LOS ANGELES–Bespoke Financial, the nation’s first cannabis-focused fintech lender, has partnered with GreenGrowth CPAs, a leading CPA firm for cannabis businesses, to encourage increased financial reporting in the industry by providing integrated, outsourced CFO services to cannabis businesses seeking financing opportunities.
According to the U.S. Bureau of Labor Statistics, about 20% of small businesses fail within their first year of operation and as many as 50% fail by their fifth year of operation. In any industry, a lack of business acumen can present significant challenges. But in the cannabis space, with its intricate web of state and local laws, failing to maintain business records or stay compliant with all regulatory requirements can prove to be costly mistakes. At best, these accounting missteps can limit a company’s access to capital. At worst, they can be potentially business-killing errors.
“Whether they are a cultivator, retailer or manufacturer, cannabis entrepreneurs create a business because they are excited about the industry and what they can bring to the table,” said George Mancheril, founder and CEO of Bespoke Financial. “But as is the case in so many industries, these business owners often lack the knowledge or experience of managing a business and fail to maintain adequate financial records or even pay close attention to critical tax matters.”
Unfortunately, many cannabis business owners do not even recognize they have a problem until it is too late. The partnership between Bespoke Financial and GreenGrowth CPAs will help these business owners and provide the accounting resources required to help set them on the right path toward financial growth.
“So many cannabis entrepreneurs do not yet have the resources or sophistication to manage the technical financial side of the business,” said Derek Davis, founder of GreenGrowth CPAs and a certified public accountant. “In the struggle with compliance and regulations, they are taking valuable time away from their core competencies to manage the business, and often doing so without the knowledge needed to do the job right. In the end, the business suffers in multiple ways.”
Under the new partnership, applicants looking to access a line of credit from Bespoke that lack the required financial reporting will gain the opportunity to engage GreenGrowth’s specialized accounting services. Also, current Bespoke clients will be able to engage GreenGrowth’s outsourced CFO services to make it easy for the business to stay in compliance with all regulations and enable more stable growth for the business, and the industry, in the long term.
“It is unrealistic to think that every cannabis entrepreneur is going to possess all the business skills necessary to start, grow and scale a business,” Mancheril said. “By providing these resources on a case-by-case basis, we think this partnership will help lead to increased financial literacy across the cannabis industry, and that will be a positive development for everyone.”
Bespoke Financial will be an official sponsor at Hall of Flowers in Santa Rosa Sept. 22-23.