Where to Find Capital for Your Legal Marijuana Business

History of the Legal Marijuana Industry

• The marijuana industry remains mostly in the shadows of American commerce, however, the passage of medical marijuana legislation in 23 states and of recreational marijuana laws in four states is attracting the attention of private equity investors, High Net Worth investors as well as individuals making the investment class a part of their overall, weighted investment strategy. Having these different investment groups simultaneously and actively investing in this industry is an important step in the evolution of the marijuana industry from emerging to developed.
• The legal marijuana industry is estimated to be worth between $2 billion and $3 billion and to date, 23 states, including California, and the District of Columbia have legalized medical marijuana. Four states — Colorado, Oregon, Washington and Alaska — also allow recreational marijuana use. The entire year of 2014 has been a tipping point.
• Despite states’ efforts to legalize medical or recreational cannabis, its use is illegal under federal law. Though recent legislation bars the feds from interfering with state medical marijuana laws, an assistant U.S. attorney wrote in a court filing last week that the plant is a psychoactive, addictive drug that is not accepted as safe for medical use. Those legal concerns — along with the drug’s social and political baggage — are factors that keep capital at bay. But in our homestate, California, voters will likely see a ballot measure to legalize recreational marijuana in 2016; more venture capital deals will be on the horizon.

How to Raise Capital for your Legal Marijuana Business?

Start Up Capital

• Investing in this area can be very exciting, since often times the corporate sponsor has a very specific request in mind and provides a full and complete analysis of where the capital is going be deployed. Seeing a company grow from an idea and quickly ramp up and have true earnings is fun to be a part of. This form of investment tends to be Venture Capital or Private Equity (P.E.).
• DEBTCRAFT is also well versed and experienced at sourcing quality investing opportunities for start-ups or distress relief as well as providing a predictable source of capital. Debtcraft provides interim, initial startup, gap and distress relief capital using its own capital and the capital of a variety of private investors familiar or eager to be involved, with the cannabis explosion.
• Debtcraft originates legal cannabis related capital requests for high quality people. We will do capital extensions as low as $100,000 and as high as $5,000,000.

Penny Stocks

• Being involved with pink sheets and a lower graded trading platform can be hazardous, especially in the Marijuana sector. Each week there is a new canna stock being promoted—absent any real product or service. In recent years, share values at many of these newly created firms opened rock bottom low and running up to 40 times their opening. Very common to see these large and steep increases and declines on companies still attempting to generate minimum revenue. Despite being difficult to assess valuation due to lack of earnings, cannabis investing opportunities can provide high yields where the underlying fundamentals such as management, capital reserves, IP/other owned assets are under ownership.

How Do I Start the Process?

Debtcraft serves both avid investors seeking investment opportunities in this growing industry as well as cannabis entrpreneurs seeking partners, capital or advisory services. We first establish the need:

• What’s needed? Money, advice or contacts?
• What’s your business plan?
• Who are we dealing with? We only look for good, professional relationships.
• How long in the industry?
• Any special designations? Is your licensing under control?