The SEC revised rules on accredited investors that will let more book-smart people and insiders invest in private companies. And it will give private marijuana and hemp companies access to seed capital that often comes with fewer strings than traditional bank and institutional investor financing arrangements.Read more
McWilliams stated that she thought bankers would be “OK” with regulators if they conduct due diligence that ensures licensed entities comply with state regulations and follow the 2014 FinCEN guidelines, including the filing of suspicious activity reports (SARs).Read more
Rule 506 provides two distinct exemptions: Rule 506(b) and (c). Unlike Rule 506(b), an issuer relying on Rule 506(c) can engage in general solicitation when marketing its offering. Certainly, there are traps for the unwary when proceeding under either exemption, as some cannabis companies have unfortunately discovered in recent years.Read more
To prosper in these tough times, cannabis muti-state operators need to follow these 5 principles:
1. Have a two year capital and cash-flow cushion
2. Strong competitive positions in markets.
3. Operational excellence.
4. An attainable business model with a path to profitability.
5. An expansion driven by realistic expectations surrounding a return on investment.
Following twelve consecutive monthly declines and then a modest gain in April, the American Cannabis Operator Index extended its rally off of its all-time low set in March, increasing 34.7% to 30.20 during MayRead more
This year’s initial pullback on venture funding was at first an acknowledgement that no market can support endless quarters of negative company earnings, regulatory uncertainty, and legal challenges. Now that COVID-19 has shaken the world, it’s clear the cannabis industry will have to respond in unique ways to finding capital, too, as investors remain cautious.Read more
Louisiana lawmakers advanced three marijuana reform bills that includes legislation that would dramatically expand the state’s medical cannabis program and offer protections for banks that service marijuana businesses.Read more
if a business borrows funds under a PPP loan, spends the loan proceeds in the manner prescribed by the CARES Act and SBA guidance, and the PPP loan is forgiven, it is not clear whether these expenditures would be deductible for federal income tax purposes.Read more
Legal compliance is particularly important for companies in the cannabis industry that seek to raise capital. Not only is this a highly regulated industry, but offers and sales of securities of companies within the industry are generally subject to enhanced scrutiny by state and federal securities regulators.Read more
learn the 6 key steps to pitching your Cannabis Business to VC firmsRead more