As the adage goes, “You need deep pockets to get into the legal Cannabis game” - it really comes down to raising capital.
What pathways have you found worked best for the legalized atmosphere? Self financed and bootstrapped? Friends and family investors? Credit lines and loans? Larger private share offerings? Crowdfunding? Co-operatives? or other more interesting ways?
We built our farm from a community business development corporation loan, and a huge bucket of blood, sweat and tears and maxxing out every credit card we had - now as we scale to a larger sized operation we are examining different options to fund more expansive and rapid growth.
Curious as to what other people might have experienced as they built their legalized Cannabis businesses.
I personally built our business via self funding, family, and then approximately 1/3 of the equity was offered up for investment. Luckily I didn’t have to do the traditional circuit of presenting in front of VC’s or angel investors. We ended up finding some interested investors through a friend-of-a-friend type situation.
In the planning stages I told anyone and everyone who would listen that I was starting a business and looking for investment. A lot of friends and acquaintances were helpful in making connections to people they thought might be interested. 2 months later we had our investment.
This age, I would probably reach to a few groups, including:
These are just the ones that I’m familiar with that have good reputations. I’m sure there are many others out there that can perform the same function.
In going after funding with the companies stated above, I would imagine they will want a lot more details and will probably be more aggressive with the equity stake they want in exchange for the money. They are also probably much more willing to lay out a substantial amount of capital for the deals that “click.” Less sophisticated investors may be a little more lenient with regard to equity, but often are more hesitant to put up serious capital. Every situation is different though!
@harrison@trybaker can you guys talk about how you achieved your recent investment round? I think I read that Poseidon was leading the round. Is that correct?
