Leading Marijuana Company

Strainz Raises $8 Million Through Debt and Series A Funding

Cannabis Brand Management Company To Accelerate National Expansion Strategy and Launch First Line of Strainz Products in Three States

LAS VEGAS, NEVADA, April 4, 2016 – Strainz Inc., a leading national cannabis brand management company, today announced it has raised a total of $8 million including a $6 million round of Series A financing from leading venture capital and angel investors. The funding will allow Strainz to accelerate its portfolio of brands in Colorado, Nevada and Washington, expand its brands into other legal states and hire additional senior management and staff.

Strainz executive management team consists of Silicon Valley technology industry veterans whose previous experiences include brand management and marketing and communications roles at leading companies including Apple and Netscape. The team also has extensive experience in launching some of the most recognized startup brands in the world.

 

Strainz Vape Pen

“This financing is a testament to the strength and experience of our management team and shows confidence in our product development plans and national expansion strategy,” said Hugh Hempel, CEO of Strainz. “Both Federal and State regulations make national brand expansion extremely complex as cannabis companies are unable to leverage central manufacturing and distribution. In addition to an extensive legal compliance review, building national brands requires a state-by-state approach involving strategic local partnerships to ensure products are consistent, safe, and of the highest quality.”

Launching in Three Legal Markets – Colorado, Nevada, Washington

Strainz’ Denver partner and licensee Bronnor Corporation has built a 25,000 square foot state-of-the-art Marijuana Infused Products (MIPs) facility. Centrally and strategically located just north of downtown Denver at I70 and Colorado Boulevard, this multi-million-dollar facility is one of the largest MIPs manufacturing facilities in Colorado and among the largest in the nation. Products are expected to begin shipping from the facility in April and an invitation-only grand opening event will take place at the facility on May 5, 2016.

“Bronnor’s facility is one of the first large scale GMP-compliant cannabis production facilities in the nation and we’re thrilled they will be manufacturing our products,” said Hempel. “The facility can accommodate wet processing for extracted oils, beverages and edibles as well as dry processing to make pills and dissolvable tablets.”

“We have incorporated semi-automated filling and packaging equipment lines and a large HEPA-filtered clean room into our facility,” added Greg Jones, General Manager, Bronnor Corporation. “All medical and recreational cannabis products produced in our facility will exceed consumers’ expected quality and safety standards.”

In Nevada, Strainz currently has a strategic partnership with one of the first fully operational production facilities in the state. Strainz’ local partner will begin shipping premium medical cannabis products to dispensaries in May. Mr. Hempel participated in Nevada’s highly competitive and rigorous licensing process in 2014-2015. He and his partners were awarded multiple Medical Marijuana Establishment (MME) licenses enabling Strainz to launch its products and expand the company’s footprint in Nevada.

In Washington, Strainz has formed a strategic partnership with Db3, the state’s premier edibles company and the makers of the popular ‘Zoots’ branded products. Strainz products are currently being produced under license by Db3 in their 25,000 square foot Seattle manufacturing facility.

Managing Multiple Brands

Strainz and its local strategic partners and licensees will manage a portfolio of cannabis brands in multiple states that address a wide variety of products demanded by consumers. Strainz and its partners will initially ship multi-ratio CBD/THC products under the Strainz label and will announce additional brands and partnerships in the coming months.

“Many cannabis companies have terrific product lines but their products may only be available in a single state, as they find scaling to be an arduous and highly capital intensive process,” added Hempel. “We want to assist exceptional cannabis companies looking to expand nationally in multiple legal markets where our strategic partners have world-class production facilities.”

According to a recent report by Ackrell Capital, a leading independent investment bank focused on emerging growth companies, the U.S. cannabis consumer market for legalized recreational and medicinal use was $4.4 billion in 2015 and is expected to grow to $9.5 billion in 2019. If legalized federally, Ackrell Capital estimates the cannabis market could grow to $37 billion within five years and $50 billion within 10 years.

“With this new infusion of capital, Strainz is well positioned for growth and to lead the way in setting quality control standards with its local partners and licensees in the cannabis industry by implementing the best practices from other highly regulated industries such as food and nutraceutical manufacturing,” added Hempel.

About Strainz Inc.

Strainz Inc. is a leading national cannabis brand management company. Through strategic partnerships with multiple state licensed cultivation and production facilities, Strainz is helping to deliver a portfolio of premium grade cannabis products that are rigorously tested and certified to guarantee consistency and quality. For more information about Strainz, please visit the company on the Web at www.strainz.com, or follow @StrainzInc on Facebook, Twitter, Instagram and MassRoots.

 

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