Raising money for a cannabis company is challenging, even if your startup doesn’t have anything to do with selling THC-containing products.
Max Simon, the CEO of cannabis education and content platform Green Flower Media, would know. The company closed a $20 million Series A on Wednesday, led by Tuatara Capital, one the largest cannabis-specific private equity funds, with participation from Poseidon Asset Management and Phyto Partners.
Finding the right investors wasn’t easy.
“We spoke with hundreds of different investors or investment funds,” Simon told Business Insider. Lots of those investors pushed Simon to take the company public on a short time frame — within 12 or 18 months — because they wanted their return quickly.
Or, they asked Simon to start selling ads and producing sponsored content for other brands in their portfolio. But Simon said that wasn’t the mission of the company.
“We had many days and many close calls where I really thought we weren’t going to be able to get this thing done,” Simon said.
While some blue-chip venture funds took meetings with Simon, he said they really didn’t understand the company.
“Even the most sophisticated venture capital groups tend to simplify what’s going on in cannabis because they don’t know it well,” Simon said. “We talked to them about educating consumers, and they’re like ‘what do they want to know, how to smoke more pot?'”
According to Simon, people do, in fact, want to know the health benefits — and risks — associated with consuming marijuana. They want to know about CBD, a compound in cannabis that went from obscurity to the latest consumer fad a matter of months. And they want the training and skills needed to join one of the fastest growing industries in the US.
To that end, Green Flower is partnering with a number of universities to offer certificate programs and vocational training in areas like marijuana cultivation and extraction, as well as regulatory compliance. It’s something that companies Simon speaks with are “really craving.”
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“People dramatically oversimplify the skills and knowledge needed to participate in the industry,” Simon said.
With its fresh capital, Simon said he plans to triple its team with a focus on creating more content in-house, offer new streaming subscription channels, and build out enterprise-level training programs for large cannabis companies.
Simon wants Green Flower to eventually expand beyond cannabis with its enterprise business as well, staffing up its enterprise sales department to work with nurse networks and insurance providers to help them understand cannabis.
“It’s really shocking to me how little people understand about cannabis and how widespread and misinformation is,” Simon said. “We really believe it’s our responsibility to up the level of the quality and credibility and integrity of the cannabis industry.”
See below for an exclusive look at the pitch deck Green Flower Media used to raise $20 million: