Debt Financing: The Lynchpin Enabling Cannabis Companies to Outpace Competition, Manage Long-term Expenses
3 min readPublished On: October 13th, 2021By News Team
LOS ANGELES–Bespoke Financial, the nation’s first cannabis-focused fintech lender, has also become the first to provide cannabis operators with an inventory revolving line of credit, allowing companies to achieve a competitive advantage by better managing needed operational expenses while maintaining other financial resources for long-term capital and growth initiatives.
“Businesses in traditional industries have enjoyed access to this tool for decades but until now, cannabis operators were often forced to choose between funding short-term operational expenses and pursuing long-term growth plans,” said George Mancheril, CEO of Bespoke Financial. “This gives operators a significant advantage over their competitors that lack access to flexible financing, and truly puts cannabis operations on a par with modern business practices of more established industries.”
(Mr. George Mancheril, CEO of Bespoke Finance)
For example, Bespoke Financial recently secured a $5 million inventory line of credit for Claybourne Co., a California-based cannabis company producing several of the state’s most popular flower and pre roll products. Claybourne’s plans include expanding their cultivation capacity, an expensive long-term growth investment that could strain the company’s ability to launch new products and maintain production to meet sales. The flexibility provided through the line of credit is allowing Claybourne to meet current and future long-term needs.
“We have found success in the market by offering a diverse portfolio of products, so that is a core component of our business and expanding those products is key to our continued growth,” said Nick Ortega, CEO of Claybourne Co. “However, we also have significant short-term working capital needs such as labor and utility expenses as we phase on our additional cultivation capacity. The flexibility of this line of credit is something that simply hasn’t been readily available to the cannabis space in the past.”
(Mr. Nick Ortega, CEO of Claybourne Co.)
Businesses need funding to grow. But with federal prohibition still the law of the land and differing regulations from state to state, securing financing is difficult if not impossible. Conditions in the cannabis industry make it challenging for businesses to even demonstrate good credit, and credit companies still shun the industry. But the inventory line of credit from Bespoke Financial has allowed Claybourne Co. to launch two new retail products as well as expand its product line, all while maintaining the ability to pursue its long-term growth plans.
“This ensured we would have the financing as needed, as well as the working capital to scale the business,” Ortega said. “We have been seeking a working capital line of credit for some time but it’s just not readily available to the cannabis space regardless if you are a leading brand or not.”
About Bespoke Financial
Founded in 2018, Bespoke Financial is the nation’s first licensed fintech lender focused on the cannabis industry and is focused on bridging the divide between institutional investors and cannabis. Led by a premier team of experts in fintech and cannabis industries, Bespoke Financial provides clients access to working capital by offering short term lending options to fuel business growth in the legal cannabis industry, reducing cash flow cycles and providing cannabis companies greater financial flexibility. The company is backed by respected venture capital firms such as Casa Verde Capital, Greenhouse Capital Partners, Outbound Ventures, Vista Investment Group, Ceres Group Holdings and Sweat Equity Ventures. For more information visit www.bespokefinancial.com or connect with us on LinkedIn.
Newsteam at Highly Capitalized are some of the most experienced writers in cannabis and psychedelics business & finance. We cover capital markets, finance, branding, marketing and everything important in between. Most of all, we follow the money.
BARRIE, ON, Dec. 8, 2022 -MediPharm Labs Corp is pleased to announce the recognition of CBD brand of the year from Kind Magazine, as voted by front line retail staff across Canada. "MediPharm Labs is honoured to ...
BOCA RATON, Fla. - Jushi Holdings Inc. (CSE: JUSH) (OTCQX: JUSHF), a multi-state cannabis operator, today announced the closing of its previously announced private offering of approximately US$69 million aggregate principal amount of its 12% ...
DUBLIN - The global cannabis cultivation market is expected to grow from $114.66 billion in 2021 to $132.55 billion in 2022 at a compound annual growth rate (CAGR) of 15.6%. The cannabis cultivation market is ...
DISCLAIMER NOTE: This email should be considered strictly private and confidential. Sender of this email is not a United States Securities Dealer, nor Broker, nor U.S. Investment Adviser. Sender is a Registered Corporation and Consultant, and makes no warranties, nor representations as to the buyer, seller, or transaction. Furthermore, this email includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Read more