One of the most fundamental questions facing any entrepreneur – whether in the cannabis industry or elsewhere – is: “What type of business entity should I choose?” This is a deceptively complex question, although we’ll try to make it seem simple here. When you ask your lawyer or accountant, their first response will likely be
With ongoing tensions between U.S. state and federal marijuana laws, U.S. marijuana investments present significant legal and logistical challenges. This is especially true for investors with ties to federally regulated businesses. While some investors have accepted the risks of U.S. marijuana, others are waiting for major federal reforms. But what if there was a way
Cannabis investments are difficult enough when the investor is a U.S.-based person or entity. But things can get immensely more complicated when foreign investment is on the table. Today I want to highlight some of the top considerations for foreign investors and U.S. cannabis companies alike. 1. Legality could cause serious headaches To this day,
If you missed our February 2024 “Cannabis Loans and Investments” Webinar, we have published a full recording and transcript here. Harris Sliwoski partners Vince Sliwoski and Griffen Thornefocused on a constellation of important factors for both cannabis industry investors and businesses in 2024: What the increase in open state markets means for business and investments
Our cannabis team has performed due diligence on countless business purchases, investments, loans, and just about every other kind of transaction you can imagine. As you can imagine, we’ve seen some pretty bad and even sketchy things over the years. With rescheduling on the horizon (see here and here), we expect to see an increase in loans, investments,
You may think that due diligence is something reserved for business or real estate purchases. But due diligence is also a must for lenders in cannabis loan transactions. I recently wrote a post about what borrowers can look forward to in cannabis loan transaction. Today I want to do a deeper dive into due diligence
I stumbled upon this recent post by Jason Paltrowitz titled “Lawful but Awful: The Small Cap IPO Cycle.” It contains some interesting findings and I like everything about it for cannabis companies, except the conclusion. The conclusion is that OTCQX and OTCQB markets are a good alternative to senior U.S. exchanges for small companies. The
Cannabis companies that need more money than they can generate through sales generally have two options: borrow money (debt) or solicit investments (equity). Over the years as the industry has constricted, equity finance became less of an option. I recently predicted that equity investment will reignite when cannabis is rescheduled. But that hasn’t happened yet,
A common way to get and retain employees is to issue them options or equity securities like corporate stock. But like with everything else, issuing securities is heavily regulated. Today, we’ll look at a few key issues for cannabis businesses that want to offer equity incentives. How do cannabis companies offer equity incentives? There are
Last week, the Department of Health and Human Services (HHS) recommended rescheduling cannabis from schedule I to III under the Controlled Substances Act (CSA). My colleagues already covered various implications of the proposed cannabis rescheduling (see here and here). Today, I want to talk about one of the most important consequences of the announcement other than
