Technology and cannabis production are two sectors which are intermingled, though not typically in the traditional sense; investors looking at a company like Canada-based Shopify Inc. (TSX:SHOP)(NYSE:SHOP) may not make the connection, at first glance.
That being said, the Liquor Distribution Branch, a government run distributor and retailer of liquor in British Columbia (and also the sole distributor and retailer of cannabis in the Province) has recently awarded Shopify with an exclusive contract to provide e-commerce solutions for the LDBC. This agreement could turn out to be very lucrative for the young Canadian technology firm, as provinces across the country determine the best way to deliver cannabis safely to consumers across the country when pot becomes legal on October 17.
Shopify was the company chosen after a request for proposal was issued by the LDBC earlier in 2018, in part due to the company’s track record as well as the company’s Canadian roots. This partnership has been speculated on already, with much of the company’s recent share price rise attributable in part to expectations that Shopify will provide e-commerce solutions to large government agencies, something the company has been successful in doing thus far.
Shopify’s business model is one which is interesting for investors because of a relatively untapped G2C market (government to consumer) market – the vast majority of the company’s current customer base are small businesses looking to put their wares online.
Invest wisely, my friends.
