Savvy investors will be looking for their slice of the green pie. The legal marijuana market could reach $10 Billion dollars in profits in 2017. Hundreds of millions of dollars will be raised for thousands of cannabis startups.
If you are thinking of getting into the marijuana business, you should know what investors like.
- Be ready with an easy to understand pitch deck – Include information on the management team, risk factors, term sheets, disclaimers, barriers to competition and the unique value proposition your company or idea brings to the table. Make sure you have proofed and vetted the pitch deck multiple times.
- Do your homework about politics, laws, and how this can affect margins. Investors want to know you have invested the time in really getting to know the nitty gritty of the industry as well to have a better idea of where it’s headed.
- Be realistic, avoid making pie in the sky claims, and approaching investors with a “trust me” mentality. Most investors are realists, so don’t be overly confident to the point that you will decline coaching from others who are more experienced in your field. Investors want to know that you are capable of learning and open to creative ideas from third parties.
- Be transparent about the information surrounding your business and ideas, and have the information to back it up. Investors understand marijuana businesses are not unlike other investment opportunities; they too will have their share of weaknesses. So do not be afraid to share them. Acknowledging any weaknesses will help you create a plan to resolve those issues. The MOST important rule is, never try to answer questions that you do not know the answers to. Investors don’t expect for you to know everything, but they can sniff a bull crapper a mile away.
- Investors do not fear past failures. Don’t be afraid to disclose previous failures. Believe it or not, this may help you attract investors. Failure is not the opposite of success but a part of it. Investors typical understand a few bumps in the road means the entrepreneur has gained valuable experience. Investors want to invest in winners. Just remember, losers live in the past and winners learn from the past.
- If you identify a potential investor don’t forget the art of following up. Investors stay swamped with opportunities. They rarely make a decision on the spot. So make sure you follow up with updates and developments of your business. It’s amazing what a simple phone call, text message or email can do to help you close the deal. With that being said, there is a difference between following up and being a nag. Do not get labeled as the buggy boo. Remember, be patient, closing investment deals will take time.
If you or someone you know is interested in learning how to prepare your business to raise capital, we can help, in many cases at no costs. If you’re an investor looking to identify investment opportunities in the cannabis markets, we have evaluated and vetted deals at fair valuations ready for due diligence. Please reach us at (619) 326-4182 or email me at chris@xmgmedia.com
What Investors Want
Savvy investors will be looking for their slice of the green pie. The legal marijuana market could reach $10 Billion dollars in profits in 2017. Hundreds of millions of dollars will be raised for thousands of cannabis startups.
If your are thinking of getting into the marijuana business you should know what investors like.
- Be ready with an easy to understand pitch deck – Include information on the management team, risk factors, term sheets, disclaimers, barriers to competition and the unique value proposition your company or idea brings to the table. Make sure you have proofed and vetted the pitch deck multiple times.
- Do your homework about politics, laws, and how this can affect margins. Investors want to know you have invested the time in really getting to know the nitty gritty of the industry as well to have a better idea of where it’s headed.
- Be realistic, avoid making pie in the sky claims, and approaching investors with a “trust me” mentality. Most investors are realists, so don’t be overly confident to the point that you will decline coaching from others who are more experienced in your field. Investors want to know that you are capable of learning and open to creative ideas from third parties.
- Be transparent about the information surrounding your business and ideas, and have the information to back it up. Investors understand marijuana businesses are not unlike other investment opportunities, they too will have their share of weaknesses. So do not be afraid to share them. Acknowledging any weaknesses will help you create a plan to resolve those issues. Rule# 1… Never try to answer questions that you do not know the answers too. Investors don’t expect for you to know everything, but they can sniff a bull crapper a mile away.
- Investors do not fear past failures. Don’t be afraid to disclose previous failures. Believe it or not this may help you attract investors. Failure is not the opposite of success but a part of it. Investors typical understand a few bumps in the road means the entrepreneur has gained valuable experience. Investors want to invest in winners. Just remember, losers live in the past and winners learn from the past.
- If you identify a potential investor don’t forget the art of following up. Investors stay swamped with opportunities. They rarely make a decision on the spot. So make sure you follow up with updates and developments of your business. It’s amazing what a simple phone call, text message or email can do to help you close the deal. With that being said, there is a difference between following up and being a nag. Do not get labeled as the buggy boo. Remember, be patient, closing investment deals will take time.
If you or someone you know is interested in learning how to prepare your business to raise capital, we can help, in many cases at no costs. If you’re an investor looking to identify investment opportunities in the cannabis markets, we have evaluated and vetted deals at fair valuations ready for due diligence. Please reach us at (619) 326-4182 or email me at chris@xmgmedia.com.
