By Ciara Linnane, MarketWatch
After being fired from his last two jobs, Canadian entrepreneur Bruce Linton is back with a new venture and a new goal: to disrupt the industrial supply chain.
The co-founder and former co–chief executive of Canopy Growth Corp. /zigman2/quotes/200603886/composite CGC -0.24% /zigman2/quotes/202205609/delayed CA:WEED -0.05% , the Canadian cannabis market leader, raised $150 million in an initial public offering of a special-purpose-acquisition corporation, or SPAC, called Collective Growth Corp. /zigman2/quotes/216857362/composite CGROU 0.00% , with the intent of using the proceeds to acquire hemp companies.
Collective Growth started trading on the Nasdaq on May 1, and Linton and his partners rang the opening bell virtually. SPACs, or blank-check companies, have no business until they acquire or invest in one or more.
The coronavirus pandemic had one positive effect on fundraising, Linton told MarketWatch in an interview. “People have been at home, and they’ve been seeing the blue skies with less traffic and pollution,” he said. “It makes them think more of sustainability, and that’s where the hemp plant comes in. If you deconstruct the plant, it can be used for sustainable building materials, and that’s good at a time when people are aware there’s a problem with the supply chain and the environment.”
The hemp plant has far less THC than related plants that produce cannabis and has long been used for industrial purposes. THC is the ingredient in cannabis that produces the high associated with cannabis use.
The hemp plant can be used to make different kinds of fiber for use in paper and fabric and to make building blocks. Until late year, hemp was illegal in the U.S., classified as a controlled substance along with cannabis plants, but that was changed in the Farm Act of 2018, which legalized hemp but left cannabis’s status intact as a Schedule I drug.
The challenge now is to find companies to acquire, and Linton has set his sights firmly on Europe, which has a less rigorous regulatory regime. Europe never imposed the kind of ban on the hemp plant that the U.S. did.
“The best technology is in Europe,” he said. “Because they didn’t get around to banning hemp, they have the best in field and some small and medium-size companies doing really interesting things in hemp.”
As a Nasdaq-listed company, Collective Growth has to remain in compliance with U.S. federal regulations.
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In addition to his hemp plans, Linton is also pursuing an interest in psychedelics, an area he believes has huge potential as a treatment for mental-health disorders such as depression, PTSD and opioid addiction. Linton is currently a director of Mind Med /quotes/zigman/204958689/realtime CA:MMED 0.00% , which listed on the Canadian NEO Exchange on March 3, the first psychedelics company to do so.
The company raised $24.2 million in a pre-IPO financing round and is backed by “Shark Tank” investor Kevin O’Leary.
Mind Med is researching the use of drugs including LSD and MDMA as treatments for ailments such as anxiety. Linton is the chairman of Mind Med’s compensation and governance committee.