OUR 9TH YEAR OF PROVIDING PROPRIETARY CAPITAL MARKETS INTELLIGENCE ON THE CANNABIS / HEMP / PSYCHEDELIC SECTORS
REGIONAL AND Sector Deal Tracker
SECTOR Tracker
The Viridian Cannabis Regional Tracker is the premier resource to follow the movement of capital and M&A by location.
Cannabis industry capital raises and M&A activity are shifting. Newly legalized states in the Central and Northeast have become the focus of an increasing amount of capital deployment to fund new cultivation capacity and new dispensaries. MSOs are often finding it more advantageous to build scale in new states through acquisition rather than internal build, leading to a similar shift in M&A activity.
The Regional Tracker gives investors a clear view of where capital is being allocated.
Week ended 11/03/2023
Tracker data shows that California, New York and Florida are the top three states in capital raised over the LTM period, unchanged from last week. California and New York have switched places since last year as New York financing has dropped by 23%.
Tracker data shows that California, New York and Florida are the top three states in capital raised over the LTM period, unchanged from last week. California and New York have switched places since last year as New York financing has dropped by 23%.
Arizona, New York, and California have the top three total M&A transaction values in the LTM period. California, however, is down 78% from last year’s LTM period in total consideration as the state’s industry economics have worsened. We believe a significant amount of distressed M&A will occur in the state over the next twelve months. Colorado is up by 16% and may push California out of third place if the wave of distressed sales we project does not occur.
Sector Tracker
The Viridian Sector Tracker is the premier resource to follow the movement of capital and M&A by sector.
Viridian Capital Advisors partitions the cannabis universe into 12 subsectors and each week we follow the transactions that occur in each of these subsectors, giving investors the ability to spot sector rotations early.
Since the Tracker’s inception in 2015, Cultivation & Retail has been the largest subsector. However, we have recently tracked an increase in activity within the Agriculture Technology, Software and Infused Products & Extracts sectors.
Week ended 11/03/2023
Cultivation & Retail was the number one sector in the current and previous LTM periods, and the decline since last year has narrowed, largely due to Canadian financings. Cultivation & Retail accounted for 56.0% of all cannabis capital raises in the LTM period dropping from 64.5% in the same period last year. The second largest capital raising sector LTM is real estate, up nearly 48% from the previous LTM period.
Cultivation & Retail unsurprisingly also leads in M&A with $6.9B of transaction value in the LTM period. The total is down about 33% from last year, but we expect it to narrow that gap as the significant Cresco/Columbia Care and Verano/Goodness growth are expected to close in the 4th quarter.
