For companies in Canada or the United States, winning a license could be the difference between millions of dollars or being stuck on the sidelines…

The Alcohol and Gaming Commission of Ontario (AGCO) presides over the cannabis license process, where millions of dollars are on the line.

A coveted retail cannabis license allows a winner to set up shop and sell cannabis products in the valuable Ontario region. As of 2016, Ontario accounted for 38% of Canada’s entire population.

And keep in mind with edibles hitting the shelves in Canada in December, getting a license now could be the difference between building a cannabis empire or being stuck on the sidelines. Edible sales alone in North America are expected to reach $4.1 billion by 2022.

Remember that all legal cannabis sales in North America in 2018 reached just over $10 billion.

AGCO emailed out a downloadable file “with the list of all entries in the order they were drawn” to all its subscribers, including me.

Only 42 applicants were selected.

No amount of money could have influenced this outcome; it was set to be random no matter who you were.

Or was it?

The Odd Happenings at the Lottery

The first name to win was easily the most controversial: Cory Cacciavillani.

Since this list has been published, 12 applicants did not submit all required documents in time, and 1 applicant withdrew from the lottery.

He is the manager of Aphria Diamond, the 100-acre campus owned by Aphria Inc. (NYSE: APHA, TSX: APH).

His dad, Cole Cacciavillani, is the co-founder of Aphria and one of its largest shareholders.

Cory only had a 0.02% chance of winning in the first place. Not only did he win, he was the first name on the list.

And a few more interesting details emerged from the process.

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One of the applicants was a numbered company that had the same address as an illegal cannabis dispensary. Many question why an applicant with a proposed location that was the site of police putting cinder blocks in front of the store to stop it from operating was selected to be in the running for a license.

Also, people are shocked that a town of 36,000 people – Innisfil – had three license winners. But what really has people talking is that three of the license winners listed addresses on the same street: 2008, 1998, and 1982 Commerce Park Drive.

And as you can see from the Google Maps image, this location doesn’t look ready to sell legal cannabis unless it’s been updated since 2015.

It’s hard to pinpoint any acts of meddling. AGCO said it employed a third-party monitor to ensure fairness to oversee the lottery draw.

If anything, it speaks volumes about the profitability of winning a license and the high-pressure stakes involved in the process.

Of course, when you know how to play the game, you have a better chance of winning.

Next week, I’m going to send you a report about an American cannabis CEO who is dominating the Florida marijuana market because of savvy moves in the courtroom.


Greg Miller

Executive Director, National Institute for Cannabis Investors

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