It's not as easy as you might think to launch a cannabis business, and it's even more difficult to land funding for a cannabis business today than it was a few years ago. With the punitive tax code IRC 280E, the shocking yet predicted cost of cannabis regulation, and a market that within the United States is still federally illegal, it makes savvy investors with a risk tolerance weary of investing dollars in a cannabis business.
Most recently, we've seen the Billion Dollar valuation and Unicorn, MedMen, start crumbling, and quite publicly. Not being being able to hit revenue targets, growing too quickly, and hiring too fast, the Company has had to incur massive layoffs just to stay afloat and it's CEO of more than six years just resigned.
So what does it take to be a successful startup in the cannabis industry? A few of the key ingredients include capital, patience, a strategic plan, and an excellent team.
On this episode of cannabis business minds we speak Dan Nicholls, CFA and Director at Ello, a Cannabis Accounting and Advisory firm based in Los Angeles. Dan shares his expertise on cannabis valuations, working with cannabis startups, and provides some invaluable insight into the cannabis landscape.