The cannabis industry is growing as more voters and state legislatures support the approval of either medical or recreational use of cannabis. With the growing acceptance of cannabis some are looking at investing in the cannabis industry. The cannabis industry is made up of a variety of companies from research to farming, distribution, education, sales, and more. With so many companies that are engaged in cannabis the investment opportunities for growth look promising. We meet up with Matthew J. Nordgren who shares with us his knowledge on the industry regarding investing, mergers and acquisitions, consolidation, and more.
Video Transcriptions
Harry Brelsford
Welcome back to the CannaTech podcast. We have a special guest today, Matthew Nordgren. How you doing?
Matthew J. Nordgren
Hey, feeling good. It’s a really great beginning of the year and it was nice to meet you at the San Francisco conference in the year it started ended things right and started things right.
Harry Brelsford
Sure, dead sure did. And I I really enjoyed the speech. The panel you were on. We’ll get to that in a moment. But first let’s let’s talk about you. I apparently we share Austin, Texas in common. Tell me about yourself.
Matthew J. Nordgren
Well, we do Harry, my, my backgrounds, Texas. I’m a Texan. I’m from Texas, born and raised in Dallas went to school at the University of Texas in Austin. I was on the football team there and went to the business school. And Austin’s just a lovely place. We are so excited. We have some people that work for the firm that are there as well. And most importantly, what somebody’s spirit right now is how excited we are to come down for South by Southwest next month. Right and be a part of talking about plant medicine in front of a community that I know so well.
Harry Brelsford
Oh, good. I’ll be there. I’ll I’ll keep an eye out for you. Because sir, you’re, you’re you’re you’re a tall athletic individual, you’re easy to spot the crowd.
Matthew J. Nordgren
Well, those linemen are so big, you had to kind of be a little bit tall just to have a chance to see over them.
Harry Brelsford
There we go. Arcadian Capital, nice portfolio that you’ve invested in, but what’s your Kadian capital?
Matthew J. Nordgren
Arcadian Capital is an asset manager that runs a variety of funds, we really focus on the supply chain that CannaTech space, as you call it, I saw your beautiful graphics you did. And we were involved in probably 50 companies. And so I was looking at that graph, and a bunch of our founders are on there. And it was really nice to see great job on that, by the way. And, you know, we focus on kind of mid stage equity, we don’t do public investments, although a lot of our companies do go public, we focus on sort of B round, maybe a or c. But we really want to be involved in the build of a business as it sort of moving along. Perhaps it comes from my background as a backup quarterback, because you can only do so much from the sideline when you have a great team out there. But we don’t really, you know, help. We’re not the best ad, when they get the ball on their side of the field on the 20 yard line. We’re sort of like, okay, you got it on the 50 yard line. Now, how do we take it the rest of the way into the end zone, I think is where we are. And we’ve been able to do that to, you know, very successful degree.
Harry Brelsford
Yeah, yeah. So you’re not doing startups and early stage, this is what I took away from that your your more mid points.
Matthew J. Nordgren
I think if you go back, you know, 5,6,7 years, we were but at this point in time, as we kind of get to this midterm election period where there’s a lot of excitement on some things that could happen from an inflection point standpoint, institutionally, globally. Yeah, we believe you’ve got to really sort of be humming along with your business, there’s a good chance that some things happen that really open things up. And that means that a business should be already at some point in their growth cycle. And that doesn’t mean you can’t start a business today. But I think if you do, you probably want to be on the consumer side. In terms of the b2b businesses in terms of sort of the fundamental aspects of the space. There are a lot of people working in various verticals and categories at a high level. And so just as a philosophy, we’re trying to lean into some of the more proven companies and help them get crossed the finish line and do some of the m&a You know, there’s gonna be a lot of consolidation.
Harry Brelsford
Sure is, finally, and forgive me it was it was about two months ago that I saw you present on a panel at the MCI a cannabis business summit in San Fran great conference. What was your panel about if you don’t mind reminding me?
Matthew J. Nordgren
Well, our panel was about investing and sort of the landscape and environment that comes with that and sort of some, you know, some thoughts about where we’ve been where we were today. And where we’re going in the thesis, I think amongst all of us was that there are a handful of inflection points we’re looking at, potentially happening as we get into midterms and between midterms in the next election, and what that means for the entire industry. But I gotta tell you, whenever I get up there, overall, it’s going to be a lot of magic and spirit and positivity. Because it’s a grind, it’s a grind, and people just need to know that there’s no better place than where you are. The past is just data that lives in our brains in the future faith or fear. So you might as well have a little faith in it, and just be where you are. And sometimes we need that reminder. And I think I did probably too much of that in that particular speech. But
Harry Brelsford
now you got everybody energized was an outcome of that today can’t have Vester Kana, Fast Track investor track. I went and signed up for Robin Hood. And I took some sofa change now, not you know, not not too much, not too much money, but sofa change in bought into a couple of the indexes starting at the end of the year and through January, but accumulating based on what I learned there, and I’m an index guy, because I don’t want to work at Walmart as a greeter at age 80. And so it’s it’s very interesting. And you know, if it wasn’t your panel, it was another one that said, you know, the cannabis stocks took a beating last year, of course. And, but it could be a good time to buy long term. And that’s my thinking is, you know, maybe every paycheck throw $100 in and in 60 months, you know, I might have a pot of gold.
Matthew J. Nordgren
Well, yeah, I think you’re probably right, I think it was our panel, I talked a lot about that, too. Now, you know, we’re not a public market expert, we don’t do public deals, we’re not licensed to give that advice. But personally, that has been my go to as well. And I actually, wait, I waited till January and I’m still buying. But I think if you look a lot of these companies, your their trading book value or balance sheet cash on basically what their valuation is, it just can’t be the case. And so this is an industry that if you believe it’s going to continue to move forward, those multiples are severe haircuts, to what their value is. And, and there’ll be some m&a, right, a lot of these companies will will merge together and your stock will ultimately be some of it in one company. But that means that the industry is doing what is supposed to do, which is consolidate to prove winners. And so I think you’re doing the right thing. ETFs index indexes is probably the way to go. Or maybe even just the top five or 10 MSOs to have some exposure to because they probably in my opinion, never are cheaper in terms of relative value based on the cash generation that they have gone and the valuation associated with that.
Harry Brelsford
Alright, my friend will thank you very much. I’m gonna look for yet the major conferences, including South by Southwest of the month here in Austin.
Matthew J. Nordgren
Yeah, please do and, you know, strengthen numbers, this community is beautiful. And folks like yourself, members of the press, that decide to allow for an avenue for these founders and influencers in this space to speak, are really just doing great work impacting we believe the world. I mean, plant medicine is something that plant products, plant consumer products, is something that is going to continue to thrive. And ultimately the result is a better planet.
Harry Brelsford
Well, I’ll end on that your good attitude, because I got involved with Microsoft as a vendor 32 years ago, late 90s. And we literally thought we were going to improve the world. I mean, we were just so walking around all pumped up. And I think we did I think Microsoft had a role in that.
Matthew J. Nordgren
Well, yeah, it still does in an in a crazy, crazy way. I think what we’re doing is a little bit of a reverse engineer on that, which is to say that the internet has always existed. It’s just underneath the ground, in the form of the mycelium network where all plant life speaks to each other and communicates and delivers oxygen and water and nutrients. And every living organism has already had a means with which they communicate. You know, and, and so we want to bring that back to life we want to have the internet is great, the Microsoft’s and all the tech businesses that we see enable the efficient world we live in. But ultimately, yeah, I think we’re designed for less information we want to have people understand that being present. Going deeper with fewer things is how we’re designed. And so I’m not saying that what you did is a bad thing. It’s an amazing thing. But everything in moderation, everything in moderation and so to have peace and happiness and quality. It involves operating as organisms are designed homeostasis. And when homeostasis is achieved, you can thrive and ultimately evolve. And an overload of information isn’t a bad thing. But if you can’t go deep and have understanding the way the brain functions, it doesn’t necessarily advanced quality. And so I think we’re really fighting for quality. Quality over quantity
Harry Brelsford
yeah yeah all right my friend thank you very much Best of luck to you
Matthew J. Nordgren
thank you God bless you
