Founded in 2019, Alphagreen is an online CBD marketplace created by Alexej Pikovsky and Viktor Khliupko.
Cannabis Wealth spoke to Alexej about his journey so far, his plans for the future – and why he has no plans to float Alphagreen on the stock market.
What is your background and how did you get involved in the industry?
I was born in Russia, educated in Germany and came to UK for university; I studied at Loughborough, which is renowned for sport, and I was a keen waterpolo player.
After leaving uni, I spent 10 years working in finance, giving advice on mergers and acquisitions, working in tech company investments.
I really got into CBD through being very involved in sports, sports science and supplements; it was through this that I became aware that medical cannabis was a thing from fairly early on, although I never looked into it in too much detail.
But when I was working in private equity, the market in cannabis was going crazy thanks to what was happening in Canada and the US, which got me interested in the legal market, I wanted to know what I was missing.
Having spent time as an investor looking at different industries and different companies, I knew that being right in terms of timing is critical.
It was when I attended a party hosted by Chrystal Capital in May 2019, where there were lots of cannabis investors, that I realised there was no deal flow for cannabis-based businesses, the only company doing anything was Prohibition Partners.
I found that interesting, as there was clearly huge investor interest but no targets.
So I thought, if I go to the US and Canada and find these interesting cannabis companies, I can create my own deal-by-deal cannabis fund. And so that’s how I got into the CBD space, more as an investor in the first instance, leveraging my background and experience.
Of course, when I got to the US, everyone wanted to meet me, because everyone needed money and I soon realised that every single firm, whether medical cannabis or CBD businesses, wanted to expand into the UK market.
That’s when I decided to create a platform to allow customers in Europe to get educated and get access to the best quality products, and have US and Canada to bring their brands over.
I was lucky, having been in venture capital I had interesting ideas and a great support team, including Victor, my co-founder.
We launched in October 2019, and I contacted a lot of previous investors to see if they were interested in coming on board, which meant we had the team, the idea and the money, we went from zero to 100 quite quickly.
In fact, we became the largest marketplace in Europe in the first six months, with 150 brands and 2,500 products online.
However, we don’t hold stock ourselves – we’re more of a tech platform than an e-commerce one. Instead, we take orders on behalf of brands, then when the brand delivers the product to the customer, we give them 70 per cent of the retail price, taking 30 per cent in commission.
What challenges do you face, and how have you overcome them?
Payment issues can be a problem, with shady payment processes and weak technology, so that took a while to iron out. We use two platforms now, in case one goes down.
However, one of the biggest issues is spreading the word, especially online. The CBD industry isn’t allowed to advertise, which means no PPC – we can’t put £100k into Google ads and get £100k revenue.
Instead, we have to grow through the search engine, so we need a lot of content, a lot of backlinks, a lot of PR – we need to be much smarter than usual brands.
This is a challenge in itself, as traffic from Google is not always linear so we have to be very close to Google algorithms and constantly produce content.
We’re producing 400,000 words a month, both on unique content, product descriptions, link building and backlinks – it’s a huge operation.
Also, Google is getting smarter, so this all needs to be good content, referencing medical publications, on a quick, sophisticated website. We’re indexed for more than 7,000 keywords, so if you google CBD benefits, we’ll be on page one. That’s one way we’re directing people to us.
The second way is through influencers – we give them the product, they tag the products and they also tag Alphagreen – although sometimes it does just end up being the product. That’s why we’re launching our range of gummies, to find other growth channels.
What other developments do you have in the pipeline?
We’ve recently launched the Nuoptima platform to increase our offering and help brands grow their own digital footprint.
The idea behind it is to simplify the marketing process, with one agency able to handle all the PPC, SEO and influencer marketing.
This saves brands, especially the smaller ones, having to work with different agencies for different things, while also giving them a marketplace to sell their products.
Setting up with a new name allows us to be clearer, and also helps us to talk to the US market about everything else they need, because, as it stands, they’re not able to be on the marketplace yet.
What do you see as the wider impact of supporting smaller brands in this way?
Ideally, we are creating an ecosystem for the best brands, because the main problem in the industry at the moment is that, every few weeks, there’s another CBD brand popping up.
We’re very selective about who we allow on Alphagreen – we’ve almost stopped UK brand admission because there are just too many, and ultimately many may have great branding but they don’t have the means to generate sales by investing in the above marketing.
So Nuoptima is an instrument for them to improve as well, and it helps us make more money – all part of our 10-year game. We want to surround ourselves with the best brands, helping them by not only generating sales on Alphagreen but also by really helping them grow as a brand and bring traffic to their own domain.
What do you look for in a brand?
Initially, we were focused on getting brands from best marketplaces. Then we got them all.
However, we still look at rankings of brands and work on acquisitions – as a marketplace, we need to have the most popular brands on our site and that is always evolving. We’re constantly talking to people and investors are always introducing brands to me, so we have various channels we go through.
Are you considering floating on the stock exchange?
We’ve already been approached for both the London Stock Exchange and the Stockholm NASDAQ. My thinking has always been that there is a lot of retail happening, retail hype means stock price goes up, but it doesn’t necessarily mean the company has a lot of cash or can do anything with that value.
There are only about ten people trading the stock every day, which is nothing. If tomorrow, I started shorting the stock, it will crash because there’s no volume there, so any impact will be detrimental – just look what happened in Canada in 2019.
The market crashed by 90 per cent and the companies had a hard time raising more money and investors got a really bad experience. As long as you’re building a good story, you don’t need to go public.
What’s next for Alphagreen and the industry in general?
For Alphagreen, we’ve got a strong international market opening up; we’re now open in France, Germany, Spain, Italy and Sweden, and we’re launching in Poland next month, then also Japan.
We’re seeing that, although there’s still a lot of regulatory noise, we do see a stronger acceptance in those markets.
Medical cannabis will also be a big focus for us over the next year or so. We launched a subsidiary in 2020 but with the pandemic, we thought it would be very difficult to educate medical professionals and they had better things to do.
Plenty of the brands we already stock offer med cannabis too so it makes it easier if they can talk to us for that too.
We’re also excited about a data product we have coming up, because we know that the industry doesn’t have any reliable intel out there.
The beauty of Alphagreen is we have 2,500 products on the marketplace, so we can really extract the data about what products people are buying, and what they’re paying, so that’s another service we can offer brands.
This means they don’t launch, say 50 SKUs, 40 of which nobody needs; they can understand what are the best-performing SKUs and what are the gaps in the market – ready to be filled.
It’s all about helping brands perform at their best – which means Alphagreen will perform at its best too.
Cannaray: “We aim to become the leading medical cannabis player in Europe”
Cannaray recently closed a £10 million funding round to expand its medical cannabis arm.
Cannabis Wealth caught up with Cannaray CEO Scott Macguire to hear about the company’s plans to expand its medical cannabis division following a £10 million funding round earlier this year.
In April this year, Cannaray closed a £10 million funding round that included a significant investment from Channel 4 Ventures. Cannaray believes the investment was a first of its kind in Europe for a major TV broadcaster.
“We were delighted to close on an amount above our initial targets, considering the difficult capital markets,” Cannaray CEO Scott Macguire told Cannabis Wealth.
“It was a great sign of confidence in the company to see existing investors come back in for this round as well as welcoming major new investors such as Channel 4 Ventures. TV advertising has taken Cannaray to new heights, so we’re thrilled to be able to partner with Channel 4 to continue to drive rapid growth of the brand.”
Other participants in the round include Three Bridges Private Capital, Alpha Blue Ocean and a mix of new and follow-on private investors.
Cannaray’s group of companies spans both medical cannabis and CBD wellness brands. Its CBD brand is already well-established in the UK. In the summer of 2021, Cannaray launched the UK’s first major brand campaign for CBD on TV. In addition to a high-performing B2C site, the brand is also stocked on Amazon and in over 1500 retail outlets across the UK including Tesco, Superdrug, ASDA, Waitrose and Harrods.
Now, the company is turning its focus to medical cannabis. The majority of the recent raise will be channelled into Cannaray’s medical division Therismos as it seeks to scale and expand its footprint in Germany and the UK.
“Our aim is to become the leading medical cannabis player in Europe,” Macguire said. “We have significantly strengthened our position over the last year to cover supply, distribution and prescription of cannabis-based medical products (CBMP) across Europe.”
In Germany, Cannaray recently embarked on a “transformational” partnership with Alliance Healthcare Deutschland – a division of Walgreens Boots Alliance – to help establish the brand’s presence in the German market.
The German federal government announced it would be putting plans in motion to legalise adult-use cannabis in November 2021. After a number of delays, Germany’s health minister Karl Lauterbach announced that the legal process for cannabis legalisation would begin this summer.
“[Germany] is the largest CBMP market in Europe and where AHG has a significant footprint,” Macguire added.
“Our medical cannabis division Therismos will be activating the partnership with AHG with the aim of becoming one of the leading providers of CBPM in a market growing at 13 per cent year-on-year.
“Our pipeline plans include product innovation, new presentations [and] galenic forms and novel technologies that will step change a market that is in its creation phase.”
Cannaray is also looking to tap into the medical cannabis sector in the UK. While only 30,000 patients have access to a medical cannabis prescription currently, there is huge potential for growth with an estimated 1.4 million people self-medicating with illicit cannabis, according to YouGov statistics.
The firm will soon be opening a medical cannabis clinic with the help of leading pain specialists in the UK.
“The UK is our second priority since this market represents the greatest growth opportunity in Europe,” Macguire said. “The UK is a small market relative to Germany and even smaller still when compared to North America.
“The prevailing challenge in the UK is the cost of the medication, as the NHS does not cover the cost of the medication. Estimates put the cost per patient per year at over £3,500. There will be a cap on the growth of CBPM in the UK until the NHS covers the cost and GPs are allowed to prescribe.
Macguire said Cannaray is now exploring additional acquisitions in its efforts to position the company as a leader in the European medical cannabis market.
Curaleaf appoints new chief people officer
Tyneeha Rivers will take on the role.
Curaleaf Holdings has appointed Tyneeha Rivers to the role of chief people officer (CPO) – a new position within the company.
Rivers will be taking on the role following the announcement of Matt Darin being named CEO. Darin will be replacing Joe Bayern, who will be launching a new CPG-focused division of the company.
CEO of Curaleaf, Darin, commented: “This is an incredibly exciting time for Tyneeha to join us and I am thrilled to welcome her to my executive leadership team.
“With over twenty years of global Human Resources expertise in senior positions for distinguished organisations, Tyneeha has a proven track record of building winning team cultures that positively impact business results.
“This is a critical focus for us at Curaleaf as we move the company forward. My goal is not only to be the leading global cannabis company, but also the place to be for the most talented, motivated, and passionate team members in the industry, bar none.”
Rivers will lead the Curaleaf’s Human Resources department and help advance strategic HR operations, talent acquisition, talent management, diversity, equity and inclusion, leadership development, training programmes, employee relationship management, compensation and benefits, job design and succession planning.
Rivers stated: “I am honoured to join the Curaleaf team at this exciting time in the company’s evolution and rapid growth.
“Curaleaf has established itself as a leader in the cannabis space, not just in revenue or retail footprint, but in talent and commitment. I look forward to partnering with the entire Curaleaf team to continue focusing on strategic HR operations and the investment in the Company’s people, without whom this exponential growth would not be possible.”
Rivers brings over 20 years of experience in corporate human resources, leading HR for various prominent organisations such as Merrill Lynch, Morgan Properties, The Galman Group, Philadelphia 76ers, Harris Blitzer Sports & Entertainment, Greater Philadelphia YMCA, and most recently, CPO at Curio Wellness.
Rivers currently serves as board president of Second Chance Mission, an organisation established to help survivors of substance abuse, domestic violence, bullying, life-altering illness and other hardships.
Kendra Mark appointed as director of product at Tenacious Labs
Mark has a passion for health and wellness.
Kendra Mark is joining UK-based CBD company Tenacious Labs as its new director of product.
International consumer products group championing emerging plant-based ingredients, including CBD and Psilocybin, Tenacious Labs, has welcomed Mark to its team.
Mark joins Tenacious Labs with industry-leading expertise in new product development, significant experience in the CBD and hemp sector, and a passion for health and wellness.
COO of Tenacious Labs, Susie MacArthur, commented: “We are delighted to welcome Kendra to the Group. With considerable industry experience, both in senior leadership and new product development roles, her expertise will be invaluable as we look to scale up, launch our brands around the world, and become a leading consumer products group globally.
“We believe this is the start of a really exciting period for Tenacious Labs, and we’re pleased to have Kendra join us on our journey.”
Director of product at Tenacious Labs, Mark, commented: “I am hugely excited to join Tenacious Labs, a Group which I have admired for some time.
“Like me, the team have fantastic ambitions to create an industry-leading Group that harnesses the natural power of CBD and other emerging ingredients. I am looking forward to getting stuck in and doing what I love most: creating natural products that support the day-to-day wellbeing of consumers around the world.”
Mark most recently co-founded natureofthings, a wellness brand focusing on natural ingredients, minerals and elements, including hemp. She has also served as VP of product development at Hemp Depot, a specialist hemp wholesaler, and led 2Rise Naturals, a consumer brand specialising in high-quality CBD.
In her role at Tenacious Labs, Kendra will be responsible for creating unique and differentiated products across the Group’s portfolio of brands, such as Press Pause and HOO RAA.
Mark will also work closely with TL Manufacturing — Tenacious Labs’ wholly-owned production facility based out of Colorado, USA — to launch products in new and emerging categories. This will support the group’s broader strategic goal of becoming a leading consumer products group globally.
Kendra, who is based in Arizona, joins Tenacious Labs’ predominantly female management team, which includes its chief operations officer, Susie MacArthur; chief financial officer, Sally Hayes; and head of lifestyle brands, Dawn Fable, at the start of its next growth phase.
In addition to Mark’s role, the Group is also actively hiring for several new roles as it looks to scale up and launch its brands around the world.