Buy-in Option:
No
Is Built Out:
No
Has Room For Expansion:
No
Operations Are Needed:
No

Precision Alchemy LLC is a cannabis and hemp processing facility located in Portland, Oregon. Since our inception in January 2015, we have focused on providing high-quality cannabis oil for Oregon’s most notable edible, topical, and vaporizer brands. We work diligently with each client, tailoring our approach to meet their specific needs. We have demonstrated steady growth, showing a profit in 2018 with $2M in gross revenue. We believe our practical growth strategy, our years of experience, and our well-developed IP give us an edge over our competition. We have enacted a 5-phase growth strategy.

 

 

Phase 1: Grow THC Sales

At the beginning of Q4 2018, Precision Alchemy reinvested roughly $100k in profit into equipment upgrades. The first upgrade will allow us to increase our distillate output from 2,000g to 10,000g daily by mid-February 2019. The second upgrade will allow us to preserve high-quality cannabis terpenes and meet an untapped niche in the market caused by regulatory changes. With these upgrades, we anticipate a gross revenue of $5M for 2019.

 

Phase 2: Start 280-E exempt CBD entity

Precision Alchemy is responding aggressively to the growing needs of our current clients and the federal legalization of hemp. In Jan 2019, we created NJC Holdings, the hemp CBD sister-company to Precision Alchemy’s THC extraction facility. On Feb 1, 2019, we entered into a 7-year lease agreement on a 6k sqft warehouse in Clackamas, OR. It is in the ideal location, centrally located in a jurisdiction with the most expedient extraction permitting process. It’s also a short 10-minute drive from Precision Alchemy’s THC facility, allowing our leadership team to oversee both operations with ease. Just by meeting the needs of Precision Alchemy’s long-term clients, NJC Holdings anticipates $11.7M in revenue in the first 12 months of production. Through the employment of a lean sales staff, we expect total revenue of $18.9M for these 12 months. NJC Holdings is currently raising $1.5M to build the facility to FDA and GMP compliance, putting us in an excellent position for long-term growth.

 

Phase 3: Expand THC facility

Precision Alchemy is raising $200K to expand our extraction capabilities at our THC facility. We will do so without investing capital into our leased infrastructure by purchasing modular extraction booths. We can move these booths in the future and, because they are pre-engineered, they make for a (relatively) painless permitting process. We will be able to extract 5x as much biomass and increase our winterization capabilities tenfold. This expansion will allow us to improve our profit margins dramatically.

 

Phase 4: Target THC markets

After our expansion in Oregon, we aim to set up THC processing facilities in states across the country. We will be selective, entering markets that we believe provide the most opportunity. These will primarily be states with limited licensees. Target markets include Massachusetts, Nevada, Florida, California, Arizona, DC. We are interested in accelerating our expansion by partnering with groups that have already secured licenses in these states. We will determine capital expenditures at the appropriate point. Our current plan is to fund as much of this expansion as possible from cash flows out of our existing operations.

 

Phase 5: Exit

We are focused on building a high-growth company, not just by serving our current and expanding customer base, but by developing our own premium branded products as well. As we execute this strategy, we believe we will have numerous options. We may decide to grow the business, or we may exit at a peak valuation if that’s the path our investors want to take.

Price: $100,000

Listing Status: For Sale

Details

Date Listed For Sale: 2/12/2019
License Type: OLCC marijuana processing and ODA hemp processing

Location: Portland, Oregon 97220

Recreational: Yes
Medicinal: Yes

Listing Type

  • Manufacturer/processor/extraction

Terms And Options

7-year lease term with 2 5-year options to renew