After Licensing Delay, Illinois Social Equity Applicant Remains Optimistic, Outlines Enterprising Plans

  • Investors evaluate cannabis (meaning THC-rich) and hemp (meaning cannabis containing a maximum of 0.3% THC) companies differently for a variety of reasons: different federal statuses, access to national a market vs. locked in single-state markets, and available biomass all play into how analysts and investors look at each market.
  • Despite hemp companies having access to federal bankruptcy (thanks to the 2018 Farm Bill legalizing the crop), Gerson believes THC companies in general are in a better position to negotiate with vulture investors compared to their low-THC counterparts.
  • Another issue with the hemp/CBD side of the marketplace making it difficult for those companies to navigate debt or equity markets, according to Gerson, is CBD tinctures can be expensive: a 30 ml bottle of Premium Jane tincture with 1,000mg CBD retails for $124.00 on the company’s website , for example.
  • Colin Kelley, operating partner at Merida Capital, a cannabis investment fund, puts the current situation for hemp companies a bit more bluntly.
  • Different parts of the supply chain bring different value to vulture investors.

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