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HempFusion’s five-channel strategy positions it ahead of competition in CBD space

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HempFusion Wellness Inc. had a historic first day of trading after it completed its US$17 million IPO on Jan. 6. The event marks the first time a U.S.-based CBD company has been approved for listing directly on the TSX.

“This IPO will accelerate our ability to scale HempFusion’s operations both domestically and internationally, drive accelerated growth within all our distribution channels, and significantly expand our marketing initiatives,” says Jason Mitchell, N.D., HempFusion’s co-founder and CEO, who is also a board-certified naturopathic doctor with decades of experience in the natural products industry.

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“A large percentage of the proceeds from the IPO will be earmarked for building out our ecommerce strategy,” continues Mitchell.

Founded in 2015, HempFusion is headquartered in Denver, Colo. Today it is considered to be a leader in the health and wellness CBD industry, providing diversified proprietary formulations utilizing the power of whole-food hemp nutrition.

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The company offers a diverse portfolio of brands including HempFusion CBD, Probulin Probiotics, Biome Research and HF Labs. It has 48 products on the market from tinctures to proprietary over-the-counter (OTC) topicals, with more than 30 under development, including OTC drug listed ingestibles.

The company operates debt-free and boasts a strong cash position in addition to US$17 million gross proceeds from the company’s IPO.

Over the past two and a half years, HempFusion has focused on building a strong catalogue of products, expanding its retail store footprint, and ensuring all regulatory compliance guidelines are met without exception. The timing is fortuitous given the CBD sector is projected to reach $16.8 billion by 2025, according to Brightfield Research.

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HempFusion has 48 products on the market, with more than 30 under development. SUPPLIED
HempFusion has 48 products on the market, with more than 30 under development. SUPPLIED

“Our products are based on exclusive and unique raw materials that are as close to the plants’ natural fingerprint as possible,” Mitchell says. He points out there are only a handful of companies that offer U.S. Department of Agriculture (USDA)-certified organic hemp products.

Mitchell cites product and market diversity among the company’s most compelling strengths. Much of that has been built on the earlier success of the Probulin Probiotics brand, which was launched in 2013 and has since become a wholly-owned subsidiary of HempFusion. According to SPINS syndicated data, Probulin currently ranks as one of the fastest-growing probiotic companies in the natural product space.

HempFusion’s family of products, including HempFusion, Probulin Probiotics, Biome Research, and HF Labs, are sold in more than 4,000 retail locations in the U.S. through five channels: natural health retailers, ecommerce, big box/food and drug mass, convenience, and doctor/practitioner.

In more recent months the company has been making inroads internationally. Led by a recent announcement of expansion into Ireland, HempFusion continues preparing to expand its sales across Europe, the Middle East, South Korea, China, Mexico and India.

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This success of Probulin has provided a strong foundation for HempFusion’s hemp-derived CBD products on a number of fronts. “As an accepted and established product, we aim for Probulin to serve as a gateway to increasing both our domestic and international distribution,” Mitchell explains. “Probulin’s distribution presence in our key markets gives us a lot of runway and opportunities to execute our plan to expand HempFusion into multiple markets that are not readily available to other CBD companies.”

“Our products are based on exclusive and unique raw materials that are as close to the plants’ natural fingerprint as possible,” Mitchell says. SUPPLIED
“Our products are based on exclusive and unique raw materials that are as close to the plants’ natural fingerprint as possible,” Mitchell says. SUPPLIED

The company’s trojan horse strategy may allow HempFusion to access retail networks through its probiotic line, creating established relationships for future CBD opportunities. “We are already in the mix with Probulin sales, so we are strategically placed to market hemp-derived CBD when they are ready,” Mitchell says.

Big retailers have a high interest in hemp CBD products, but they also have a significantly higher threshold for risk. This is why the company goes out of its way to meet, and hopefully exceed, compliance standards.

HempFusion’s big box retail and presence on Amazon are especially important strategic moves that have garnered early success for HempFusion. Most recently, the company has begun selling its OTC products in an undisclosed top 5 FDM grocery retailer in the U.S. Currently the HempFusion OTC products are selling very well in this retailer (#1 in unit sales and #1 in dollar sales).

The company’s established success on the probiotic side also translates into deep experience with regulatory compliance procedures. “We have always prided ourselves in taking an uncompromising approach to regulatory compliance,” Mitchell says.

The company is now looking to leverage the additional capital brought in by the IPO to accelerate both domestic and international expansion plans.

Learn more at hempfusion.com.

This story was created by Content Works, Postmedia’s commercial content division, on behalf of HempFusion.

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