What’s the biggest challenge facing the cannabis industry right now, and how are you and/or your company addressing it?
280E! But I suppose there isn’t much anyone can do about that barring legislative change (which may be on the horizon, of course). A better response in this context might be cost of capital. I don’t want my response to sound like I’m saying I am personally addressing this issue head on – but traditional Banks & Credit Unions are increasingly opening up to lending to the space. This movement towards “bank rates”, plus a major influx of available debt capital is already having a big impact on cannabis rates. Take for example the announcement some time back by one of the top MSO of their $70mm+ credit facility at sub 8% rate via a consortium of traditional banks. That would have been unfathomable just a few years ago. Now, that was for one of the largest cannabis pubcos… So, the next step would be to see that loosening extend to more players.
Where do you see the most exciting opportunity for growth and innovation in cannabis?
I know S3 is a bit of a controversial topic. But I think the research that will come with it will be incredible. Consider this: sleep management, pain management, weight management – all billion-dollar industries. You could potentially have all those in just one plant.
What’s one piece of advice you would give to someone looking to break into the cannabis industry?
Don’t forget the fundamentals. There’s this book called “This Time is Different…”. The book analyzes years of economic cycles, booms/busts and bubbles, etc. In the book the authors posit that a commonality in asset bubbles is this phrase “this time is different”. This time is different because it’s the internet; this time is different because its real estate; This time is different because it’s crypto, etc…. But what happens is – it’s not different, because at the end of the day the fundamentals are always the same. A business needs to make money. A career requires hard work. Etc… So, if you’re getting into cannabis because you think green money is going to suddenly fall from the sky, and you catch yourself saying “This time is different because its — cannabis”. Just remember – don’t forget the fundamentals.
What is the most important thing you have learned from your experiences in the cannabis industry?
Please see my response to question 3. One thing that is fairly unique to the cannabis industry, is this concept of a “relationship with the plant”. And I think it’s great!! But regardless of how passionate you are about the plant, at some point every entrepreneur must worry about mundane issues… like cash flow.
What do you want your legacy to be as it relates to the cannabis industry?
Apologies in advance if my response won’t be good for the article… but I’m not sure I’ve ever given any thought to “legacy”, haha. Seems like a big word for an average Joe like me. I suppose if I had to give an answer: I remember when I first started posting about cannabis banking on LinkedIn, there were very few bankers doing that. Today there are quite a few publicly acknowledged programs and bankers openly posting about banking cannabis. Same with financing for cannabis, almost a non-existent topic in the early days, and now it’s a common subject matter. I hope my legacy is that I played a small part in the normalization of cannabis banking/financing.
Do you have a comment for Peter?
