Interview, Part 1: Beau Wrigley, Jr., Chairman And CEO, ParallelApril 27, 2021
Beau Wrigley, Jr. is the chairman and CEO of Parallel, an Atlanta-based cannabis company with operations in four states and over 40 retail locations, as well as cultivation and manufacturing facilities. In February, Parallel announced its intention to go public via a purchase by special purpose acquisition company Ceres Group, with the deal valuing Parallel at $1.9 billion. SNDC associate editor Danny Sullivan recently caught up with Wrigley to discuss the emerging cannabis market in the U.S., growth opportunities, and the advantages of going public.
SNDC: You recently agreed to acquire Windy City Cannabis for $100 million, which will give you a foothold in Illinois. What are your expectations for your operations there?
Wrigley: We’re hoping that we’ll have final approval to take over that business sometime this summer, but we like the assets that we purchased. I like the fact that they’re distributed around the state a bit—I think that’s actually a good thing. Everyone always wants to rush to the city centers, but often it’s better to go where there’s less competition. We’ll have opportunities to expand in Illinois since it certainly does seem to be a growth state. Until we get more experience under our belts in all these markets, it’s a little hard to say how high the ceiling is.
SNDC: What is Parallel doing to bring new consumers to the category?
Wrigley: We’re the type of company that is very much about educating and developing relationships with our consumers. Windy City represents that. They’re very neighborhoodly, to use a term that’s not a term, in their approach, and we like that because it creates long-term customers when you can explain this whole category to people. It’s pretty foreign to people at first. It’s almost scary when you’re walking into a cannabis store for the first time because you’re overcoming old stigmas. That’s changing so rapidly that it’s really exciting.
SNDC: You’re currently in the process of going public via a SPAC deal, which values the company at $1.9 billion. What prompted that decision and what advantages does it give Parallel in the long run?
Wrigley: Well, it’s easier to be a private company than it is to be a public company, that’s for sure. But at the end of the day, this is a hugely capital intensive business—to build out cultivation, production, retail. Because of the regulatory environment, you’ve got to do it in every market that you want to play in, meaning you don’t get the efficiencies of interstate commerce, which just makes it that much more expensive. We felt that it was time to go to the public markets to put some more capital on the balance sheet. But even more importantly, it was to have the public currency to make additional transactions. I think we’re an amazing value and growth story.
SNDC: How is Parallel positioned overall as the U.S. cannabis market continues to gather steam?
Wrigley: It’s a new industry and there are so many opportunities to pursue. There are numerous players who maybe haven’t scaled successfully and so they’re looking to partner up with companies like ours that have scaled. It can be quite a frenzy. Our approach is to keep our heads down and keep building this business—it comes down to a lot of basic cultivation, production, in-market selling, and so on. That’s not as sexy a part of the business, but it’s fundamentally important. People are also beginning to understand that it really matters who the management team is and their level of experience. One of the more recent additions we made to the team was our CFO from Walgreens, Jeremy Kunicki. That continues to strengthen the fact that we’re a professional management team and have a lot of pharmaceutical and healthcare background, which is great in a regulatory and compliant industry.Subscribe to Shanken News Daily’s Email Newsletter, delivered to your inbox each morning. You will also receive the Cannabis edition as part of your subscription.