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Do you have a client looking to launch or grow their cannabis operations? Finding secure and compliant cannabis financing may seem challenging, but this blog post will share how to find the optimal lending solution.
For potential cannabis entrepreneurs, finding the right financing is essential to getting their business off the ground. Due to the unique legal status of cannabis, many traditional lenders don’t approve cannabis businesses for financing, or they have an exhaustive process to do so.
The good news is several specialized cannabis lenders can provide the funding you need. Below are a few tips for finding the right cannabis financing.
Before you can find the right cannabis financing for your client, you need to evaluate their needs. Are they looking to purchase a property? Or are they wanting to build a dispensary or manufacturing facility from the ground up? This will determine the type of financing you wish to refer them to.
If your client is looking to purchase a property, you will want to refer them to a lender specializing in real estate loans. If they are looking to build a dispensary or manufacturing facility from the ground up, you will want to refer them to a lender specializing in commercial construction loans. Or, maybe your client has a different need. Regardless, understanding the need is critical to help determine the types of cannabis financing options available.
There are various options to explore when funding a cannabis business. A line of credit can provide working capital your client can use for everyday expenses, such as inventory or payroll. Invoice financing can help businesses to free up cash flow by using unpaid invoices as collateral for a loan.
Business owners can use equipment financing to purchase essential equipment, such as fans or grow lights, or construction loans to build out cultivation or dispensary facilities. Finally, bridge loans can provide short-term financing for businesses waiting for long-term loan approval.
At AVANA Capital, we understand the cannabis industry’s unique financing needs. We offer commercial construction loans, real estate loans, and bridge loans to cannabis entrepreneurs. We are dedicated to helping our clients grow their businesses and achieve their goals. Contact us today to learn more about our financing options.
Any business owner will tell you that access to financing is key to success. However, traditional lenders like banks are often reluctant to work with cannabis businesses due to the industry’s legal uncertainty. As a result, alternative lenders have become a popular source of financing for cannabis businesses.
However, researching before working with any lender is essential, as not all lenders are created equal. In addition, ensure the lender complies with all relevant regulations and their security measures are up to par.
When looking for a lender, there are several things to consider, including the type of business, the stage of development, and the desired loan amount. Fortunately, there are several options available for cannabis businesses. The key is to connect your client to the right lender.
One option for cannabis financing is private investment. This can be an excellent option for well-established businesses with a solid track record. Private investors are typically interested in long-term partnerships and are willing to provide large sums of money. However, they may also require a higher level of involvement in the business.
Another option is cannabis venture capital firms. These firms specialize in investing in early-stage cannabis companies. They tend to be more hands-off than private investors and usually provide smaller sums of money. However, they can be a good option for starting businesses that need seed money (pun intended) to get off the ground.
Cannabis financing is an essential part of growing a successful cannabis business. By connecting your client to the right lender, you can help them secure the funds they need to continue thriving.
At AVANA Capital, we understand the cannabis industry is proliferating and that business owners need access to financing to take advantage of new opportunities. We offer various financing options for cannabis businesses, including commercial real estate loans, construction loans, and bridge loans.
Our team is dedicated to working with you to identify the best option for your business and to get you the funding you need as quickly and efficiently as possible. Contact us today to learn more about how we can help you grow your cannabis business.