ParcelPal: Revolutionizing The On Demand Economy

2018 was a banner year for the legal cannabis industry and 2019 should be that much more significant.The cannabis sector recorded enormous growth the past year; and this is a trend that is expected to last for quite some time.

We have been closely following the cannabis industry and have been concentrated on targeting businesses that are underappreciated and well positioned for growth. Today, we would like to highlight ParcelPal Technology Inc. (PKG.CN) (PTNYF) which satisfies this criteria and is definitely worth watching.

ParcelPal provides on-demand regional delivery services in North America. The company has strategic relationships with significant global conglomerates as well as leading Canadian cannabis retailers. ParcelPal has substantial growth prospects and transactions at an attractive valuation.

In late November, ParcelPal released third-quarter financial results that showed impressive growth and we’re positive about the growth prospects going forward. During the quarter, the company generated more than $800,000 in revenue and is well positioned to see significant growth from here.

Focused on the Cannabis Market and Forms Relationship with Choom

In September, ParcelPal announced a strategic agreement with Choom Holdings, Inc. (CHOO.CN) (CHOOF), a leading cannabis retailer in Canada, for the distribution of cannabis. ParcelPal’s arrangement with Choom will advance distribution to various retail outlets in Canada. The initiative will consist of:

  • Distribution: ParcelPal and Choom will jointly develop the optimal roadmap for distribution in various provinces for adult use cannabis.
  • Accessibility: Using Choom’s and ParcelPal’s platform to improve user experience and accessibility to products offered.
  • Safety: ParcelPal and Choom are committed to public safety by enabling safe access to merchandise for consumers through an instantaneous delivery channel with the objective to eliminate impaired driving.

We’re positive on this connection and believe that every provider adds strategic capabilities to the venture. ParcelPal would like to be the Uber of cannabis for Canada and believe that Choom will improve the company’s nationwide cannabis distribution and delivery strategy. This represents a significant opportunity and will be a enormous revenue driver for the businesses, if successful.

Choom has a strategic relationship with Aurora Cannabis (ACB.TO) (ACBFF), whereby Aurora owns a significant portion of Choom and this may be a major catalyst for ParcelPal. The company has significant growth prospects because of its connection with Choom and this is a chance that investors will need to be watching.

In the Midst of a Major Expansion

During the last year, ParcelPal has been implementing flawlessly on a multi-faceted growth strategy and has successfully delivered over 1.5 million bundles. This is important for a company that is in the early stages of its growth cycle and for that we expect to see incremental growth over the next year.

One of the areas in which ParcelPal has exceled is with strategic partnerships. The connection with has been a major catalyst for growth and we’re positive on the focus on expansion.

In the most recent company update, CEO Kelly Abbot announced that the company has partnered with and invested in TokeIt (Centreel Systems) for the distribution of cannabis. We’re positive about the focus on the cannabis sector and the distribution side of the business represents a major opportunity.

ParcelPal ended 2018 on a high note and this leaves us excited for the year ahead. ParcelPal is continuously executing on its strategic plan, bringing potential partnerships, and looking at additional city expansions. This represents a significant opportunity for the company, and we’re monitoring the way the team executes out of here.

A Business With Significant Growth Potential

With ParcelPal, there are countless opportunities for evolution and revenue diversification within the on-demand delivery market. The company is well capitalized and has been reinvesting in its technology platform and has started to scale its service across Canada as well as the United States.

ParcelPal is in the center of a major expansion and recently established operations in Saskatoon and Calgary, two new markets on the west coast of Canada. The company plans to create a significant presence on the east coast of Canada as well and we will monitor how this procedure goes. ParcelPal intends to pursue several technologies, products and marketing initiatives to continue to drive further growth in 2019. The company’s strategic priorities include:

  • Grow monthly recurring earnings by engaging new and acquired customers.
  • Continue to launch multiple delivery verticals within the application.
  • Capitalize on various opportunities over the cannabis sector
  • Further grow the technology platform and offer ParcelPal on multiple platforms
  • Broaden ParcelPal’s geographic footprint across Canadian cities
  • Continue leveraging its partnership with Amazon across North America

An Opportunity to Watch

When looking at cannabis companies, it’s crucial to evaluate the management team and focus on businesses that are led by a team that is oreiented towards growth and on creating value for shareholders. ParcelPal is directed by a strong management team and the company recently enhanced the team through strategic additions.

ParcelPal is well capitalized and well positioned to perform on expansion focused initiatives and this is an important aspect of the story. Parcel Pal finished the year with over $2 million in working capital which will allow for an 18 months expansionary run rate without needing to raise further capital. This is important and we are positive about the organic growth opportunities.

This is a company that we will be monitoring carefully and if you would like to get more information, please contact [email protected].

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