August 20, 2019

Halo Labs Inc (NEO:HALO) Differentiated Vape Product Lines Generating Revenue

Midas Letter
Midas Letter
Halo Labs Inc (NEO:HALO) Differentiated Vape Product Lines Generating Revenue

Halo Labs Inc (NEO:HALO) (OTCMKTS:AGEEF) (FRA:A9KN) VP of Revenue Chad Kanner joins Midas Letter in Los Angeles, California to discuss the company’s product line, the concept behind them and the quality of Halo Labs’ concentrates. The VP of revenue outlines the demand for vaporizer products compared with dried flower saying the two have “very similar demand.” Halo Labs involvement with wholesale products, white label products, concentrates with medical industry pharmaceutical grades are also discussed. Within the interview, Mr. Kanner shows off several examples of Halo products available for the Californian concentrate market from the company’s Hush™ and Gilt™ product lines. Hush is a more of a budget-friendly but good quality concentrate option while Gilt is a high-end aspirational product line. 

The Hush™ product line includes both a line of strain-specific distillate cartridges and a line of strain-specific live resin pucks.

Gilt™ boasts two innovative product lines to appeal to the growing premium recreational consumer, DabTabs™ and a disposable Sauce Pen.

DabTabs™ are the brand’s flagship product offering and provide consumers with a convenient way to enjoy cannabis concentrates without the sticky residue.

The Sauce Pen features a disposable C-Cell battery and a unique formulation that preserves the taste and full spectrum experience that was previously only accessible to flower consumers.

Midas Letter
Midas Letter
Halo Labs Inc (NEO:HALO) Differentiated Vape Product Lines Generating Revenue

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James West: Chad Kanner joins me now. He’s the VP of Revenue at Halo Labs. Chad, welcome.

Chad Kanner: Thank you.

James West: Chad, as the VP of Revenue, I guess it’s your job to make money for the company?

Chad Kanner: In theory.

James West: In theory. And as a way to make money, you have a line of products, some of which we have now tried, and we can vouch for the quality of. Tell me about the product line of Halo Labs and what is the whole concept behind them?

Chad Kanner: Got you. So as a concentrate producer, we really just try to fill whatever need we see in the market. In front of us right now, we have two of our brands on display, one being Hush, the other being Gilt. Hush being more of a budget-friendly but good quality product line, Gilt being more of a high-end kind of aspirational product line.

On the far side, we have a whole with a Hush Live Resin, Live Resin being a full-spectrum concentrate; you get a lot more out of it than you would from a standard vape product like distillate, which we do have here. Distillate being kind of the more standard concentrate that’s used for vapes across the industry.

James West: Okay.

Chad Kanner: And then we have a new product that we’ve just released called Dab Tabs. Dab Tabs are a brand-new method of consuming concentrates that never existed for the industry; the first lab-certified dosing application for the industry. Each of these contains a 50-milligram dose of any concentrate you put into it. Dab Tabs allow for many solutions to the dabbing process that has oftentimes been a detraction for consumers. They’re no-mess, they allow you to drop them on the ground, which you’ve never been able to do before. Beyond that, they still retain all the flavour and all the things that people always come to enjoy in their dabbing. It does solve a lot of problems.

James West: Yeah, you bet. That’s quite an elegant solution, really, especially for, you know, the upper crust, as it were. And the unit that you’ve got there in front of you with the glass top, that is the unit for consuming the Dab Tab?

Chad Kanner: So in theory, Dab Tabs can be consumed any way that you are used to dabbing at home. However, we do have new, proprietary hardware. This is the Shatterizer Pen, which has been designed to not only vape them holding in here, but also to carry them on the go, in a nice little convenient storage jar.

James West: Wow, so you can hit it discreetly any time you want. [laughter]

Chad Kanner: Indeed you can.

James West: You’ve got your little stash on the bottom.

Chad Kanner: Indeed you can. And then right here is another product that we’re really excited about. This is called the Dab Tab Go. The Dab Tab Go is a 510 thread cart which can replace really any standard cartridge in the market.

James West: Okay. When you say 510 thread, what do you mean, exactly, by that?

Chad Kanner: So a 510 thread is merely the threading on the bottom.

James West: Okay.

Chad Kanner: Which is the standard fitting for most vaporizers on the market. This will allow you to drop one in on the go, which kind of facilitates your ability now to carry a much more high-end product in your pocket, in the same form factor as these more traditional vapes.

James West: Right. Okay, so among these products, which is the one that consumers are looking for the most?

Chad Kanner: You know, they’re for different consumers. The truth is, Dab Tabs is going to be slightly more of a connoisseur-type product, whereas these vapes will kind of be more of a mass-market-type product. But really, it depends on the user, what they’re looking for in the product, and also the price point that they’re looking to pay.

James West: Okay, so the resin here, this one: is that something that I can use in that device, or do I need a separate device for that?

Chad Kanner: You could, you could use that in this device. We wouldn’t necessarily recommend it in this, but you could absolutely use it, and in really almost vapes in the market.

James West: Okay. So what percentage of the California market is vapes as opposed to dried flower?

Chad Kanner: Actually, vapes and dried flower are becoming very similar markets in the space right now. On the go, what we’ve seen is a large growth on the ability to use pens on the go, which has kind of eked into the flower market. But they’re very similar demand. 

James West: Sure. So has the demand for cannabis products generally gone up thanks to legalization, in your opinion?

Chad Kanner: I would tend to say yes. However, there are, you know, issues with the black market and white market, so we’re seeing them in different ways, but I do believe that the new recreational market has opened up and made a lot of people feel less scared to enter a dispensary and buy the product, and use it. You know, I feel like it’s just bringing in more people that were feeling averse before.

James West: Sure. Earlier we were talking about live resin, and how that is sort of like the ultimate product in terms of all of the extracts. What is it about live resin that makes it such a hot commodity, and which of these products contain it?

Chad Kanner: So these two products, the Sauce Pen from Gilt and the live resin Hush, as well as these Dab Tabs, which are Gilt-branded Dab Tabs. The beauty of live resin is you’re able to take the plant and get the full spectrum of the concentrate out. So all the flavour, all the THC, all the CBD, CBN, CBG, all the cannabinoids that you want, you’re able to get in a live resin; whereas when we make distillate, you’re distilling down to get a very pure form of THC, where you don’t quite get all of the other benefits of the plant. So it’s really trying to stay as true to the plant as possible.

James West: Okay. So Halo has this portfolio of branded products for consumers; do you also have, you have products that you make and sell as a wholesale product to other producers as well?

Chad Kanner: Yeah. So we do a lot of bulk business; we have several relationships with other companies that are retailers, brands, and we try to facilitate them making their own products, but with the high-end and great quality products that we’re able to produce in large volume.

James West: So what about in California, I’m wondering, the application for medical uses of cannabis seems to be something that’s growing, even though we still labour under a Federal prohibition against cannabis. Do you produce any concentrates at a pharmaceutical grade for the medical industry?

Chad Kanner: Right now we’re working, especially Africa, to get some CGMP certification for the products going out of there. Right now, however, we work really within state guidelines. You know, we’re operating in three different states in the US right now, each of which have very different guidelines, so we just try and kind of roll with the punches and do whatever each state is telling us we need to do, while also internally trying to, you know, have the best practices possible and really be in advance of what we think may be things to come.

James West: Sure. The explosion in interest in CBDs that, I guess you could say, has reached kind of an apex with the FDA finally conducting conversations, I guess, as to regulating CBD on a national level. And, is that kind of like as far as it’s going to go in the United States for the near term, in your view? Or is THC, by extension, just around the corner as well on a federal level?

Chad Kanner: I think that the truth is, when you talk about cannabis, CBD and THC are each part of cannabis. So while I do feel that CBD inevitably as there are, you know, no health effects that are negative from CBD, no psychoactivity, it’s allowing for CBD to bridge the gap. But inevitably, long term, CBD and THC come from the same plant, and I believe that as CBD grows, THC will come alongside.

James West: I can’t help but think that creating a line of brands like this, especially when it comes to innovative sort of delivery mechanisms, that is part of the drive for that to protect yourselves from a saturated market?

Chad Kanner: You know, in a lot of ways, the concentrate space and a lot of the cannabis industry is what we call a Me Too market, which is, you know, we’re producing vapes, but so is the guy down the street. And so we try to figure out where we can have differentiation. You know, the Sauce Pen market is somewhere we’re trying to market as a higher-end product than most people produce, and really the Dab Tabs are, you know, trying to attack a space, but completely change it and redefine it.

James West: What do you think of the idea that when the market goes federally de-prohibited, that all of the consumer branded goods channels will be owned by the traditional owners of those channels, like the Walmarts and the Amazons and the Whole Foods?

Chad Kanner: You know, at the end of the day, we are a consumer goods industry, and while I think we would all love to see it progress in, you know, the people who have been here controlling it, it will be hard to fight the business coming in, and I think that we are, you know, as a producer and a player in this industry, we will have to work alongside with bigger players as they come in.

James West: Okay. And last question: which of these is your favourite product?

Chad Kanner: Well, I love them all. [laughter]

James West: Okay.

Chad Kanner: But I would say probably the Dab Tabs and the Sauce Pen, being that they are filled with, in theory, the same product. I would probably use Dab Tabs a little bit more at home, until we have these more readily available, but the Sauce Pen on the go is my favourite go-to.

James West: Okay. Well, Chad, that’s a great introduction. We’re going to come back to you soon; thanks for joining me today.

Chad Kanner: Appreciate it.





Notice for Forward-Looking Information

Certain statements in this press release are forward-looking statements and are prospective in nature. Forward-looking statements are not based on historical facts, but rather on current expectations and projections about future events, and are therefore subject to risks and uncertainties which could cause actual results to differ materially from the future results expressed or implied by the forward-looking statements. Such forward-looking information includes that HALO Labs Inc will be a big, successful company in the cannabis sector; that cannabis use and sales will grow and HALO’s sales along with it; HALO’s intended acquisition of various foreign companies and expansion into the US market; that extraction is and will continue to be a fast growing and profitable sector of the cannabis industry; that HALO will reach $48M in revenues in 2019; HALO’s plans to produce concentrates and sell them in various locations throughout the world; that HALO could be granted licenses to expand; and that it will be able to carry out its business plans.

Readers are cautioned to not place undue reliance on forward-looking information. Forward looking information is subject to a number of risks and uncertainties that may cause actual results or events to differ materially from those contemplated in the forward-looking information, and even if such actual results or events are realized or substantially realized, there can be no assurance that they will have the expected consequences to, or effects on HALO. Such risks and uncertainties include, among other things: that a regulatory approval that may be required for the intended acquisitions and subsequent sales are not obtained or are obtained subject to conditions that are not anticipated; growing competition for intended acquisitions in the cannabis industry; potential future competition in the markets HALO operates for sales; competitors may quickly enter the industry; general economic conditions in the US, Canada and globally; the inability to secure financing necessary to carry out its business plans; competition for, among other things, capital and skilled personnel; the possibility that government policies or laws may not permit legal cannabis sales or growth or that favorable laws in place may change; HALO not adequately protecting its intellectual property; interruption or failure of information technology systems; the cannabis market may not grow as expected; HALO’s technology may not achieve the expected results and its accomplishments may be limited; even if it is granted patents, it may not have success at licensing its technologies or sell its products at the rate expected; planned acquisitions and partnerships may not materialize because of inability to agree on terms with prospective partners or targets; HALO’s business plan also carries risk, including its ability to comply with all applicable governmental regulations in a highly regulated business; incubator risk investing in target companies or projects which have limited or no operating history and are engaged in activities currently considered illegal under US federal and foreign laws; and other regulatory risks relating to HALO’s business, financings and strategic acquisitions, including securities laws, trade rules, and foreign country regulation that is not the same as Canadian or US regulations.


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