LAS VEGAS, Oct. 21, 2015 /PRNewswire/ -- GreenWave Advisors Founder Matthew Karnes once called cannabis testing "the most attractive subsector of the industry" adding that it could generate close to a billion dollars in revenue by 2020. With a growing number of states legalizing recreational and/or medical marijuana, there's a growing need for a cohesive cannabis testing framework to avoid many of the problems created by inadequate initial laws passed in states like California and Colorado.
DigiPath Inc. (OTCQB: DIGP) recently opened a state-of-the-art cannabis-testing laboratory in Nevada – a state with some of the toughest testing regulations in the country. By leveraging its experience in the best possible initial market – given its strict testing standards and enormous potential to become a cannabis tourism destination, the company aims to replicate its success across the United States in order to unify testing standards.
Recently, CannabisFN's Mike Elliott sat down with DigiPath Inc. CEO Todd Denkin to discuss some of the company's latest moves and upcoming catalysts. Video: http://www.cannabisfn.com/mdc/digipath-inc/
Early Success in Nevada
DigiPath took its time to build out its flagship cannabis-testing laboratory in Southern Nevada, ensuring that they purchased the best equipment and hired the best scientists, knowing that the business would become a model for future labs throughout the United States.
While there are still some early delays, there are a handful of cultivators currently licensed in Nevada and the laboratory has recently begun generating some revenue as just one of a handful of laboratories operating in the state. The company's client base continues to grow as the state approves medical marijuana license applications, while experts believe the market could eventually reach $100 million in size. In part, the growth will be supported by the state's reciprocity rules, enabling out-of-state visitors to access MMJ.
Recreational legalization could also turn the Las Vegas area into the new "Vegsterdam" – ripe for cannabis tourism – if approved in the 2016 election cycle. Since recreational marijuana would fall under the same testing requirements as medical marijuana, the company's laboratory would be well-positioned to benefit from the legalization. Some experts peg illicit marijuana sales at $2.5 billion in Las Vegas alone – an enormous market to be sure.
Fast and Furious Expansion
DigiPath expects that its nationwide expansion plans will be helped with the appointment of Joseph Bianco as its Chairman of the Board. After attending Yale Law School, he founded Alliance Entertainment Group and built it up by acquiring and consolidating over a dozen smaller companies. The company eventually became the largest independent distributor of recorded music, listed on the NYSE, before being sold to a private equity fund.
By leveraging Mr. Bianco's M&A expertise and the company's experience in Nevada, DigiPath hopes to replicate its success around the nation over the next year. Successful execution of its expansion plan could quickly turn the company into a market leader in the attractive cannabis testing segment, while ensuring that high testing standards are applied in all markets, regardless of whether lawmakers have passed legislation or not.
DigiPath's close work with regulators could help ensure that its rollout strategy succeeds, by keeping its leadership in-the-know with regards to upcoming regulations. In October, the company's Chief Science Officer Cindy Orser, Ph.D., gave a presentation before Washington D.C. Attorney General Karl Racine and others on the issues of synthetic cannabis, identifying cannabis strains, and the need for testing standardization nationwide.
A Diversified Presence
The cannabis testing industry is certainly the most attractive subset of the industry, but DigiPath has also diversified into other synergistic areas, including cannabis media.
The TNMNews division reaches an average of 200,000 listeners each month through its online and terrestrial radio program, while receiving upwards of 500,000 visitors to its website. Including interviews with ArcView Group and other top-notch industry voices, the company has built an attractive channel through which it can reach cannabis businesses and consumers to advertise its current and future products and services, while generating third-party advertising revenue.
Looking Ahead
Investors in the cannabis industry, including Nemus Biosciences Inc. or MassRoots Inc., may want to take a closer look at DigiPath given its growing presence in the cannabis testing space and its diversified play in media and other areas.
For more information, visit the company's website at www.digipath.com.
Legal Disclaimer:
Except for the historical information presented herein, matters discussed in this article contain forward-looking statements that are subject to certain risks and uncertainties that could cause actual results to differ materially from any future results, performance or achievements expressed or implied by such statements. Important factors that could cause these differences include, but are not limited to, the demand for the company's services, governmental regulation of the cannabis industry, and the company's ability to execute its business plan. Emerging Growth LLC dba TDM Financial, which owns CannabisFN, is not registered with any financial or securities regulatory authority, and does not provide nor claim to provide investment advice or recommendations to readers of this release. Emerging Growth LLC dba TDM Financial, which owns CannabisFN, may from time to time have a position in the securities mentioned herein and may increase or decrease such positions without notice. For making specific investment decisions, readers should seek their own advice. Emerging Growth LLC dba TDM Financial, which owns CannabisFN, has been compensated for its services in the form of cash and equity securities by DigiPath. For full disclosure please visit: http://www.cannabisfn.com/legal-disclaimer/.
Media Contact: DigiPath Labs, Inc. [email protected] 702-470-2249
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SOURCE DigiPath, Inc.
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