This article was originally published on WeedWeek, and appears here with permission.
In recent months, special purpose acquisition companies, or SPACs, which function as “backwards IPOs,” have become the darlings of the cannabis world and the broader economy. However, a recent report that Casa Verde Capital, a SoCal investment fund co-founded by Snoop Dogg, has raised a $100M fund, underscores that traditional venture capital is alive and well in cannabis.
With U.S. pot stocks on a tear and legal REC coming to New Jersey, with more of the northeast likely to soon follow, WeedWeek asked two senior insiders how they would put $100M to work. Casa Verde did not respond to a request for comment.
These types of deals are occurring more often as a less costly and more efficient go-public strategy.
Recall in November how
Caliva and entrepreneur Shawn Carter (aka Jay-Z) inked the largest ever SPAC deal with
Subversive Capital Acquisition Corp. (OTCQX:SBVCF). The SPAC would acquire Caliva and Left Coast Ventures for a respective $282.9 million and $142.2 million.
But SPACs must clear several hurdles in 2021 to remain a popular and effective investment alternative.
SPAC Deals May Close In Just A Few Months
The traditional initial public offering (IPO) process is expensive and time consuming. SPACS allow companies to go public without spending as much money or time on the process.
The main thing holding the cannabis industry back is access to capital, according to Cresco Labs Inc (OTCQX: CRLBF) CEO Charlie Bachtell.
Bachtell, who took over Joe Caltabiano’s duties in March, discussed a variety of marijuana-related topics with The Associated. Read More. Don t Miss Any Updates! News Directly in Your Inbox Subscribe to:
Cannabis Investment Boom: Its Existence Is Up For Debate, Say Industry Insiders
Cannabis Investment Boom: Its Existence Is Up For Debate, Say Industry Insiders
From intricate tax laws to the evolving acceptance of marijuana in the United Nations, cannabis investing is no walk in the park.
The green wave of cannabis reform swept through America on Election Day 2020, ushering in new laws across five states. The momentum could continue, depending on the Senate’s balance of power, which will be determined in two January runoffs in Georgia.
The belief among some in and around the cannabis investment space is that if the Democrats win Senate control, the industry could see the passage of crucial bills, including the MORE and SAFE Banking Acts, bolstering the cannabis market’s long-term potential.