April 20 2020,



San Francisco Mayor London Breed said the city will not allow the annual 4/20 celebration on Hippie Hill, as the cannabis world moved festivities and promotions online. Many of the events support charities.

Sales are likely to be substantially lower than normal on what the industry counts on as the biggest weed-buying day of the year.

Quick Hit

  1. Travel writer and legalization activist Rick Steves talked to GQ about life in isolation. (He bought weed for the first time.)
This week on the podcast
The LSD Story Dock Told Donny

In recognition of Bicycle Day — the April 19 LSD holiday — we explore the origins of major league pitcher Dock Ellis’s acid-fueled no-hitter. Donny is joined by author Dan Epstein, No-No: A Dockumentary producer Chris Cornell, and An LSD No-No co-producer Neille Ilel in discussing the legacy of this hallucination achievement, which turns 50 on June 12.


An analysis of 33 pot companies tracked by MJBiz found eight don't have enough money to last more than 10 months.

  • It's going to be an "extinction-level event for some companies," an MJBiz analyst said. “But it’s a healthy and necessary process for any industry to go through once it’s had a phase of absolute excess and exuberance.”
  • Analyst Jonathan Cooper sees many U.S. companies at risk of insolvency.
    Seeking Alpha
  • This comes as cannabis use reached an all-time high in March.
  • The Washington Post and Cannabis Business Times look to California where the pandemic is "expediting the state's existing cannabis market failures."
  • Despite some noise about it in D.C., lawyer Hilary Bricken writes the cannabis industry is unlikely to be eligible for the next round of federal relief.
    The Hill, Canna Law Blog
  • In a sign of the times, Canndescent, whose CEO Adrian Sedlin used to boast the brand was worth a 25% premium, released "super affordable" brand Baker's. On LinkedIn, Sedlin described it as a "deep value offering designed to help dispensaries retain consumers during this economic downturn and to keep consumers from switching to the black market."  

For this week's Power Players interview, I spoke with Entourage Effect Capital managing partner Matt Hawkins. We talked about what the firm, which has made close to $200M in cannabis investments, is looking for in new companies.

On why it's a good time to be investing in cannabis:

When you think about investing in distressed assets, the first things that come to mind are either margin shrinkage or top line shrinkage. In a lot of cases in the cannabis industry, that's not the case: those two things are typically in a positive trend. The only thing that's really impacting the cannabis industry in the negative sense, at least prior to Covid, was the cash crunch. There's not enough liquidity and capital to take advantage of all the opportunities.

On the pandemic's impact:

I think the expansion of state by state legality is going to be driven to a whole other level with states and municipalities looking for increased revenue streams to offset what's been lost here recently and will continue to be lost. And the federal government's no different. I think we can look to the federal government and say, "Look, we're an essential business, why are we illegal? Why are we not able to participate in the CARES Act?"

On the industry fallout:

"There's going to be some clear winners and some clear losers in the multi-state-operator sector. It really boils down to who has money and who doesn't."

Read the Whole Thing.



WeedWeek business columnist Dan Mitchell talked to some smart folks like BDSA (formerly BDS Analytics) CEO Roy Bingham, Poseidon Asset Management managing director Michael Boniello and Measure 8 Venture Partners portfolio manager Justin Ort about the industry's road back to health:

"Insiders predict it will become more consolidated, more “corporate,” and more disciplined. Some think this will make for a healthier industry. “Everything that was happening before the pandemic is being accelerated,” Roy Bingham, CEO of cannabis-data firm BDSA, formerly BDS Analytics, said. That means more mergers and acquisitions, more companies folding or being snapped up by bigger outfits, and the larger companies expanding their market share."

Read the whole thing.

Quick Hit

  1. In a cover story for the East Bay Express, Mitchell looked at the scammers promoting cannabis as a cure for Covid-19.

An early investor in beleaguered MSO MedMen is claiming three executives at the company have refused to hand over the deeds to their homes as collateral on a $10.2M loan.

  • Alaska based Milestone Investments claims three executives, co-founders Adam Bierman and Andrew Modlin, and current Chief Strategy Officer Christopher Ganan agreed to put up their homes as collateral on the loan but only Ganan complied.
  • The executives couldn't be reached by MJBiz. A MedMen spokesperson declined to comment and noted the company isn't party to the suit.
  • Several weeks ago, Modlin sold his $3.9M West Hollywood home to a YouTube star. It's not clear whether that was the home in question.
  • Ganjapreneur has more.

In another real estate law suit, Gia Investments is suing Paul King, CEO of Cannafornia, a company in Salinas. 

  • The suit alleges King "refused to repay a $3M corporate loan by claiming the promissory note outlining the terms is a forgery."
  • It further alleges, “King has grossly mismanaged Cannafornia and New Wave,” the lawsuit states. “He has used the companies as his personal piggybank to the detriment of their shareholders and creditors.”
  • The suit names Cannafornia and subsidiary California New Wave, in the suit.
  • King did not respond to the Real Deal's request for comment.

Quick Hit

  1. Canna Law Blog suggests the next wave of high-profile weed litigation could involve breaches of consumer privacy data. You've been warned.

The one, two, three punch of the vape crisis, the pot stock crash and now Covid-19 have been brutal for many cannabis companies. But just about all insiders remain bullish on the industry's long term prospects.

  • At New Cannabis Ventures, Alan Brochstein sees silver linings. "We are more optimistic than ever that legalization efforts will be successful when the crisis passes," he writes. Plus, he points out, in response to the pandemic, several states have liberalized how consumers obtain cannabis.
  • Nancy Whiteman, CEO of multi-state edibles player Wana Brands, writes businesses need "win-win thinking" to overcome the crisis. For example, "At Wana we are offering a 10% discount to our dispensary partners with outstanding accounts receivables who were willing to pay in a timely manner, regardless of how old the account is."
  • Nick Kovacevich, CEO of ancillary conglomerate KushCo Holdings, suggested the pandemic could hurt the illicit market. By contrast, in a recent interview with WeedWeek, he said it probably would empower them.
  • Point of sale software company Green Bits raised $23M in Series B financing from investors including Tiger Global Management (a giant, mainstream investor), Casa Verde and DNS Capital.
  • In the next few months there may be great opportunities for real estate deals.
  • MJBiz also looks at some of the ways companies are trying to boost morale.
  • Salaries in hemp are way higher than in traditional agriculture.
    Hemp Industry Daily

Quick Hit

  1. MJBiz Daily started a partnership with professional network Leafwire.
    Warren Bobrow -- Forbes
The only legal green in Boston

A Massachusetts judge has sided with Gov. Charlie Baker (R) in his opposition to making pot shops "essential" businesses.

  • The judge noted industry plaintiffs made a "convincing showing" that they could address the governor's safety concerns.
  • The forced closure of REC shops is costing retailers across the state $2M in daily sales.
  • Massachusetts is the only major U.S. market where cannabis businesses were not deemed essential.

In May, the Florida Supreme Court will hear two pot related cases via Zoom.
Miami Herald


Canada's Canopy Growth, sometimes called the world's largest cannabis company, said it was halting several operations on three continents and expects its restructuring plan to result in a charge of up to C$800M (US$567M).

Elsewhere on Wall St.: Business Insider takes a look at special purpose acquisition vehicles, or SPACs, the financial structures used to take many cannabis companies public. Investors have poured $2.8 Billion into cannabis focused SPACs since the beginning of 2019.

  • This accounts for about 15% of all SPAC investments.
  • Citigroup lead Bespoke Capital Acquisition Corp.'s $350M IPO in August, but much of Wall Street remains leery. "This is clearly a gray area."

Quick Hit

  1. An article in conservative journal The National Interest found, "Canada only has good news," about legalization. "Nearly all the available evidence counters the core arguments of legalization opponents."

This week in Covid-19 vs. the cannabis economy:


S.F. Weekly talked to Bay Area residents for whom MED is essential medicine.

They include:

  • Marine veteran Ryan Miller, 39, who says says cannabis saved him from destructive behaviors like binge eating, depression sleeping, and alcoholism.
  • Kat Marshall, 20, who was first prescribed opioids at 13 for a spinal injury.


Quick Hits

  1. Esteemed cannabis journalist Amanda Chicago Lewis has a twitter thread explaining was smoking cannabis is not nearly as dangerous for pulmonary health as smoking tobacco.
  2. In a moving piece, Lewis also talked to Curbed about living a socially-distanced life before everyone else was doing it, on account of a traumatic brain injury.