Scott Jordan, Director of Business Development for Dynamic Alternative Finance, sat down with HIGH! Canada to discuss our business model and the different options available for securing marijuana investment.
Scott Jordan, Director of Business Development for Dynamic Alternative Finance, discusses recreational marijuana and California businesses with the team at San Francisco’s FOX News.
Scott Jordan, Director of Business Development will be in Portland, OR February 14-16 for the Collective Cannabis Conference. He will be speaking on the 14th at 3:25pm in the Portland Expo Center He will be discussing how to successfully invest in the emerging cannabis industry. Please see their Investor Forum page for additional information on location and agenda.
You can receive $50 off your registration fees by using code CCCBUD. If you are a business seeking funding, please go to the Pitch Portal where you can apply for funding.
The marijuana industry has come a long way in the last 5 years. The cannabis market as-a-whole is one of the fastest growing industries in North America, and is quickly becoming one of the most profitable. States that have passed some form of legalization are reporting gross sales in the billions, and these numbers will be increasing as more states legalize marijuana.
Many investors are turning toward the cannabis industry to supply capital to this cash starved industry. Whether from venture capital firms or private money investment, the marijuana space is seeing more investment from private non-bank sources than ever before. Despite marijuana being illegal at the Federal level, investors are enamored with the higher returns and the appeal of the growing industry.
Continued Research and Positive Reception
Marijuana-related products continue to gain popularity for both medical and adult use. The largest contributor to the cannabis market’s expansion is the mounting medical research showing its benefits. Able to help with ailments ranging from anxiety to cancerous tumor growth, cannabis and derivative products like CBD (Cannabidiol) oil are now receiving recommendations from doctors in many states. Attention to its medical benefits is gaining worldwide acceptance.
There are 28 states that have now legalized some form of marijuana use, where 8 of these states do not require a medical recommendation. There were 4 additional states which voted to legalize adult use in the November 2016 Elections, which has only proven to be an economic boom for states like Colorado that have had increased employment, increased tourism, real estate values and other economic benefits. Colorado reported nearly $1 billion in cannabis product sales in 2015, and the figures for 2016 are expected to be larger.
One of the largest issues marijuana businesses are faced with is the difficulty and cost of obtaining banking and traditional loans to expand their business. Despite being legal in some form in 28 states, it remains difficult for cannabis-based businesses to open a business bank account, obtain a loan, or open a line of credit. This is where private investors provide value to the industry.
Private capital is one of the preferred options available to the business owners, who want to maintain control of their company without further diluting their equity. Dynamic Alternative Finance has been able to secure more than $25 million in funding for cannabis-based businesses in the past 2 years. The need for capital continues to grow as more businesses are expanding into other states and larger facilities.
High Returns from Sound Investments
One of the reasons investors are looking at the marijuana industry is for the above average returns and the profit potential. Investors can receive monthly cash flow and obtain returns in the 12% and higher range. The cannabis industry is constantly evolving and investors are providing new and innovative products to serve this need for capital to expand their business.
Several of these cannabis businesses are large, multi-location, vertically-integrated operations with multiple product offerings. At Dynamic Alternative Finance, we arrange financing for established marijuana businesses that require more than $250,000 to expand their operations.
The Opportunity is Only Growing
The opportunity for investors is expanding as more states legalize marijuana and cannabis business owners have a need for equipment, real estate and working capital loans. Continued legalization of cannabis and related products means that not only will more companies open in the market, but more companies will decide to move into the market. Food and beverage companies are starting to explore and expand with marijuana-infused offerings and tobacco companies are investing in cannabis vape brands. Cannabis derivatives like CBD are presenting companies the opportunity to include the health benefits of marijuana in their products, without the psychotropic effects.
Scott Jordan, Director of Business Development for Dynamic Alternative Finance, sits down with Ricardo Baca of the Cannabist to discuss the marijuana finance process. Starting at 28:45, watch them discuss recent transactions and what sets DAF apart from other capital sources.
Scott Jordan, Director of Business Development for Dynamic Alternative Finance, shares the 3 things that you should being doing to borrow money for your marijuana business with MG Magazine. Read about planning phase for obtaining funding and how to identify the right sources for you.
At Dynamic Alternative Finance, we help business owners acquire the funding they need to expand and grow their business when traditional resources aren’t available. Most recently, we have helped businesses with expansion projects, inventory woes and final touches before opening. Read more about each below:
Cannabis Company Expansion $350,000
A vertically-integrated marijuana company wanted to expand past it’s 2 stores and grow operation without searching for equity capital. We were able to arrange a $350,000 deal in less than 3 weeks.
Marijuana Storefront Build-Out $350,000
A vertically-integrated cannabis company wanted to open a 4th store in the Denver area without diluting their equity. We were able to secure a $350,000 working capital loan for the build-out of their new location. They were drawn to the speed and flexibility of the lender, and the ability to obtain exceptions during the underwriting process.
Grower’s Working Capital $325,000
A wholesale adult-use cannabis grower in their first year of operation needed additional capital for marketing, equipment and supplies. Losing money, and unable to invest resources in raising equity capital, we were able to secure a $325,000 private money real estate loan using equity in the real estate and green house as collateral. This deal closed in a mere 10 days from the first call.