How can an entrepreneur go about finding the right investors for a dispensary?
Avis Bulbulyan replied:
First you need to decide what you're looking for from an investor. Every investor looks at deals a different way and what’s a priority for one investor, might not be one for another. The investors that are looking at the marijuana space, for the most part, understand the basic economics of the industry and have a general understanding of the legalities. What they're really investing in is the operator and the operators vision. That said, most are not looking to be passive investors and will be wanting some sort of control over the organization and/or the company finances. Is control of your organization something you would be willing to share with your investor? Are you willing to take direction, guidance, and criticism from your investor, who is now your partner? For some, this is a deal breaker. For others, it’s welcomed. You don’t want to find yourself in a shotgun marriage partnering with someone just for the sake of the investment dollars if there is no synergy or common vision. Those never end well. Once you’ve figured out what you want from an investor, ask yourself what value you bring to the investor and why the investor should invest in you and your dispensary? This should give you an idea of what the right investor looks like for your needs. Once you know what you’re looking for in an investor and what you’re willing to give up, put together a business plan.
When you’re writing your business plan, you need to educate the potential investor and give that person a 360-degree view and full understanding of the opportunity. Explain the market, and how your operation fits into that market. On the financials, make sure they’re accurate. It might be tempting to minimize your expenses while setting your projections high, but what you put down on paper, you will need to justify and explain. You don’t want to be caught in a situation where you can’t explain or justify what you just pitched.
When you know what you want, you know what you don’t want, and you have your plan that outlines everything, it really comes down to putting yourself out there. Industry conferences are a great place to meet investors. Attend the networking sessions and receptions. Sometimes, those are more valuable than the conference itself. If you go out there and hand out copies of your business plan, you’re probably not going to get anywhere so work on establishing the relationship and getting to know the individual before you pitch anything. Think of it as dating and your pitch is your proposal. Get to know the person and decide if they’re a good fit for you. Sometimes when they’re not, they can introduce you to someone who would be. If nothing else, you’re growing your network and that’s valuable on its own.
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