A sit down with Bant Breen on the growth and development of Highway33.

I recently sat down with Bant Breen on The UNCAGED Show to discuss my career as principal managing partner of Highway33, a capital advisory firm capable of handling global M&A and financing transactions. This is an edited excerpt from our discussion.

Bant Breen:

Welcome to Uncaged. Today we’re speaking with David Hofer. I’m excited to go through this stuff with you. David works in an area where he knows exactly what’s coming down the pike. David is the principal managing partner of Highway33, a capital advisory firm. They work on global M&A and financing transactions, and they work in really a lot of highly regulated and emerging areas from automotive, pharma, biotech, SAS to really emerging areas like cannabis, CBD and hemp and technology. I’m excited to go through all of that with you, David, but before we get there, tell us a little bit about you and your career.

David Hofer:

Yeah, well, thank you, Bant. You know, I’ve had sort of the very interesting juggernaut of career stops along the way, starting out with being at the big brand agencies of J. Walter Thompson and McCann Erickson at the very young age of 28. I was running the Buick business for McCann, where I had PNL responsibility for a $280 Million budget and five car line brands. And it was during that time that we had the pleasure of signing Tiger Woods. So, you know, I did the big agency world for a few years and then spun off and created my own agency, which was sort of the combination of what you might see in a shark tank. So, the skill sets of a McKinsey Booz Allen on strategy, development and resource planning combined with that of a full-service agency. So, all our clients were, you know, companies like Audi, Jet One, Microsoft, Raytheon, several SAS, ERP backed venture companies where, you know, they came to us because they wanted to know what the product commercialization roadmap looked like. So, we did everything from the strategic planning all the way through the execution and trying to win and dominate market share in a fiercely competitive industry.

Bant Breen:

I love the background. I mean, you may or may not know I was at IPG as well, so we can probably have many, many more stories that we can compare and contrast at some point. But I mean, I also think that that mix of a background is really kind of why you’re perfect to be doing what you do now. Tell me more about Highway 33 and the business today.

David Hofer:

So, I shifted to the finance industry back in the, you know, call it 2010 era. I was leading the turnaround and transformation of one of the top payments companies in the US. And I transitioned from there to spinning off an alternative lending platform called Advanced Working Capital. I had a credit facility that we raised with a bank in New York. Sold that portfolio in 2014 and started Highway33 primarily to help highly regulated industries like pharma, biotech and cannabis to build out their plans for growth and more importantly, assist with the capital stack. You know, how do they raise equity in a very competitive market that’s constrained because they can’t go to the traditional lending institutions? And in assisting with debt facilities as well. And so, we’ve really been focusing on that ever since 2014. We formalized it with a partnership with another investment banking group called Capital 33. So, Highway’s name was changed to Highway33 Capital, and we’ve transacted in more than 14 states, Latin America and Canada. And I would say 80% of our volume has been in the cannabis and CBD space.

Bant Breen:

Yeah, I mean it’s a fast-growing space certainly as far as I can see, the only business right now in New York City seems to be that business when you walk down the city streets! But, you know, tell me a little bit more about the industries that you’re working with and what their take is on the state of the market right now. What are they looking for when they come to you guys?

David Hofer:

Well, typically, they are focused on growth capital, So they’re either trying to line up some debt financing or attract equity investors. I will tell you that in the last year, specifically in cannabis, the equity markets have nearly evaporated. There’s been too much skepticism over where the industry is headed. There have been multiple legislative attempts with the Banking Act and now with the proposed rescheduling thing, which we do believe will pass as early as January of next year. And I think what will happen is when you reschedule this from a schedule one to a schedule three, which is akin to Tylenol, you’re now opening it up for these operators that have strong operations, have revenue and M&A to be able to start borrowing at more cost-effective rates. That is something we’re definitely keeping an eye out for. It’ll also free up capital. So, as we’re working on M&A transactions, typically we’re representing mostly sellers in this marketplace. But as you can imagine with any new emerging market, you will have thousands and sometimes hundreds of competitors that end up being a handful over time, just through attrition and in M&A activity. We saw that at the turn of the century in automotive, we’ll see it again in cannabis and CBD.

Bant Breen:

Very, very interesting. Well, thank you so much, David, for being on Uncaged. I really enjoyed our conversation, and look forward to having you back on the show.

To see the full interview on the Uncaged YouTube channel, go to: