Photo: Jones Soda

Investors are on a high lately towards CBD. Now it seems that at least one CBD company is feeling pretty sweet towards one sugary beverage brand.

Late last week HeavenlyRx, a hemp-focused portfolio company of cannabis investment firm SOL Global Investments, spent $9 million to acquire 15 million shares of Seattle-based Jones Soda Co. The deal brought its ownership stake in the soda maker to 25 percent, which CNN reports could increase to 51 percent due to stipulations within the agreement.

Jones Soda revealed in a press release that it plans to use the new capital from the HeavenlyRx investment to expand its repertoire and develop new products, “including the potential commercialization of C.B.D.-infused beverages.” (Presumably using HeavenlyRx’s hemp extracts.)

We’ve seen plenty of beverage companies exploring CBD partnerships, from big players like Coca-Cola and Dirty Lemon to smaller upstarts like Sprig and Recess. We’ve also seen mega beverage companies invest in/partner with cannabis suppliers to begin developing a CBD-infused option — as with Cannabis Growth/Constellation Brands and HEXO/Molson Coors.

However, we have yet to see it the opposite way around: a cannabis company making a major investment in a beverage brand. Jones Soda is a logical choice for HeavenlyRx: it’s on the “edgier” side of sweetened carbonated beverages, using only natural cane sugar in their drinks and featuring black-and-white consumer-captured snapshots in their branding. Definitely the kind of soda you could imagine embracing a trendy ingredient like CBD. While public, Jones Soda is also not a mega-corporation like Coke or Pepsi, so they’ll ideally have to deal with less red tape when creating a CBD-infused product.

This is a significant move on the part of HeavenlyRx’s (or really its parent company, SOL Global Investments) to get ahead of the curve on the CBD soda trend. Right now the CBD-infused beverage space is relatively fractured, filled with smaller companies making niche products like adaptogen sparkling water and wellness “tonics”. But an industry leader has yet to emerge.

All that said, let’s not forget that selling CBD food and beverage is technically illegal right now (though that’s not stopping smaller players from adding it to everything from chocolates to coffee). The FDA held the first public hearing on CBD this past May which gave some hope that regulatory structure was on its way. However, not long after the NYC Health Department announced that it would begin seriously cracking down on all companies selling food & drink containing the controversial chemical compound.

CBD might not be approved by the FDA yet, but judging by experts’ projections, it’s only a matter of time. There’s certainly a lot of potential in the CBD edibles market: it’s projected to reach a value of $1.4 billion by 2024. With that much cash up for grabs, it follows that as soon as CBD gets the rubber stamp from the FDA there will be a mad scramble by beverage and cannabis companies to get a product to market and grab first-mover advantage.

Right now the field is wide open. With support from a heavy hitter like HeavenlyRx, Jones Soda has a chance to come out in front.

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  1. Catherine, thank you for the Jones/Heavenly Rx article. It certainly would be incredible to see Jones Soda come out of the gate first with a great tasting CBD Beverage. It would be reminiscent of the days when Jones rocked the Beverage industry with the wild flavors they bottled. This would shoot them from the outhouse to the penthouse overnight !! I love it when the underdog makes the major players nervous. I think it’s time for Jones to stand up and not only be counted, but have end caps in all chain stores !!!

  2. Thank you Catherine. It’s about time that Jones gets some positive ink ! This co. has so much potential. they were once the “little darlings” of the beverage industry but now they are playing with the big boys. With the influx of cash from Heavenly, who knows what will happen. I would love to see them come out of the gate first with a great tasting CBD Beverage & rock the heavy hitters, big time. It’s time that Jones Soda bounces back and gets the ink they deserve for keeping this company afloat. Oh yea, an end cap in every chain store for the CBD Roll-Out would be helpful too.

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