​SinglePoint CEO Greg Lambrecht Talks Acquisitions, ‘Picks and Shovels’ of the Cannabis Market and Growth Strategy

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The legal cannabis space blossoming at a rapid pace is creating opportunities for companies interested in all facets of the business. SinglePoint (SING), a company rooted in digital payment systems, has not overlooked opportunities in the cannabis market, taking an aggressive approach with respect to acquisitions and developing new technologies that complement its legacy IP with the goal of carving out market share with ancillary solutions to the burgeoning industry.

The company very recently announced the completion of a $4 million round of funding, $1.2 Million of which having already been collected, including $600,000 from United American HealthCare Corp (UAHC). The stocked war chest will enable SinglePoint to aggressively develop and complete its previously announced Bitcoin Payments solution and acquire additional companies in the cannabis space. On Tuesday, SinglePoint announced the acquisition of Denver-based group, JAG, and offered an update on several corporate initiatives. The company stated that the acquisition of JAG solidifies SinglePoint's fundamentals toward growing the company and acquiring or investing in larger targets with each transaction.

Recently, Equities.com had the opportunity to speak with SinglePoint CEO Greg Lambrecht to discuss the evolution of his company, the market opportunity at hand and just how exactly SinglePoint is emerging as a leader with its forward-thinking business model.

Equities.com: For those unfamiliar with SinglePoint, can you give us a brief overview and talk about your market strategy?

Lambrecht: SinglePoint is a mobile payment company. our technology and IP is in enabling customers to use their mobile phones and credit cards to do transactions or donations anywhere in the United States. We have connected through all the mobile carriers and through three merchant processors. That’s our technology and generally when we look at a vertical for acquisitions, we try and make sure that we can use this technology to implement and complement them.

In our overall strategy, there are two ways that SinglePoint is looking at gaining revenues. One is through acquisitions, which this year we've been very successful at. We’ve completed four acquisitions to date, and most of these acquisitions have been in the cannabis space because of the huge potential in growth there.

EQ: Can you tell us more about your approach into this area of the market?

Lambrecht: What we've done is looked for companies that we call the “pick and shovel” in the cannabis industry that don’t touch the plant. We feel that is a strategic advantage because we can go into all 50 states without having to worry about licenses and other things. This inorganic growth strategy is the primary way that we are building revenue streams.

The other way of growing revenues is our in-house strategy, which goes back to payments and opportunities in that space. One of the things that we're working hard at is cryptocurrency. We have two of the best Bitcoin programmers in the world working on a product that we believe is going to be ready in November that is going to solve the banking problems at the cannabis dispensary by using cryptocurrency. So, that is back into our expertise and our wheelhouse. Of course, we couldn’t acquire that company because it doesn’t exist. We’re actually building that out internally. That is kind of an overview of our outside revenue strategy and our inside revenue strategy.

EQ: Let's start with the inside revenue strategy first. This puts you at the intersection of two very hot markets, with the cannabis space and the cryptocurrency space. Can you talk about the market opportunity here and why cannabis and cryptocurrency is such a unique fit, considering the two natures of those markets?

Lambrecht: it's not only a perfect fit in the broad sense, but it's an exact perfect fit for SinglePoint. About two years ago, we started putting point of sale terminals into dispensaries in Washington and in Colorado. We were allowing people to use their debit card to pay for cannabis and it was going very well, but – against the backdrop of negativity banks were facing due to cannabis being illegal at the federal level – the bank shut that down. That was a little disheartening because we were on our way to building a significant market traction.

At that time, we announced in a press release that we were also looking into Bitcoin and cryptocurrency. The problem was not that many people, especially customers, even knew about those technologies back then. So now two, three years later, Bitcoin and cryptocurrencies are growing quickly in popularity while more states have opened up recreational and medical marijuana, making it a perfect storm.

We believe that when we get through with our cryptocurrency product we're going to have a huge first mover advantage to be able to go into the dispensary and let the customers use Bitcoin or other coins to pay for cannabis. It’s just a huge opportunity and with our technical expertise we feel like we're if not the absolute best, one of the best companies to pull this off.

EQ: You’ve been very active this year on the acquisition front. As you mentioned, you’ve made four acquisitions thus far and there is very likely more to come. Can we start with the companies that you have acquired and how they’ve bolstered your portfolio in this space?

Lambrecht: the first company that we acquired is Convectium, a company with a machine that fills the vials that go into the vape pens and other similar applications. Currently, growers or dispensaries have to fill these by hand. You can imagine filling 5000, 10,000 of these little vials by hand; it’s obviously extremely inefficient and tedious. Convectium’s revolutionary technology, called the 710Shark and 710Seal system, is capable of filling and packaging over 100 cartridges or disposable pens in only 30 seconds. Very interesting company and they're selling to growers and dispensaries. They're doing very well and we funded them almost a year ago. We’re very happy with our investment in, and future of, Convectium.

The other company is called DIGS, an acronym for Discount Indoor Garden and Supply. DIGS has opened up two stores in the San Diego area and they're selling products to growers and dispensaries that they need, including things like fertilizer and other items. So, DIGS is kind of an indoor garden store specifically catering to cannabis industry needs. Keeping with our theme, we still don’t touch the plant there as well, so expansion is simplified. We’re really excited about that.



We also have a have a website presence where we're selling CBD products and we're looking at opening up more brick and mortar locations. At this moment, we’re doing our due diligence regarding opening one up in Denver and also one in Phoenix. That is really a brand that we can open up stores across the country that sell products to growers, dispensaries and consumers. For example, we sell a small grow pack that someone can buy it and grow three plants at their homes. That is a very exciting acquisition as well with a great deal of potential.

The latest acquisition was a company called Dr. FeelGood, which is kind of a website where people can go to find out where the nearest dispensary is and browse its ratings and so on and so forth. (Read more about the company's very recently announced fourth acquisition, a 51% stake in JAG, here.)

EQ: With these three acquisitions and the pending fourth, is your intent still to focus on picks and shovels and not actually touch the plant? Do you have any plans to acquire companies which provide the actual cannabis product?

Lambrecht: right now, we're focused on the pick and shovel companies of the cannabis business and we're going to acquire companies that don’t touch the plant. Having said that, through all of our acquisitions and our press releases out there, we’ve had a lot of companies approach us that do touch the plant—whether they're a distributor, manufacturer, dispensary or grower—and we're looking at some of those opportunities now. There’s no law saying that, as a public company, we can’t touch the plant; we’ve just avoided it to this point. Some of the companies that are approaching us are doing some serious revenue. So, to answer your question, we are open to doing some larger acquisitions of companies that do touch the plant.

EQ: This space evolves so quickly, it makes sense to be nimble enough to adapt as opportunities present themselves. What are some of the criteria you look for when you're assessing acquisition targets?

Lambrecht: one of the things that we look for is how the pick and shovel is involved in the cannabis industry because, first of all, we've told our shareholders that we're going to really focus on that vertical, which we have. This is simply a matter of magnitude of opportunity. We know from the different statistics that the cannabis business in California, Florida and other states opening up not only for recreational, but medical, has estimates going from $5 billion to $25 billion in five years and $5 billion to $50 billion in 20 years. We know that this business is really growing. So, that is why we are looking for opportunities particularly in the cannabis space.

The other thing that we're looking for, whether it's cannabis or non-cannabis, is solid revenues. What we have done at SinglePoint is built the public company first to where the market cap is $50 to $60 million and we’re able to raise cash. Now, we're going after the revenue through acquisition and some in-house initiatives as well. Good revenue: that is the second thing that we're looking for, albeit a cannabis-oriented company or not; we’re looking at them.

A third criteria involves our philosophy that we want to acquire companies where existing management stays in place to run the business. We don’t want to build an army of employees at SinglePoint. Having said that, that is exactly what we have done and our strategy has worked out quite well. We really want to focus on running the public company and let these companies that we acquire run their business. Those are three criteria that we're looking at. Of course, there's more but those are the three that come to my mind.

EQ: In terms of the final stretch of 2017 and looking into 2018, what kind of progress and milestones should we be tracking when watching SinglePoint going forward?

Lambrecht: I think that we’re on schedule to complete our cryptocurrency product for a launch in November or so, which will be a milestone moment and the very first shot to see how customers adopt using digital currency to buy cannabis. I think you're going to see a lot of news around that. As we start signing up dispensaries and having customers use cryptocurrency to purchase cannabis, this is going to be a huge deal. We anticipate that there will be a lot of attention on us and hopefully our projections. Once we have this product done, we’ll start signing up a hundred accounts, a thousand accounts, five thousand accounts. We’re really excited about that and we're spending time and money on building a product that nobody else has, and we think we could be first movers there.

As far as acquisitions, we have said and shown shareholders and the public that we were going to make acquisitions and significant investments in other companies. Our shareholders realize that we are capable of making acquisitions to increase our revenue. The confidence is high there. I think the next step with acquisitions is we simply start making larger ones with ability to raise money and use our stock. I see us announcing much larger acquisitions. In fact, the aforementioned one under a Letter of Intent is generating close to $1 million in revenue a year. Those two are a couple things that we can look forward to.

It is also certainly worth noting that we’re just finishing our 2016 audited financials and as 2017 ends, we're going to start right away on 2017. We’re hoping somewhere in February or maybe after that to be fully reporting to the SEC and move up to OTCQB, which is a huge milestone for the company.

EQ: That is a very exciting thing. You mentioned raising money and financing. On October 11, you disclosed completing a substantial round of funding. In terms of capital position, where are you now in your ability to execute on the acquisition front?

Lambrecht: We completed a $4.0 million round, $1.2 million of which already has been collected, inclusive of a $600,000 investment from United American HealthCare Corp. We intend to use those funds to maintain our aggressive schedule to develop the cryptocurrency solution. Other portions of the cash infusion will be used to execute on our revenue-by-acquisition strategy. As I said, we intend to make larger acquisitions and this financing gives us a stronger balance sheet to do so.

EQ: Any final takeaways or closing comments that you want to leave to our readers as they continue to track your story?

Lambrecht: I think that the stock has been really steady for the last four to five weeks at around six to seven cents, which I’m really pleased with. We’re stabilizing and not seeing any huge fluctuations up or down. I’m really happy that we kind of have a new benchmark in this area. As we start showing more revenue and moving up to the OTCQB, I think we're just going to have more credibility with the shareholders. I expect great things to come from this company.


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Companies

Symbol Name Price Change % Volume
SING Singlepoint Inc 0.08 -0.00 -2.41 6,709,491
UAHC United Amer Healthcare Cp 0.65 0.02 3.17 64,762

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