Top 4 Issues of Concern for all Cannabis Investors and Businesses

Across the US state legalization of medical and adult recreational use of marijuana is driving burgeoning business and sales growth in the cannabis-marijuana industry (click here to view March 2015 graph and chart). There is little doubt the cannabis industry is one you should invest in if you can do it safely as some very smart people believe medical cannabis and non-THC extracts from cannabis plants will soon prove to substantially advance medical and nutritional therapies and help people live longer healthier lives across the globe. Also agricultural technologies are evolving rapidly due to advanced cultivation techniques being perfected by cannabis industry growers. Cannabis industry cultivation technology and process improvements are leading to rapid advancements in sustainable locally grown food sources already impacting fine restaurants and natural grocery stores.

Cannabis investors and entrepreneurs must keep foremost in mind four (4) key issues of significant concern, especially if the business they operate or are considering investing in touches the agricultural cannabis plant or extracts of controlled substance ingredients in any way.

These top issues all investors and cannabis business owners must be aware of and consider are:

  1. Federal Laws – Despite 23 states legalizing medical marijuana and 4 states decriminalizing adult use, marijuana growing or consumption remains a federal crime since all types of cannabis are listed as Schedule 1 controlled substances. The federal government has in recent years shifted enforcement away from state-legal medical cannabis businesses. The Cole Memo and FINCEN guidelines reflect the Department of Justice has same enforcement focus, and the House of Representatives passed a spending bill prohibiting the DEA from using any money to enforce criminal laws against state-legal marijuana operations. Section 280e of the Internal Revenue Code has negative tax incentives, acting as penalties on businesses growing or transacting in controlled substances; 280e restricts any impacted business from deducting most operating expenses against its taxable income.
  2. Banking reluctance to get involved due to federal criminal laws and anti-money laundering compliance issues (click here to learn about recent setbacks in the insurance side of the industry)
  3. Stigma associated with involvement despite the majority of Americans in support of decriminalization of marijuana use and cultivation
  4. Lack of traditional business experience by many of the cannabis industry’s growing businesses looking for investment

US State Marijuana Law Map - March 2015

If you are thinking about investing in the rapidly growing cannabis industry, look for businesses that are ancillary to the agricultural and medical treatment side of the cannabis industry as the above key issues generally would not apply to them. The parent company of is such a venture. Learn more about it at

Also keep in mind that as more and more folks grow cannabis, and more and more businesses enter and expand marijuana concentrate extraction capacity, the price of the agricultural product and its derivatives will continue in a downward spiral. This is not a good financial trend for cultivators, dispensaries and creators of edibles and extracts, but there is a big silver lining in this trend. As the price of marijuana and infused products drop, the number of consumers who can afford the products expands. This presents a very favorable growth scenario for ancillary businesses that are fully legal and do not touch marijuana or cannabis products, but create and sell legal products to cannabis consumers and cultivators as does our sister company

For more detail on above topics read:


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