All posts by Andrew Kessel

CSE Issuer Stories, Magazine

Excitement Follows When You Unveil One of the Largest Lithium Projects of Its Kind

Some 200 kilometres from Las Vegas sits Sarcobatus Flat. It is a massive dry lakebed, similar to its nearby neighbour Area 51, the birthplace of generations of advanced U.S. aircraft and, according to some, home to who knows what else.

Sarcobatus Flat is part of the Nevada desert and you can see it for miles due to an eye-catching surface that looks like a dusting of snow. Underneath that white blanket of salts lies what Mining Intelligence ranks as the third-largest lithium clay and hard rock project in the world, Bonnie Claire.

This is the project proudly held by Nevada Lithium Resources (CSE:NVLH). The company has 18,300 acres of land at Bonnie Claire and has completed a Preliminary Economic Assessment (PEA). By the numbers, the project contains 18.37 million tonnes of Inferred lithium carbonate equivalent.

That’s all the more notable when one considers that the global lithium market is projected to hit sales of US$15.45 billion by 2028, according to data from Research and Markets.

Canadian Securities Exchange Magazine sat down with Chief Executive Officer Stephen Rentschler to discuss what’s coming next at Bonnie Claire and the future of lithium as a commodity.

Let’s begin with an overview of Bonnie Claire. When you engage with new investors during presentations, how do you articulate what Bonnie Claire entails?

Bonnie Claire is an advanced lithium exploration project located in Nevada, two and a half hours northwest of Las Vegas. Our project gate is 50 metres from Interstate 95 and high voltage power wires traverse the entire length of our property, which is the size of Manhattan Island.

We’ve finished a PEA and have a robust project of substantial scale, projecting an annual output exceeding 30,000 tonnes over a mine life of 40 years. Even at conservative lithium prices, the PEA suggests a project with a net present value exceeding US$1.5 billion.

And while we have more than enough resource already, the prospect of discovering additional resources remains a distinct possibility.

I also tell investors that although Bonnie Claire is often referred to as a clay deposit, a nuanced understanding is required because sedimentary deposits are relatively new to the scene. The world has simply never needed the lithium they contain. South American salars (salt flats), and then the hard rock deposits, had been forecasted to provide the needed lithium supply. 

But now, with the world significantly increasing the projected number of electric vehicles (EVs) on the roads, a third category has entered the scene: the sedimentary deposits, often referred to as clays, which in the U.S. are predominantly found in Nevada. These sedimentary deposits tend to be of lower grade compared to many hard rocks, and even some brines. However, in Nevada, the size is the key. Lower grade is compensated for by vast tonnages.

Typically, I finish my presentation by telling investors that in just over two years, Nevada Lithium Resources has gone public on the CSE, acquired progressively larger percentages of this world-class project, and last summer consolidated 100% ownership of the property. Now, we are in the initial stages of introducing ourselves to the investing public, leveraging our new full ownership status.

Is the next step in this process a Preliminary Feasibility Study?

Yes, and ideally our Preliminary Feasibility Study (PFS) should be completed around the close of 2024, plus or minus a few months. Following the PFS, we envision launching immediately into a Feasibility Study that we think will take two years to complete.

Unlike the output of many of the lithium projects being developed globally, Bonnie Claire’s lithium will not need to go somewhere else for conversion into battery-grade material. Our lithium will be ready for immediate use, ideally in one of the many U.S. or Canadian battery plants that are currently being developed. This will allow end users of Bonnie Claire’s lithium to extract maximum value from the tax credits offered by the U.S. Inflation Reduction Act. 

It’s interesting to see different methods for exploring for lithium within the sector. How would you characterize your process and how does execution and cost differ when pursuing lithium at your project as compared to other approaches?

Because of the expansive nature of the sedimentary deposits, a considerable amount of drilling is needed to adequately define the resource. In the case of Bonnie Claire, which has a massive footprint, the drilling is laterally expansive, already covering multiple kilometres.  And because of the tremendous columns of lithium we’ve encountered, the drilling is very deep. Our latest assay results have shown even higher grades over almost an additional 200 metres below our deepest holes. So, for us, making sure we are not missing the best mineralization will cost additional money. This is not a small pegmatite field that we are drilling out.

Another difference with our process goes back to the distinction between sedimentary and clay-hosted lithium mineralization. In simple terms, our recovery flow sheet is significantly different than most of the other Nevada-based projects because our localized geology is different. Our lithium is not bound in the clays, so we avoid the use of sulphuric or hydrochloric acid to liberate the lithium. This is an important part of our ESG (environmental, social and governance) profile that we think differentiates us from our peers and makes our lithium particularly attractive to lithium end users. 

Looking ahead, how do you position the company to emerge as a key player in the lithium space?

I am convinced that there is a secular supply-demand mismatch due to the global commitment to an EV future. Given the tremendous economic and geopolitical advantages of our Nevada location, we want to build a world-scale lithium mine, producing battery-grade lithium headed for the U.S. auto market. And we want to do that as quickly as possible. 

Part of our strategy is to use our management team’s collective experience to proactively mitigate the effects of obstacles that will always emerge during the development of a natural resource asset. At the same time, we are working to achieve important technical milestones as early as possible. An example of this is having already proved our ability to produce battery-grade lithium carbonate, which we believe differentiates us from many other lithium developers.

In my opinion, Nevada will emerge as the centrepiece of the future U.S. lithium supply chain, and our intent is to leverage Nevada’s location, history and culture. Nevada is perennially ranked as one of the very top mining jurisdictions in the world, with a rich history of gold, silver and copper production. A recent trip to Canada by Joseph Lombardo, Governor of Nevada, showcased his intent to extract maximum value from the lithium industry for his state. Concurrently, Nevada Lithium intends to extract part of that value for its shareholders through the responsible development of Bonnie Claire.

This story was featured in Canadian Securities Exchange Magazine.

Learn more about Nevada Lithium Resources at https://nevadalithium.com/.

CSE Issuer Stories, Magazine

Creating a single point of access to a broad range of crypto stories

Picking winners in the fast-evolving cryptocurrency, blockchain and artificial intelligence sectors isn’t easy for investors. A long list of major success stories fuels excitement about opportunities to deploy capital in both new and established companies, but as in any industry, there are also teams that were unable to reach their goals.

And yet, there is no doubt that the companies that do succeed will change the world. That’s certainly the belief at Web3 Ventures (CSE:WEBV), which offers investors exposure to entities that are pushing the boundaries for these innovative sectors.

“Look to the future and understand that things will be very different a decade from now,” says David Nikzad, the company’s Chief Executive Officer and Co-Founder. “I call it deep technology, and I think Web3 Ventures is all about community. It’s a community of people that want to bring parity to the financial system and make sure that what they get has trust and transparency.”

Nikzad got his start in digital marketing and has worked in investing for the last two and a half decades. Now, with his own fund, he’s become something of a shepherd for investors who may have misgivings about blockchain and Web 3.0. 

Take the collapse of FTX, which saw US$8.9 billion in customer assets go missing under the leadership of Sam Bankman-Fried. That hurt a lot of investors, but Nikzad believes there are positives moving forward. 

“It definitely shook a lot of people’s trust in crypto, but I think it was sort of a silver lining for the bigger banks to get into the industry. That drove BlackRock and others to get into the game. I think that in a weird way, it’s all going to work out perfectly, and I think that was the catalyst.”

The CEO has an optimism that borders on inevitability. He was an early disciple of the Satoshi Nakamoto white paper and bought Bitcoin before it took off. 

Web3 Ventures, he says, is his endeavour to give investors the same opportunity but through an audited, publicly traded company.

In terms of exposure, Web3 Ventures has a mandate to focus on decentralized finance, healthcare, telecommunications, tokenization, venture capital, blockchain games and social media. All told, the company has deployed $2 million since its inception. 

Notably, Web3 Ventures’ crypto assets are staked by a third-party custodian for greater security and fairer pricing, according to its website. 

“Look at us as a liquid fund that gives somebody a community of diversified assets that they can invest in the space,” Nikzad explains.

“This is a marathon for us,” he adds. “Digital assets will become the norm. Things will be tokenized. Big board exchanges will tokenize stocks. Usually, it takes a decade for new technologies to be implemented, so the time is now.”

The Web3 Ventures team is made up of lawyers, accountants, investor relations talent and broker-dealer experts, nearly all of whom have a capital markets background. 

“My co-founder, Jason Hobson, is a securities lawyer,” Nikzad says. “I think that’s really useful in terms of reaching critical mass — getting people like that involved.”

“We’re not some kid that, you know, left Harvard and decided to use customer funds to pay for some condo,” he quips.

For the skeptics, Nikzad points to his track record. 

“In one year, we built a company that, fully diluted, has a $100 million market cap. We look at all the investments we’ve made today, and our failure rate is very low,” he says.

“We put our own money on this; we didn’t go and beg for funding. Obviously, it’s always nice to get funding but almost a little antithetical to the whole Bitcoin decentralized finance kind of ethos. We practice what we preach.”

Nikzad in many ways embodies the DeFi ethos. 

Take generative AI, which Nikzad believes has the potential to change the way consumers interact with nearly every industry on the planet, particularly in an age of declining social trust. 

“People don’t trust anybody. They don’t want to go to the doctor. Instead, they want to go to a website,” he notes. “I call it WebMD 3.0”

Nikzad, for his part, says he hasn’t been to a doctor in three decades. Why would he, he says, if there are large language models and data sets that can deliver information that’s just as good. 

“[The skeptics represent] the old guard,” he exclaims.

Looking ahead, Nikzad believes tokenization, crypto and blockchain will follow the same path that social media companies took over the past decade and a half to become mainstream. 

“My grandmother uses Facebook. That didn’t happen in the first year of Facebook, it took multiple years,” says Nikzad. “Today, my father, my grandmother, people in my family that come from previous generations, they own crypto.”

It’s a changing world, and Web3 Ventures wants to offer investors a chance to participate in the space while it’s still in its early days. 

“Do you hear any hesitation in my voice?” Nikzad asks. “No. That’s what it takes. I don’t hope and pray. We just execute and we know.”

This story was featured in Canadian Securities Exchange Magazine.

Learn more about Web3 Ventures at https://www.w3ven.com/.

CSE Issuer Stories, Magazine

Railtown AI Technologies: Software Engineers Get a Co-Pilot to Help Navigate the Inevitable Turbulence of Development

Artificial intelligence is everywhere right now, and in the tech sector, thousands of entrepreneurs are looking for a way to plug AI into their business models.

The problem is that anyone who’s gone back and forth for more than a few minutes with a bot such as ChatGPT knows one thing: its responses are full of errors.

For AI to be truly useful, it needs to be trained effectively and have a defined purpose. Railtown AI Technologies (CSE:RAIL) has not one product but three designed for software developers that meet those criteria.

The company’s proprietary AI has been in stealth development for three years under the direction of Chief Executive Officer Cory Brandolini and Chief Technology Officer Marwan Haddad, a pair of self-described software geeks who became fast friends at a previous company and partnered up.

Their raison d’être is making it easier for developers to create new software and manage ongoing projects.

The first offering is Railtown’s Root Cause Analysis Co-Pilot, which is designed to detect bugs within applications and then quickly pinpoint the root cause of the errors and the impact on the application.

Right now, 40% of a software engineer’s time is, on average, spent identifying bugs and fixing them. It creates an enormous manpower challenge, according to Haddad. He and Brandolini once installed a fire engine light in the bullpen at their previous company that would go off whenever an issue arose. Senior engineers would drop everything to figure out what was wrong, at times taking hours to diagnose the root cause of the error and the impact it had on the application, resulting in delayed deliverables and pushing schedules behind.

Root Cause Analysis eliminates the mad dash to comb through every line of code. The Root Cause Analysis Co-Pilot hooks into the developer’s machine, where it spots errors before they reach production and immediately determines the root cause and ticket where the problem originated.

That’s why Brandolini says the company doesn’t design bots – it builds co-pilots.

“No matter how strong your team is technically, no matter how senior your developers are, when you’re building complex applications they are still fraught with functionality, logic and syntax issues,” he explains. “We’ve got it to the point today where AI can do a ton of the heavy lifting for you.”

The British Columbia-based company has also built an application to streamline the process of documenting product updates and enhancements, which are known in the industry as release notes.

Writing release notes takes an enormous amount of time for a team lead to produce, as they have to sift through dozens, if not hundreds, of completed work items to summarize and then write digestible release notes that can be consumed company wide. This is where Railtown’s Release Notes Co-Pilot comes in, as it is continually analyzing all new software deployments, as well as any changes made to software which will trigger the co-pilot to automatically generate comprehensive and accurate release notes. The net result is saving hours of developer downtime.

The Root Cause Analysis Co-Pilot and the Release Notes Co-Pilot are now available to over 400,000 Microsoft partners on the Microsoft Azure Marketplace and at Railtown’s website.

Then there’s Scrum Master, currently in the alpha stage of development, which could be Railtown’s crown jewel.

Scrum Master is a co-pilot in the truest sense of the word. Utilizing Railtown’s AI engine, the Scrum Master Co-Pilot can provide reason-based answers related to a wide range of topics including work items, deployment issues, build errors, bug fixes, performance issues and much more. Developers can ask the Co-Pilot specific questions or describe the problem that they are facing, and the Co-Pilot will provide relevant and actionable information to help solve the problem.

Brandolini calls Scrum Master a targeted language model, in contrast to large language models such as Open AI’s ChatGPT or Google’s Bard AI. Integrating Railtown’s proprietary AI into a development team’s builds, code changes and work items creates a more precise learning environment than any large learning mode could dream of.

“ChatGPT and Bard are trained off of what’s readily available and free, so any painting by Picasso or any book written by T.S. Eliot, they can train their machine on it. But they don’t have access to what goes on inside a company’s own specific applications,” Brandolini says.

“Because our AI is integrated with a company’s projects, our machine is now training on that data. Where Open AI’s is trained on the internet, our co-pilot understands exactly what you and your team are building and can answer questions in real time.”

It also keeps a developer’s data from being exposed to the broader internet, which means companies get the benefit of AI without exposing proprietary information to the prying eyes of Big Tech.

Scrum Master could even be used to onboard new engineers by delivering them detailed information on application features and answering any questions they might have.

That simply doesn’t exist in the market today, say Brandolini and Haddad, and it wouldn’t be as close as it is today if the two hadn’t become good friends.

“We were on a family holiday together in Whistler and sat down over a glass of wine. Marwan says, ‘I’ve got this idea,’” Brandolini explains. “I was like, ‘I’m in 100%.’ Life works that way by chance, but when both people have the common drive and our goals are the same, then it’s an instant connection.”

The plan is to release Scrum Master in the next quarter.

“Version one was like a child in elementary school. Now, version six or seven is like a university professor,” Brandolini exclaims. “It went from learning how to understand what a bug is to where it’s now using knowledge and reason to generate answers. Ask any developer if they would like this running for their team and the answer will be 100% yes.”

To help make that a reality, Railtown plans to ramp up spending on market awareness and user acquisition starting in June. The company expects a significant increase in paying customers and revenue growth over the next two to three quarters.

“This is not a bubble; this is just the beginning of the AI generation,” concludes Brandolini. “Artificial intelligence is having, and is going to continue to have, a profound and positive impact across all of our lives and across every business. The question investors should be asking themselves and asking their financial advisors is ‘what is my AI investment strategy’?”

This story was featured in Canadian Securities Exchange Magazine.

Learn more about Railtown AI Technologies at https://www.railtown.ai/

CSE Issuer Stories, Magazine

Li-FT Power: Explorers Will Race to Find Lithium Over the Next Decade, and Li-FT Intends to Lead the Field

A swath of land lies nestled in the Northwest Territories, not far from the capital city of Yellowknife, where hard rock lithium pegmatites literally stick out of the ground. They’ve been there for a long time, but few people had reason to take notice.

Now known as the Yellowknife Lithium Project, the site was acquired by Li-FT Power (CSE:LIFT) in November of this year. Covering 14 mineral leases that host numerous spodumene-bearing pegmatite, the area was held privately for 35 years.

Sufficient exploration was conducted to demonstrate the world-class lithium resource potential of the dyke systems on the leases. However, the properties lay dormant because lithium had yet to become the vital commodity it is today. 

That’s about to change.

Li-FT Chief Executive Officer Francis MacDonald believes the lithium market is entering a window of unprecedented potential to generate returns on investment. Lithium-ion batteries are powering a technology revolution that will leave the carbon economy behind. A supply crunch has driven up prices. 

That has created plenty of jockeying for territory, plus a race to reach production before supply catches up to demand. 

“The world needs more lithium,” MacDonald states plainly. “Lithium is not especially rare; it’s just that the transition to electric mobility supporting the fight against climate change drastically increased demand for lithium-ion batteries. So, one of the key things now is getting projects into production quickly.”

Li-FT is working with the Indigenous communities in the area to do just that. The company is currently in the initial permitting and engagement phase, and once that is complete, the intention is to conduct a substantial drill program as soon as possible to confirm the world-class resource potential is valid. 

If things go to plan, drilling under the lithium pegmatites on the surface would deliver enough data to put out an inferred resource estimate after just one pass, likely in the first half of 2024. 

When the dust settles, this could be one of the largest lithium deposits in North America if what’s visible on the surface goes down to depth at 300 metres, MacDonald says. 

The last company to work on the area was Equinox Resources, one of billionaire mining entrepreneur Ross Beaty’s companies. Equinox was acquired in 1993 by Hecla Mining, which was focused on gold exploration, not lithium.

“This was the early nineties. Lithium was used for ceramics and very special niche markets. No one cared about lithium,” MacDonald explains. “After the acquisition of Equinox, Hecla didn’t have any interest in advancing lithium projects, so they just reverted back to the private company.”

Prior to Li-FT, which named him CEO before making the Yellowknife acquisition, MacDonald spent the earlier part of his career as an exploration geologist with Newmont Mining working in the Canadian Arctic and Africa. In 2016, he co-founded Kenorland Minerals, a North American greenfield exploration company.

Most of his previous work was in gold, but in recent years, MacDonald has been drawn to lithium projects. In addition to the metal’s rise in value, lithium projects are quicker to reach the feasibility stage, he says. 

For example, a 2 million ounce gold project can require between 500,000 and 1.5 million metres of drilling to reach feasibility. That’s a lot of money and a great deal of time. 

Lithium pegmatites, by contrast, need as little as 15,000 metres to reach feasibility, which in turn means a much more attractive return on exploration dollars. 

The reason, MacDonald says, is hard rock lithium’s high grade and structural continuity. In other words, you don’t need to drill as much to be confident about what’s beneath the surface.

“These pegmatites, they’re cracks that go for two kilometres, and they’re just consistently 20 or 30 metres wide,” he says. “The structural geometry is a lot more continuous, and the grade is more homogenous as well.” 

Other projects just aren’t like that. A vein of quartz, for example, could pinch out and be much shorter than anticipated. To get the same level of confidence requires a lot more drilling. 

The value of lithium, the amount a given company is sitting on and the speed with which projects can reach feasibility are going to define the sector over the next decade. Li-FT is in a race, and MacDonald likes its chances.

“Everyone’s asking for lithium properties now,” he says. “And at some point in the future – 2030, 2035 – supply is going to satisfy or even exceed demand.”

In the meantime, Li-FT is getting its permits in order. That starts with showing the local Indigenous communities that this project will bring economic benefits to the region. 

Communication is key, and MacDonald doesn’t take that lightly. 

“This is traditional land,” he says. “And who am I? I’m a guy from Nova Scotia who lives in Munich saying, ‘I want to drill something in your backyard.’ I always think: if someone came up to my parents in Nova Scotia, and they didn’t sit down, have a cup of tea with them and explain what they were proposing, my parents would be pretty annoyed.”

Listening to what has worked, and what hasn’t, with past mining projects helps create a win-win for everyone. Plus, if the experience is positive, that makes the next project easier to get off the ground. 

Eventually, if some of the pegmatites go toward a positive feasibility study and eventually into production, that’s when an impact and benefits agreement could come into play, MacDonald says, helping the affected First Nations communities.

In addition to Yellowknife, Li-FT controls a combined 228,237 hectares of ground across a trio of greenfield lithium pegmatite projects in Québec: Rupert, Pontax and Moyenne. Those projects are prospective for lithium pegmatite too, but it’s a totally different strategy and will play out over time.

But at Yellowknife, the lithium is actually sticking out of the ground. Someone just needs to take a drill to it and define the extent of what is there.

“It’s one of the most interesting exploration opportunities out there right now because it sat in a private company for 35 years for the right group and the right time,” MacDonald concludes. “We just need to show what is below the surface.”

This story was featured in Canadian Securities Exchange Magazine.

Learn more about Li-FT Power at li-ft.com. 

CSE Issuer Stories, Magazine

Cresco Labs: Top-Tier House of Brands Acquires a Major Retail Network and Sets its Sights on Becoming Number One

Cresco Labs (CSE:CL) Chief Executive Officer Charlie Bachtell believes that when it comes to cannabis, brands matter just as much as in any other industry. Branding Cresco’s retail stores Sunnyside, rather than simply using the parent company name, is but one example of this concept at work.

There are 51 Sunnyside stores across seven states, all brightly coloured and selling products in packaging that would be right at home on the shelves of Whole Foods or CVS.

Different Cresco Labs products have their own unique branding too, depending on their target audience. There’s the namesake Cresco, the flagship “excellent everyday cannabis,” packaged in sleek, matte-coloured containers.

Then there’s Mindy’s, a line of restaurant quality edibles made in collaboration with a James Beard award-winning chef. The packaging has a deep red colour and black cursive font – it looks indulgent. It’s a Cresco Labs product just the same, but it has a totally different identity.

Bachtell emphasizes the importance of a house of brands strategy rather than what he calls a “branded house” where everything is named for the company itself. Consumers are loyal to brands they trust, and you cultivate that trust by speaking to your target audience.

“One thing we realized very early is that the cannabis consumer is very wide and varied,” Bachtell says. “You’ve got your 21-year-old male college student, but you’ve also got your 63-year-old grandmother. They’re effectively walking to the same store to buy the same product, but they want it to look and feel very differently from each other.”

The dedication to brand differentiation is paying off. Cresco Labs had the top branded product portfolio in the second quarter, according to cannabis sector analytics firm BDSA, including the top portfolio of branded flower, the top portfolio of branded concentrates, the second-highest portfolio of branded vapes and a top five portfolio of branded edibles.

The company grew even stronger in March when it announced a definitive agreement to acquire what Bachtell refers to as “the largest engine of value creation in the industry,” New York-based Columbia Care. Once complete, the acquisition will bring 131 facilities (99 dispensaries and 32 cultivation and manufacturing locations) into the Cresco Labs family in one fell swoop. The transaction is expected to close around year-end.

Creating scale in the US cannabis industry is a challenge, in no small part because regulations vary from state to state. Most cannabis companies, Cresco Labs included, generate 75% of their revenue from their three biggest states, according to Bachtell.

But with Columbia Care under the umbrella, Bachtell expects to have eight states contributing at least US$100 million to the top line in 2023. That’s significant diversification.

“We are matching the most productive per-store retail operating model with one of the largest combined retail store platforms in the industry,” Bachtell explained on the company’s earnings call to review the second quarter. “We are creating an unmatched diversification and balance of revenue by geography and by channel.”

Speaking of geography, Cresco Labs is number one in market share in Illinois, Pennsylvania and Massachusetts. The goal is to be in the top three in every state where the company operates.

Bachtell is based in Illinois, where before he co-founded Cresco, he was general counsel for a mortgage company. He started that job in 2007, just in time for the housing market to be engulfed by the Great Recession.

The mortgage industry went from relatively unregulated to highly regulated overnight, Bachtell says, and those in the business had to figure out how to navigate rapidly shifting sands.

When a colleague suggested they get into the cannabis business in 2013, Illinois was just about to pass a law legalizing medical cannabis. Bachtell was skeptical it would be a good fit for him, but then he saw the legislation.

As it turned out, mortgage banking and cannabis sales have something in common.

“I read the bill, and it was as well-drafted and thorough as legislation that was geared toward that banking industry through the last five years of crazy regulatory and legislative initiatives,” he says. “I felt like I had read this book before.”

What Bachtell realized then is that cannabis would never be less regulated than it was at the time. Especially if federal legalization eventually became law, cannabis would develop into a consumer product whether the industry knew it then or not.

The cannabis industry, according to Cresco, can be broken down into four verticals: cultivation and manufacturing, building consumer brands, distributing those brands onto as many shelves as possible, and retail locations. The goal is to excel at all four, but Cresco is prioritizing the middle two. That’s the way the wind is blowing, according to Bachtell.

For example, if cannabis products do end up on the shelves of your local pharmacy, that makes brands more important than brick and mortar retail stores.

Illinois also became the first state to require that products be packaged in childproof containers. That cemented the importance of packaging in what Cresco Labs considers its mission to this day: normalizing, professionalizing and revolutionizing cannabis.

“If Illinois was going to require you to put it in a container, then that becomes your Coca-Cola can, your Budweiser bottle, your Marlboro cigarette pack, your Tylenol box,” Bachtell explains. “However you want to think about cannabis, it just became a consumer product good.”

Bachtell is the first to admit that the cannabis business is complicated. With all manner of different state regulations and federal legalization not yet realized, it’s not an easy industry to navigate. But it’s where Bachtell feels he belongs.

“I knew what the industry needed at that time, which was somebody to come in that had been through this kind of chaos before and knew how to normalize and professionalize an industry that people were concerned about.”

Investors are concerned too, he says, and fatigued by the lack of federal progress. Cannabis companies can’t trade on the New York Stock Exchange or Nasdaq while cannabis is federally illegal, and there is no shortage of OTC-traded companies jockeying for position.

But Bachtell believes Cresco Labs can become the most important company in cannabis. With a vibrant house of brands and an acquisition that more than doubles the company’s retail footprint, the mortgage lawyer turned cannabis CEO looks to have collected all the pieces to the puzzle.


This story was featured in Canadian Securities Exchange Magazine.

Learn more about Cresco Labs at www.crescolabs.com.

CSE Issuer Stories, Magazine

Appia Energy: The quest for a more balanced global supply of rare earths is underway in Saskatchewan

Tucked away in northern Saskatchewan, so close to the border that it practically touches the Northwest Territories, sits Alces Lake. It’s a gorgeous part of the province and the namesake for an important resource exploration project that happens to host the second-highest average grade of rare earth elements (REEs) in the world.

REEs are used in everything from permanent magnets for electric cars and wind turbines to lithium-ion batteries, as well as smartphones and the ceramics and glass found in superconductors. It’s an industry with rapidly accelerating demand, and Appia Energy (CSE:API), which owns 100% of the 14,334-hectare Alces Lake Project, is looking to become one of its major players.

Alces Lake has an in-situ average total rare earth oxide (TREO) grade of 16.65 weighted total percent (wt%). Anything with a wt% above 4 is considered high grade.

With a measure that high, a single metric ton of mineralization from Alces Lake would contain roughly 166.5 kilograms of TREO. Of that, 38.5 kilograms (a little less than 25%) would be what is known as critical rare earth oxide (CREO), which represents roughly 85% of the total mineralization’s dollar value.

Specifically, that’s neodymium, praseodymium, dysprosium and terbium. Or as a former US Department of Energy national laboratory director once put it, “the stuff you need the most but can’t get enough of.”

CREEs are particularly important in the production of permanent magnets, which are also found in everyday items such as audio speakers, laptops and refrigerators.

Appia’s Chief Executive Officer, Tom Drivas, believes his company can play an important role in filling a resource need that is only going to get bigger in years to come.

“It’s because of the grade, because of the technology, because of our location and because of the right mix of rare earths as well as the mineralogy,” Drivas tells Public Entrepreneur. “Because of all that, we’re in a very good position to have a stable supply in North America.”

Pay close attention to the “North America” part of that last statement. Right now, two-thirds of the world’s TREO supply comes from China, and more than 90% of the world’s magnets are produced there. The potential for disruption to the supply of rare earths and related products is real. During former US President Trump’s trade skirmish with China, for instance, China threatened a REE blackout, according to Asia Times Financial.

“Whoever controls the supply of critical material controls the economy – and that means jobs,” Drivas explains. “There’s lots of interest from the Western world to get to a position where they have the supply of critical materials to have the economy start moving and create jobs.”

COVID-19 didn’t do the rare earths supply chain any favours, either in China or anywhere else around the globe. For Appia, it meant paring down its exploration program in 2020.

Since 2017, the company has discovered 74 REE surface zones and occurrences over a 45-     kilometre strike area and completed 78 diamond drillholes, 64 that reached a depth of 50 metres or less and 14 that extended further. Appia has a 95% success rate at intersecting REE-bearing systems, and more than 99% of its property remains to be explored.

This year, Appia has a lot more time – and a lot more money – to do just that.

“We basically have three times the budget of last year,” Drivas notes. “We’re going to be spending $3 million to $4 million at least and see how it goes from there.”

The REE minerals at Alces Lake are contained within a caramel-coloured phosphate mineral called monazite. This is good, according to Drivas, because monazite is relatively easy to extract elements from, and companies have been doing it since the 1950s. Not every REE site is so lucky.

Currently, much of the world’s monazite is shipped to China, where it is processed into REEs. That too, though, is changing.

In August 2020, the Saskatchewan Research Council and the provincial government announced plans to build a first-of-its-kind REE processing facility in Saskatoon, which is expected to be up and running in late 2022.

On the agenda for Appia is a property-wide airborne magnetic, electromagnetic and radiometric geophysical survey, followed by additional surveying and geological mapping to track known mineralization trends and investigate any newly discovered radiometric anomalies.

From there, the company plans a diamond drilling program of at least 5,000 metres to explore for more high-grade REO occurrences.

In terms of how big this could get, Drivas points to two established REE producers: MP Materials and Lynas Rare Earths. They have market values of US$6.2 billion and US$4.5 billion, respectively. Appia’s is US$41.6 million.

“They’re the two main rare earth producers outside of China, but our grade is much better with what we’ve seen so far,” Drivas says.

It’s important to note that there is some diversification to the Appia story as well. The company has three uranium exploration projects over a total of 48,024 hectares in Saskatchewan: Loranger, Eastside and North Wollaston.

At Loranger, for instance, six of seven drillholes intersected uranium mineralization in the company’s first drill campaign. A second drill season was completed in 2019 and discovered a near-surface uranium zone that extends more than 900 metres.

Elsewhere, Appia has a 13,000-hectare uranium and REE property at Elliot Lake in Ontario. The Elliot Lake camp has produced more than 300 million pounds (136 million kilograms) of uranium and is the only mining camp in Canada with significant historical commercial rare earth element production.

Back at Alces Lake, the company seems to have the best of both worlds when it comes to where it finds its rare earths. Much of the high-grade material discovered to date is close to the surface, suggesting relatively easy extraction were a decision eventually made to put the project into production. In addition, a recent news release discusses that REE mineralization occurs within multiple sub-parallel trends of the system over 875 metres of strike length and down to 340 metres in vertical depth. With the mineralization hosted in monazite, it could be just what North American supply chains are looking for.

“If we can prove in the next few years that we’ve got a viable deposit here, there’s a lot of upside for Appia and the industry,” concludes Drivas.

This story was featured in the Public Entrepreneur magazine.

Learn more about Appia Energy at http://www.appiaenergy.ca/

CSE Issuer Stories, Magazine

NexTech AR Solutions: Evan Gappelberg’s latest venture is a big bet on the future of augmented reality

Imagine you are shopping online for a new couch. You find one you like, but it is hard to know if the colour quite matches the rest of your furniture, and the retailer’s website only has a 2D photo of it from the front.

Now imagine being able to view and rotate the couch in full 3D and use your phone to project a volumetric image that you can place, pinch, zoom and walk around, right into your living room.

That’s one example of how augmented reality is changing the way people shop, and shopping is just one of four verticals NexTech AR Solutions (CSE:NTAR) is pursuing in the sector.

Chief Executive Officer Evan Gappelberg calls it “ARitizing,” and his company has done it to everything from furniture to firearms to human holograms.

A self-described crazy entrepreneur looking for the next trillion-dollar megatrend, idea or industry, Gappelberg prides himself on identifying the next big thing. He has invested in dozens of successful ventures and led companies in the software and cannabis spaces, and three years ago he found his latest muse, augmented reality.

Augmented reality is a new concept to most people. Tell us how NexTech AR was formed and why you became interested in the industry.

I spent 30 years on Wall Street, and on Wall Street you always have to identify the hot stock in the hot sector. In the 1990s, it was the internet. Then energy and real estate took centre stage in the early 2000s. And then in 2008 the iPhone kicked off a paradigm shift, with mobile phones creating an entire new industry and stock sector called social media. Then, in 2015, everything switched to cannabis investing. Now and in the 2020s, technology, and specifically AR, AI and IoT, will create new billion-dollar companies seemingly overnight.

To be a successful investor I have followed the flow of money, which has made me kind of a generalist. If oil and gas is a hot sector, I do a ton of industry research and I become an expert in everything to do with oil and gas. Same for technology, healthcare, social media, etc. I research industries as I get deeper into them, and I start to understand how they work, which makes investing life interesting since I’m always learning something new.

I identified cannabis as the next big wave in 2011. It took a few years, but I brought in seed capital for a cannabis company that went public in Canada in 2016, and in 18 months it went up by 40 times. It was about identifying the trend and getting in before the big wave, then riding the wave, although to avoid a round trip you need to be able to see if the sector you are in is about to go through growing pains or get disrupted. Most of my investments are not buy and hold, although I did take a gaming company called Take-Two Interactive Software public in the 1990s, and today it has a $15 billion market cap. That was one I should have held.

Not to say I haven’t had my fair share of mistakes, but I do have a solid track record of picking industries that really have the potential to be grand-slam-home-run investments.

That brings us to augmented reality. I was introduced to AR in late 2017, and as soon as I saw it I knew that it was going to be the next big thing.

To take advantage of the coming AR megatrend, I founded NexTech AR Solutions in January 2018. Our first product was ARitize, which is an app that went live in 2018. It’s a white label AR app that we are having a lot of success with. It can create AR experiences and allow us to demo augmented reality to our enterprise clients. So that is how we got started.

As CEO and Founder of NexTech, I put my money where my mouth is by investing in my own company. I have invested millions in NexTech, and currently I take 100% of my salary in stock, plus I have made four purchases of the company’s shares this year alone. The only reason to do that is because I think the company is going to be worth a lot more over the following 12 to 24 months.

How does your technology augment a user’s reality?

We were first to market with a webAR e-commerce solution, which we launched in early 2019. It allows customers, on any web browser without requiring an app, to just click on a web icon and view a 3D model in augmented reality. And if they are on a mobile device, the product shows up as an AR digital twin.

We recently signed up an eyewear company, Clearly.ca, and are ARitizing seven different styles of glasses for them. We’ve created a special 3D/AR advertising platform where you can put your face up to your phone or up to your computer screen, and the glasses will appear on your face, so you can try them on virtually before you buy.

It sounds as if the possibilities are endless. What does the business model for such an evolving technology look like?

It’s a SaaS business model. You can download the ARitize360 app for free, and then after that you pay for usage. It can cost as little as $40 to $99 for an AR scan, and the goal is to get it down to $10 to $20 per scan. If we can do that, we expect to see mass adoption.

The cost has to do with human touch-up, as the less interaction there is with the asset, the cheaper it is. We are currently the only company that has virtually zero human interaction, so nobody needs to touch it.

Businesses can then use those assets on our 3D/AR ad network, which launched this year.

Most medium-sized businesses are spending $50,000 a month on ads, and we have proven that 3D ads generate a 300% increase in conversions. We have done testing on an e-commerce site we own, vacuumcleanermarket.com, and the 3D ads we ran brought a 300% jump in sales.

And if you can grow something 300% by switching to our ad network, you are going to do it. We get a percentage of those dollars, so it’s less about how much money we make on the 3D asset itself and more about how companies use that asset to drive sales for their business.

The COVID-19 pandemic is affecting companies in different ways. What has it meant for NexTech so far?

Well, we had a platform called ARitize University, which has morphed into our recently acquired InfernoAR virtual events and video conferencing platform, which is surging right now.

InfernoAR is the only platform that offers virtual video conferences with augmented reality. So, if you’re watching a presentation and there’s a product on the screen, by using our ARitize app you can take your phone and scan a QR code, which literally pulls out of the screen whatever product it is you’re viewing and places it in the room with you. We see this as transformative new technology.

InfernoAR is booming. Because so much has been shut down by COVID-19, governments, businesses, universities, healthcare providers, really everyone is looking for a way to communicate remotely, and we have the only immersive platform driven by our AR that allows you to create human holograms or to have 3D/AR product views, all built into this video conferencing platform.

It’s funny watching people try it for the first time, because they will literally press their nose against the screen of their computer to get a closer look. I literally see them move all the way in, because they cannot believe what they are seeing.

We recently doubled our sales force, as we continue to sign up new customers, and we expect to double it again this year. Because we are in the fastest growing market sector, which is the technology sector enabling the work-from-home and shop-from-home paradigm shift, our business really has the potential to explode and grow exponentially, similar to the way that Zoom has grown recently. Zoom just reported that revenue grew 169% for their last quarter, while we reported 169% growth for last month alone, so similarities do exist.

You clearly have unique products that fit the times. How are sales going?

We had record revenue and record gross profit in the month of May. We saw $1.3 million in revenue and $800,000 in gross profit, which is a 169% increase year over year on the revenue side and a 290% increase on the profit side.

We are firing on all cylinders right now. Virtual events, augmented reality, e-commerce – they’ve never been stronger. And we see that trend continuing. June should be better than May, and July better than June. We are projecting $15 million to $20 million in revenue in 2020, and possibly double that in 2021, up from $6 million in 2019.

It goes without saying that a company such as NexTech is constantly evolving. What’s on your radar for the next little while?

There are a few things on the horizon. First is to continue to succeed with our virtual video conference platform and build up our sales force.

We also have our 3D/AR ad network that is starting to gain traction and show sales wins, so we are going to have to build a team around that and allow it to scale.

Lastly, we are looking at acquisitions. We have made four acquisitions since we went public, and we continue to look for more.

There are some exciting opportunities out there in the world of augmented reality. There are a lot of little start-ups that would fit right in with NexTech and help us to push our technology forward without having to spend time and money on development costs.

This story was featured in the Public Entrepreneur magazine.

Learn more about NexTech AR Solutions
at https://www.nextechar.com/.

CSE Issuer Stories, Magazine

InnoCan Pharma: Better delivery of CBD to the body holds the potential to lower costs and broaden treatment options

CBD is advertised as providing relief for anxiety, depression and post-traumatic stress disorder, among other benefits. Its popularity reflects, in part, that it is positioned as non-psychoactive while still providing access to many aspects of the cannabis plant that are good for human health.

The challenge is to create a more precise and efficient method for delivering CBD into a patient’s body, preferably allowing for synergistic effects and/or controlled release.

InnoCan Pharma (CSE:INNO), based in the Israeli tech hub of Herzliya, has found what might be the golden ticket for CBD-integrated pharmaceutical technology in the form of a method to inject CBD into the body.

InnoCan and Ramot, Tel Aviv University’s business engagement centre supporting scientific discovery, are collaborating on a revolutionary exosome-based technology that targets both central nervous system indications and COVID-19 coronavirus symptoms, as CBD-loaded exosomes have the potential to provide anti-inflammatory properties to help infected lung cells recover. Public Entrepreneur spoke with InnoCan Chief Executive Officer Iris Bincovich recently about this project and other exciting directions the company’s technologies are taking.

Tell us about your personal background and how InnoCan came to be.

My background is in healthcare, working in the international pharmaceutical and cosmetic and medical device arena, and I hold a Bachelor of Science degree in chemistry from the Israel Institute of Technology.

I have experience developing strategies and building brands in the dermatology space, and I have worked and communicated with top pharmaceutical companies and cosmetic companies, including Johnson & Johnson, Estée Lauder and L’Oréal.

InnoCan Pharma was established by Yoram Drucker, an Israeli serial intrapreneur with experience founding companies in the field of stem cells; Ron Mayron, former CEO of Teva Israel, Teva Pharmaceutical being one of the most important generic drug producers in the world; plus Nir Avram, who was on the pharmaceutical innovation team at Perrigo and holds a number of patents, not to mention more than 30 years of experience developing topicals. We bring worldwide experience in healthcare and nearly 20 years of international marketing, business development and sales experience. I have led and managed hundreds of successful international transactions in the OTC cosmetics and dermatology sector.

InnoCan gives me an opportunity to utilize my experience, take my knowledge in the healthcare markets and combine it all into a company that today is active in three different segments.

We are involved in several pharma projects with the Hebrew University of Jerusalem and with Tel Aviv University to better administer cannabinoids into the body with innovative delivery platforms and potential to treat several diseases.

We have also developed a line of over-the-counter topicals, Relief & Go, targeting a variety of skin conditions associated with issues like pain relief. Our pain relief spray provides a fast-action muscle relaxant and pain relief. It contains an analgesic blend of active ingredients, with isolated CBD to provide temporary relief of muscle and joint pain.

And we developed a line of CBD-integrated derma cosmetics, SHIR, whose formulations feature a tailored blend of active ingredients and technologies.

Let’s talk about the technology itself.  How is the company using exosomes and CBD?

We are developing a new platform that delivers cannabinoids in an improved way into the body. Our latest project is a collaboration targeting the COVID-19 virus with Tel Aviv University and Professor Daniel Offen, who heads the Neuroscience Laboratory at the Felsenstein Medical Research Center.

Exosomes have the ability to target damaged cells like a targeted missile, improve regeneration and assist in their recovery. Together with Professor Offen, an experienced researcher on cell and gene therapy in neurodegenerative diseases, we are looking to develop new technology that might be applicable to several indications.

Professor Offen is a co-founder of several biotechnology companies developing therapies for neurological disorders. One of them, BrainStorm Cell Therapeutics, developed cell treatment for ALS patients and is now in Phase III clinical trials.

Along with Professor Shulamit Levenberg of Technion, the Israel Institute of Technology, he previously utilized loaded exosomes administered by intra-nasal spray into rats with severe spinal cord injuries. The results were dramatic. Within a few weeks, the rats began to walk again.

With COVID-19, most people die from a secondary infection and lung or multi-organ failure. CBD is highly anti-inflammatory, and CBD-loaded exosomes, which we refer to as CLX, may hold the potential to provide anti-inflammatory properties and assist in the recovery of infected lung cells.

The lungs are the organ most affected by COVID-19, so the CLX are expected to be administered by inhalation.

How far along in the development process are you?

We are in the preclinical stage, which we estimate will take nine to 12 months. We will begin production of exosomes loaded with CBD and then do in-vitro proof of concept in several models.  From there, we will do animal proof-of-concept models and then safety testing.

InnoCan’s strategy is to combine R&D with commercial experience. Professor Offen has more than 20 years of experience working with stem cells and exosomes, and he has already established companies developing therapies for neurological diseases.

How do these different delivery methods compare to taking CBD oil orally?

We are developing a unique technology with Professor Barenholz from the Hebrew University to enable the injection of CBD into the body. When you take cannabinoids orally, about 80% of it is destroyed by enzymes of the liver. Patients overload to achieve a therapeutic level.  More than that, the dose is not controlled systematically. In each case, a drop of oil is put below the tongue and it might take some time from administration until therapeutic effect is achieved. Size and therapeutic effect can differ from one drop to the next. We are proposing a much more controlled and effective delivery system.

CBD is an oil molecule that normally cannot be easily injected into the body. But once isolated inside a capsule, such as a liposome, it could be injected. Liposomes are small vesicles that could entrap a substance inside.

Imagine a child with epilepsy – which there is already an FDA-approved CBD drug for – having a seizure; today he needs to be under close care, to be given the medicine, it will take a few minutes until the effect begins, and so on. InnoCan’s approach could be different. We are looking at a solution where the child will have a smartwatch connected to a pump with injectable CBD-loaded liposome. Then, instead of the child having a seizure, maybe falling to the floor and needing someone to administer CBD, the watch will sense the seizure and instruct the pump to inject a specific amount of CBD into the body. Precise delivery of CBD immediately could assist in relieving the seizure.

And this is just one application. For an epilepsy seizure, the CBD would be released immediately, but the liposomes can also be multi-layered to prolong the release of the CBD. We are developing a platform for several potential indications.

For example, for people suffering from chronic pain, we may be able to offer an injection once a week, and over time one could have a consistent release of CBD into the body.

Professor Barenholz has already developed a liposome-based breast cancer drug, named Doxil, that was licensed by Johnson & Johnson. We are working with people who have done this before and are connected to the commercial side. This is the value-driven proposition of the company.

Do you have any other products headed for commercialization?

We have our over-the-counter topicals, patent pending products that combine CBD and other active ingredients targeting skin conditions, pain relief, as well as for itchiness.

We also have a line of premium cosmetic products for women. Those products are now being produced by two manufacturers: one in New Jersey for the US market, and one in Portugal for Asia and Europe. Sales will start in the second half of 2020.

Eventually, the world will open up again, and there are lots of plans for the future, including additional distribution contracts for the topicals.

In Canada, we are in dialogue with several companies to enable local distribution. We need to collaborate with a local licensed producer in order for them to manufacture, distribute and sell our topicals to the different provinces. And I can say that we are in the screening process of who is going to be our local partner there.

This story was featured in the Public Entrepreneur magazine.

Learn more about InnoCan Pharma
at https://innocanpharma.com/.

CSE Issuer Stories, Magazine

Cerro de Pasco Resources: A new generation breathes life into an old mine with benefits that reach far and wide

Cerro de Pasco is a centuries-old community nestled high in the Andes Mountains of Peru, but after nearly 400 years, a local mine that once brought prosperity must rethink a path forward in alliance with the nearly 50,000 people who now live there.

What began as an underground operation became an open pit at the centre of a growing population of miners and their families. Outdated mining technology resulted in inefficient yields. Tailings and stockpiles grew, and contaminated dust and water crept into surrounding areas.

There’s a huge economic opportunity in the tailings and stockpile at the site, though, not to mention known in-situ resources, 11,000 hectares of concessions, and unexplored areas.

But Cerro de Pasco Resources (CSE:CDPR) wants to do more than make money.

Chief Executive Officer Guy Goulet and Executive Chairman Steven Zadka have a vision that, if everything goes right, will see parts of the population relocate away from certain areas to new locations with clean drinking water, heat in their homes, and well-paying jobs – for the benefit of all stakeholders.

The company bought the mineral rights to the tailings and stockpile in 2012 and in November, inked a deal to acquire the mine itself and all accompanying infrastructure. Public Entrepreneur caught up with Goulet and Zadka as they began transitioning the company into production, initiating a multi-decade plan to revitalize a mine and restore a city.

Tell me about your background in the mining industry and how Cerro de Pasco came to be.

Zadka: In 2011, through my capacity as an investment banker, I came across the opportunity to buy the mineral rights on the tailings and stockpile in Cerro de Pasco and decided to jump on it.

Guy was running a company called Maya Gold & Silver in the early 2010s, and I was one of the bankers. He closed a very difficult client of mine and had incredible energy, so I said, “This guy knows how to do things.” He left that company in 2017 and I reached out.

Goulet: I was working in Morocco, and Steven approached me while I was on my way out, following the restart of a silver mine there.

We teamed up to accelerate the development of the project and list the company on the Canadian Securities Exchange.

I’m also attracted to pro-environmental projects. In 2000, I co-founded H2O Innovation, which is the largest water treatment company in Canada as of today.

What are we looking at here in terms of metals? What’s the game plan on the mining side?

Zadka: I knew that there was silver, lead, and zinc. And I discovered that there was also copper and gold in the tailings. The grades are pretty good, both because they’re old and they come from one of the richest mines in the world.

You’ve got material, metals literally sitting on top of the ground, which is much less expensive than traditional exploration.

We’re buying two subsidiaries that are producing and permitted. For 2019, we estimate their revenues were about $120 million combined.

Permitted capacity is about 20,000 tonnes per day on sulfides and right now, it’s doing 7,000 tonnes a day, and once we bring these tailings into production, the annual revenue starts getting into the $250 million to $300 million range.

With all the resources we have and what we’re acquiring, we have a 17 year mine life. But the reality is that the mine is going to go for much longer because there’s 11,000 hectares of concessions and areas that are largely unexplored.

Goulet: Post-acquisition combined, Cerro de Pasco will be the largest holder of silver in one single site. There is a need to increase the current production capacity up to its permitted level of 20,000 tonnes per day.  We estimate this will require about $35 million of capital. Once production levels are up, cash flow will start to generate rapidly.

We’re in the process of raising the capital required for the first phase, which is $65 million USD.

You’ve called Cerro de Pasco a resource management company. What does that mean?

Zadka: A traditional mining company is only focused on extracting metals from the ground. That’s what mining is; it’s going into the ground, digging up dirt, and putting the waste somewhere.

We call ourselves a resource management company because we plan to do more than just mining. There are some aspects of mining at Cerro, but there’s other aspects involved.

For one, we’re reprocessing the materials that are sitting on top of the ground, which is not theoretically mining. There’s also storage of waste.

If you can return clean water to the environment, you’re managing a resource. If you can turn your waste into building products, or turn pyrite into heat to generate hot water, you’re managing a resource.

With that in mind, how is resource management going to help the people of Cerro de Pasco?

Zadka: We’ve been completely open and transparent with the community and the local government. We’ve told them the truth, and the truth is that this is a mess that can be turned into an opportunity with some reorganization, planning, and support from the local authorities and community.

The government acknowledges that Cerro de Pasco is laden with lead, and they have a plan to relocate sections of the city 30 kilometres away from the mine. What they need in order to do that, amongst other important factors, is support from the most important economic driver in town. That’s us.

Peru has a program called “Obras por Impuestos,” or taxes for works, that enables a company to use taxes generated from operations to fund infrastructure projects for the benefit of society. You can fund roads, sewer lines, hospitals, and schools.  One of our main objectives is to do just that.

We also want to take it a step further. None of the cities in the Andes Mountains have heat, and it’s freezing every night. We have so much pyrite, which produces heat on its own, that we can harness to produce hot water and we could pump that hot water through the city.

Goulet: We want to do more water treatment systems and educate the young people to wash their hands before they eat. We want them to play in parks where we’re going to renew the topsoil.

I come from Thetford Mines in Quebec, which was the world capital of asbestos. You know what I was doing as a kid? I was going with my bike and playing in the dumps. In Cerro de Pasco, we want to avoid that.

There is a problem of contamination in Cerro de Pasco, but just as important is the problem of poverty. That mine used to employ 7,000 people.  Some 1,200 work there now in some capacity. In an area that is 4,400 metres high, what else is there to do for work besides mining?

Let’s recall that the problem of contamination is not mainly due to mining activities. The old city is located on a geological natural accident: a massive intrusion of lead, zinc, copper, silver, and gold. A “mine” is what it’s called today! And the population has been living from that operation over the past 400 years.

We want to help solve that problem of poverty and restore prosperity in the community.

The company is listed in North America, but what does your management team look like in Peru?

Zadka: I’m based in New York, and Guy’s based in Canada, but the heart of the management team is in Lima and Cerro de Pasco.

We employ several Spanish speaking expat VPs, who are specialists in different areas like mining, geology, metallurgy, environment, health, and safety.

Everybody that works with us has a very special drive, and I don’t think you find that at other mining companies because this isn’t only about making money. Here, we’re trying to make a difference.

Goulet: We’re going to spend $58 million over the next four years on HSEC (Health, Environmental, Social and Communities). We have a social license, which is essentially a vote of confidence from a key component of the population that agrees with our business plan. That’s an important asset in Peru. We received positive signals from the Minister of Energy and Mines, the local government, and the President himself.

Can an environmental restoration project like this also be profitable?

Zadka: There are multiple benefits to the local population and the environment, but at the end of the day we believe this is a very compelling investment.

Not surprisingly, investors are cautious about tailings and stockpiles because they tend to be a finite resource. They would not normally offer the opportunity to find something above and beyond expectation that could make the stock go up by 10 times overnight.

However, Cerro de Pasco not only has 170 million tonnes of reserves in the tailings and stockpiles, but also 140 million tonnes of material in the ground and 11,000 hectares of concessions in one of the most prolific mining districts in the world, which has never been properly explored.

We’re talking about almost 1.6 billion ounces of silver equivalent.  That would be the biggest amount of silver in one location on the entire planet. Nobody else has that.

What does the long-term picture look like?

Seventeen years from now, a large portion of the population won’t be living in Cerro de Pasco anymore. They’ll no longer be affected by the hazards of the area.  They’ll have access to clean water and live in proper homes.

There are still two approaches to mining. There are companies that try to skirt ESG-related issues, and there are those that see the opportunity to deal with these issues head on.

We aspire to be a leading example of why you shouldn’t run away from these problems. If you’re innovative and you’re willing to go the extra mile, you’re going to have a much better impact on the outcome. Cerro de Pasco needs that outcome.

This story was featured in the Public Entrepreneur magazine.

Learn more about Cerro de Pasco Resources Inc. at https://pascoresources.com/.

CSE Issuer Stories, Magazine

New Wave Esports: Esports investments are the latest thing and this CEO is at the top of his game

Esports in North America is undergoing a metamorphosis. Video games like Fortnite and Overwatch have taken the world by storm, viewership at tournaments is bigger than ever and capital is flowing into the industry from sources that had never considered it before.

New Wave Esports (CSE:NWES) provides the spark for organizations looking for oxygen in the space, whether it’s esports teams, platforms, tournament organizers or technology innovators. If you have a great moneymaking idea in this industry, New Wave Esports is the type of company you turn to for the capital to make your dream a reality.

And it has not taken long for the company’s investments to begin paying off. In July, Lazarus Esports, a competitive team in which New Wave owns a minority stake, took home US$3.5 million at the Fortnite World Cup.

At the helm is Chief Executive Officer Daniel Mitre, who perfectly fits the profile of an esports CEO. He’s fresh-faced – young enough to have spent his whole life growing up around video games, but old enough to remember carrying a roll of quarters to the arcade. With a beard, gauges in his ears and a sleeve of tattoos down each arm, he looks the part.

New Wave Esports went public in October and Public Entrepreneur caught up with Mitre in the midst of a road show to talk about where his company, and the industry as a whole, goes from here.

Tell me about your background in the gaming industry and how New Wave Esports came to be.

I’ve been in gaming for over 17 years. I started off testing video games way back in the early 2000s, where I learned the fundamentals of game development and gained an understanding of what motivates players to keep coming back.

I went on to do community management, and eventually started doing global marketing campaigns. I’ve worked at Electronic Arts (EA), THQ, Sega, Sierra Online, and various music and toy companies.

The past five years I’ve been at EA, and I got to work on the Battlefield franchise, as well as some other competitive titles like FIFA, Madden, NBA Live, and Need for Speed. And esports has always been a common thread in the sustain/retention models of those games, so I’m able to bring my gaming network and my expertise to New Wave Esports.

Then, I met with Trumbull Fisher. He’s a 15-year finance industry expert who’s raised capital across Canada for industries like cannabis and mining, and he brings capital markets experience as New Wave Esports’ president. Between my gaming and his finance, we bring the investment vehicle that is New Wave Esports.

How does your investment process work?

We set up the company in two pillars, the first of which is the acquisition arm. We’re looking for companies that we can fold into the New Wave Esports family. They benefit from the performance of our shares as well as the ancillary services we provide, and their revenues are directly turned into our revenues.

The second pillar is the traditional holdings arm. We’ve built a phenomenal portfolio of minority investments, and as we go forward, I expect to see a shift in our investment approach toward majority stake investment.

We‘re unlike a traditional investment group that just puts in a bunch of money and checks in every quarter. We place investment capital and take stock options in companies, and we sweeten the deal with financial advisory services and new revenue streams.

We facilitate new sponsorships for teams and collaborations with big franchises like Fortnite or Battlefield, as examples, and that’s where teams thrive.

What do you look for when considering a potential investment?

We look at the esports industry in four verticals. The first one is teams and organizations – that’s Lazarus.

We also look at tournament organizers, whether an event is in your local hometown or a big arena – that’s Even Matchup Gaming.

The third is platforms and networks. This is anywhere gamers congregate online, such as online tournaments or an esports gambling platform – that’s PlayLine.

Fourthly, we target technology and tools, which is really the backbone of the industry. A lot of this is behind the scenes, including data insight and business intelligence for esports companies to better know their audience or build a better experience for gamers coming in – that’s Thunderbolt CDG.

We look at the esports industry as an ecosystem. First and foremost, we look for ethical teams that share the same vision as us. Secondly, we ask if these companies are led by executives that have run businesses before, and if not, how we can help. Thirdly, we consider whether these companies are positioned to thrive in a space that may be saturated or may not have any competition.

Speaking of Lazarus, congratulations are in order after the team won $3.5 million at the Fortnite World Cup this summer. What was your involvement there?

Lazarus is owned and operated by an organization called Tiidal. We came in and invested a sizeable chunk into Lazarus in March.

Not many people knew about Lazarus before the Fortnite World Cup, but the tournament came around and Lazarus took second in the duos and fourth in the singles, which led to that $3.5 million revenue into Tiidal. That put Lazarus on the map as one of the highest grossing esports teams in the world.

I was at the airport and I got a call from one of our advisors who said, “Dude, Lazarus just took home $3.5 million! Their athletes are like rock stars now!” I love calls like that.

Why did you decide to take New Wave Esports public?

We see the public vehicle as an opportunity for the esports community as well as other investors and brokers to invest in the industry. We are the first esports investment company to be traded publicly on the Canadian Securities Exchange, and we wear that with a badge of pride.

We went live on October 28, and so far it has been phenomenal. This generates exposure for us and opens up new opportunities worldwide. Not only are we listed on the CSE, but we also just listed on the Frankfurt Stock Exchange in Germany, where we know esports is massive.

How do you see esports evolving in North America?

The esports industry is still very much growing in North America. Asia is 20 years ahead of us, so we look to them as an opportunity to replicate those tried and true models. That’s why we opened up the New Wave Esports Asia department.

But with North America as an economic stronghold, everyone’s looking to see what we do to push esports forward. You’ve got celebrities like Will Smith putting sizeable money into a team called Gen G, and Drake took an ownership stake in gaming group 100 Thieves.

It’s just starting in North America, so the revenue multipliers have yet to hit. So, if you’re at the ground level, you’ll see that coming through.

Look, gaming has been around for 40 years, and it’s always been entertaining to watch someone play who’s better than us. I remember swarms of people at arcades watching someone play Street Fighter, and that’s why Twitch exists today.

As a video game player, how does it feel to be running your own esports company?

If you were going to tell 15-year-old Dan that he would have a career built on video games and ultimately become the CEO of an esports company, he’d be saying, “Get out of here, that’s insane.”

Back in the 90s, video games were still kind of for nerds. You didn’t have Internet connectivity, a mass audience and mobile games that make gaming accessible to everybody.

It’s phenomenal to see gaming grow, and it has created a community that I absolutely identify with. I’ve been able to build a sustainable life from it, and this is an opportunity for me as a CEO to grow the video game industry.

This story was featured in the Public Entrepreneur magazine.

Learn more about New Wave Esports at https://newwaveesports.com/.