While Troy Dayton and Steve DeAngelo of the ArcView Group want people to think that it's easy to get a cannabis business funded, the truth is that there are still many hurdles a marijuana entrepreneur faces to attract investment capital. In short, it isn't easy.
The road to attracting investment capital is lined with land mines, and it can be costly, time consuming, and often times, unproductive.
Basically, ArcView allows companies needing capital to pitch for a few minutes in front of "qualified investors." Arcview hosts webinars each week where 3-5 companies pitch as well as a big in-person pitch event at least every quarter.
Other companies, like Poseidon Asset Management, offers loans, short term financing, and convertible notes. When loans aren’t an option, Poseidon commonly turns to a convertible note, essentially short-term financing that can be changed into future equity in the company. Using a convertible note is an established tool to raising capital for early-stage companies with low cash flow, according to Poseidon. Working with a convertible note also doesn’t set a hard valuation for the company at an early development stage.
Some companies have had success going public. Kush Bottles (ticker: KSHB), recently completed a successful transition from private to public company, and is one of the few publicly traded companies in the cannabis sector that is actually showing a profit.
Vuber Technologies, the developer of one of the best selling vaporizers in the nation, is seeking investment to help them expand. They are going directly to qualified investors with a combination of equity and private note investment opportunities. Vuber, now the number one brand of vaporizer in their home state of Washington, needs the capital to ramp up production and fuel future growth.
Both Vuber and Kush are unique in the cannabis industry, because they are exiting companies with a solid track record of steadily growing revenues and profitability. Investing with these companies is practically a no-brainer.
There are many other far riskier investment opportunities in the cannabis sector such as Notis Global (Ticker: NGBL), which is trading at under a penny, but if it makes a few correct moves, it could explode. Then again, the company may fail to delver on it's business plan, and your investment is at risk.
Of course, all investments involve risk. A savvy investor will carefully weigh the risk vs rewards, and never invest more than they can tolerate to lose.