Hempco Food and Fiber Inc. (TSX.V: HEMP) utilizes this January 2019 investor presentation to position itself as a leader in the industrial hemp sector. The deck focuses heavily on infrastructure and strategic partnerships rather than early-stage product validation. Key highlights include a 56,000 square foot state-of-the-art processing facility capable of processing 2.9 million kg of food and 3.5 million kg of fiber annually. The presentation also emphasizes a strategic relationship with Aurora Cannabis, which provides Hempco with institutional backing and distribution networks. While the dec…
Key takeaways
- The global hemp market is projected to reach US$10.6B by 2025 with a 14.0% CAGR, according to slide 6.
- Hempco claims their products meet 6 specific health and wellness claims, including Organic, Protein, and GMO-Free, as shown on slide 7.
- The company utilizes a 'whole-plant' strategy, targeting food, personal care, medicinal, and industrial applications (slide 10).
- The 'Praise Hemp' animal supplement line accounts for 9% of revenue and is present in over 250 locations (slide 15).
- Hempco secured a distribution agreement with Kane Veterinary Supplies in March 2018, reaching over 1,900 pet stores (slide 15).
- A new 56,000 sq ft processing facility was scheduled to be operational in Spring 2019 (slide 16).
- The facility has a projected annual capacity of 2.9 million kg for food and 3.5 million kg for fiber (slide 16).
- Aurora Cannabis is a major shareholder, providing Hempco with access to low-cost raw materials and broader distribution (slide 19).
Hempco Investor Presentation: A Deep Dive into Industrial Hemp Infrastructure
Hempco Food and Fiber Inc. presents a narrative of industrial transition. By January 2019, the company was no longer a startup in the traditional sense, but a publicly traded entity (TSX.V: HEMP) seeking to capitalize on the global legalization and commercialization of hemp. This teardown examines the nine slides provided from their 25-slide deck, focusing on their market positioning, infrastructure, and strategic alliances.
Slide 1: Title and Credentials
The cover slide establishes immediate credibility by highlighting that Hempco was a '2018 TSX Venture 50 Award Winner.' This branding, placed prominently in the upper left and bottom center, signals to investors that the company is recognized as a top performer on the exchange. The title, 'The Seed of Possibilities,' is thematic, while the inclusion of the stock ticker 'TSX.V : HEMP' confirms its status as a public company. The date, January 2019, provides the necessary context for the market projections that follow.
Slide 6: Market Opportunity
Hempco uses third-party data from 'Infinium Hemp-Based Food Market 2018' to frame the market size. The headline claim is a global hemp market reaching US$10.6B by 2025, growing at a 14.0% CAGR. The pie chart breaks down industrial hemp revenues by category for 2017, showing a relatively even distribution across sectors: Personal Care (24%), Food (20%), Industrial Applications (19%), and Textiles (18%). This slide serves to justify Hempco's multi-vertical approach, showing that no single category dominates the market, leaving room for a diversified player.
Slide 7: Consumer Demand and Health Claims
This slide transitions from macro market size to micro consumer behavior. It cites a Nielsen survey to show that consumers are demanding 'simple, fresh' products with fewer preservatives. Hempco claims its products meet six specific health and wellness (H&W) claims. A bar chart illustrates the 4-year CAGR for these claims, with 'Organic' leading at 14.5%, followed by 'Protein' (11.5%) and 'GMO Free' (11.2%). By aligning their product attributes with the fastest-growing consumer trends, Hempco positions itself as a modern CPG (Consumer Packaged Goods) contender.
Slide 10: Whole-Plant Utilization
One of the most critical slides for an industrial commodity company, slide 10 explains the efficiency of their business model. Hempco illustrates how every part of the hemp plant is monetized: Seed for food and personal care; Leaves and Flowers for medicinal purposes; and Stalk for fiber, textiles, and building materials. This 'zero-waste' approach is a common trope in the hemp industry, but Hempco uses it to signal that they are not just a food company, but a raw materials processor for multiple industries.
Slide 15: Praise Hemp Brand and Distribution
Slide 15 focuses on a specific business unit: 'Praise Hemp,' which produces animal wellness supplements. The slide provides concrete traction metrics: the brand accounts for 9% of total revenue and is available in over 250 locations across Canada. Crucially, it mentions a March 2018 distribution agreement with Kane Veterinary Supplies, which services more than 1,900 pet stores. This demonstrates a clear path to scale through established wholesale channels rather than relying solely on direct-to-consumer sales.
Slide 16: State-of-the-Art Processing Facility
This slide represents the company's 'moat'—physical infrastructure. It features a photograph of a 56,000 square foot facility and lists massive throughput numbers: 2.9 million kg/year for food and 3.5 million kg/year for fiber. The note that these figures are based on a single 8-hour shift suggests significant upside if the company moves to 24-hour operations. The 'Operational Spring 2019' tag indicates that at the time of the presentation, the company was on the verge of a major capacity increase, a key catalyst for investors.
Slide 19: The Aurora Cannabis Strategic Investment
Hempco highlights its relationship with Aurora Cannabis, one of the largest players in the cannabis space at the time. The slide lists mutual benefits: Hempco gets an 'endorsement of growth strategy' and access to 'well-developed networks,' while Aurora gets 'access to low-cost raw material for CBD extracts.' This partnership is a major de-risking factor, as it provides Hempco with a massive, stable customer for its medicinal-grade hemp output.
Slide 20: Board of Directors
The governance slide reinforces the Aurora connection. Two of the six listed directors, Allan Cleiren and Steve Dobler, are high-ranking executives at Aurora Cannabis (COO and President, respectively). The rest of the board includes a mix of accounting expertise (Joel Watson), marketing (Mary-Lynn Bellamy-Willms), and long-term industry leadership (Larry Karass). The presence of Aurora's leadership on the board confirms that the investment is strategic and deeply integrated, not just passive capital.
Slide 25: Conclusion
The final slide is a standard 'Thank You' page that mirrors the cover. It repeats the TSX Venture 50 award and the stock ticker. While it lacks a specific call to action or contact information (likely due to the public nature of the company), it maintains the professional, clean aesthetic established throughout the deck.
What Hempco Does Well
Hempco excels at demonstrating industrial scale . Many hemp startups focus on niche consumer products; Hempco focuses on the processing infrastructure required to feed global supply chains. By quoting capacity in millions of kilograms, they move the conversation from 'craft' to 'commodity.' The deck also does an excellent job of leveraging institutional credibility . The repeated mentions of the TSX Venture 50 award and the detailed breakdown of the Aurora Cannabis partnership tell an investor that this company has already passed significant due diligence by larger entities.
What is Missing from the Deck
The most glaring omission in these nine slides is a detailed financial breakdown . While we see that one brand accounts for 9% of revenue, we do not see total revenue, EBITDA, or burn rate. As a public company, these are available in regulatory filings, but their absence in the pitch deck makes it harder to assess the company's current health. Additionally, there is no competitor analysis . The hemp space is crowded with both agricultural processors and CBD extractors; failing to mention how Hempco's facility or technology differs from competitors like Manitoba Harvest or others is a missed opportunity to define their competitive advantage.
What Other Founders Should Copy
Founders in the hardware or agricultural space should emulate Hempco's utilization of facility photos and specs . Seeing the actual building and the specific throughput numbers (Slide 16) makes the business feel tangible and 'real' in a way that renderings or abstract goals do not. Furthermore, the Strategic Partnership slide (Slide 19) is a masterclass in explaining 'why us, why now.' Instead of just saying they have an investor, they explain exactly how the two companies benefit each other operationally. This turns a cap table entry into a business catalyst, which is far more persuasive to potential investors.
Frequently asked questions
- What is Hempco's primary revenue driver according to the deck?
- While the deck discusses multiple verticals, it specifically highlights the 'Praise Hemp' animal supplement line as contributing 9% of total revenue. The company is also heavily invested in food and fiber processing, with a new facility designed to handle millions of kilograms of raw material annually, suggesting a shift toward large-scale industrial supply.
- How does Hempco plan to utilize the different parts of the hemp plant?
- Hempco employs a 'Whole-Plant Utilization' strategy. As detailed on slide 10, the seeds are used for food and personal care, the leaves and flowers are designated for medicinal use (specifically CBD extracts for Aurora), and the stalks are processed into fiber, hurd, textiles, and building materials.
- What is the significance of the Aurora Cannabis investment?
- Aurora Cannabis is described as a 'large, stable shareholder.' For Hempco, this provides an endorsement of their growth strategy and access to Aurora's networks. For Aurora, the partnership ensures a low-cost supply of raw materials for CBD extracts and a broader portfolio of value-added hemp products.
- What are the processing capacities of the new facility?
- The 56,000 square foot facility, which was slated to open in Spring 2019, has a food processing capacity of 2.9 million kg per year and a fiber/hurd processing capacity of 3.5 million kg per year. These figures are based on a standard 8-hour shift, 5 days per week.
- Who leads the company's governance?
- The Board of Directors is chaired by Joel Watson, a Chartered Professional Accountant. The board features significant representation from Aurora Cannabis, including Allan Cleiren (COO of Aurora) and Steve Dobler (President of Aurora), alongside industry veterans like Larry Karass, who has 30 years of experience in consumables.
