I have never given Namaste Technologies (N.C) the time of day previously. There’s a good reason for that, and it’s the reason I’ve given several other companies short shrift in the last several months.

That reason is ‘vapes’.

Man, do I hate vapes. Vapes can shampoo my crotch. What has two thumbs and thinks vapes are a bad business concept?


Why I hate vapes is simple; they were the easy out for mining guys looking to move their non-mine-holding shells into weed deals for a quick buck. The IP was cheap to buy, or get cranked out in China, or not even turn into products but rather just keep raising money to keep the lights on.

“We’ve got the best vape in the world, and it’s going to be in every 7/11 by this time next month and you should see how much money we’re projecting we’ll make! It’s gonna be yuge!” – every shonky mine-to-weed exec, 2015.

I consulted with a lot of weed plays since 2014, and any time I had a client tell me they were vape-bound, I protested most adamantly.

“Point me to the vape brand that’s making $100 million a year,” I said. And nobody ever could.

And it got worse this year as the US FDA has announced a retroactive market approval process for e-cigs that will put most vape manufacturers out of business.

In its draft of the proposed rule, issued in 2014, the FDA had estimated it would cost the industry $330,000 per product, and the new regulations cut the predicted time for compliance from 5,000 hours per product to 1,713. But Gregory Conley, president of the American Vaping Association, another trade group, maintains that the FDA’s cost estimates are unrealistic. “Ninety-nine percent plus of the products on the vapor market now will be banned within two years,” he says.

It’s been two years.

So death to vapes and e-cigs, right? Well, maybe not.

I’ve long said, I don’t want to be growing coffee, I want to own the Starbucks stores. And Namaste owns the world of online vape and e-cig sales.

“We’re focused on growth through acquisition,” says Namaste COO Kory Zelickson. “The last purchase we made put us to the level where we’re now, we think, the largest online retailer in the world for vapes.”

What makes that a big deal for Zelickson and his partner Sean Dollinger, is not just that they can move a lot of product and make good margin on the sales side, it’s that any vendor that wants a mass market globally for their product has to come through Namaste.

“We have international exposure in launching new categories of products, not just North American reach. And that puts us in a great position to getting the best deals – and even launching our own brands.”

Let’s say you and I decide we have a great idea for an e-cig. We’ll brand it Robot Dick and shape it like a Transformer’s package. Maybe when you’re not using it, it turns into a Hot Wheels truck. The public will eat it up.

So what’s our first move, once we have the product designed and in our warehouse?

Sales. And not the kind of sales that involve calling every head shop in the world and asking if they’ll take five on consignment. I’m talking the sort of sales where one company brings you instant business, and buys your inventory out. I’m talking ‘the QVC of weed accessories’ sales.

Namaste is the launchpad we’d need to use to get Robot Dick out to the kids. In fact, that’s exactly what companies are doing on the regular right now, with exclusive arrangements that trust Namaste to not just move product, but build brands.

Pursuant to the term of the Agreement, Pharmacor has provided Namaste exclusivity over the sale of the Inhalater line of products for a period of 2 years. The exclusivity shall apply to all countries outside Canada and the US. In exchange for exclusivity, Namaste has committed to use reasonable commercial efforts to build the Inhalater brand internationally and will provide support in terms of managing advertising, shipping, customer service and support, and warranty and return functions. Namaste will charge Pharmacor competitive market rates for managing these services and has established standard operating procedures for administration and execution of the Agreement. “

The origin story is what makes this deal a unique one to me, in that these aren’t guys who decided weed would be a fun lifestyle or wanted to raise a bunch of cash off a momentary spike in interest. They actually started out building e-commerce sites for electronics.

“Our background is in commerce and distribution,” says CEO Dollinger. “We developed niches for online sites in other countries. We launch a site, have local reps, find good margin electronic niche products and sell them throughout the network.”

There’s a bunch of those kinds of sites out there. You’re noodling about on Facebook and you see an ad for some Big Lebowski cushion covers and you click along because, like, those would really tie the room together, and you’re suddenly on a website you’ve never heard of before and they have all manner of oddball stuff and before you know it, you’re getting a box of trinkets from China that you paid eight bucks for.

The Namaste guys do those, but they’re using some serious tech know-how to penetrate a competitive online sales world, and they ain’t selling trinkets.

“We started with vapes a few years ago,” says Zelickson. “We were shipping out of Sean’s garage, and we took our concept – the business model we’ve been doing for years – and applied it to that market. In the first year, we grew from zero dollars to $3 million in sales. We added products to the mix and were growing quickly, but we knew there were bigger opportunities out there, and we had an increasing demand for capital to keep up with that growth, so went public through an RTO about eight months back.”

Did you notice that when it happened? Because I didn’t. In fact, looking at the stock charts, nobody took much notice of Namaste until mid-October, when any fart with a hint of weed aroma to it jumped to a buck.

But while we weren’t noticing them, Namaste was doing some serious business.

In October, they closed a deal to take out URT 1, operator of www.everybodydoesit.com, and one of the top 5 domains in the world for vapes, pipes and accessories. Also loaded into the deal: C$3.2 million in sales over the trailing 12 months, and a gross profit margin of 53%.

Pursuant to the terms of the Definitive Asset Purchase Agreement announced on September 15, 2016, Namaste has acquired all the website domains, the customer list of over 40,000 individuals, the EDIT Collection of smoking accessories, direct relationships with over 190 vendors, intellectual property and related technologies.”

Before that, they raised $3 million at $0.12 per unit, which investors will be very happy with now considering the stock’s at a double, and prior to that came the announcement that the company, “is pleased to announce two new agreements with industry leading manufacturers, PAX Labs and Firefly Vapor.”

“The agreements with PAX and Firefly approve Namaste to sell their products in North America and over 20 countries internationally. Namaste is the only company in the world to receive international rights from these companies. PAX and Firefly are two of the most innovative manufacturers of portable vaporizers and carry two of the most sought after products on the market.”

Before that, they closed the acquisition of Vaporseller to break into the US market, bringing in another $3 million-plus in sales annually, and adding 150,000 more customers to their base.

And it’s not just about vapor.

“We’re selling grow tents, we’ve developed our own brand, Grizzly Originals, we’re now manufacturing our own products because it brings us better margin, and that’s now being sold to distributors,” says Dollinger.

“We can casually market our own brand in our own set of sites,” says Zelickson, “which saves a fortune in marketing and sales, and brings an instant audience.”

“We’re now developing grow equipment for our own network,” he adds, “but what really keeps this thing humming along is our inventory system, which we developed ourselves to accommodate 40 websites in ten countries. It’s a complex thing to manage all that stock across the UK, US, Australia, and have it all managed by one centralized system. But it means, for us to do acquisitions of other sites, the setup and bringing them into our system is really very easy.”

These aren’t small brands that Namaste is dealing with. EveryoneDoesIt.com is one of the oldest, well known internet smoke shops, with large warehouses in both Las Vegas and in the UK.

EDI specializes in bong sales, while VaporSeller is big in e-cigarettes, and Namaste focuses on the high end vape market.

“A lot of our suppliers, they don’t want to be in the fulfillment business,” says Zelickson. “They want an Amazon of weed accessories to do the heavy lifting. They just want the revenue, not the logistics.”


“Also a plus, we got some great staff in some of those acquisitions. The Everyone Does It deal included a great financial team, we’ve got some new product development guys as well, and the financials are nice.”

Those financials are going to be pretty sweet. The most recent financials for Namaste in Q3 showed revenue of $738k for the quarter, with $353k profit, and $2.6 million revenue for the nine months of 2016. Add in the revenue from EverybodyDoesIt and Vaporseller, and you’re looking at a significant 2017.

Namaste is not a client of Equity.Guru, but I have bought their stock and remain very interested in what numbers they can put up for the coming year, and what other entities may make sense for them to grab in their effort to corner the e-commerce space in weed accessories.

I still hate the vape market. I think it’s a dumb space where folks spend millions developing things that already exist. But if someone is going to get a piece of everyone else’s deal, I can see the value in that.

Boy howdy, can I.

— Chris Parry

FULL DISCLOSURE: The author has purchased stock in Namaste on the open market.

Written By:

Chris Parry

A multi-Webster Award winner for excellence in BC journalism, Parry is the founder and publisher of Equity.Guru, which he built with the specific plan to blend old school reporting with stock promotion, in a way that puts the emphasis on truth, high standards, and ethics. Parry is a veteran of TV, radio, and print, and consults with public companies to help them figure out their storylines, lay down achievable milestones, and improve their communication with shareholders, while also posting regular deep dive analysis of companies in the public spotlight.

More By This Author
Featured Content
Medical marijuana
Namaste Technologies
0 0 votes
Article Rating
Notify of
Newest Most Voted
Inline Feedbacks
View all comments
Would love your thoughts, please comment.x