BioSteel

I knew something was amidst when I could not get my order of BioSteel. From a marketing standpoint, they offered retailers a deal they could not refuse. If you purchased 8 cases of BioSteel, you get a free fridge. Needless to say, we received 3 fridges before they caught on. I knew that these fridges were very expensive and must have cost Canopy, the marijuana company, the majority of their cash flow. I remember the euphoria of marijuana companies such as Canopy reaching their zenith of capitalization of billions of dollars. In fact, at one point their stock reached $60 CDN, with the lowest being $0.60 cents. Many analysts were ecstatic that Canopy, the marijuana company, paid hundreds of millions of dollars for BioSteel. Canopy wanted to become global by partnering with Constellation Brand as their distributor.

Gary Bettman was laughing all the way to the bank, when he got rid of Gatorade (owned by Pepsi Co.), replacing it with a fringe beverage BioSteel. However, Gary Bettman did not consider Constellation Brand entering an agreement with Coca-Cola, which owns Monster Energy drink. Coca-Cola and Pepsi Co. are ruthless companies that take pride in decimating their competitors. With these boys, it is a dog eat dog world of big business not like pipsqueak companies that believe in the rise in revenue expectations.

Canopy is a relatively small marijuana company that lost most of its market share to competition. Regulatory challenges in the Canadian cannabis industry included licensing, marketing and advertising restrictions, and quality control. These challenges made it difficult for legal cannabis companies to compete effectively with the established black market. The challenges faced by the legal cannabis industry in Canada, including competition from the black market, high taxes and local government opposition, have been widely documented since the country voted to legalize recreational marijuana. The illegal cannabis market in Canada has a long history and established networks, making it challenging for legal industry to compete. Illicit operators offer lower prices since they do not have to adhere to the same regulatory requirements and taxes as a legal business.

Canopy’s corporate structure is based on a bunch of adolescent cowboys, who think they are executives. They achieved absolutely no corporate long-term execution in battle against the big boys in America. The problem with superstars like Connor McDavid, and Connor Bedard is that they are not going to receive one red cent by endorsing BioSteel. Gary Bettman has to go back to the drawing board and perhaps get another deal with Gatorade, this time at a substantially lower price for the NHL. The reason why BioSteel got credit protection is because their operating cost of Canopy marijuana exceeds revenue. They were banking on BioSteel to propel their stock upwards. The real tragedy of this Canadian company is BioSteel’s revenue was made with the expectation of paying off debt. BioSteel thought with the NHL endorsement deal will further enhance their future earnings to pay off debt. Once you accomplish that aspect in a corporate company there result is a failure, but at least dealers received their fridges, which in my opinion is worth more than the 8 cases I purchase. It is always good to see a marijuana company building fridges.