U.S. investment bank Cowen Inc. is making a bet on cannabis data, forming a partnership with market research company Headset Inc. to sell retail data to investors.
Headset collects point-of-sale data in Colorado, California, Nevada and Washington, largely to help dispensaries and producers manage inventory and pricing. The new partnership will see the data repackaged and sold to the financial community by Cowen’s data research subsidiary Kyber Data Science, LLC.
"It's actual data versus estimates, it's timely, and obviously it's going to give investors a much better read on an industry that they've become increasingly focused on," said Robert Fagin, head of Kyber Data Science.
The kind of data sophisticated investors typically use when making decisions is largely absent from the cannabis space – although several firms, including Headset and BDS Analytics, are aiming to become a kind of Nielsen of cannabis.
“You'll see revenue, volume, average selling price information. You'll also see the top ten brands in every market, and so I think this will give investors a read on brands that have traction, it will give them a read on differences between markets, which in some cases are very notable," Mr. Fagin said.
"Whether there are market share shifts between form factors like flower, beverages, edibles... that's also something we'll be able to have a very good read on," he added.
Kyber Data hasn’t publicly disclosed the price of the new product, which it intends to sell to investors ranging from pension funds to small private equity shops. It will be sold on a state-by-state basis, so people only interested in California, for instance, won’t have to track pricing in Washington.
Headset recently announced operations in Canada though the Greenline point-of-sale system. Kyber Data, however, has yet to announce plans to sell a Canada-specific data to Bay Street investors, Mr. Fagin said.
To date, Cowen has been the most active mainstream U.S. investment bank in the cannabis space. Earlier this year it became the first New York firm to appoint an analyst to cover cannabis. It’s also co-led U.S. raises for Canadian companies such as Tilray Inc. and Canopy Growth Corp.