In an era where the cannabis industry is rapidly evolving across the globe, investors and operators face complex challenges and opportunities. Recently, in a new episode of Financing Your Cannabis Future, Rachel Wright sat down with David Hyde, founder of Hyde Advisory and Investments based in Toronto, to gain expert perspectives on the international cannabis landscape, investment strategies, and the nuances of entering emerging markets.
A Journey from Security to Cannabis Expertise
David Hyde’s entry into the cannabis sector was serendipitous. With a background spanning over two decades in corporate security—including roles such as global director of security for a major commercial real estate firm—Hyde’s transition into the cannabis industry began around 2013. His initial involvement was sparked by a chance encounter while doing a television segment on crime and terrorism, which caught the attention of Dutch cannabis producer Bedrocan. Their outreach led Hyde to explore the security and regulatory aspects of medical cannabis, eventually positioning him as a leading security consultant for Canada’s early licensed producers (LPs).
Hyde’s initial focus was on securing the physical infrastructure of cannabis facilities, but his expertise soon expanded into broader consulting—covering licensing, compliance, and international market development. Over the years, Hyde has worked with hundreds of cannabis companies globally, including in Germany, Portugal, Spain, and Australia, helping shape their security frameworks and strategic growth plans.
From Security to M&A Advisory
In 2019, Hyde shifted gears, establishing Hyde Advisory to focus on mergers, acquisitions, and investment facilitation within the cannabis space. The firm now operates as a global advisory, assisting companies in selling or acquiring cannabis businesses worldwide—excluding direct operations within the US due to regulatory complexities.
Hyde explains, “Our work is rooted in helping entrepreneurs, investors, and companies navigate the M&A landscape, identify desirable assets, and position themselves for growth. We’re not an investment bank; we’re advisors first, industry experts second.”
Understanding the Market Landscape
Hyde emphasizes that while the US remains a dominant market, the global scene offers promising opportunities, especially in Europe, Australia, Israel, and emerging markets like Poland. He highlights the importance of diversification, advising US companies to consider international markets for brand expansion and investment.
One key insight is that outside North America, cannabis markets are often more medical-focused, but with significant crossover into recreational use. For example, in Germany, many consumers use cannabis for both medicinal and lifestyle reasons, creating opportunities for US brands to establish a foothold through strategic partnerships. Hyde notes that brands with strong recognition in the US can leverage guerrilla marketing tactics and local partnerships to enter these markets without large capital investments in cultivation infrastructure.
Investment Trends and Capital Flows
Regarding financing, Hyde observes a shift toward debt-based funding in Europe and other regions, with major banks such as Deutsche Bank providing multi-million euro debt facilities to leading cannabis companies. He points out that this indicates increased institutional confidence in the sector, although private equity remains more prevalent than public equity at present.
“European banks are starting to support cannabis companies more actively, which is a positive sign,” Hyde states. “We’re also seeing a decline in overly inflated valuations, replaced by more realistic, performance-based assessments—an encouraging trend for investors seeking safer entry points.”
Global Supply Chains and Protectionism
Hyde discusses the complexities of cross-border cannabis trade, noting that some countries are beginning to implement protectionist policies to safeguard domestic cultivation. Israel, for example, has imposed tariffs on Canadian imports after concerns about over-reliance on foreign supply. Conversely, Portugal serves as a European hub, exporting cannabis across the continent and beyond, with minimal restrictions on imports.
He predicts that as domestic cultivation capabilities grow in markets like Germany and Australia, Canadian exports may gradually decline, but the demand for high-quality flower will persist. “The global appetite for premium cannabis remains strong, and countries are balancing import needs with developing local production.”
Cautionary Tales and Best Practices
Hyde offers pragmatic advice to investors and operators: conduct thorough due diligence and avoid superficial evaluations. He recounts instances where inadequate assessment of management teams, facilities, or legal contracts have led to financial losses. “You have to dig beneath the surface—get expert support for technical, financial, and legal due diligence. Otherwise, you risk overpaying or investing in a fragile operation.”
He stresses that successful mergers and acquisitions require careful integration, cultural alignment, and comprehensive evaluation—lessons learned from many failed deals in the industry.
Looking Ahead: Opportunities and Challenges
Despite ongoing hurdles, Hyde remains optimistic about the future of global cannabis markets. He advocates for US companies to diversify by exploring international opportunities, especially in markets with realistic valuations and supportive regulatory frameworks.
“The timing has never been better to dip your toes into global markets,” Hyde advises. “Markets are maturing, valuations are more reasonable, and the infrastructure for cross-border trade is improving.”
Connecting with Hyde Advisory
For industry players interested in exploring international cannabis markets, Hyde emphasizes that their firm offers a straightforward path to assistance. Hyde Advisory maintains an active presence on LinkedIn and their website, hydeadvisory.com, which features a list of ongoing deals and mandates. Hyde also participates in key industry conferences, including the upcoming ICBC Berlin in April and the Talman House Private Investors Forum in London, providing valuable networking and learning opportunities.
Final Thoughts
As the global cannabis industry continues to evolve, experts like David Hyde serve as invaluable guides for navigating its complexities. His insights underscore the importance of strategic planning, diligent evaluation, and openness to international markets as avenues for growth and risk mitigation.
For those looking to expand beyond the US and Canada, Hyde advises, “Now is the time to explore the world—markets are accessible, valuations are more realistic, and the opportunities are vast. With the right guidance, the future is bright for global cannabis entrepreneurs and investors alike.”
