Cannabis Knowledge & Insights

Cannabis Industry Update: June 2020 + Q&A

In our monthly cannabis industry update, we talk about many topics including cannabis business taxes, cannabis industry news, and take questions from the live attendees.

We covered topics ranging from updates on dispensary & delivery licensing for Los Angeles, how California cities may kill the delivery model, and cannabis business funding questions.

If you need help with your cannabis business, then please reach out to us today to get started.

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Cannabis Business Webinar Transcript

All right. So thank you for joining today’s live session on our monthly update on the cannabis industry. And this presentation is brought to you by Green Growth CPAs. So today we’re going to talk about a little bit of prepared material, as well as go over some questions from the audience. So thank you for joining now, before we get started, I need to let you know that the information contained in this presentation is meant for guidance purposes only, and not meant as professional legal or tax advice and further, it does not provide any personalized legal tax investment or any business advice in general. So with that out of the way, let’s review what we’re gonna cover in today’s livestream. So again, first we’re going to go over some big developments in the industry over the past 30 days since our last live stream of the industry update, and then take questions from the audience.

I’ve gotten some submitted early, drop your questions in on the YouTube chat or on the webinar jam chat. If you have some that come up now, if you need help with anything finance or tax related for your cannabis business, then please reach out to Green Growth CPAs via our website or give us a call (800) 674-9050. So let’s hop into the prepared material I want to share with you guys. So first and foremost, the tax deadline for your income taxes is due. It’s going to be three weeks about July 15th. So that’s gonna be federal and state taxes are going to be due. So make sure you plan ahead and get these things done. And if you need help with your filings, for your taxes at both levels, state and federal, please reach out to us. We can help you out with that. Getting filed on time and accurately.

Now, secondly, we’ve all been seeing these protests going on and you know, there’s been looting at certain cannabis dispensaries or distributors or any other types of cannabis businesses. So you’re thinking, well, what do we do? How to recover from this. Now on the tax side, the CDTFA has released some guidance, a very good stuff to understand on how you actually need to prepare for your taxes. So again, during those recent protests, the businesses were looted and, …, other assets were taken, cannabis was taken. So for some of those products, taxes were already paid, but no retail revenue was actually generated. So there’s two taxes. I want to talk about you have the cultivation tax and then the excise tax. Now for cultivation tax distributors are supposed to collect this tax from the cultivators based on the way in the category that cannabis has its flower or trim.

Now the tax law States that this must be collected once the cannabis moves into the legal market. And that means once it has passed testing. So once it passed testing, that means it’s now into the legal commercial market. Now, there are no provisions in the tax law that exempt cannabis cultivation tax, once it enters into the market, even if it was stolen. So if you have cannabis that was stolen cultivators, don’t expect to get your cultivation tax back for that product. …, now, so distributors, you need to still remit that cultivation tax to the CDTFA no matter what, if the product was stolen or not now for the excise tax, conversely, there’s some different guidance on that. So if you understand excise tax and this may be the same for other States as well, please reach out to us. We can get you more guidance, but I’m just sharing the California guidance because primarily our audience is based in California.

So with excise tax, it’s a 15% markup on the retail. There’s also a calculation of, you know, 80% markup of the wholesale price, not that important at any rate, there’s an excise tax being collected on cannabis. And this is in almost every state. So since that cannabis was not sold at retail, because it was stolen, that tax actually never became, do we give guidance that distributors should collect the tax on delivery? Because if a retailer goes belly up the distributor, you’re on the hook for that tax. So we always say collect that tax when you deliver the product. Now, if you’re working on, you know, other terms, it’s totally up to you, but collect that tax upfront. But beyond that, if you’re a retailer and you have already pay that tax and the cannabis was stolen and you’ve paid excise tax on it, you can request a refund from your distributor for that excise tax.

Now it’s going to work out in a few different ways, two main ways. …, first for both ways, you’re going to need some backup documentation. You can’t just call up and say, Hey, some cannabis was stolen. You need to have a police report or an insurance claim document. That’s be very important. And then that will allow you to reach out to the distributor and say, Hey, I need to excise tax back, …, for these certain amounts of cannabis and go from there. Now they’re going to either issue the refund right away. If they haven’t filed, or if they have filed, then they’ll go back to the CTFA. The distributor will get a refund from them, and then parlay that back to you once they receive that now, very, very big information, no matter where you’re at, make sure that your documentation is buttoned up extremely tight because the CTFA or very slim a use case, right?

Then not many. I mean, there was a lot of businesses that got smashed up a lot of cannabis businesses, but it’s not a majority of them. It’s a minority of the businesses. Your documentations can be very, very important when the auditors come through to verify that you’re paying the right amount. I believe that auditors. And we believe that auditors will for sure look into these cases. Now, lastly, your cannabis is in metric, whether that, or whatever kind of tracking trace kind of software that you have for your state, make sure that you reach out to the BCC, which is the Bureau of cannabis control or any other cannabis industry, …, Bureau within your state that does your track and trace and get guidance on how to Mark off that cannabis. Cause it got transferred over to your entity. Make sure you take that the right way.

I don’t have any guidance on that specifically right now, but look into that. Now, second thing I’m talking about with taxes, Harbor side, big, big case is a dispensary up in Oakland and they were a retailer and they were arguing that section two 80 of the federal tax code is unconstitutional. And this time they’ve got an, they’ve got, you know, decisions that keep coming and they keep appealing them. So they got a new legal team recently with a slightly different approach. But other industry, people that are looking at it is believe that is very, very long odds that this is actually going to work out for them. And it could actually harden the stance of the IRS onto ADE. So they’re using two arguments. Harborside is saying two different things. So the ninth circuit that’s section two 80 E has been applied in an unconstitutional manner that runs contrary to the 16th amendment to the us constitution in their second leg to stand on, is that the U S the IRS and the us tax court have been wrongly interpreting how cost of goods sold or cannabis cogs should be calculated by cannabis companies under section two 80.

Now the 16th amendment one is kind of the one that stands out. Cause you see a lot of these tax court rulings for two 80 is like, this is unconstitutional. You shouldn’t be doing this that never, ever, ever, ever works. But with the 16th amendment one, they say that, you know, the 16th amendment says that you can have an income tax, right? The the government can put it out that you have an income tax. And the first argument is that 280e results in a tax. That’s not on income. And it said, does it say here it’s a, not an income tax. So therefore it’s unconstitutional. There’s a lot to unpack in that. And I don’t want to go too deep into it. And, you know, you may not hear anything about this case for a year or two, because these tax court rulings, they take a long time to turn around because there’s a lot at stake here for the cannabis industry and for the IRS.

If they start to turn things over, think about, you know, I think this case stems from either 2009, 11 or 15, I know that’s very wide, but at any rate, think about if it’s just from 2015, that’s five years of back taxes that in tax filings for every legitimate business that I adhered to 80 E they would have to go back. They being the IRS and the preparers for those businesses have to go back and then do amended returns and get refunds from the IRS. That doesn’t sound like something that’s going to be happening. So I would say, don’t hold your breath and bank on this getting overturned, but Hey, we could be in for a pleasant surprise. We’ll see how that shakes out now. Second or sorry. Third part here on the taxes I want to talk about is that there was this late petition.

You may have seen this, …, essentially what happened is that earlier this month, the ninth circuit tossed out to California cannabis company’s challenge to the tax law, that bars cannabis businesses from taking deductions based on the petition seeking nearly $2 million tax bill that arrived one day too late. So essentially these businesses, you know, were filing their taxes. They got assessments against them after being audited. It said that they owed $2 million that was built up of, I think, one point $6 million in back and at 330, $2,000 in tax penalties. And this is stemming from the tax years, 2010 and 2011. Okay. So their council and whoever sent this thing in via FedEx, it arrived one day late. Now with most IRS filings, when you ship it out, it’s considered filed, right? That’s why some people will ship out their tax filings via the U S P S it’s postmarked on April 15th.

You’re good. Right? Or July 15 for this year. Now that’s only for approved, …, careers. Okay. So that’s like, you know, other, you know, S I’m not sure who else is involved in there. Obviously the U S P S is, but FedEx was not on that, …, list. It got added multiple weeks later, but we need to understand is that the moral of the story is file on time accurately. And with the right method of mailing, this company is going to end up having to pay $2 million for being one day late. That’s a big, big deal. I’m sure they’re going to appeal it, but I believe it’s gonna go to like, you know, summary judgment and right to just pain. And also do not wait to file last minute for any, either your tax filings petitions to the court. Don’t wait, you’ve got this stuff. You’ve got months in advance to prepare for it.

It fee or a penalty because you’re one day late, be thoughtful file on time file early and file accurately. So that’s the tax stuff there. If you have any questions, drop them into the chat here. And then next let’s talk about some licensing updates. Okay. So big licensing updates for the month of June. Now you’ve got Louisiana expanded their medical access for the clientele for the patients. So what you’re going to see now is significantly more Louisiana residents are going to have access to medical cannabis under a very major expansion of the state’s therapeutic cannabis program that their governor Edwards signed into law. Now, these changes are going to go into effect in August. So what this does is it allows doctors to recommend medical cannabis for any patient that they believe it would help, which removes all these big restrictions in which doctors can recommend cannabis, right?

It was, you know, for very nuanced things, you know, the cannabis or for cancer treatment, or for, …, any other kind of debilitating illnesses, it’s really, really opened up for this. So this is a big, massive win for patients and a big win for the industry. When you have more people, especially in a state in the deep South that is going to allow more people to have access to this cannabis. That’s just going to become more advocates for our industry is going to be more money for the businesses, more tax revenue for the state. And then maybe they start to push up, getting to recreational a little bit faster. I hope that’s the case. We’ll see how it shakes out, but that’s a big win for everyone in the industry. Now the major, major, major update on licensing for the California market is that LA licensing and social equity applicants.

So this is going to be a big one here. I want to talk about now, there was a, let me just start here. As you may know, with LA the social equity application opened up, I think it’s September or October. I think it was the end of September, actually last year. So about nine months ago, it went incredibly haywire. Some people got access to the licensing application, you know, 10, 15 minutes early. It was a first come first served and first licensed kind of basis. So if you submitted your application first, you got looked at first and potentially got a license first. So it was very important on the timing of that application. People got in early submitted their application and it was 11 or 12 people got in earlier groups, shall I say? And there’s a lawsuit that’s kind of going on with this.

And there was an audit that happened, I think in March. And they said there was nothing really that big of a deal, only 11 people, but the DCR has gotten some Gusto behind saying, alright, we have some recommendations for the LA city council on the cannabis business licensing structure and the social equity program. Now there are four prongs to these recommendations. So first they’re gonna be granting or recommending to grant temporary approval for all social equity license applicants. I didn’t read too deep into this as if it’s everybody that submitted an application is going to get it that meets the requirements. I believe that’s what that means, but we’ll see. I’ll talk about that in a moment. Now, second, allowing this is going to allow applicants and businesses to re locate as well within the city. So currently applicants are required to find a location and stick with it throughout the licensing process.

Now subsequently over the past nine months, new properties have popped up that are either more economical or better for business. So they’re allowing people to kind of move their licensing thing around because there was some contingency stuff and people had lost their location because they couldn’t keep up the rent. …, you know, we’ve been going nine months here. So think about sitting on nine months of rent it $10,000 a month. That’s 90 grand with no revenue. No, one’s not a lot of who are just sitting on $90,000. So that’s a big one third part here is that it’s gonna be limiting new storefront, retail and delivery licenses to social equity applicants only until 2025. That’s, you know what, 54 months away, right? That’s four years, four and a half years away that only social equity applicants going to get licenses. And then the fourth part of this is that they want to improve the processes to minimize predatory practices in this social equity application program.

Now, what you’re going to see is like a lot of these bigger companies, I won’t name any names, but we’ve seen a lot of these deals. They’re pretty much giving these predatory investments into companies, these cannabis companies that are social equity based and, you know, pulling out all the stops, you know, limiting their profit upside, limiting their exit upside and all these different things and really putting these big burdens on them. So they want to, the DCR wants to put a, pull that out and kind of put some processes in place to create strict requirements. Now, yesterday, the rules committee voted on these changes for the city social equity program. All good there. So today at 10:00 AM, it’s noon right now. So the LA city council today is going to be considering those items that were passed by the rules committee yesterday, again, meetings at 10:00 AM.

I don’t know how it shook out. We’ll see. And I’ll keep you updated on that. But these are in cannabis in LA the social equity overall for all the States. Well, this will allow us more licensees, …, and people in the social equity application program to have access to the industry, right? They’re very misrepresent re represented in, I say, disproportionately underrepresented in the industry, …, people have that have been thinking about the war on drugs and you know, and the jail over cases, things of that nature. So I think this is a great step in that direction, and this will allow more licensees. So more people, right, licenses are going to become worth a lot less. This will allow market dynamics to see who the real winners are in the industry, right? You shouldn’t win by regulation. You should win because you’re a great operator.

Now getting into the industry is a different thing. You need to have regulation to allow people into the industry, but winning in the industry, that should be by the best operators that run the best, you know, awesome businesses. Now, not everybody’s happy about all of these recommendations, legacy players, people that have been in the industry for quite some time that are not social equity eligible. They believe they’re gonna be pushed out of the market. That may be the case. We’ll see how it goes, but, …, we’ll see how that, I don’t know how that’s going to shake out, but again, this all stems from that very poor process that happened at the end of last year for their licensing. Now this long pause is very, very, you know, damaging to the pocket of anybody that’s been sitting on some rent. But one thing to know is that there is a lawsuit out there from one of the social equity applicants.

I think there’s a hearing on July 9th for that lawsuit where they’re going to see about redoing the entire process overall to begin with. So there’s a lot of ways this can move, but it seems like less the whole, a lawsuit on the July 9th hearing, it looks like social equity applicants may get a good foothold here in the Los Angeles market. So we’ll see how that goes. I’ll keep you updated on that now, again, drop any questions in here. We’ll get to those questions and see how things are. If you have any more questions, but let, let’s talk about a lot of legal case here that you really, really need to keep an eye on as a delivery business or anybody that’s looking to go into delivery for the state of California. Now with California cannabis, you can pretty much, when you get a license in one city, you can deliver anywhere in the state, as well as understand that two thirds of the entire state of the cities in the state say, we don’t want any kind of commercial cannabis activity.

So they don’t license that stuff, but where it stands now we can still deliver to that city because it’s like, you know, just say it’s a consumer protection, right? They should be allowed to get access to this product. That’s legal in this state. You just can’t run a business license in that city. So it was a highly, highly anticipated trial that set to take place in July. And it’s where the regulators are going to be looking to stop the overturning of the, …, that law, where you can actually go out and deliver to other States. Certain States, I think 25 local governments have gotten together. And they’re arguing that the delivery policy violates state law by overriding the city’s ability to regulate cannabis commerce at the local level. So they’re suing regulators to stop this. And that could really, really big, be a big punch in the mouth for these cannabis businesses.

Especially if you’re relying on some of these cities to drive certain revenue, there’s a model out there where you go and open up a delivery service right outside one of these cities that does not allow it. So you can just serve up that city. You don’t need to be in it, but you can be close and serve that city up and take care of those customers. Now, if the court were to side with the cities, right in abandoned, this delivery medium, the legal cannabis market could potentially collapse. If legal transactions are not allowed in those jurisdictions, then only illicit transactions are going to occur in those jurisdictions. And the illicit market is going to be perpetuated and grow deeper and stronger. And the goal of creating a legally regulated statewide commercial cannabis market would then be initially essentially sabotage. Okay. So this is very, very big.

So we’ll keep you updated on how this all comes together for, …, the July monthly cannabis update. But this is one to really keep an eye on. And I don’t know how it’s going to shake out. It’s very mixed emotions are Saudi saying, not emotions, but stances on the motions that the BCC has put out there against this court filing. We’ll see how it shakes out. I hope that the state prevails and that they allow this dispensary, sorry, this delivery mechanism, where you can deliver to States that are not licensing out commercial activities, because that’s very, very big. And it’s, …, again, this could collapse the industry in California, as we know it drop any more questions in here. I’m going to go, I got about of that were sent in early, and we can go ahead and get into those, but drop in your questions.

If you have any questions about when we’re talking about today, how it could affect your market or just anything, whatever questions you, if you have questions about financials, or if you have questions about any other companies, let us know, drop them in here. I want to make sure that I get to these, …, when we go ahead and, and get going. So the last thing, three things I want to cover here, deal with black market and elicit market kind of updates in how this is actually playing out, right? When you think cannabis, you think there’s going to be some type of, you know, big boom and all of this regulated markets going to go great. But in these more mature markets, California, Colorado, they’re going to have these very well built black market illicit market off market, illegal shops that continue to thrive because it’s very hard when you drive by as a consumer and as a regulator to tell, if this person is regulated, you know, in California, they’ve got these big QR codes now where you can scan and see if that’s a legit shop, but who’s to stop these illegal operators from putting a big QR code.

So from the street side, it looks like it’s a legit shop. Now, two things that play here in California, this is pretty big stuff. …, you’ve heard of this defund, the police movement. And so what the LA city council is proposing here. I’m not sure if this is driven specifically by the defund, the police movement, but this will surely be an application you’ll see throughout. I think many other States that’s going to happen, where if you want to defend the police, they’re just going to take away certain enforcement things. …, we’ll see how that shakes out, but let me get into this here. So LA is actually asking for a 100% reduction in the cannabis enforcement budget. Now, currently it sits at $15 million and they want to take it down to a goose egg to zero. And that means no enforcement on against these illegal shops.

So it means a stronger elicit market and then no taxes collected on these illicit businesses. This is a pretty backwards move overall for the industry. I think it’s kind of crazy that they would want, want to do this, but even with this current budget of the $15 million in enforcement is still pretty difficult due to COVID as well as even before that, again, it’s hard to tell these shops away from these illegal shops compared to the illegal shops. And it’s built into the budget of the illegal shops that they will get caught, right? They know that they’re going to have to move locations and they get caught. Guess what happens? All it is is that, you know, stuff gets smashed up. The product is taken in the money gets taken the time site. So just don’t leave a lot of cannabis there and don’t leave a lot of cash there and then just find a new spot opened up in a month.

You’re not paying any taxes. This is built into the illegal business business plan. So at any rate in gen, you know, …, this current budget, cause it’s going to go crazy. I think these budget cuts are really because the LA, …, macro budget, their whole city budget is out of balance for the next fiscal year. That starts on July 1st. They don’t do it end of year. They do a mid year, July 31st. So we’ll see how this all shakes out. But again, this could become a macro trend. You see, in other States, if they’re going to, you know, do the defund, the police movement, I would hope that they would allocate some of those expenses to, …, you know, other good programs, but don’t take it away from the enforcement against illegal cannabis based businesses. It’s going to be a net net, double loss for the city, right?

It is going to be less cannabis activity, …, for those legal sh for the legal shops. So less cannabis activity for the illegal shops, which means they’re not driving in revenue for themselves, but also they’re not driving in tax revenue for the city. So we’ll just kind of create this cascading effect. We’re going to see drops and budgets for that. Now let me bring up here. Why I believe that because the second article or the second kind of thing I want to talk about is that California governor right now, Gavin Newsome is warning of a decline in cannabis sales due to COVID. Now, this is contrary to what we’re seeing on the short term, but we’re talking about a long term next one to two years. So know tailing out this fiscal year, and then looking at what’s happening for the next fiscal year. And it’s, it’s pretty eyeopening.

…, no we’ve been seeing right now higher, you know, people going into lockdown or shelter in place. They’re buying a lot of cannabis, but we you’re seeing when you shelter in place, there’s a lot less ability for new people in the industry to just randomly collide and go into a dispensary. Or there’s a lot less ability for people to say, Hey, we’re going out for a birthday house party. Let’s get some cannabis to go along to the house party with, you know, it’s a lot less of that. And a lot more individual consumption, not like group consumption, …, especially if we go into a second lockdown is going to be pretty big. So understand this Gavin Newsom, he projected that we’re going to have $479 million in excise tax to be collected. You know, for the past 12 months and four or five months ago, six months ago, they said that now they brought their guidance down for this fiscal year, which ends at the end of this month, it’s down 8% and they think granola can collect $443 million, which is still a good amount of money.

But bringing your guidance down 8% in tax collected is a pretty big deal, but even more bigger, shocking one is that they’re looking in forecasting a 27% decrease in the cannabis excise tax collected next year. Now, I mean, that’s per their guidance, right? So the January guidance was 590 million. They’re projecting 435 million. So it’s a 27% decrease as a lot of money that’s moving, like not going to be happening in the cannabis industry for taxes. So what is that? Four 35 S what? 70 160 million or something like that. Okay. So 160 million times eight, I mean, that’s almost a billion dollars in sales. They think they’re going to lose. That’s a lot of money, right? So, cause it’s 15% of them, of the retail markup. It’s a billion dollars cut right off the top of California’s revenue top line for these cannabis businesses. I’m not talking about a tax.

I’m talking about a billion dollars, billion plus in loss revenue for legit legal licensed operators spread throughout the state. That’s a big deal. And, …, and I hope this doesn’t really actually materialize, but I’m pretty sure they’ve got a lot of smart people working at the state to project this out. We’ll see how it all shakes out. But when you you’ll see this in other States, I believe because the more mature recreational markets we’ll see this, I think such just Oregon, Nevada, Colorado, since they’re not experiencing that initial exponential growth that Illinois or Michigan is seeing with their brand new markets of recreational or medical things of that nature, right? Oklahoma is just still, constantly growing, maybe flatter. …, I’m not sure exactly, but I know that it’s been in a parabolic growth, but these more mature markets, you may see this decline in cannabis sales and excise tax collected because you just don’t have that serendipity of social interaction, or just being able to go out whenever the heck.

You want to go out to just mosey into this new recreational shop. That’s on my block or that’s in my city. So we’ll see how that shakes out. But when you pair the pandemic with the no enforcement budget, tighter consumer budgets due to unhealthy macro economy, and also a potential for two thirds of the cities to say no to delivery of commercial cannabis, the California market literally could get kicked in the teeth and die if most of these things happen. So we’re walking on pins and needles here, we’ll see how this all shakes out. So I hope this does not happen. So we’ve got a question here from Josh Saya. I’m from Oklahoma. I am one of these people who qualified for grower license between March 31st and August 31st, 2019. This is the gray area in between when the two year residency requirement, …, legislator was signed.

And when it was supposed to actually go into effect, 90 days later, I am up for renewal in August to September. And not sure if I will get grandfathered into residency, like we expect it to happen when we applied before August 31st deadline, any insight onto what Oklahoma is doing here. So I personally do not have insight into that. I would ask you to reach out to Lawrence who was on our team. He’s based in Oklahoma. His email is Lawrence I’m going to type that into the chat here real quick.

So reach out to Lawrence. What he’s gonna be able to do is connect you with any lawyers. He can give you the guidance on how that’s working out. I don’t want to assume and say that you’re going to get grandfathered in. There’s all these different technicalities and nuances to that. So again, reach out to Lawrence. If he can’t answer that question for you, he is in a shared office space with many law firms that are working in cannabis and they can get you an answer and help you along with anything else you need. So Josh, thank you for that question. I hope that this was helpful for you. See there’s any other questions here? I’ve got a lot of them here on YouTube. …, yeah. King club. What is this court case called the court case? I’m not sure which one you’re referring to, but …, the one for the cities that are going against the state, I’m not sure.

Just, …, look up California cannabis delivery lawsuit. You’ll see the case come up and it’s, I think it’s in the night. I’m not sure what district it’s in, but just check that out. There’s only one case like it. So go ahead and check that out. You’ll get all the information that you need on that particular case. And again, it’s coming up. We’ll keep you updated on it as well. So another question here, I want to start a small cultivation, 500 plants in Southeastern Michigan. It’s my home state. I’m from Southeastern Michigan from Warren, baby. Yeah. So backyard grow on acres of property is their forums free wanting to do investors. And so Juan, so on wants to build small work to testing ASAP after your first couple harvest, have the three dispensary’s that will sell my product, going to utilize some sun, some supplemental lighting, looking for ideas to keep the costs down and maybe builds a game within my budget.

So just real quick here on the, …, how do you say the cost of cannabis starting up is going to be a lot of money to start up no matter where you’re at the cheapest state to license right now. And it gets started is going to be Oklahoma and it’s going to be significantly higher than anywhere else. I don’t know of any particular incubators or any other places that are going to take in people that you know, so called. Like they have these like type S licenses in California where you can tell the shared space where you can use manufacturing equipment. There may be other cultivators that you can partner with. And instead of starting your own business, become a junior grower and work within a cultivation business, especially because you said you wanted to start mall, start small and test work with another cultivator, use their resources to learn about the business, to practice with different genetics and learn these different things and learn how your local market works out.

Maybe you can also make relationship with distributors. It sounds like you already have relationships with three dispensary’s. If you are low on money, start up capital. And I’ll say this is probably sub $250,000. You should start to work in the industry and make valuable connections and allow your destiny to kind of unravel itself, right? You’re choosing the fate of getting in the industry, allowing its collisions to happen, allow serendipity to happen, where you actually meet with the people that will understand your business and potentially invest in your business. But the big big lever here is that you have industry connections. Most people don’t invest in a plain cultivation business. It’s not very novel or cool to start a cultivation business. There’s nothing unique about it. The thing that people invest in is they invest in the team and the connections of the team. Anybody can grow cannabis, but can you sell it to the right people at the right prices?

And can you get good terms on those deals for selling that cannabis? That is a real big thing. Also they’re, they’re betting on your skill, right? Make sure you’ve got your stuff behind you. So this experience by working in the industry can work very, very well for you to get better terms and have more leverage when you go to go for investors. So that’s too hot. It takes, I would say on that for trying to open up, you know, 500 plants is not that small. It’s a pretty sizable grow. That’s going to take a lot of money grows, take between 70 to $150 per square foot. If you’re going to do indoor for the buildout, you’re going to do outdoor and doing these, …, you know, natural lighting kind of greenhouses probably get away with significantly less, but you will have to have some kind of deed for the property.

So be thoughtful on that or find something that allows you to do that. I’m there. So hopefully that helps out. …, let me see if I’ve answered everything on that particular question in business plan, you asked as well, make sure you’re working on a business plan while you’re working within the industry. It’s again, it’s really, really tough to get in and knock and get anything done for less than 200 grand, $230,000. So we’ll be thoughtful on that, but you can also test by working in your own yard, right? I think I’m in the medical laws you’re allowed to do I think six mature plants, maybe even 12, look into that. That’s another way to practice in that little work at home can help parlay into a job at a bigger growth facility, which you can then parlay into a business, you know, 18 months down the road.

I want to make it very clear, do not get diluted. This is for everybody. Do not think that there is a green rush. There is no such thing as a green rush. That is a media headline that they’re putting out there. You only rush into something when resources are finite like gold, right? You’re rushing because there will never ever be any more gold in our lifetime. But with cannabis, there’s going to be so many opportunities. Think about alcohol, for instance, right. There was prohibition for a certain amount of time. Then it got legalized in the thirties. There are still multibillion dollar companies that are being made 70, 80, 90 years later in alcohol. So don’t think that you have to rush into this, be thoughtful. Don’t get going too fast and then trip over your feet. And then you’re bankrupt for the rest of your life.

Or you’re just, you know, emotionally scarred having not done the right pre-steps for. So that’s kind of a hot take on that as well. So the second one here, and it’s got another one. Do you have anybody from GreenGrowth CPAs in Massachusetts? So rod will ask, do we have anybody out in Massachusetts? Yes. We have people out in the East coast that can help out with what you need. We are a national firm. We can help out with any of the 50 States. We can help international clients that want to get into it. Started button, reach out to us. Someone will help you out. We’ve got many clients in Massachusetts and in new England right there. So we can help you out with anything going on in that area. So thank you very much for letting us ask him this question and we can help you out with that.

Now we’ve got, …, cool. Thank you. So Rob will ask, you know, I need a financial partner and vice for your company. You can get advice from our company. …, just reach out to us again via our website at GreenGrowth CPA’s dot com or give us a call at (800) 674-9050. We do everything remote pretty much nowadays, unless you’re an active CFO client. We do visit sites and things of that nature, but Raul will reach out to us again. The website is green growth, and the phone number is (800) 674-9050. Okay, so got a, another one here. We can drop into webinar jam. Any other questions in there? No questions there. Keep dropping in your question. He’s a very, very great things. I’m looking forward to answering more of them. So perfect. …, so finder gaming, the guy in Michigan or gal in Michigan was saying that they’re working on making a good money personally, they’re saving up so good for that. I’m glad to see that.


Hey, rod will says, if I’ve watched all of your videos and definitely reach out to you, thank you. I appreciate it. We love making this content and helping people out and educating them. The biggest thing in this industry is education. There’s no secrets. And if there are secrets, most people will not tell you their secrets cause they don’t want increase competition. I will give you all the secrets. Our company will give you all the secrets that we see because you know, this raises all boats in the Harbor. When you have a good, nice wave, come in lots of good information. So I’m glad that you are getting value from these live streams, from the videos that we put out, we’ve got over, I think 115 videos now. So more and more coming out, drop more questions in here from the, …, live stream. We’ll get these answered here for you.

It’s one more. Last thing I want to kind of cover a few more things is that a Canadian cannabis exports have jumped five X in 2019. Now, why am I talking about this? Right. Most people here, I say 80% of our audiences in a States. We got a good footprint in Canada and other States, but I want to point out why it’s very important that these exports are growing up because a big benefit to having a nationally legal cannabis industry like Canada does is that you’re not only limited to your nation or to your boundaries and where to sell your cannabis. You can export if people have import guidelines. Now what you’ll see here, according to data by health, Canada, cannabis oil products were approved by at least approved for export to at least 17 different countries for medical and scientific purposes. In 2019 biggest destinations, Australia, Germany, and Denmark, they counted for 90% of the exports.

Now this is really, really big. It was mostly primarily driven by oil, which is, …, a five X jump and then flower jumped 160%. So you’re going to see a big growth, right? A lot of the growth here, but this is really big stuff. If any regulators are watching, we need to go for this national regular legalization. So we can start to export some of the world’s greatest cannabis to all these other countries. So keep an eye on that, on what happens with Canada and how it plays out. It’s a very good leading indicator to what’s going to happen with the States surely will not be step for step, but there are some good indicators that exporting can be a very fruitful industry for domestic businesses.

Is when there’s a national legalization program. All right. Courtney asks, I want to start a hemp processing business. How do I start hemp farmer relationships? So there let’s see, this is a good quiz is a very, very good question. So first and foremost, there’s probably some type of register of all the businesses that have hemp licenses within your County or any other County. So I would say first look to that registrar, see if there are names and any kind of addresses or emails, things of that nature reaching out to people. They’re also usually, and this is, you know, they had isn’t cannabis. That’s why I give that suggestion. You go on the BCC site, which is a Bureau of cannabis control in California and see every business, all the contact information, you can reach out to them. Now, if there’s not a state or County list of all the hemp businesses start to look also on Facebook.

There are many groups on Facebook where you can reach out and, you know, it’s like have specific groups for your County, your state, where people either talk about regulations, things that they’re seeing in the industry. So that’s one thing I would do is constantly go out to that. Also reach out to your County chamber of commerce or your County to get access to any kind of licensed facilities in that manner, because that will be a big thing. Also potentially advertising in local newspapers. If you can run ads on certain places at the ag stores, right? I’m sure these farmers, you know, go into ag shops and things of that nature, you can potentially advertise there that you are a processing plant. One of the things we noticed last year in California, cannabis or California hemp props was that there was a lot of people that grew a lot of hemp, but the secondary part of that market, which is the processing, which Courtney is going to be in, that wasn’t built yet, there was no machinery built specifically for hemp processing.

There are no big houses in drying barns for this. So people were putting out hoophouses and it was just like a mad dash to get this stuff done. So those are some ways you could potentially collide with, …, …, do that. You know, there’s many other markets, …, Janine on here says, Hey, Courtney reached out to me. …, I can help you out with that if you’re on the East coast. So I’m not sure where you’re going to be at Courtney. If you’re in the East coast, let me know I can connect you and Janine here. And, …, you guys can help each other out. This is the kind of collision it’s being in the serendipity of the livestream. You can connect with somebody. So hopefully that works out for you, but those are some hot takes on how to find hemp cultivators for your processing business.

There’s probably many others out there, probably not even an ad in the classifieds. They might be looking for that stuff as well. We get to Janine’s question here. So she talks to the question about, can you give color on export tariffs or other export fees and taxes, low THC versus THC? How prohibitive is this? Are you talking about export tariffs between different States or is it something that’s a export for out of country for him? I’m, …, either way, I don’t know too much on the export tariffs. And how, …, how do you say restricted? Those are, I just know a few things, things I’ve read in little articles here and there. One of the biggest consumers for hemp, let me see exporting to the U S okay. So Janine says, all right. So when you export cannabis out there gonna be tariffs that come onto that cannabis.

I don’t know specifically on that. I don’t, I don’t want to vocalize too much about this. I don’t know much. I know that one of the biggest users of, sorry, one of the biggest consumers of hemp that’s imported into the U S it comes from China. As you all know, you read some of the news, there’s a trade war going on with China. China sends a lot of hemp over here for industrial purposes. And I think that with this they’re imposing huge terrorists on that to kind of help support the U S agricultural market as just a hot take. I don’t know too much on it, what those tariffs are gonna be. But I think that the U S is trying to put the focus and help support the businesses within the States on state side, compared to importing a lot of hemp from out of country, again, from the China China’s of the world or anywhere else throughout the world.

So that’s all I really know about the tariffs. I don’t want to act like I know more than I do. I will put a note down here to get more back to you, Janine, but yeah. Connect with us directly, go to our website, fill out the form. Adam will probably reach out to you if he doesn’t have the answers him and I can research it real quick and get back to you and, …, and get some more information for you back on that. So I, …, I apologize for not be able to give a very thoughtful answer, but I don’t want to sell something that I don’t know the answer to. I want to be transparent with you guys. All right. Another one here from a YouTube, it looks like Bermuda. We’re passing a law for recreational, and I would love to get into the business.

I would love for you to get into the business, to getting ahead of the regulations. There’s a lot of people that want to get ahead of the wave. That is a very big term. I hear all the time, a hot button. I want to get ahead of the wave. I hear they’re going to be doing this, understand that there is there going to be the legalization of it, right? They’re going to say, all right, it’s legal, but there’s a whole long onslaught of creating the regulations around it, and then doing the licensing process. And then all the things of building those businesses up, it could be 18 to 24, even 36 months before you see some type of industry. So get in now with other people that are in the industry, whether they’re in the illegal side of the business, and they’re running these other shops, you said they’re going to be passing recreational.

I would assume that there’s medical shops out there. So go and work for these medical shops, get your name into the industry. Just how I gave that guy or gal that was in Michigan. The advice work in the industry because of the people within the industry are always in the know or more in the know than anybody else. So they’ll be able to give you more information and kind of give you this guidance. You’re just going to allow things through us, Moses, to come to you, right? If you’re in the area where they’re talking about this, I would love for you to get into the industry when things become necessary for you to get a business plan or proforma financial statements, reach out to us, we’d love to help you. We’ll be thrilled to help you and wish you much success into that. I Raul says I’m on the East coast looking to open one, a more retail in their Waterton mass in Watertown, Massachusetts.

So if you look looking for a business partner, you know, reach out to Rockwell here, you looking for a financial partner and financial partners are really, really difficult and hard to find. …, and I’ll say they’re even harder to find good ones. Cannabis is sexy right now. People want to put their money in. So be thoughtful on who you take money from and who, and what the terms of those deals are, right? There’s smart money versus dumb money. Be very thoughtful on that. It can, you know, you take somebody who doesn’t have any connections in the industry. You take their money. You’re pretty much just getting another person you have to answer to. It can be really, really tough when you’re doing that. Cool. Roger’s got, got, got partners. That’s good. …, I want to actually answer this some questions that came in before I forgot to get to those.

So first from Andrea, she sent a question in earlier that sells, okay. She says, I’ve read some States say that we do not need to adhere to 280e, but federal taxes. We do. Can you help me to understand what to do with my tax filings? Okay. So for tax filings, I want to make this very, very clear. Every state is different. And I saw in a, in a submission, we got here that her, …, she was from Oregon. So just to answer this, let me actually step back and step a little back here. There are some States that say, you don’t have to adhere to 280e when doing your state tax filings, but you still have to adhere to two 80 for your federal filings. So since you’re in Oregon, the answer is that you do not have to need to apply IRC280e, your state tax filings, but you still need to do that for your federal filings.

This is also the same for Colorado and California 280e does not apply to the state filings, but it was still applied to the federal filings. Now new guidance is being implemented all the time and often, so reach out to us. If you have another state, then you need a question answered. We can give you the best information from our tax team that is up to date. Now I want to think, I want to reiterate from a previous video, is that people say, well, I’m a state legal business. This doesn’t mean anything to me, state legal cannabis businesses. If you’re licensed by your state, you are still subject to 280e at the federal level. Again, sometimes not at the state level, but always at the federal level. Do not think that because you have a state legal cannabis business that it doesn’t apply to you.

It does because cannabis is still a schedule, one controlled substance. And until that changes to ADE will still apply to your business. So be thoughtful about that. All right, Kevin O’Brien says I’ve until about Bermuda and cannabis, captive insurance, if needed. Yeah. Kevin drop it in there. If you’ve got something to share, share it, or we could do a live stream together. If you’re within the industry, …, I’d love to have you on for something, reach out to us and we can get that back to you. All right. Now we’ve got, …, Alex you’re asking any thoughts or advice and starting a bookkeeping business in the cannabis industry, Oklahoma location, without a CPA license, but with an accounting degree, all right, here’s a, here’s a unique one. How to compete with us. …, you know, just it’s, it’s really unpersonal relationships. I’ll just kind of peel back some things here at GreenGrowth.

And at any other service company, people are buying your service for one, but they’re really buying into the people of your business. So Alex, what I would give you some thoughts on how to start an accounting or bookkeeping business to compete with us is get the right people that are likable on your team. If you’re, you know, an accountant that doesn’t really like to talk to people find a sales person, find somebody that can go move and shake and be around these businesses and visit and go knock on doors that could potentially help you out. That’s one way to start it out. And I would say, really be thoughtful on what your offerings are. New businesses, new ancillary service businesses. And this is in many industries cause I’ve been in four or five different industries in my career, but specifically in cannabis, everyone wants to promise the world and then not deliver just to get the client.

And in consulting, this is like Cardinal rule. Number one, do not do that. Make sure you understand what your scope of work is and what your fees are associated with that because people are going to ask you what’s in scope and what’s out of scope. I would hate for you to be, you know, promising things that are in scope, but once you get to it and like whole man, this is a lot more time and I’m only making $18 an hour doing this, right. Starting a business. Sounds really good. There’s a lot to it. Other than just doing the core competency of the business, which is doing the bookkeeping and taxes. Now, if you’re looking for a listen new bookkeepers, we could potentially, you know, work with us. So there’s some times, you know, these synergies working and being with a bigger company. So that’s my hot take on how to start a company, to compete with us, get the right team, go out and meet people because it’s all about personal connections.

You know, we can’t advertise in cannabis, even as an ancillary business, we can not advertise on Google or on Facebook. So that’s my advice to you is just go out and meet people that could be helpful. Courtney. All right. I will pass your email onto Jeanine. Thank you very much. This is, I love it. This is great. This is exactly why we do these live streams. I’ll make sure to get that and just make a note here. Janine, Courtney email beautifully off. Beautiful. Just go over to YouTube here. Any more questions? No more questions here. We’re about 53 minutes in man. We are crushing on this. …, any more questions, please drop them in. I’m going to get to one more previously submitted question here and then I’ll take any last ones. I’ll go to at least one, maybe a little bit later. I love doing, I could stay all day on this stuff.

All right. Leo from the Bay area. So it’s Northern California. He says, should I take on, on a private loan or debt for my cannabis company or own offer equity to this person? They are a family member. If that makes a difference. Okay, this is a, is a big question. Okay. You, how do you get funding? As we just talked about laboriously, it’s expensive to get into cannabis. You’re going to need to take some type of funding if you’re not personally well off. Right? So taking money first and fourth, I want to talk about taking money from family comes with a lot of strings attached that may not be explicitly stated, but they are subliminally understood by at least the person giving the money. They think that they’re now a big member of the business. Yeah, you’re a financier, but you really, you know, you don’t make it.

How do you say, say it’s a nice way you gave me money. That doesn’t mean you run my business. It doesn’t mean you own my business, especially this is not an equity investment. So the first thing with family stuff is, do not be nonchalant about taking money from anybody, but specifically family, make sure you work with a lawyer to draft up all in any of your agreements and make no handshake agreements. Don’t just do something through email or you’re at the house and you’re filling out some basic one sheeter, Hey, this is the terms, 15% interest. And 90 days to be due or 180 days, or, you know, whatever it’s going to be. Don’t do any of that. Make sure that you have lawyers doing the agreements and that that person giving them money is also represented by a lawyer because you know, thing out there where say, well, I didn’t understand the terms of this agreement.

And I filed and I was under duress. When I signed the agreement, do not let that happen. Make sure they get legal counsel. You put in 200, $300,000 into a business. $50,000, an extra two grand for a lawyer is not that big of an ask. So that’s my first thing on the family. Now, second on this question, debt versus equity. Now it’s going to change depending on the scenario. So I would ask this person, that’s going to give you this money or loan you this money. What are they trying to get out of this investment in what are you trying to do with this investment? Because that will kind of change how you frame up the investment, the terms of it, and you do debt or equity. So just a few different scenarios. Here are questions you need to ask on those other two questions is going to be, what documents did you show this person, the backup that you needed to $250,000, was it pro forma financial statements that were created by a CPA or created by someone who is familiar with the industry or just a few news articles and things you’ve heard about this green rush.

If it’s the stuff about the green rush, well, either way, this is these, whatever they know the investor knows about this will set their expectations. So if it’s a pro forma financial statement, it’s sent them to a smooth growth of a budding industry. They know things are going to grow well, but it’s not gonna be, you know, parabolic right away. But if they saw something like a news article, they’re going to think they’re going to get real, you know, filthy rich really quick, do not take money from these kinds of people. Okay. Do not take money from anyone who’s going to get filthy. Rich and cannabis is not a get rich quick scheme. If you take money from people, they think they’re going to get rich. This will only cause you more headaches later down the road. It’s cause to be waiting for their big payday.

Oh, I gave you money 18 months ago. Where’s my million dollar check. It doesn’t work like that. So be thoughtful on that. Now second thing to consider is what are you going to be using this money for? So this is where it’s going to help you get into kind of, should you take that or should you take equity since you did that state? This I’m going to go into, I think, I think three scenarios I listed out here that I wanted to cover because this is really the bulk of why you would take on funding. So first, if it’s for licensing application, right, if you’re getting like say 50 to a hundred thousand dollars for licensing application and securing property, I would say, you know, make sure this investor knows that there’s no guarantee that you will ever get this license. And I would go and try to get them to put in an equity investment.

This aligns your incentives. They will probably help you more throughout the process compared to if they were to give you a debt investment or some kind of loan. And again, understand if this is not guaranteed and it’s a debt, no license means you’re not getting any revenue and you’re still on the hook for that debt. And if it’s personally secured, you could lose your home, your car, other assets that are valuable to use. We’ll be very thoughtful on how you’re actually, …, you know, backing up this loan. So licensing process probably go for equity. Second, one situation you get money is scaling up a business. Okay? Now both debt and equity are attractive in this scenario. Just so long as the interest rate is manageable. And the terms of the loan are reasonable. There was an article I didn’t cover in the earlier part of this, but acreage holdings, big, big, big cannabis company.

They took on millions and millions and millions like $60 million. So huge amount of money at a 15% interest rate for 90 days. So per annum at 60%, that is like loan, shark, you know, status here. That’s crazy. Do not do this when you get into a thing, unless you can surely cover that debt service. Okay. And it also doesn’t make sense to take on a debt if you’re going to be financing some particular new equipment. If the term of that loan is very short. So for example, if you’re going to buy some equipment and it takes 90 days to build and install this equipment, you know, the loans that for 90 days doesn’t make any sense because you have no way to generate revenue off of this and you’ll have the debt payment come do. Plus that interest in that acreage example, I’m giving them a $6 million penalty if they miss the debt payment on that 91st day.

So our 90th day or whatever it is. So be thoughtful on that. Have a lawyer look at these contracts, but when you do something like scaling the business up, especially scaling, you should look more for these. Would you say equity investments because this aligns incentives, you’re gonna get smart money at that point. Maybe it’s a distributor or it’s a retailer that can help put more money into your business. All right, I have a third part of this is for short term working capital. This is what acreage was doing. They needed $60 million for short term working capital. That’s crazy to me, but if you’re going to do that short term and you have a plan and how you’re going to do it, then debt would be suggested here because it’s short term, right? Especially if you have a solid pipeline of revenue or money or cash coming into the business relative to the term of that loan.

So say the terminal loan is 180 days. The rate is good on it, and you have some checks and big, …, revenue that’s gonna be coming in in 60 9,120 days that allows for you to get that money, pay that debt back and keep the business alive. Now of course, no revenue is ever guaranteed. So make sure that there’s a secondary plan to pay off that loan. It could be a convertible note, even right where it converts into equity. If you miss, or if they, you know, the, …, creditor wants to call that loan in and you can’t pay it, they can just convert it into equity, any rate, …, I would give equity in this scenario because the pain is temporary. You just need short term working capital. Whereas if you give, you know, so don’t give, sorry. If I said, don’t give equity in this scenario, go for the debt.

If you can, and make sure you can cover it. Cause when you give equity away, it’s a permanent longterm thing. And your pain is only short term, working capital understand. You just don’t want to just be giving percentages of your company away. Cause when you give too much of your percentage away, you don’t own a lot of the company and that’s fine. I’d rather own 10% of a billion dollar business than 80% of one. That’s worth 200,000 bucks, right? Also when you have a very fractured cap table, this is like a red flag for institutional investors, which are people that are in venture capital. People that give you that gasoline to your fire. And they’ll say, no, we don’t want to pass. Cause there’s too many stakeholders that they have to kind of wrangle up to make this the right thing. Granted, you could do different types of shares, but fracturing your cap table is never, it suggested if you can avoid it.

So that’s my hot take on that. Leo. Hopefully you saw that answer and then we’ll go from there. Any other questions? Drop them in here. We’ll get those answered. I don’t see any other ones so far. I’ll wait around for another minute or two. We’re just past one. O’clock here. I love this stuff. This is great. This is great stuff. Got people, making connections, beautiful. Drop those questions in there if there’s anything else. And if you have any questions that we don’t get to, if you’re watching this on a replay, reach out to us via our website at Click that get started button on the top right corner. Or you can reach out to us via telephone. Give us a call at (800) 674-9050. I’ll wait for a few more minutes here.

Okay guys. Cool. So sulfur gaming says thank you for the streams. You’re very welcome. Thank you for joining. I appreciate people joining in here. This has been my complete pleasure to do this. This is my absolute dream job is to be able to help and to educate, to grow our business and help you grow your businesses. It’s always a pleasure to help people out. So thank you for watching these live streams. Thank you for watching the other videos. Thank you for being on the email list. I know we send emails twice, three, four times a week. We want to keep you updated. Right? I try to take all the noise that’s going down and distill it down into some good music or some good learning. Some like, you know, tidbits of information that you can either use for yourself or maybe even using your next conversation when you’re starting to network with other cannabis individuals.

So we try to keep you in the front of that way. Kevin says, this is great. I’m glad you think it’s great. Who is question is I missed the beginning of this. If you guys heard of any progress on the safe act. So the safe is a banking act that the, I think it went through the house. It went really well in the house. It’s sitting in the Senate right now, there was grumblings and rumblings saying that it was going to be put into the next stimulus package. I, you know, that’s just a backup. How did that even get into the next stimulus package or be proposed for it? The, …, it was a group of industry. People got together, they wrote this letter to some senators and they just kinda threw it in there. Would you understand about these stimulus packages is that they are, we call on the bus legislation.

It’s looks like it’s masqueraded as a stimulus, give companies and money, but there’s a lot of other provisions that kind of work their way in there. They’re called riders. They’re riding this wave in the stimulus package to get through now safe baking act was one of those writers you saw, I forget who the, who was on Capitol Hill or whatever the testimony of the hearing they talked about. Hey, cannabis is in the stimulus bills 65 times. Whereas jobs is only in there eight times that really put the kibosh on it. I think people who are in the Senate are not in either sides of the, of the spectrum. A Democrat and Republican are probably not going to pass the safe, safe banking act. I think it should be passed because we can do a lot more business. If we can take everybody can take debit cards, you can do merchant processing potentially as well as you’ll be able to track the money for audits.

When you get more tax revenue from this, it’s just a, it makes things so much more easy to track and it’s just safer for the cannabis operators. I don’t know what you, but like when I go, when I have like, you know, a couple thousand dollars in my pocket, when I’m going to purchase something or put like a payment down on something it’s nerve wracking. And that’s only a couple thousand, I know people that are driving with, you know, Suburbans filled with a half million dollars front and back armed guards, you know? Cause they don’t even, they’re not paying for, you know, brakes to drive it. They’re kind of keep it even low hush than that. It’s crazy man. And they can get into some like real big things and they’ve got to how’s that money somewhere. So there’s got to be really safe to have a drop safe somewhere that only the lawyer in the business owner knows and your cash custodian.

That’s crazy. Some of these banking partners, banking partners out there charging five, six, 10%. It’s crazy. You’re working your butt off for that money. They want to take 10 points on that money. 10% just so you can use a debit card. That’s crazy. That is crazy. So I’m not sure how it’s going to shake out. I haven’t heard much since that lasts. I think it was like in may they all, they said it was going to be in the next stimulus bill, which could come in as early as July, potentially August. …, but safe banking act. Don’t expect it to be coming around anytime soon, Kevin O’Brien says it opened up insurance as well. That’ll provide a backstop. Yeah. I mean so much hinges on being able to have transparency and proof of funds, right? If you can’t prove that you have liquid 180 203, four, 8,000, you know, $800,000 in the bank, you’re not going to get certain things, right?

Insurance is not going to come with you. It’s just a multifaceted problem where one of the linchpins is access to safe banking. So Kevin, I love to connect with you. Please reach out to us via our website. Connect then fill out that form and then you’ll connect with Adam. He’ll connect you with me. We can share, we can potentially do a live stream on, …, insurance, in the cannabis industry. All right. So we’ve got another one here. Do any of your existing clients, a student opening for retail, …, or delivery business and mass, please let me know. Should we have somebody run? We’ll just reach out to us. We can connect you and answer all these questions. Potentially create some collisions with people within our, our a stack of clients. We service hundreds of clients think we’re over 400 clients now throughout the U S started and leverage our clients in the States to produce and white label their products.

So reach out to us. We can potentially help you out with that. So hopefully this is very helpful group saying, this is dope. Ay, I appreciate it. I’m glad this is helpful for you. I’m glad everybody can find some value in this. I just want to provide as much value as we can. Again, I think this is the best use of our time as my time Expedia, especially as a, a chief marketing officers to give you information and make sure you have what you need to make sure that your business grows and that we can be with you there every step of the way from, you know, people that are in the early stages like that guy or gal that’s in Michigan, they want to get started all the way through to people that are, you know, getting growth capital or even going public. We helped take companies public.

We did a couple of those last year, reverse takeovers in Canada, as the States start to be more accepting of it. We can do it that way as well. So love to be with you along your entire journey here. So I think we’re gonna cut it off here. That should pretty much wrap up our live stream. If you want to drop in a question, you could have dropped it in lots of times in the past hour, but again, thank you for joining the live stream or watching the replay. If you have any other questions, please reach out to us via our website or give us a call (800) 674-9050. Have a great day, an amazing week. We’ll see you on the next live stream in July. Have a beautiful rest of your day. And we’ll talk to you soon.