Niklas Kouparanis, CEO and Co-founder of Bloomwell Group- Interview Series

“So when Germany opens up for adult-use cannabis, it will become the biggest market in the world. The future language for cannabis will be German, and this will be the flagship market once adult-use legalization takes place.”

Niklas Kouparanis

The legalization of recreational cannabis in Germany, which is likely to happen any time from now, will be a tipping point for the global cannabis industry. Even though Germany will be the second EU country to legalize adult-use marijuana, the sheer size of its economy is likely to cause a stir in the global cannabis industry. Germany has a population of a staggering 83 million; that’s greater than Canada (38 million) and California (39 million) combined. Not only is the economic potential in this market massive but Germany’s legalization is likely to have a domino effect on the rest of Europe.

The potential value of the cannabis market in Europe has been placed at $4.7 billion annually with an average demand of 400 tons of flowers annually. That said, cannabis remains a highly regulated commodity the world over and this comes with significant business risks. In this interview, Niklas Kouparanis gives us insights and an insider view of the cannabis industry in Germany.

Niklas is the CEO and Co-founder of Bloomwell Group, which acts as a holding company for medical cannabis businesses, and is also positioned to hold and oversee companies in Germany's upcoming licensed adult-use cannabis market.

Without further ado, meet Niklas.

As an intro, how did your career path lead you to the cannabis industry?

I have always known that I did not want to work for someone else, but rather wanted to venture out on my own to create something big. My educational background is a Master of Science Management, majoring in Strategy and Consulting. I have been building cannabis companies for over five years in Germany. Along with my sister and Bloomwell Group co-founder, Anna-Sophia Kouparanis, we are among the first entrepreneurs in the country to successfully gain a foothold in the medical cannabis market. Now, we’re gearing up for the adult-use market.

You are the co-founder of Bloomwell which is the biggest company in the cannabis market in Germany. What can you attribute your success to?

It takes diligence and hard work, but it’s worth it because I’m extremely passionate about the cannabis industry and the potential of the cannabis plant itself. I’m determined to use my expertise and experience to pave the way for the cannabis market to achieve long-term, sustainable success. We’re already making waves at Bloomwell Group, currently Germany’s largest cannabis company with over 250 employees, and will keep on shaping the market for the better and setting the stage for a new, progressive era of cannabis consumption.
You recently closed a seed funding round of over $10 million. Can you share how this deal came into being and how you intend to use the funds?

When we closed this funding round in October 2021, it was the highest publicly known seed investment for a medical European cannabis company to date. The lead investor is US growth capital provider Measure 8 Venture Partners, specialists in cannabis industry investments. Among other investors, business angel Dr. Reinhard Meier is investing again through his Venture Capital Investors fund; Mr. Weber of FPS acted as legal advisor to Bloomwell; and Curaleaf’s Boris Jordan, who has also been named for a board member. Tied to this announcement, the Bloomwell Group, which includes Algae Care, Europe's leading Telemedicine Company for medical cannabis with more than 7,500 patients, is repositioning itself as a holding company, allowing it to build, invest or acquire cannabis companies.

With this successful fundraising round, we are revolutionizing healthcare through digitalization and making medical cannabis and other natural medicines more accessible than ever before. Our portfolio companies are able to focus on a direct to patient approach, and in the future a consumer-centric approach, along the entire value chain of medical cannabis with the exception of cultivation. And we are far from finished. This initial round was conducted before the adult-use market for Germany had been approved. Bloomwell Group is now raising additional funds to put ourselves in a prime position for when the adult-use market comes online.

Besides being the first German telemedicine company for medical cannabis, we are also investing in pure vertical integration, pharmacy teasers, product sourcing and development, better access to prescription/treatment, and fast delivery services. The era of cannabis as a consumer product begins now and Bloomwell is at the forefront. We’re redefining the cannabis industry and crafting a new episode in its history, moving cannabis beyond its previous sole purpose as an ailment-relief treatment for patients. While that is still important and necessary, we believe in cannabis culture. The plant is a statement by people who dare to tap into themselves and live an elevated, modern and community-driven life.

“Germany will be the biggest cannabis market in the world. Bigger than Canada and California together.” What’s your take on this?

I agree with this statement, and it’s based on facts and statistics! Germany has more than 82 million inhabitants – that’s more than Canada and California, two of the current biggest cannabis markets on the globe. So when Germany opens up for adult-use cannabis, it will become the biggest market in the world. The future language for cannabis will be German, and this will be the flagship market once adult-use legalization takes place. It’s very important to mention that according to renowned economist Justus Haucap, we will have a demand of 400 tons of flowers annually after legalization. A representative survey of our own shows that one out of every two adults in Germany is a potential legal cannabis consumer.

According to the latest projections by Haucap, the state could achieve an annual plus of 4.7 billion euros through the legalization of cannabis combined with various tax revenues (including cannabis tax) and savings (including the judiciary and criminal prosecution). According to Haucap, 27,000 new jobs could also be created.

Is Germany going to legalize adult-use cannabis this year?

Party leaders in Germany’s incoming government coalition reached an agreement to legalize cannabis for adult use in November 2021, but we don’t expect the market to come online until the beginning of 2024. The law itself needs to be drafted and pass Bundestag (German federal parliament) and Bundesrat (Germany’s elected representatives) on a national level.

What will be important in Germany regarding the timeline for the licensed adult-use market is adhering to international law and policies set forth by the United Nations, which we as a country are part of. This includes their policies on narcotic drugs, written and agreed upon in 1961, which asserts that countries cannot legalize cannabis for adult use. There are two different ways to approach this issue: the first option is to ignore it, which is essentially what Canada did. Another way is to step out of the U.N. single convention that adopted these rules, and then rejoin once we legalize. We are famous for our bureaucracy in Germany and for following rules, so I expect Germany to stick with international law and opt for the latter method. There’s an extensive procedure to follow in order to do this, so my expectation is Q1 2024 for the adult-use licensed market to come online in Germany.

Rather than being hasty to bring the legal market online, it’s important to be well-prepared and implement a stable infrastructure and supply right from the beginning.

What can other EU countries learn from Germany’s legalization journey?
The German market has the potential to be the role model for a successful adult-use cannabis market for the European Union as a whole, and the world, but we need to take the proper steps to make the transition as smooth as possible.
Other European countries such as Malta and Luxembourg have taken the initiative to decriminalize cannabis but have not taken the full steps to actually legalize cannabis. But from Germany, countries will learn that protection of minors and product security can only be achieved in a fully legal market. Germany has nine borders in the heart of the EU and will lead to a change of paradigm of cannabis regulation.

However, the legal market stands or falls with a secure, nationwide cannabis supply, otherwise, the unlicensed market retains the upper hand. Therefore, politicians must enable the industry in good time to legally produce or import cannabis, distribute it and ultimately sell it to consumers via stationary specialist shops or online. Bloomwell is taking the lead to ensure product quality and safety, affordability and access will be the pillars to building a successful market. It is very important that policymakers include industry pioneers that were involved from the beginning to benefit from the learnings of the medical market. If the federal government works thoroughly, we will see a legal cannabis market in Germany at the beginning of 2024.

Last week, Michael Krawitz issued a statement (https://www.youtube.com/watch?v=cYZprRYZCl4) at the UN plenary that shows how member states can regulate recreational cannabis while complying with the Single Convention treaty. What do you think is going to be the impact of this “new interpretation” on member states?
The article that Krawitz asserts allows member states to legalize cannabis for uses beyond scientific and medical reasons is promising. But it’s too early to tell if member states planning to legalize cannabis for adult use, such as Germany, will evoke that specific article to move forward to bring their market online and if the process works as Krawitz assumes it does.

What’s next for Bloomwell?

Germany has the potential to be the world leader of adult-use and medical cannabis and shift the market to be global, with companies conducting business across continents, and we will continue to lead the way in our country. Bloomwell, which is already Germany’s largest cannabis company complete with 250 employees, is the gate-keeper for the adult-use and medical market in Germany and is the only company that is vertically integrated and engaging with customers through a direct to consumer focus.
We’re continuing to establish a fully integrated universe of distinct cannabis-related brands, each fulfilling a different purpose. From Wholesale to Direct to Consumer, from flower to accessories and from medical use to lifestyle consumption. We’ll continue to cover and redefine the whole value chain not just because we can, but because it’s necessary to offer our customers and business partners a different experience in cannabis.

It was a great pleasure to have this one-on-one with Niklas Kouparanis, CEO of Bloomwell Group. Readers who wish to keep up with the cannabis market in Germany are welcome to visit their website.