Former Canopy Growth Corp. (WEED.TO)(CGC) co-CEO and chairman Bruce Linton says he has been “leaning in super hard” on the team at a small Canadian technology firm, borrowing from the business playbook he used to build the world’s largest cannabis company.
TSX Venture-listed shares of Martello Technologies Group Inc. (MTLO.V) surged after investors spotted Linton sporting a t-shirt with the company’s logo in place of his usual Canopy Growth apparel in television interviews after his ousting from the cannabis producer last week.
Linton jokes the shirt is now worth about $50 million due to the attention it drummed up for Ottawa-based Martello.
The company specializes in cloud and enterprise network solutions. Or as Linton puts it, they make things like streaming and video conferences “way less annoying and functional” for corporations around the world.
Linton, who worked mainly in the technology sector before he founded Canopy Growth in 2013, has been involved with Martello for the past six years. Now, he says he wants to pass on some of the strategies he used to scale Canopy Growth from a $100 million market capitalization to $17.5 billion in just a few years.
“I’ve been leaning in super hard on them to say, ‘Guys . . . you can buy companies one at a time, or you can sign three or four or five up, make it binding on them, and then figure out which one you want to buy,’” Linton to Yahoo Finance.
“What I’m doing is taking some of the things that I have learned, a little bit more of my standard ‘put the screws in as fast as you can’ (strategy),” he added. “What I really want to do is make it a solid serious business which could either make a good home in a private equity firm or be a bigger market capital company.”
Linton has a track record for bold strategy, innovative deal-making and scaling businesses faster than his competition.
Canopy Growth became North America’s first publicly traded cannabis company in 2014. During his tenure, Linton spent billions acquiring or investing in at least 30 companies, including an option to buy U.S.-based Acreage Holdings Inc. (ACRG-U.CN) should cannabis become federally legal in the states.
He oversaw the build-out of over five million square feet of licensed growing capacity, expansion to 12 countries, and the development of celebrity partnerships with Snoop Dogg, Martha Stewart and Seth Rogan.
Then there’s the blockbuster $5 billion dollar investment Canopy Growth received from Constellation Brands Inc. (STZ) The deal was largely seen to legitimize investment in cannabis when it was announced last year, sparking a sector-wide rally.
How much are Canopy Growth’s new products worth? Call me in five years
Constellation Brands’ massive stake in Canopy Growth would eventually see Linton pushed out by board members from the beer and wine-maker who grew wary of his big spending ways.
Linton sees the Smiths Falls, Ont.-based cannabis producer more akin to Amazon Inc. (AMAZ), Netflix Inc. (NFLX), or a tech startup, rather than a slower-growth company meant to live and die by quarterly results.
“Canopy is really in my mind a startup which has created a really good base in Canada. But even the opportunity in Canada is just beginning to open up with new products coming out at the end of the year,” he said, referring to the cannabis-infused edibles, drinks and vapes expected to be available in late 2019.
“I have this idea that massive creative energy focused on a field that is coming out of prohibition should be measured on intellectual property achievements, and novel creation of products, because those will be the branded differentiated good versus a rolled joint. All these things come with a big cost. How much is it worth? Call me in five years, I’ll tell you.”
A non-compete clause prevents Linton from joining another Canadian cannabis company, but that does not mean he is turning his back on the sector. He said he will “need to be selective” in choosing his next opportunity in cannabis.
Linton said he is also eyeing 5G, AI or other spaces where he can see a big marco trend or policy change spurring rapid growth. (Like recreational cannabis legalization in Canada did for Canopy Growth.)
As for Martello, Linton says his plan is to “push” the company forward.
“Right now, it’s just push, push, push,” he said. “And I like that.”