January 18, 2019

High Hampton Holdings (CNSX:HC) Granted Six New California Licenses

Midas Letter
Midas Letter
High Hampton Holdings (CNSX:HC) Granted Six New California Licenses

High Hampton Holdings Corp (CNSX:HC) (OTCMKTS:HHPHF) (FRA:0HCN) is a California-focused, vertically integrated branding play. CEO Gary Latham provides some personal background on his tech experience and journey to the cannabis space. He explains the significance of the company’s recent announcement that it has obtained six new licenses to operate in Cudahy, California. These licenses fall across the entire production spectrum, from cultivation to retail delivery. Crucially, the company was able to secure these licenses before an anticipated slowdown in California’s licensing process. High Hampton already holds similar licenses in other parts of the state through its various subsidiaries.


James West:        What is the business model of High Hampton?

Gary Latham:  Good. First I want to tell you I’d really like to use Calamity Jane – I hope you guys aren’t going to take that off the table.

[stock_chart symbol=”HC:CNX” align=”left” range=”1M”]

James West:   [laughter] It’s all yours. That was my mistake, it’s all yours. Mojave Jane was a great name too, though.

Gary Latham:  I like it. [laughter] I like it. We get a lot of good response to Mojave Jane; I can’t wait to add the sub-brand of Calamity Jane to that, that’s going to be beautiful.

James West:   Yeah, you bet.

Gary Latham:  So thanks for having me. I know you guys have spoken to High Hampton in the past on a number of occasions, and the business that we’re in is focused in California today, and that business is to bring together a number of different capabilities across the spectrum in California, from cultivation to manufacturing to creation of edibles and distribution. And be able to create and manage the brands that we want to take out to the market, and then also control the distribution path out to the market as well.

So we’re set up in two places, Southern California in the town of Cudahy; you may have seen yesterday that we received six licenses to operate there, which is terrific news for us. You guys follow the California space and you know that if you didn’t receive a license prior to the end of December, you’re in a for a bit of a long wait, we think, in this part of the New Year. So we were very happy to get those licenses issued and to be off to the races.

James West:   You bet. What – so six licenses, that was kind of an eye-popper for us. What are the six licenses entail? Are they six cultivation licenses, or three cultivation three extract, what exactly is the mix, and what’s – how do we sort of determine a value of those?

Gary Latham:  Right. So the licenses go across the span of the licenses that are available in the State of California. So we have a handful of small cultivation licenses; the facility is 15,000 square feet, so as you can imagine, cultivation won’t be the key business in a 15,000 square foot building.

The balance of the licenses are for manufacturing, so we have in California what’s considered a Type 7 license that allows us to do both volatile and non-volatile types of manufacturing. So we can produce products completely across the spectrum of the manufactured concentrates and what have you.

And then we also have a distribution license there, and then very importantly, we also have what’s called a non-storefront retail license that allows us to do delivery out to across the state of California, actually. So that’s the set of licenses that we own.

James West:   Wow. So that makes you rather completely vertically integrated, doesn’t it?

Gary Latham:  [laughter] It does, and what’s interesting though is, you know, we already hold a number of those licenses in other parts of the state, as well. So Mojave Jane has a Type 7 license in the city of Coachella; Cali Gold, another one of our subsidiaries, has a manufacturing license in the city of West Sacramento. Our delivery organization subsidiary called Bravo Distro has a distribution, or is in process for getting a distribution license, in Sacramento as well.

So this just kind of adds for our ability in each of these local municipalities.

James West:   Interesting. Tell me a bit about your background; you came to High Hampton through Mojave Jane. Tell me about the Mojave Jane brand and how you guys developed it and how that’s going to assist you in making High Hampton a success overall in the California market.

Gary Latham:  Yeah, that’s a great question. First, I’ll get you excited about me in general.

James West:   I already am!

Gary Latham:  [laughter] Buckle up! So I actually have had the good fortune to, you know, live through the high-tech entrepreneurial days on the east coast of the US and also out in the Silicon Valley and had the fortune to be part of or lead a number of start-ups in that business, as well as be part of Fortune 50 companies that acquired the businesses that we built. So I lived through the process of, you know, raising money and the early high expectations of a complicated industry, and balancing those with shareholder interests and then being able to take those businesses and do something interesting with them.

It’s not unlike what’s going on right now in California in this market space, where we have the opportunity to grow these businesses at a pretty hectic pace, and so I’m excited to do that. The skills that we bring to the table, the rest of our team, are very execution-oriented, but you know, one of the things that I really liked about High Hampton and the subsidiaries that we have is that, you know, California has got this unique kind of position which is that it was built on a bunch of kind of rebels in the space who kept at this business for years at very high risk to themselves personally and certainly to their businesses.

And we embrace that kind of person who did that, and our subsidiaries that we acquired are very reflective of that culture. So the challenge for us, and the real model here, is take those kind of rebels and entrepreneurs who’ve been at this for a while in the face of legal challenges, and allow them to take a breath now that it’s legal and bring real business discipline to it, and take it out to the market. And that’s going to be the fun path for us.

James West:   You bet. All right, Gary, that’s a great introduction. We’re going to leave it there for now; we’ve had some frozen image issues with Skype, but we’ll come back to you in a week or two and carry on the conversation. I look forward to seeing you in Toronto soon; keep up the good work with High Hampton! Thanks very much!

Gary Latham:  Sounds great!

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