Tej Virk’s journey into the cannabis business began when he met former Canopy Growth CEO Bruce Linton just a few years ago.
At the time, Virk was a global equities and capital markets banker at BMO Capital Markets, but he saw a more compelling career path in the cannabis business for both personal and business reasons.
Virk’s mother successfully used cannabis to treat her chronic pain. He also sensed a compelling chance to help cannabis go legit.
“You don’t have to create a product and build demand, because the demand is already there,” Virk told MarketWatch. “We’re going from the legacy to the legal market. It was an opportunity to be part of something that’ll change the world. I believe in access in medicines that really improve the quality of life.”
As the cannabis business grows, executives such as Virk have been moving into the industry and starting relatively small. With Virk as its founding CEO, Akanda Corp. is taking its initial steps as a business at a time when the legal cannabis trade remains in the early innings. To be sure, just as many businesses were acquired or shuttered in the 1990s and 2000s during the Internet’s birth as a mass medium, many startups in the cannabis space may not last for more than a few years.
After meeting Canopy Growth’s
Linton, Virk ended up leaving BMO in 2019 to head up Canopy Growth’s European business, followed by time as president and managing director of Europe at Khiron Life Sciences
in 2020 and early 2021.
In June, Virk co-founded and became CEO of Akanda as a new company focused on the medical cannabis market in the U.K. and Germany.
“I left to join Akanda… partly because of the allure of getting more responsibility and executing my best vision,” Virk said.
At the moment, Akanda is getting up and running as a unit of Toronto-based cannabis company Halo Collective Inc.
but it’ll become an independent company under an equity exchange transaction of Halo’s international assets to Akanda. The deal values Halo’s two main overseas business units, Bophelo and CanMart, at about $13 million, and is expected to close by the end of this month.
“These are international, regulated medical assets that follow pharmaceutical regulations,” Virk said. “It made sense for Halo to separate these assets from their adult use cannabis business, which is more like a consumer packaged goods company.”
Akanda will organize Halo’s European unit under a management team with a strong emphasis on ESG, Virk said. The company plans to name a female chairwoman, and it’ll grow medical cannabis under ESG guidelines in the Kingdom of Lesotho.
“These are key tenants to our story and make us highly differentiated,” Virk said.
Virk declined to comment on whether Akanda will seek a U.S. listing in the vein of other companies with businesses in Canada and elsewhere such as Tilray
and Canopy Growth.
Akanda has hired Boustead Securities as an exclusive U.S. financial adviser, in a move expected to open up opportunities for financing by issuing stock. It remains to be seen if this stock will be privately issued or traded on a public exchange.
“Our priority track is Germany and the U.K. as the more established markets in Europe with plenty of upside for the next three to five years,” Virk said.
With a global cannabis market estimated at more than $300 billion, Virk continues to see plenty of opportunity in Europe, which has a similar population as the U.S. but a much smaller cannabis market for now.
“The cannabis plant was under prohibition and we’re just starting to unlock its medical value,” Virk said. “I also believe in consistency and safety and that’s led to my support of adult use cannabis. I want to be an agent of change.”