Adam Stettner, founder and CEO of cannabis lender FundCanna talks to Cannabis Wealth about the lack of funding in the cannabis space and what makes a canna-business viable for lending.
Given its legal status, access to capital has historically been a challenge for cannabis companies and in many instances, there continues to be a rift, especially for small-medium sized companies looking to scale up and expand.
In America, the cannabis industry remains federally illegal but 39 states have legalized the drug to some degree. Each region has its own regulations and license requirements leading to a fragmented industry lacking federal support and even less financial access for cannabis operators.
“This results in cannabis operators, particularly small and midsize cannabis businesses, being underserved and under-banked,” Adam Stettner of FundCanna told Cannabis Wealth.
“Often where there is access there are onerous terms, lack of flexibility and an inability to renew or draw down as needed. Too often, fixed terms do not mirror the business needs. Many of the funding options [require] hard collateral like real estate or are inflexible.”
The landscape is improving as access to funding continues to grow for smaller cannabis companies but there is still a huge void to fill. FundCanna has focused its efforts on helping SMEs reach the next level in their growth strategy with flexible debt financing.
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