What is the competitive landscape?
Every day more and more people are turning to herbal wellness and away from medicines that can be addictive or include detrimental side effects. Finding innovative ways to extract herbal benefits and devices to consume them is an ever-evolving process. CannaKorp is excited to contribute to the evolution. In the cannabis space, more and more products are invented every day. The competitive landscape includes all the ways you could ingest, inhale or apply herbal medicines. Direct competitors include devices for which the individual must understand the make-up of the herbs, prepare the herbs, set the right temperature for vaporization and be experienced enough to get it all right. The hand-held or portable device category for cannabis includes some well-known brands which have earned good reputations. But, they are inherently inferior to the larger home-use or desktop devices. These devices include three or four well-known brands but each requires a good deal of experience and are based on aesthetic and sometimes mechanical designs that are outdated.
What are the competitive advantages unique to the Wisp?
No matter what, the competitors’ devices are only as effective and efficient as the person who is preparing and controlling the process. CannaKorp’s Wisp is a step above the rest, because the automated system and pre-measured pods deliver a consistent, efficient experience every time. The whole point of the Wisp is to make it super easy for the user by providing advanced technology - it should feel like magic. Technically, the secret of the system is the marriage of the pre-measured Wisp Pod, the Wisp Pod design and the manner in which the Wisp device heats the pod and controls the air flow through it and into the Vapor bottle sleeve. No other device on the market automates the process like the Wisp or delivers the vapor extraction efficiency the Wisp does.
What are the barriers to entry?
There are three main barriers to entry: patents, partners and positioning. But, as with any successful product, we expect fast followers to emerge. First, we have filed several patents on the Wisp device, Wisp Pod design and how they work together. Those filings were done in many countries around the world. CannaKorp will have to vigorously defend its patent but that is in our plan. Second, our partner model targets the “best-of-the-best”. There’s no question the herbs inside the Wisp will be a big part of the experience and value to our customers. Those herbs need to be of the highest quality in terms of efficacy and laboratory tested to be free of any harmful elements. Fast followers may find other partners, but they will not be able to partner with our network. Third, CannaKorp is on the cusp of going to market with its unique product, which means the Wisp will forever be known as the first pod-based vaporizing system. Every other product will be compared to and will have to catch up to our first-mover advantage.
What is this “herbal wellness?”
Humans have been using natural elements as medicine since the dawn of time: flowers, roots, trees, vegetation, etc. The Wisp device is uniquely positioned to allow people the opportunity to explore various options using natural herbs. Sometimes those herbs are a blend of ground botanicals and sometimes they are ground cannabis flower. In both cases, people have found benefit from each. Much like herbal teas. But in this case, through inhalation rather than ingestion.
What is your exit strategy?
CannaKorp is a privately held company that has raised money in various equity rounds of funding. The management team is very mindful of its shareholders and takes great care in making decisions that are intended to be in the shareholders best interest. To that end, the management team plans to build the value of the company through great product, great support and great attention to its customers. With that foundation, shareholder value grows and exit opportunities emerge. The dream of the management team is to go public in the United States on a major stock exchange. A public offering’s goal would be to provide shareholders liquidity and take advantage of the ability to buy and sell CannaKorp shares. Before we get to that stage, CannaKorp intends to explore all options along the way that could also provide shareholders with the best exit outcome. Those options include, but are not limited to, merger, acquisitions, international public offerings and private equity funding.
What is CannaKorp’s Banking situation and strategy?
CannaKorp has a very stable and favorable banking relationship. With complete transparency into all of our business operations, e.g. business lines and international opportunities, we do not anticipate any near-term issues. However, given the possibility that banking or other federal laws can change we will have to navigate those changes as they arise.
Will CannaKorp operate outside the U.S?
CannaKorp currently has definitive partner agreements in Canada and Australia for cannabis pod-filling and distribution. Each country operates national programs and each country allows for export. In Canada, in the summer of 2018, their new provincially regulated adult use cannabis markets will launch. CannaKorp will operate with its pod-filling partner as well as the provinces and retail partners for distribution of the Wisp into the adult use market. CannaKorp is also continuously monitoring and researching opportunities in Central and South America, Europe and Africa. As appropriate, we expect to operate in those territories as well.
How will you use funds raised through this crowdfunding initiative?
In order to launch and expand the business as we have described, the initial use of funds from crowdfunding will be to build the resources necessary to establish pod-filling partners state-by-state in the U.S. and the related launches. Those resources include the upfront cost of pod-filling equipment, personnel and promotional activity. In parallel, given regulatory approval, CannaKorp will conduct the same activity with our Canadian partner, MedReleaf. While inventory has already started to ship, additional funds will be used for manufacturing and inventory build-up.