NORWALK, Connecticut, July 13, 2016 /PRNewswire/ --
Seventh Point, LLC., a private equity firm focused on acquiring legal, California-based medical marijuana dispensary and cultivation assets announced today that its initial $750,000 friends and family funding round is oversubscribed. The firm has also received two separate $5.5 million financing Letters of Intent for the completion of its first fund -- an investment unit that includes the acquisition of a legal Los Angeles based dispensary, its related license, an on-site cultivation facility, and a satellite cultivation buildout.
Steve Gormley, Seventh Point's CEO said, "We are excited to close our first round and will be working with several investment groups to deploy $75MM into the legal cannabis market over the next 36-42 months. We have seen a tremendous shift in the willingness of investors to come off the sidelines and take advantage of the tremendous opportunity available in legal cannabis."
Once cannabis is rescheduled, the expected value of the legal cannabis industry is estimated at $38.6 billion (in today's dollars), or 12% larger than the entire "Organic Food" industry. Current market players, such as Seventh Point, who have a demonstrable history of successfully working within this highly regulated market-place, will be in first position to capitalize on the expected exponential growth outlined above (a 500% increase in market size).
Dermod (Trip) Ives, III, Seventh Point's COO said, "What separates Seventh Point from its PE competitors is that Seventh Point does not simply make passive investments in existing companies. Instead, Seventh Point wholly owns its acquisitions, manages the day-to-day operations and bring years of industrial cannabis experience to the table as well as Fortune 50 consumer package goods leadership and Wall Street senior leadership. At this time, Seventh Point is focused on bringing mature, enterprise level strategies to this "cottage" industry specifically within Los Angeles. The reasons for focusing on LA are the favorable regulatory environment and the fact that nearly 25% of the industry's $4.1 billion in revenue was generated within LA last year. LA is to cannabis as New York is to fashion and Silicon Valley is to tech."
There are currently an estimated 80 fully compliant medical marijuana licenses in Los Angeles, and by controlling 10% to 12.5% of the fully compliant medical marijuana licenses in the city of LA, Seventh Point will effectively capture 25% to 50% of the $1b in annual revenue emanating from the LA basin.
Erica Sharf-Abramson, Seventh Point's CBD, said "I was attracted to Seventh Point because of the team's high level of expertise, experience, quality and dedication. I was impressed by their knowledge and sophistication in both cannabis and finance. It is very exciting to be a part of this industry at this critical point in time."
Forward-Looking Statements -- Safe Harbor
This press release contains forward-looking statements as defined in the United States Private Securities Litigation Reform Act of 1995. In some cases you can identify those so-called "forward-looking statements" by words such as "may," "will," "should," "expects," "plans," "targets," "believes," "anticipates," "estimates," "predicts," "potential," or "continue" or the negative of those words and other comparable words. These statements include, but are not limited to, our expectations concerning Seventh Point's revenue growth, growth rates for hydroponically-produced food, the market for medical marijuana cultivators, and our ability to provide support services to marijuana growers.
By their nature, forward-looking statements and forecasts involve risks and uncertainties because they relate to events and depend on circumstances that will occur in the future. There are a number of factors, risks and uncertainties that could cause actual results and developments to differ materially from forecasted results. For a discussion of these factors, risks and uncertainties please see our filings with the Securities and Exchange Commission. Our public filings with the Commission are available from commercial document retrieval services and at the website maintained by the Securities and Exchange Commission at http://www.sec.gov . We assume no obligation to update or alter our forward-looking statements made in this release or in any periodic report filed by us under the Securities Exchange Act of 1934 or any other document, whether as a result of new information, future events or otherwise, except as otherwise required by applicable federal securities laws.
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SOURCE Seventh Point, LLC.