SinglePoint, Inc. (OTC: SING) Moves Forward on Cannabis Industry Safe-Profit Plan
SinglePoint, Inc. (OTC: SING) has been planning an arms-length distance approach to profit from the booming cannabis industry in a way that protects them from regulatory setbacks and Big Tobacco competition, and it seems they have moved forward with their plans.
SinglePoint acquired a stake in Jacksam Corp., dba Convectium, which provides the company direct access to an established revenue stream stemming from primarily B2B cannabis industry products. In addition to the cash flow injection this stake is expected to provide for reinvestment purposes, SinglePoint will be able to leverage Convectium’s expansive cannabis industry network to pitch its supplementary services, such as mobile payment processing and marketing software. This creates new profit potential, as many larger financial processing institutions are staying far away from cannabis-oriented businesses.
The added cash flows will also benefit SinglePoint by allowing easier access to, less expensive, and more favorable financing for its future cannabis industry acquisitions. While Convectium was a great acquisition for SinglePoint, it is still best seen as a “first step” in the company’s roll-up acquisition strategy, which entails building a diverse portfolio of cannabis industry supplemental/service providing companies.
During the California Gold Rush, many claimed that the people selling the shovels to the miners are the people who made the most money. It’s an interesting take, and it shows parallels to what SinglePoint is hoping to accomplish by selling a wide range of services to companies with more direct involvement in the cannabis industry.
Regardless of what happens in terms of cannabis regulation over the course of the next four years, it will be interesting to see how SinglePoint continues to diversify its holdings and position itself to profit indirectly from the industry that is estimated to reach $50 billion by 2026, according to research done by Cowen & Co.