High Times magazine works to establish $100M High Times Growth Fund for marijuana startups
High Times, a magazine that focuses on marijuana enthusiasts, is on its way to establishing the High Times Growth Fund, a private equity fund that would enable investors and legitimate pot startups to connect with each other, CNBC reported. High Times Business Manager Michael Safir said their aim is to launch the fund next month and be able to raise $100 million in the next two years. Safir will be working for the marijuana fund full time as soon as it is launched.
Other private equity ventures in the growing pot industry could be dwarfed by the High Times Growth Fund. The fund is only going to be open to accredited investors, the report said.
In an interview with CNBC, Safir said, "Basically, the main obstacle is getting people over the fear of investing in cannabis. I've kind of taken the position that if you believe in it, it doesn't matter what we say-you're going to give us a check."
Beginning January 1, Colorado retail pot dispensaries intend to sell marijuana without a prescription to those above 21 years old. Recreational marijuana was also legalized in Washington this year, with state officials planning to start the issuance of the retail licenses this February, the report said.
However, the lack of capital remains a stumbling block as banks don't give the same treatment to dispensaries in the same manner as traditional businesses. Safir said, "The businesses we're looking to invest in don't have access to credit markets. They're basically run on a combination of savings and credit cards."
He said that their marijuana fund should be able to fill the financing gap experienced by the industry since lenders do not allow marijuana businesses to open commercial accounts inasmuch as gaps exist between certain state and federal laws. Citing information found on its website, the report revealed that the fund intends to pursue a traditional private equity investment schedule.