Quality Gatekeepers to Legal Cannabis Industry
Apricot Analytics is a product quality test lab serving the legal cannabis market in California. California is by far the largest cannabis market, valued at $3.0B in 2019 growing to $5.6B in 2022. By law, every product shipment must be tested for potency and purity by an independent licensed test lab. Mandatory testing creates an attractive investment opportunity. The rapidly growing market, combined with the challenging technical, management and capital requirements to open a test lab, have resulted in an acute shortage of cannabis test capacity in California: 6,469 licensed producers served by only 49 licensed cannabis test labs. This presents a high margin opportunity with gross margins of 92%. Apricot Analytics? business plan is to become profitable within one year, establish a differentiated product offering, generate sufficient cash to internally fund substantial expansion, and become an attractive acquisition candidate.