We discuss today with Rebecca Conti Koar. Rebecca is SVP Investor Relations at Ascend Wellness Holdings
Rebecca, can you start off by telling us about SVP investor relations and how it works as a part of Ascend Wellness Holdings (“AWH”)?
A Head of Investor Relations (“IR”) for a public company is responsible for the planning, development, and implementation of all investor programs and messaging. Much of this revolves around the quarterly earnings cycle. For each earnings cycle, IR is tasked with developing the earnings slides, scripts, press releases, and other ancillary documents so that the buy-side and sell-side analysts can understand the Company’s value proposition and current financial situation. Working closely with the sell-side analyst community to ensure that the research reports they publish on AWH are an accurate and fair depiction of our reality is among my top priorities. Since AWH went public in May 2021, we have increased sell-side engagement to 10 covering analysts. The sell-side help get the story out to the rest of the investor community. On a daily basis, I also work with existing investors and new investors to ensure that they understand our value proposition. Another critical piece of this role is serving as a feedback loop to provide market and peer information to our management team and Board of Directors. A key component of my role is liaising with the Board and managing our governance objectives.
Another component of investor relations is providing adequate disclosure to the “Street” on your Company’s Environmental, Social, and Governance (“ESG”) metrics and initiatives. ESG is a core focus of the institutional investor community. Today, cannabis investors are primarily retail investors so there hasn’t been a massive investor push for ESG disclosure in the cannabis space. Ascend, however, is doing a ton on the “Social Impact” side to help correct some of the injustices many have faced due to cannabis legislation. As soon as I joined AWH, I knew there was an opportunity to shed light on the work that the team was doing. We recently published our first annual report and integrated Environmental, Social, and Governance report, where we reported ESG metrics in conjunction with the Sustainable Accounting Standards Board (“SASB”) and pledged to eight United Nations Sustainable Development Goals (“UNSDGs”). This was a big push, and we were proud of that. We were actually the second company in our industry to do this, so I like to think that we are among the folks leading the way in ESG disclosure, and our work will encourage others to follow suit.
What is the critical investment thesis for Ascend Wellness?
Let’s dissect this question into two parts: a) what differentiates AWH from our peers? and b) why invest in the sector? AWH is differentiated from our peers in a plethora of ways, but a few key ones are that we primarily only operate in states where the state government has imposed a limited license structure so that the market does not become too competitive; we have a strong emphasis on retail location placement and try to place our dispensaries on the corner of “Main and Main” or right on a busy highway with plenty of parking; our management team is deeply experienced in capital allocation and has a proven track record on executing M&A, which is a frequent entry point for this sector; and we are vertical in every state in which we operate, being on both sides is a crucial factor for optimizing margins.
I personally think the sector itself is also an exciting proposition and a unique opportunity to get involved in an emerging market in its infancy. Legal cannabis sales are only $25 Billion in the US today, but they are expected to reach close to $50 Billion over the next five years. The sector is among the fastest-growing industries in history and employs almost half a million people. Cannabis workers outnumber insurance salespeople, yet the industry is completely capital starved as traditional institutional investors are ought to get involved in the sector given its federal illegality. While they sit on the sidelines, the current players are building the mote around their business. Unfortunately, however, no one has a crystal ball for when (and if) the institutions will be able to invest, so stock prices are certainly taking a beating.
You joined the company in 2021. What was your experience working in the cannabis industry before working for SVP Investor Relations at Ascend Wellness Holdings?
The cannabis sector was new to me when I joined AWH. However, the Investor Relations profession was not. One of the sectors I previously worked in was municipal and industrial waste, which was, oddly enough, very similar to cannabis. They are both highly regulated at the state level, and it all comes down to “PxQ,” but the quantity unit is much different. For instance, in municipal waste, we modeled out on a price per ton basis; with cannabis you model out wholesale revenues on a price per pound basis and retail on an eighth of an ounce basis.
Can you tell us about your career before Investor Relations at Ascend Wellness Holdings?
After studying Materials Science Engineering undergrad at the University of Virginia, I made a hard left right after school and started working at an angel network and venture capital firm. That was a unique experience because it provided me the opportunity to work with portfolio companies as they built their businesses from the ground up. I also got to understand what early-stage investors look for in an investment opportunity and how they value companies. From there, I wanted to better understand what a strategic acquirer looks for when making a strategic acquisition, so I moved on to Corporate Development and Mergers and Acquisitions. I did Corp M&A at two different companies: Covanta (Waste-to-Energy) and Verizon (TMT). I got to hone my diligence and valuation skills and learn about two new sectors. Although I enjoyed Corporate Development, I wanted to fully round out the company investment life-cycle and move on to Investor Relations for a public company where I could communicate the message to investors looking to invest in later-stage companies, which led me to IR. I like to tell people that IR is the trifecta of Finance, Strategy, and Communications.
What led you to your role with the company?
A recruiter reached out to me, and I was just so impressed by the caliber of the management team. You know how the saying goes, “always surround yourself with people smarter than you,” and I saw this as an opportunity to do that. Our management team has such deep expertise in financial and capital markets, and I jumped at the chance to learn from this group of professionals. Not surprisingly, the caliber of talent goes past the management team. I have now worked for four companies in corporate America and have seen my fair share of coworkers that will accept mediocrity. At Ascend, there is no room for mediocrity. It is too fast-paced a company, and an industry, to allow for that. I love that everyone I work with is undeniably hungry and acutely motivated.
What should anyone who hasn’t invested in Ascend Wellness Holdings expect?
This is just the beginning. Ascend operates in 5 states today with 22 dispensaries and 217,000 square feet of canopy spanning five grows. We have pending acquisitions and current assets that would bring us north of 30 dispensaries and close to 300,000 square feet of canopy all within our existing pipeline. We are growing in leaps and bounds!
Can you tell us about the company’s stores? What will customers find in the stores across the USA east of the Rockies?
Ascend is laser-focused on premier retail locations, and our stores have a significantly elevated, clean experience. Our retail approach has an emphasis on ordering ahead to reduce wait times and we offer a robust product assortment. We like to say that we don’t have a company store where we only sell the products we produce, but that a customer can walk in and get anything they want whether we made it or not. This concept is similar to Whole Foods’ and Target’s models. At Target, customers can purchase Target branded products, but they can also buy any number of other brands and leave with whatever they could possibly want!
What is the current landscape of cannabis in the US?
At present, there are about ten top-tier multistate operators (or “MSOs”). These players operate in multiple states across the country. Then there are dozens of smaller single-state operators (or “SSOs”) within each state. Ascend is among the top 10 MSOs. Some of the MSOs span the nation; however, Ascend likes to focus on only a few key states that are very populated and only issue a limited number of licenses.
Rebecca, what does a day in your life look like?
Weekdays are pretty regimented! My husband and I wake up at 6, get our 18-month-old ready for her day, and both get started on our work at 8. I then operate on overdrive to get as much work done as I can so I can finish at 5 to get my daughter and get ready for dinner! I really try to use my time during the day as effectively as possible. I put every little reminder on my calendar including notes, agendas, reminders to follow up with people, questions to ask people, reminders to shower… you name it! I also leverage automation whenever possible, despite the heavy lift often required at the onset. An example of this within the IR setting is by utilizing Factset to view and compare analyst expectations. I have customized excel templates that link to Factset for every key financial metric for every covering analyst. All I have to do when an analyst revises their numbers is hit refresh to view and to compare to peers. This saves a ton of time scraping models every time an analyst makes a tweak. I also try to optimize every meeting I am in; every meeting should be focused on action items and next steps…. no dilly-dallying allowed! I then hop back on the computer around 7 after my daughter goes to bed, if needed.
Weekends are spent with family and friends. My husband and I love to take our daughter on new adventures with our rescue dog. We also try to find time for our passions and hobbies. We met as sailing instructors 13 years ago, so we enjoy going out and sailing together; we still race on many weekends in the summer. I was also a competitive equestrian back in my day, so I like to go out and jump around when I can find the time.
Two truths and a lie:
I horseback rode coast to coast across Spain, I have had anesthesia 40+ times, and Betty White is my grandma. You’ll never know 😊
Choose two of your favorite quotes and write them here
“In order to be irreplaceable, one must always be different”- Coco Chanel
“Emancipate yourselves from mental slavery, no one but ourselves can free your mind”- Bob Marley
If you had the power to change just one thing in the world what would it be?
I would like people to be better listeners (myself included). I think if we solved the way humans approach problems, then humans would be able to solve the rest of our problems ourselves. Perhaps, we would come to more balanced conclusions and make tangible progress on the world’s most pressing societal challenges such as climate change, women’s reproductive health, gun control, and more. Let’s teach people to fish, rather than magically get them just one fish and let’s come together in the middle a bit more!
Anything else you’d like to add?
Thanks for the opportunity to tell not only my story, but also the Ascend story! Readers can feel free to reach out to me at [email protected] to learn more about Ascend. They can also view our investor website here: https://investors.awholdings.com for a copy of our investment overview deck and quarterly financial filings.