Exclusive Interview with Ammonite President and CEO Mike McDonald
Ammonite is bringing a more sophisticated oil delivery system to the cannabis market: its Dablicatorᵀᴹ oil applicator platform. The startup company, spun out of Jetty Extracts, is hoping to demonstrate the need for something beyond traditional syringes in the cannabis oil category. President and CEO Mike McDonald spoke with New Cannabis Ventures about the company’s product, pursuing brand relationships and the opportunities ahead. The audio of the entire conversation is available at the end of this written summary.
Opportunities in Cannabis Oil
Cannabis oil is a growing category, driven by a need in the medical category and demand in the adult-use category. The COVID-19 pandemic has driven consumers to look for alternatives to inhalable products, according to McDonald. With more attention on non-inhalable cannabis delivery, interest in products like the Dablicatorᵀᴹ oil applicator is also growing.
McDonald first connected with Jetty Extracts as an investor and then as an advisor. About a year ago, the company was receiving unsolicited demand for oil delivery hardware (including a large order from Surterra) that led to the spinout of Ammonite.
Ammonite is now a separate entity, but the talent at Jetty Extracts helped to create it. Ron Gershoni, Nate Ferguson and Robert Ferguson founded Jetty Extracts, building a respected California cannabis brand and inventing the Dablicatorᵀᴹ oil applicator. Ammonite is further supported by leaders like Product Design Director Ryan Artale and Creative Director Max Dolberg.
Ammonite has warehousing space in Oakland, California, but the company’s goal is to create national and international reach through brand partnerships. It works with California-based brands, including Jetty Extracts, 710 Labs and Oakland Extracts. It has also signed with other cannabis brands outside of California, such as Ancient Roots in Ohio.
The company’s main focus is on building relationships with larger partners, like the MSOs in the United States and LPs in Canada. Ammonite can deliver companies that have their own branding and distribution a turnkey solution: a customized, branded product line. Ammonite is currently in conversations with more companies across the U.S. and Canada, according to McDonald.
Funding Now and in the Future
Ammonite and Jetty Extracts are divisions of the parent company Ametrine. Over the past 12 months, Jetty Extracts has received funding through friends, family and a Series A round. Ammonite was initially funded internally by Jetty Extracts. Now, it is self-funding.
As the company grows, it will be open to raising more capital, either individually or in combination with Jetty Extracts. Ammonite is also open to other possibilities, such as joining a larger company, pursuing M&A or going public.
McDonald sees significant hockey stick growth ahead of Ammonite. The company’s revenues have been growing 20 to 30 percent quarter over quarter, and they are expected to double or triple in 2021.
The company is currently focused on sustainable profitability rather than growth at all costs. It is working to create those valuable brand partnerships with larger companies. A single brand partner with operations in multiple states could place an order for hundreds of thousands of Dablicatorᵀᴹ oil applicator units, according to McDonald.
Ammonite is aiming to have two or three more growth-oriented partners in the MSO and LP space by end of the year, according to McDonald. The company also plans to drive revenue with new products.
McDonald sees the trajectory of Ammonite and the Dablicatorᵀᴹ oil applicator as similar to how Pax and G Pen’s Gio went to market. These companies have innovative hardware and select partners with platforms that help to grow their businesses.
Gaining visibility is the main challenge ahead of Ammonite in 2021. The company’s team will be working to gain the attention of decision-makers in large, rapidly growing cannabis businesses. It does have the advantage of access to relationships Ametrine and Jetty Extracts have built, and it has turnkey production and a brand management team ready to deliver custom products to its customers’ shelves.
To learn more, visit the Dablicatorᵀᴹ oil applicator website. Listen to the entire interview: