Tumbleweed investor deck_may_2015_ir (public)

Investor Presenta,on Public Access

May, 2015 © 2015 Proprietary & Confiden,al

Disclaimers

This document has been prepared by Tumbleweed Holdings, Inc. (the “Company”) solely for investor presenta,ons as of March 2015. This document does not cons,tute an offering document. This document is the sole responsibility of the Company. Informa,on contained herein does not purport to be complete and is subject to certain qualifica,ons and assump,ons and should not be relied upon for the purpose of making an investment in the Company’s securi,es or entering into any transac,on in rela,on therewith. This informa,on and opinions contained in the document are provided as at the date hereof and are subject to change without no,ce and, in furnishing this document, the Company does not undertake or agree to any obliga,on to provide recipients with access to any addi,onal informa,on or to update or correct the document. No securi,es commission or similar regulatory authority has passed on the merits of any securi,es referred to in this document, nor has it reviewed this document. This presenta,on includes forward-‐looking statements intended to qualify for the Safe Harbor from liability established by the Private Securi,es Li,ga,on Reform Act of 1995. These forward-‐looking statements generally can be iden,fied by phrases such as the Company or its management “believes,” “expects,” “an,cipates,” “foresees,” “forecasts,” “es,mates” or other words or phrases of similar import. Similarly, statements herein that describe the Company’s business strategy, outlook, objec,ves, plans, inten,ons or goals also are forward-‐looking statements. All such forward-‐looking statements are subject to certain risks and uncertain,es that could cause actual results to differ materially from those in forward-‐looking statements.

2 © 2015 Proprietary & Confiden,al

About Tumbleweed Holdings, Inc.

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•  Trades on OTCQB: DCDC •  143MM Shares Outstanding; Market Cap: ~$2.44MM •  Float: ~23MM shares

Our Mission: •  Building businesses in state-‐legal cannabis and related high growth sectors •  Target opera,ons in science, technology and data that support the

cannabis value chain •  Deploy capital strategically to leapfrog exis,ng market players •  Develop scalable, repeatable models that creates a na,onal footprint

•  Team seasoned in cannabis, financial markets and public company opera,ons •  LOI in place with cannabis lab tes,ng business in fast-‐growing OR,

other targets ID’d •  Opera,onal in Q2 2015 upon comple,on of funding

© 2015 Proprietary & Confiden,al

Tumbleweed’s Business Strategy


Our Strategic Focus: •  Cannabis “business intelligence” services, including

data, technology and the science powering the cannabis supply chain in the US and around the globe –  Cannabis tes,ng labs as opera,ng founda,on for our

corporate strategy

–  Leapfrog exis,ng labs, using proven quality systems aligned with ISO-‐cer,fied tes,ng standards

•  We have assembled a team of proven business, technology, scien,fic and strategic experts

•  We have iden,fied scalable, repeatable businesses to support mul,ple state-‐specific cannabis markets

Formally Establish Company

Friends & Family Raise Completed

Define Ac(va(on Strategy

Ac,vate Founda,on via Ini,al Acquisi,on

Create Investment and Acquisi,on Momentum

Operate and Further Develop Strategy

Tumbleweed Recent Milestones

An(cipated Milestones

1H 2015 2H 2015 2016

Q1 2014 Q2 2014

© 2015 Proprietary & Confiden,al 5

Corporate Milestones

•  Key Leadership Named •  Business/Market Strategy •  Acquisi,on Target ID

& Due Diligence •  Gather Acquisi,on Funding

•  Tumbleweed benefits from a well established historical investor base

Cannabis is a Rapidly Growing Market


•  The legal cannabis market is expected to grow to $8.2BB in the next 3 years •  34% CAGR1

•  Recrea,onal sales growing faster than medical sales1

•  24 states and DC have legalized cannabis for medical or adult use

•  3-‐5 addi,onal states an,cipate recrea,onal legaliza,on in 2016

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Cannabis is Gaining Na,onal Acceptance

Sources: Gallup, Brookings


•  American antudes towards cannabis are shioing rapidly

•  Shios cross all age groups •  Federal Gov’t beginning to

shio their stance

“There is some preliminary data showing that for certain medical condi6ons and symptoms, that marijuana can be helpful.” -‐ V. Murthy, US Surgeon General

Guiding Principles

Principles that guide and differen,ate Tumbleweed: 1.  Broad penetra,on of mul,ple cannabis market sectors

2.  Geographically scalable business models with limited regulatory barriers to cross-‐

border expansion

3.  Development of repeatable, synergis,c businesses 4.  Fundamentals driven

o  revenue-‐ and margin-‐capable in 12-‐24 months of acquisi,on

5.  Innova,on focus o  priori,zing market crea,ng or fast follower model opportuni,es

6.  Data-‐rich opera,ons crea,ng mone,zable intellectual property

7.  Ac,ve holding company management and support

8.  Transparent posture to build marketplace trust with investors, regulators and the cannabis community

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Segmen,ng the Category

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Opportunity & Ra,onale

Tumbleweed is leveraging the intersec,on of two key trends in this rapidly growing economy, sharing focus on business data

Business Intelligence Technology Few solu,ons yet in market

Lab Tes,ng >100% CAGR through 2018

Data

Trend #2 Consumer Safety

Pa,ent and consumer safety is paramount, driving states to require scien,fically rigorous product safety and quality tes,ng

Trend #1 Business Matura,on

Produc,on, manufacturing and retail cannabis businesses are demanding more sophis,cated technology services and systems


Source: Tumbleweed Analysis

Long Term Data & Technology Vision

Quality lab tes,ng is our “first-‐step” founda,on for a long term growth-‐oriented data and technology strategy

Business Intelligence

Data Lab Tes,ng

Grow & Produc,on Support

Retail Point of Sale

Digital Marke,ng Automa,on

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We are developing a proprietary technology architecture that builds value from capturing, analyzing, repor,ng and mone,zing

mul,ple data streams for mul,ple customers and stakeholders


Benefits to Lab Tes,ng Businesses


•  Rapidly maturing service layer in cannabis economy

•  Tes,ng requirement growing steadily •  Direct supply chain integra,on with cannabis

producers, MIPs manufacturers and dispensaries •  Data rich output delivering insight to mul,ple

stakeholders •  High degree of repeatability of services model

across the country •  Early stage partners with rela,ve speed to net-‐

posi,ve revenue •  Alterna,ve revenue streams available including

hemp and general agriculture •  Developing partnerships with university-‐backed

medical research studies

Regulated Cannabis Market Value Chain


•  There are many possible points in the cannabis value chain from producer to consumer where lab tes,ng is mandated by government and demanded by users

•  We’ll provide tes,ng services throughout the product lifecycle •  The data that is generated allows us to provide addi,onal services

•  Real-‐Time access to test results •  Labeling for compliance and consumer confidence •  Analy,cs services to aid producers in product development

-‐ Lab Revenue Opportunity

Planned Rollout -‐ Tes,ng Labs

•  Shared procedures and services model

•  Founda,on for rapidly scalable na,onal footprint


•  Ini,al Acquisi,on: Portland, Oregon –  Ready to launch -‐ 60 days to opera,ons –  Planning advanced level of instrumenta,on,

processes, service and obtaining cer,fica,on •  ISO-‐17025 •  NELAC

–  Ini,al customers and channel partners iden,fied, agreements in place

–  LOI in place with Portland team with strong cannabis network and rela(onships

•  Other prospec,ve priority states –  CA, WA, CO, NV, IL, MA based on market

dynamics and scale of opportunity –  Extend our founda,onal quality, proprietary

processes and cer,fied opera,ons model via partnership and licensing opportuni,es

Tes,ng Lab Founda,on Market: Oregon

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•  OR Medical Marijuana Program (OMMP) •  Established 1998 •  65,000 current OMMP pa,ents -‐ 25,000+

Portland/Salem area •  200+ licensed dispensaries

•  All legal cannabis in Oregon is required to be tested prior to release to pa,ents

•  Current state tes,ng requirements not in line with general laboratory industry standards

•  Lack of consistency and accuracy in results

•  OR Recrea,onal Marijuana Program: Ballot Measure 91-‐ Approved November 2014 •  Allows for licensed and regulated cul,va,on and sales of cannabis by January 2016 •  Massive market for tes,ng services -‐ 70,000 pounds per year forecast

•  Oregon Liquor Control Commission (OLCC) to administer program. Rules will likely mirror current OMMP regula,ons and Washington State regula,ons

© 2015 Proprietary & Confiden,al Source: 2015 oregon.gov

Our Compe,,ve Posi,oning: Tes,ng Labs


•  Our lab model is designed to deliver improved cannabis tes,ng accuracy, consistency and transparency than what’s available to Oregon customers today

•  Our seasoned lab sciences leadership team and advanced instrumenta,on packages will empower us to leapfrog our compe,,on

Source: Tumbleweed Marketplace Analysis, 2015

At launch, Tumbleweed plans to have a more sophis,cated set of cannabis tes,ng and technology services than any other Oregon cannabis lab today

Poten,al Rollout -‐ Tes,ng Labs

Portland, OR Boston, MA

Seatle, WA

Los Angeles, CA

Las Vegas, NV

Denver, CO

immediate

an,cipated

Chicago, IL


Cannabis Data & Technology Business Opportunity

•  Providing business intelligence is a key long term pillar for the cannabis industry supply chain

•  Available category-‐specific sooware is currently immature, with tradi,onal supply chain sooware not yet focused on cannabis

•  Sooware and data represent repeatable, high-‐margin assets

•  We have an LOI in place to develop delivery soHware in a Joint Venture with a leading home delivery service in California

•  We plan to leverage a variety of data –  Lab tes,ng results –  Product formula,on insights –  Gene,c traceability –  B2B business intelligence –  Consumer behavior

18 © 2015 Proprietary & Confiden,al 18

Data as a Business

•  We plan to leverage our founda,onal businesses and exper,se in labs and sooware to capture, analyze and profitably sell access to the output of our analyses.

•  Initally, two primary data mone,za,on opportuni,es –  Aggregated cannabis lab tes,ng data

•  Analyzed, packaged and sold to growers, extractors and retailers –  Consumer behavior data

•  Aggregated, anonymized and sold as targe,ng data to cannabis marketers and general product manufacturing marketers in parallel industries

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Produc,on Data Point of Sale Data Consumer Behavior Data

Technology Plan

•  Business Intelligence Value Proposi,on –  Mul,ple use cases being underserved and market seeking

more sophis,cated solu,ons –  Data from lab tes,ng business and various supply chain

rela,onships will be leveraged

•  Pursuit of Dual Revenue Streams –  “Sooware as a Service” subscrip,on fees –  Mul,-‐source data capture, aggrega,on, analysis and value-‐

added mone,za,on •  R & D: Tumbleweed Technology

–  Led by accomplished Chief Technology Officer –  Pre-‐Revenue, trac,on dependent on market forces

•  “Sooware as a Service” (SaaS)

•  Labs data founda,on •  Data mone,za,on


4 Year Development Roadmap

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Tes,ng Labs OR WA CA MA IL

Technology Delivery Logis,cs Grow Monitoring

mCommerce

Data Services Business Intelligence

Market Targe,ng

Corporate Management

Finance Strategy

1H FY1 2H FY1 1H FY2 2H FY2 FY3 FY4

Current Raise: 2nd Raise Self-‐Sustaining

Barry Regenstein Chief Financial Officer

(interim)

Gary Herman Chairman, CEO

Seth Lukash President, COO

Bill Hewson Chief Strategy Officer

Patrick Moore Chief Technology Officer


Tumbleweed Corporate Leadership

General Manager* Tes,ng Lab Services

General Manager* Data & Technology

Services

* Currently confiden,al

Seth Lukash President & COO

Patrick Moore Chief Technology Officer

Barry Regenstein CFO (interim)

Gary is an experienced execu,ve, seasoned porxolio manager and investor. He was previously an investment banker. Gary has sat on the boards of many public and private companies. He has a B.S. from the University at Albany.

Seth is past Chairman and CEO of Tridex Corpora,on, a $100 million manufacturing and technology holding company. Seth also led Progressive Sooware, a leading provider of applica,on sooware to the restaurant and hospitality market. He has his B.A. in Finance from University of Miami.

Patrick has over 25 years of advanced technology leadership and innova,on to his credit. He has leadership experience in both enterprise and start up organiza,ons, including being CTO of sephora.com and was a co-‐founder of Lemonade, Time Magazine’s “App of the Year.” Patrick lives in Portland, OR and received his BS from Oregon State University.

Bill leads Tumbleweed’s company and opera,ng unit strategies, including posi,oning, marketplace penetra,on, branding, and communica,ons. With 25 years of prior leadership posi,ons in a variety of public and private companies focused on strategy and marke,ng, Bill holds a degree in economics from St. Lawrence University.

Barry Regenstein is a global senior execu,ve, with more than 25 years leadership experience. Mr. Regenstein most recently served as President and Chief Financial Officer of Command Security Corpora,on. He is a Cer,fied Public Accountant and a graduate of the University of Maryland with a Masters Degree from Long Island University.

Bill Hewson Chief Strategy Officer


Tumbleweed Corporate Leadership

Gary Herman Chairman & CEO

Gary Herman Chairman & CEO

Gary Herman Chairman & CEO Tumbleweed Holdings, Inc. 720 Fioh Ave, 10th Floor New York, NY 10019 212-‐247-‐0581 [email protected]

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Contact

Seth Lukash President & COO Tumbleweed Holdings, Inc. 720 Fioh Ave, 10th Floor New York, NY 10019 203-‐246-‐7871 [email protected]


Documents

Tumbleweed investor deck_may_2015_ir (public)