The Parent Company has the goal of becoming the most impactful cannabis company in the industry. Within 28 days on the job, new CEO Troy Datcher is turning the company’s focus to direct-to-consumer, a move that could reward communities and shareholders.
“I’ve spent 30 years of my career in consumer products,” Datcher told the 2021 Benzinga Cannabis Capital Conference.
Datcher said if you would have told him years ago he would be speaking at a cannabis conference, he wouldn’t have believed it.
The new Parent Company CEO said he’s attracted to the space and the company due to its impact on delighting customers and providing an end-to-end platform.
Direct To Consumer Cannabis Business: The Parent Company is tied for the second-largest retail footprint in the state of California, a highly competitive market with numerous brands, Datcher said.
The company touches 80% of the state with its dispensaries and delivery areas, getting close to a goal of 90% by the end of 2022, the CEO said.
Datcher calls the cannabis space highly competitive and notes that it is a “cluttered space” with new brands emerging.
“Brand loyalty drives and incredible power in the marketplace.”
Working With Jay-Z: The Parent Company is partnered with Jay-Z and Roc Nation on Monogram, a cannabis brand.
“To be able to work with a global icon, cut through the clutter of all the brands, is absolutely incredible,” Datcher said.
Monogram has amassed over 1 billion image impressions and built a strong brand awareness, Datcher said.
Datcher told the audience there isn’t another cannabis brand that can be featured in Variety, the New York Times and Vanity Fair with one phone call like Monogram, thanks to Jay-Z’s influence.
Datcher said a common question is how involved is Jay-Z with Monogram.
“Nothing happens on the Monogram brand without Jay-Z involved.”
Jay-Z designed the packaging for Monogram, Datcher shared with the audience.
Datcher shared a photo of himself with Jay-Z, noting the two sat down recently to discuss the brand’s future and vision. Datcher joked he has yet to meet Beyonce, the musician/actress superstar who is also Jay-Z’s wife.
The Parent Co.’s Financials: Thanks to a “very strong balance sheet,” The Parent Company has been able to make several acquisitions to continue its expansion in California and pursue its direct-to-consumer focus, Datcher said.
“You’re going to see us add to our portfolio.”
Vertical integration is important for the consumer and also for the company’s profitability, the CEO said. Bulk sales have lower margins than direct-to-consumer brands.
Going forward, Datcher said the item for investors to watch is “are we moving the needle in direct-to-consumer?”
The Parent Company had revenue of $40 million and $54 million in the first and second quarter, respectively.
Direct-to-consumer revenue was $9.7 million and $11.9 million for the first and second quarters, respectively.
Datcher said the company will report third-quarter financials in the coming weeks.
“We’ll be taking care of shareholders long-term too.”
GRAMF Price Action: GRAMF shares ended Thursday’s session down 2.33% at $2.93.