Stockport-based CBD brand Naturecan has seen a record growth of 300 per cent over the last year. Co-founder Paul Finnegan discusses the company’s journey and the secrets behind its success.
Founded just over two years ago by ex-CEO and board director of My Protein, Andy Duckworth and entrepreneur Paul Finnegan, the high-quality CBD brand Naturecan has grown substantially over just a short period, seeing a record growth of 300 per cent over the last 12 months.
Naturecan’s products are now sold in more than 28 countries across the globe from the Far East, to America and Europe. As well as recently securing a seven figure investment from the Far East, Naturecan is backed by high profile cricket star Freddie Flintoff – an early investor who is aiding the brand’s global expansion.
Finnegan decided to get into the CBD business after his friend’s mother used the cannabinoid to aid with her recovery from breast cancer.
“It all started at beginning of 2018 – I had shares in a drinks business and property – and I had seen CBD advertised everywhere. A friend’s mum had breast cancer and had used cannabis treatment in her recovery. I was amazed at how she had recovered and amazed that this lady had gone down this route, so it really piqued my interest and I needed to see what it was all about,” said Finnegan.
“The more I researched it the more I thought this is incredible, from kids with autism, to people with anxiety and fibromyalgia sufferers that haven’t got a real cure or a way to take the edge off the pain. I went out to the United States and found that there was so many cowboys in the industry – you didn’t know who was extracting, who was an agent, who was selling you hot dog water. You needed to go out and physically look at these facilities and check their standards. Being from the drinks background – there is high standards in the UK for food products so it was about checking all of those things.
“I went and visited everywhere in the States – I went to extractors in Colorado, Oregon, LA and eventually met with a man who had done this out of pure passion for helping his children, one of which was heavily autistic and suffered night terrors who was on seven different prescription drugs. He then, as a doctor himself, took the path of taking him off this medication and putting him onto a cannabis-based medicine. This young boy’s life totally changed – he went from being in the emergency room for 300 days a year to literally living a normal life, going to school with years and years between episodes. So, I thought that this guy has got the passion and the motivation – nothing motivates you more than your children. I have two of my own children and it resonated with me.
“He also had at the time the mythical beast of zero THC because of this enhanced technology he had been using – chromatography – where the levels were incredible low. That was the big turn on. We struck a deal with them on an exclusivity agreement.”
High profile investors and supporters
Naturecan attracted high profile investors early on, including Flintoff, who Finnegan says is a true believer in the benefits of CBD.
“Freddie invested in the business early on, it is not an endorsement deal. I have known him for a few years, we are good friends and he believes in the business and the product. So, at a very early stage he was a major investor.” says Finnegan.
“He does use the products, you can see that he has a go at everything – he keeps himself in such good shape and uses everything from protein and keratin on the non-CBD product side, through to oils, cookies and balms. A lot of his network also use CBD such as ex-cricketer Kevin Pietersen who has been posting about our ‘miracle’ CBD arnica cream, as well as Darren Gough, and Tom Davies the comedian uses the gummies relentlessly for golf – so Flintoff is a great person to have as an investor and supporter.
“CBD is really taking off in the sport world. There are still issues with whether or not CBD is allowed, so that is something the whole industry needs to get behind. Naturecan, at the moment, are sponsoring PhD courses at Liverpool John Moores University under professor Graeme Close who works with the England rugby and the European golf tour, as well as many others. We want to give that clarity to these sporting bodies about retention of THC and how it effects you so, we are undertaking human trials.”
Taking Naturecan global
Finnegan met Andy Duckworth, Ex-CEO and board director of My Protein, who has helped take the business to global levels, as well as helping to broaden Naturecan’s product offering.
“Duckworth took the business to huge numbers and spread it all around – he truly globalised the business. We were introduced by our mutual friend and investor, Flintoff. He took the business on and looked at how we could make this into a global wellness platform.
“He had contacts from contract manufacturing which allowed us to create more products – instead of just offering tinctures, gummies and balms, we now do all sorts of baked goods as well such as cookies and brownies, and a capsule range with dozens of different extra skews, and products with ingredients like novaSOL curcumin which is 185 times more bioavailable than native curcumin. These ingredients compliment CBD so well for inflammation.
“With Andy’s network we have been able to put this together so quickly and he has also helped to bring a lot of staff in – we have around 40 staff working with us, most of which are ex-My Protein or the Hut Group that have worked with Andy in the past.”
Finnegan attributes the last year’s success to the hard working and driven team, as well as the high quality of Naturecan’s products.
“The product is incredible quality and everybody that we deal with as a contract manufacturer say it is the best they have seen from a purity level,” says Finnegan.
“However, 100 per cent the growth is from the team – the people in the business are fantastic, driven. They believe in the product and also believe in increasing peoples’ happiness in life, which is the key to our business so, we have just got a real group of highly motivated skilled people, and, with Duckworth as our leader, he drives everything forward.
“We are in 28 countries now with 40 planned by the end of the year – being able to rely on each country manager and staff in their team to drive each territory forward has been a massive contributor to the growth.”
Finnegan says that Naturecan’s ethos is to bring together the power of nature and science, and to include only the best ingredients to create high-quality products.
UK CBD company Kaya raises £1.7m for European expansion
Kaya co-founder Ludovic Rachou discusses the company’s journey and plans for European expansion.
UK-based CBD brand Kaya has successfully raised £1.7m of funding which will help fuel its expansion into European markets.
Founded in 2019 in France, CBD and adaptogenic brand Kaya had a vision to be a European leader in the CBD sector. The company was one of the first in the UK to receive approval under the new Novel Foods certification, verified by the Food Standards Agency for their CBD-based products, and today, its products are sold in over 1000 stores across Europe.
Kaya’s recent £1.7m fundraise came from both new and existing investors including VC fund, Senseii Ventures, and US cannabis fund, Artemis Growth. The funding will go towards fuelling the company’s brand mission as they expand into European markets following its recent launches in Italy, Germany and Poland.
“We’re currently the biggest player in France when it comes to finished products with CBD and we have about 40 people in the company in France. We have a few people in the UK as well,” said Ludovic Rachou, Kaya co-founder and founding member of the Association for the Cannabinoid Industry (ACI), a cannabis trade association in the UK.
Kaya’s range spans ten bespoke adaptogenic and CBD-based, vegan-friendly products for a number of uses from restful sleep to everyday stress relief.
“It was the first market because of the regulation in the UK with Novel Foods so, it has been hard to grow in the UK recently. We launched Germany with an edibles brand, and launched a cosmetics brand called Skin back in November 2020. So, we mostly sell in France in pharmacies and general retails, and also small independent shops and online. So, we don’t have the same kind of health retail that we have in the UK or in the US.
“About half of our revenue is our own revenues online, and we are going to finish our first year with somewhere between €5 to to 6m in revenue.”
Rachou highlights that, whilst other brands are relying on ingredient suppliers or manufacturers to achieve compliance, Kaya is one of the few brands to have submitted its application in its own name, processed through the EIHA Projects Consortium.
“It is a process where we have to prove that the CBD we use – we currently only use isolates in our products – is actually safe for human consumption, and it is something that we had to do in the UK, but we also have to do for French markets for instance. There are quite a few brands that claim the same thing, but the main difference with us is that we actually formulate all our products in-house.
“We have five different founders and my co-founder Allison is a pharmacist who is actually the one doing all the formulations. So, we don’t buy, because on the market you mostly see brands which products are from on-the-shelf labs – however, we usually outsource production, but we work on the formulations and the recipes ourselves.
“I think that’s one of the biggest differences, and we buy for different regions from different suppliers. We never buy anything at the same place.
“When we launched the company we raised €1m with mostly French and British private investors – high net worth individuals and mostly entrepreneurs. Then, for the second round, it was mostly the same people, and a new, interesting new player from the US, a fund called Artemis Growth, which is interesting because they are one of the biggest funds in the US space.”
Kaya is beginning to look towards the European CBD market for its future and will be launching a new Series A round aiming to raise between €5 to 10m.
“I think we have seen the market in the US maybe losing faith a bit because of all the regulation – it is not so clear with the FDA, so, many Americans are starting to look at what is happening in Europe. For us, when you see the investments that Artemis Growth has made in the US – so far they have made the right choices – so, we are quite proud to have them on board.
“We are funding our international expansion – so, we just launched in Germany and Italy, and we are also willing to expand all around in Europe. We want to trial all the markets and, if the figures are good, then we will launch specific teams on the ground. We think it is very important to have natives in each and every country – to understand the market and the consumer.”
One year ago Kaya had six people in the company, but has now evolved with a team made up of 40 people, and soon to be 55, and has plans to launch new product lines.
“We are going to launch a pet food brand, hopefully, by the end of the year or early 2022. Most of the CBD you get in Europe is either imported from the US, or sometimes from Eastern Europe, but we are about to launch in mid-2022 with French hemp and CBD. France is actually the biggest hemp farmer in Europe and there is a new regulation that is about to change next year. So, we’re going to be allowed to do French CBD which I think is pretty important to sell. Our goal, in the end, is to sell German CBD in Germany and French CBD in France, and so on.
“We are always looking for talent so we are currently recruiting a lot of people and we are always interested in talent everywhere in Europe. So if anyone wants to get in touch – feel free.”
Kaya, which also has headquarters in Paris, has seen more than 15,000 customers since September 2020, and Rachou says the latest round of funding puts Kaya one step closer to achieving the goal of delivering quality products with the potential to have a real impact on consumers’ day-to-day lives.
Grow group: innovating cannabis medicines and improving access
Grow Group co-founder and CEO Ben Langley spoke about the company’s aims, cannabis innovation and its plans for expansion.
Founded in 2017 by former JP Morgan banker, Ben Langley, and Dr Ian Atkinson, Grow Group is working to improve access to medical cannabis to patients across the UK and the globe.
London-based biopharmaceutical company Grow Group has patients at the heart of its strategy, having partnerships with some of the UK’s leading medical cannabis clinics to bring its broad portfolio of cannabis medicines to patients that need them at an affordable price, already helping over 1200 patients with access every month.
The company recently embarked on its first crowdfunding round, reaching its minimum target in just one hour, and acquired its first company, Sanoid Isolates, the Spanish cannabis producer, in a move that positions Grow to be one of the leading global producers of sustainable cannabis.
Co-founder and CEO Ben Langley spoke to Cannabis Wealth about the company’s aims, cannabis innovation and plans for expansion into international markets.
Breaking down barriers to access
After quitting his position at investment bank JP Morgan in 2016 to become a socially conscious entrepreneur, Langley saw an opportunity to help cannabis patients that are facing stigma and barriers to accessing medicines that improve their quality of life.
“This rang a huge alarm in my head which was that this doesn’t make sense. The lack of access to these cannabis medicines is one of the most nonsensical things I’ve ever seen in my life, and as an economist and a logical person, if something doesn’t make sense to that magnitude then addressing the problem is a huge social opportunity. I decided that cannabis was the right mission for me and ultimately, it would be something I should dedicate my working career towards and hopefully make a bit of an impact in the world,” said Langley.
“We were founded in 2017 by myself and Dr Ian Atkinson who has a whole raft of patents and medical devices under his belt. We put our heads together and founded Grow Group, which exists to get quality cannabis medicines to the patients that need them. There are hundreds of millions of patients, globally, that ultimately could and should get cannabis medicines. But currently, the legal context, we see only a very small fraction of that number actually getting that medicine.
“So, everything we do points towards making sure to get more patients access to cannabis medicines that will ultimately improve their lives. We want to break down barriers and make sure that cannabis gets to where it needs to be and that the patients have access to it legally. We look at it quite holistically around what we need to do to achieve that goal.
“Having a quality basket of medicines is really key. There is almost an infinite combination of molecules so we know that cannabis is a personalised medicine – different combinations of cannabinoids and terpenes will appeal to different people. We know that people have different stigmas – some might like to smoke and somebody else might never think about smoking and instead use an inhalation device for a measured dosage, without smoke. Some might want to take oils. So, you’ve got this really interesting subset of medicine where, even though cannabis medicine is one category, within that you have got, potentially, thousands of medicines.
“What we try and do first and foremost is make sure we have got the best medicine, and help as many people as possible, then over time we can improve that with data and products.”
Improving medicines through innovation
Grow Group currently has over 50 cannabis medicines and continues to work towards improving this portfolio with extensive R&D, exploration of new technologies and the development of technology patents that will innovate the cannabis industry.
“Product innovation will ultimately lead to better patient outcomes. We start with the best basket of medicines. Then, we have been doing research and development since 2017 when there were very few legal markets, so, we started doing the research. Our research and development work focuses on improving the technologies that will ultimately move this industry forward,” said Langley.
“We have got, for instance, a very interesting technology around distillation and purifying cannabinoids that will go into our production facility. I will make sure that we can ultimately produce some of these medicines more cheaply and with higher quality than anywhere else.
“We have lots of Ph.D. scientists in our lab in Rothamsted in the UK and what they are trying to do is not accept the process of how cannabis ends up being a medicine. There have been 100 years at least of essentially zero innovation in cannabis because it has been illegal to do anything. There is a massive shortfall in technological innovation that would have happened had cannabis been a legal substance. So, what we are trying to do is look at the whole way cannabis is processed currently and how it ends up as a medicine, seeing where we have been and where we can improve things.
“Some of the improvements could be relatively subtle but a lot of things we are working on seem to have fairly substantial effects on the end product. So, the first technology that we have got patented and that we came up with ourselves is a way of processing cannabis that is completely different from any other process currently – it completely rewrites the rule book of purification of cannabinoids. Interestingly, it also seems that we can use this in formulations because the actual substance we use to process the cannabinoids is also non-toxic and therefore usable in formulations. So, it is about looking at processes, seeing where we can improve them, and driving at it as hard as possible with our team of really smart scientists.”
Expansion into international markets
Grow Group recently made its first acquisition of premium medical cannabis producer, Sanoid, as part of its expansion strategy to reach more international markets. The acquisition gives Grow the ability to control its own supply chain and ensure access to low-cost products for patients.
Langley commented: “We have become vertically integrated as we do most things along the supply chain. A lot of people will say they are vertically integrated and that is almost a goal of theirs. We look at it the other way round, where we have become vertically integrated because we have seen that in order to achieve our goal of making sure we are getting cannabis to as many places as possible, actually, being vertically integrated makes sense strategically.
“The acquisition of Sanoid Isolates gives us the ability to control our own supply chain slightly more, grow our own cannabis, process that cannabis extract, and make sure that those cannabinoids are high quality and low price.
“Spain has got a long history of controlled drugs exports, so, they have got a history of some agricultural controlled drugs. The regulatory infrastructure makes sense and Spain for us is a great location, great sunshine for growing the cannabis – everything that we grow in Spain will be fully sold into Europe. So, at the moment work is big in terms of distribution in the UK and Ireland, but we will also be sending to third parties to make sure that the others can also benefit from the high quality and affordable products we can grow.
“I have been doing acquisitions since I was 21 years old in some shape or form. We haven’t set out to be an acquisition company, but equally, I see a lot of opportunity for us to bolt on companies throughout the world. With global expansion, we know there are companies in different jurisdictions that have made good starts, who we could potentially partner with or acquire and essentially fast forward our own development in those jurisdictions. We have a company of dealmakers by nature, and the acquisition of Sanoid definitely won’t be our last.”
Grow Group was the first British medical cannabis startup ever to crowdfund, the funds from which will support the company’s expansion plans and R&D projects.
“The first goal of the crowdfund, rather than just raising money, is to build the community, because we know that achieving our mission requires regulatory change, requires political change and it requires public support. The big goal here is to build our community and make sure that people really buy into that mission.
“The funds raised will go towards expanding the facilities at Sanoid, as well as into doubling down on what we’re doing in the UK and helping as many patients as we can in the country. It will also go towards geographic expansion – both into continental Europe and other jurisdictions that are very close to going live. We are also having initial conversations around wholesaling into South America, Africa, and Australasia. So there is a lot happening in terms of geographic expansion and really our goal is to help as many patients as possible – we’ve done a great job with that in the UK.
“The key for us is helping patients globally, and we take the view that something that is going to be good for patients but also good for shareholders fosters an industry where shareholder outcomes and patient outcomes almost perfectly align, so, we think that having global ambitions is the right thing.”
Kanabo and Materia: innovating the cannabis supply chain in Europe
Kanabo and Materia say the acquisition will utilise Materia’s supply chain innovation to bring products into European markets.
The first medical cannabis company to IPO on the London Stock Exchange, Kanabo Group, has signed a letter of intent to acquire a leading processor and distributor of medical cannabis in Europe, Materia.
The Kanabo acquisition of Materia, which operates a state-of-the-art EU GMP certified facility and has subsidiaries in Malta, Germany and the UK, will see the import and selling of medical cannabis products to German pharmacies through Materia Deutschland and a focus on bringing new products to patients.
Speaking to Cannabis Wealth, Kanabo and Materia say the acquisition will utilise Materia’s innovation in the supply chain to bring products into European markets.
Kanabo says it believes that Materia’s complementary infrastructure will be crucial to expanding and strengthening its existing supply value chain of medical cannabis and CBD products. Materia Deutschland has agreements in place with numerous suppliers and already distributes its medical cannabis portfolio to pharmacy customers.
Kanabo CEO, Avihu Tamir, said: “When we met Materia for the first time there was immediately a few points that pop; that it is the entering the most interesting market in Europe right now, Germany, and have not just a licence, but a sales team in Germany, that is already selling products and having a relationship with physicians and pharmacies.
“The second thing, which I think is one of the biggest assets that Materia has, is having an EU GMP facility in Malta, so it is inside the EU. Above all, I would say is management, which has a clear plan.
“On the one hand is product development and commercialisation, where the assets that we are bringing into the R&D centre in Israel gives us the capability to bring them to the market and to commercialise them under the Kanabo brand, and Materia is bringing the processing and production capabilities, their relationship with suppliers around the world and access into the most interesting market the CBD markets in the UK and the medical cannabis market in Germany. So, there is minimum overlap and maximum synergy.
Materia’s managing director for Europe, Nick Pateras, commented: “Most of us who are on the Materia side, like our founding management team, come from the Canadian cannabis industry. I spent five years in cannabis, and Deepak, who is our co-founder and CEO, spent eight years in cannabis, and we both come from a pharma background prior to that. So, we can bring that experience to cannabis. What we have seen in the Canadian space was a lot of emphasis on effectively trying to do everything across the value chain. When we were starting to think about how to architect the Materia business, we thought cultivation is a very expertise-driven capability, so, how do we build a company that really zones in on the value-adding activities. We perceived them and we saw in other markets that they stay at processing and distribution.
“By leveraging the cultivation expertise of a global supplier network without doing cultivation ourselves, we landed very quickly at doing an EU GMP processing capability, building our facility. In a place like Malta, it is very interesting because it allows us to work with suppliers all over the world who may not have had their EU GMP certificates yet, and we represent the doorway for them, wherever they are based, into the European market. We can tap into low-cost, high-quality supply, as well products that have genetics and have the stability that no one else has seen in Europe, yet. The next step is extracts and producing what we know the market will move towards now.”
New products to market
Kanabo is to commercialise its research through Materia Malta’s facility, including formulas developed for its VapePod device, and those targeted to treat medical conditions such as insomnia, post-traumatic stress disorder (PTSD), neuropathic pain and anxiety. Tamir highlights the focus of the market currently remains with flower, but in the next few years it will move to more innovative products.
“What was amazing about this particular marriage is on one side of the aisle, Avihu and his team have developed medical grade extracts targeted to specific medical conditions with medical and clinical trial data behind it, so that we can actually produce in Malta, and we don’t have to go through the R&D process ourselves,” said Pateras.
“So, the coming together of these two companies I think is just a really nice complementary infrastructure which is really exciting.”
Tamir added: “A big part is our flagship product idea is the number one problem in the industry and that is the delivery method. It is huge problem. There are only two delivery methods in the market that have significant market share and that is smoking and tinctures.
“Sadly smoking is the number one delivery method right now. So, we are solving this issue by having a product that is easy for patients to jump from smoking into something else that mimics the same benefits of inhalation, but at the same time gives the comfort for physicians to be able to prescribe a product that has a specific dose, and which has medical validation behind it. Pain management is obviously the biggest challenge that the market has. In the last five years, physicians have been starting to feel uncomfortable prescribing opiates. This is the focus of the first product we’re launching now in the UK.
“The second product is for mental health. We see a lot of success with cannabis, and, there are medicines that are problematic. If you are looking in the market right now, all of the products are almost the same oils with different brands, but exactly the same flowers. The options that you have now in Germany are probably the same amount of options you will find in one dispensary in California, so, that is very limiting for patients. Materia is going to bring products into the market, dealing with the supply chain challenge.
“The last challenge is patient access challenge, and that is something that both companies are going to work together on. We will be investing more in patient access, to have safe access for patients and for them to be able to get a prescription, especially in the UK.”
Co-founder and CEO of Materia, Deepak Anand, added: “Kanabo have already been researching products to put onto the market on the vape side. I think the combination that we provide is that we have been doing the same thing but on the medical cannabis side, where we have been thinking ahead to novel product formulations, keeping in mind that flower and oils are currently where the European markets are. Looking at the rearview mirror, as we have seen in Canada, that moved on very quickly. Canada was predominantly a flower market for a very long time and that has shifted quickly into other kinds of products form. So, R&D and growth are pivotal to both our companies.”
Europe’s largest public cannabis company
The acquisition will create Europe’s largest public cannabis company, a move which Tamir says is a step towards both company’s visions of being leaders in the industry.
“We want to be recognised as the authority to physicians, because there is a trust deficit by virtue of cannabis just being new. There needs to be a body of evidence put in front of physicians and for that, we need to be working with patients,” says Tamir.
“The company’s ambition is to be coming forward with products that provide new ways of speaking to patients and physicians, and that are accessible, relatable and trustworthy, and really demonstrate to people that cannabis is a new medicine. We are adhering to the strictest pharmaceutical standards, and it should actually be considered, just like any other medicine.
“We are talking about patients all over the US, all over Europe and all over the world, who have had to suffer through a quality of life, because they have not had access to cannabis – let’s change that. Let’s allow people to understand that cannabis is a new product. We want to be the flag bearers of that story.”
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