420 Day in Colorado!

Posted on April 30, 2014 by admin

Well it looks as though Colorado passed yet another vitally important cannabis test last weekend, and yes it just happened to be on target with Colorado’s new recreational marijuana industry.

With Colorado being the first state to legalize recreational marijuana it appears that their annual holiday held on 4/20 went well. Although there were long lines for the Cannabis Cup (which led to a few grumbles) did not led to any real bad behavior among the recreational cannabis consumers that were gathered for the rally in downtown and at other events that were held to celebrate the holiday.

The weekend of 4/20 was everything that the cannabis business had waited for and the cannabis consumers were very relaxed.

The holiday event of course turned out to be very profitable and the Cannabis commerce flowed free. Many recreational marijuana businesses had record sales; which means there was a surge in tax revenue for the state of Colorado.

This was great Public Relations for Colorado’s recreational cannabis industry since cannabis received bad PR in the beginning stages when there were several incidents involving edibles.

There are some individuals who are still against having tens of thousands of stoners gathering at one time, and smoking marijuana freely in public places although authorities did have to issue several thousand citations at the holiday event for public consumption, and some individuals were even taken to detox. Many say this is no different than alcohol-related events. There have always been those who don’t know their limit.

The message the folks of Colorado wants the rest of the world to see is: legalizing marijuana will not create a world of chaos, this is not any different than allowing individuals to drink in a bar/restaurant, or any alcohol-related event and that recreational cannabis users will not gather in large groups to consume marijuana.

Organizers of the rally downtown had a more professional event which brought a more professional side to the event. There were long lines for the vendor booths that sold Leafly and the manufacture CannaEnergy and some of the businesses handed out samples of their products. The atmosphere was very laid back.

Since the recreational cannabis industry is under the microscope due to the side effect of consuming marijuana through candy, cookies, and other means it has caused a black mark on the marijuana businesses as well as the legalization.

Horrible incidents that involve edibles need to be looked at as isolated incidents and they are not directly related to proper cannabis use. There may be possible misuse of the product (this is no different than taking too much of a prescription drug or alcohol poisoning). So the same measures you would take with medicine and alcohol you should also apply with the use of recreational cannabis.

Colorado and other states will need to address some of the issues that are tied to the edibles, and the responsible use of the cannabis users.

But 4/20 in Colorado will not only be marked as a holiday in Colorado. It will also go down on the history books as the first State to allow individuals to openly smoke, purchase, eat, and drink Cannabis in public.

Is the Government turning their heads on Privateer Holdings?

Posted on April 30, 2014 by admin

One of the largest private equity firms in the cannabis industry is Private Holdings. They raised more than $50 million dollars in the last fundraising and the firm is expecting to finalize investments and close its Series B financing effort at the end of May, with the Privateer Chief Executive Officer Brendan Kennedy.

The dollar amount is significant for the cannabis industry; there is documented information that shows high level investors are finally starting to pump money into the cannabis sector. Kennedy said there have been several institutional investors, who had no interest in this industry and wanted no part of it in the past. Now they all want in, because they are witnessing millions of dollars flowing into the industry and investment firms along with some wealthy individuals from mainstream businesses all around the world are starting to invest in these cannabis companies that they once turned their noses up at or didn’t want others to know if they invested in anything connected with marijuana.

ArcView Group has seen a 50% spike in their membership over the last three months. And the ranks have increased more than five times in a year.

Chicago investment firm Lincoln Park Capital Fund closed a deal to channel $27-million dollars into the publicity traded biotechnology company named Nuvilex “they will use this money for MMJ research”.

Mediswipe a publicity traded company that provides various products and services to the cannabis industry received a $1.1-million dollars funding commitment from a private equity firm. This company was also reported to have offered another $500,000 dollars in loans to assist Colorado dispensaries and cultivation operations with the purchase of high dollar equipment and real estate.

Privateer Holdings, which is a cannabis private equity firm that is run by a variety of investment banking veterans, has witnessed interest from investors on the rise and it will not be long before it reaches $25-million dollars in its second funding. In the first funding the firm raised $7-million dollars.

The surge in interest from the mainstream investors has been very successful for the cannabis executives. And cannabis executives are looking forward to the additional surge in the interest rates from the recreational marijuana companies.

There are two executives from High Times magazine, that recently teamed up to start a new investment fund and they are looking to raise $100-million dollars in two years, while the cofounder of a dispensary listing giant WeedMaps has gone in a similar direction. The cannabis business leaders want to continue to saturate the market with the recreational cannabis dispensaries.

The recreational marijuana sales in Colorado and the impending launch of Washington’s adult-use program there have been some major players that have joined this new market. This recreational market is where you will find the real money, and investors are now starting to see recreational marijuana is a money maker.

The federal government is no longer trying to regulate the marijuana markets; they are pretty much taking hands off approach as they lower the risks.

The future is looking very profitable for the businesses that use to be a “can I get a $5.00-dollar bag”?

Obama Administration Ok’s Bank and Marijuana Merchant Account Transactions

Posted on April 25, 2014 by admin

In February, the Obama administration gave banks approval to do business with legal marijuana dispensers. For the first time ever, these dispensers are eligible to secure loans and set up checking and savings accounts with traditional banking institutions.

20 states and the District of Columbia have legalized the sale of marijuana. Colorado and Washington were allowed to legalize marijuana, as long as the states kept a close eye on businesses. In August, the administration set forth eight guidelines for legal dealers to follow to avoid federal prosecution. As a result, the Treasury Department has issued new rules making it easier for banks to do business with marijuana dispensers, while the Justice Department decided not to prosecute banks that do business with legal marijuana dispensaries.

Yet banks are leery of engaging in business with legal dealers, because the sell and distribution of marijuana is still forbidden by federal law.

Frank Keating, president and chief executive of the American Bankers Association voiced financial institution concerns. “This guidance doesn’t alter the underlying challenge for banks. Possession or distribution of marijuana violates federal law, and banks that provide support for those activities face the risk of prosecution and assorted sanctions.”

Currently financial institutions must notify the federal government if they suspect any illegal activity by marijuana merchant accounts. The Treasury department requires banks to submit a “marijuana limited” report that says that dealers are following the administration’s guidelines, and are keeping revenues out of the hands of illegal dealers. If the bank suspects that a marijuana merchant account is engaging in illegal activity, they must file a “marijuana priority” report to notify regulators.

This is exciting news for marijuana dispensers like Steve Horwitz, whose account was closed once Wells Fargo discovered it sold marijuana laced goods. “We’re good customers. We pay extra money for cash deposits, and we move a lot of money. It’s in their interest to keep us.”

Legal marijuana entrepreneurs are not the only ones who would benefit from the integration of marijuana merchant accounts into the banking industry. Financial organizations could win big with legal marijuana business. The industry is expected to gross $2.57 billion this year, according to ArcView Market Research.

marijuana-merchant-account.com has easy payment processing solutions for retail and delivery dispensaries. Our services let your patients donate at the point of sale using a credit or debit card and a PIN number.

The transaction will only cost patients a small convenience fee ranging from $0.99 – $2.00. We offer debit card, credit card, and savings account services. Our retailers choose us for their marijuana merchant accounts because there are no discount rates, interchange fees, or processing fees.

Our MMJ delivery services also offer electronic payments on the go. Contact us at: 1-800-466-1809 to set up your marijuana merchant account today.

Traditional Payment Processing Services Freeze Out Medical Marijuana Merchant Accounts

Posted on April 25, 2014 by admin

Medical marijuana is legal in 17 states and in the District of Columbia. However, federal law does not recognize marijuana dispensaries as legal operations. As a result, medical marijuana dispensaries are being blocked out of banking services. The Huffington Post reported that Wells Fargo recently denied banking services to a Colorado medical marijuana company. “The complex, inconsistent legal environment relating to medical marijuana dispensaries, Wells Fargo has opted not to bank these businesses,” said a representative of the bank.

As major credit card processors like Discover and American Express have decided to not engage in marijuana dispensary payment processing services, other payment processing organizations have also used the ambiguous legal environment to refuse processing services to legal marijuana dispensers. Recently VISA and Mastercard announced that they would let individual acquiring processors decide if they would process marijuana merchant accounts. As a result, large payment processing company, Electronic Merchant Systems (EMS) told its customers last summer:

“In light of recent developments, we wanted to reach out and make you all aware of the latest news regarding Medical Marijuana merchants. Effective July 1st, 2012, MMJ merchants will no longer be able to accept Visa or MasterCard credit or debit cards.”

Traditional Banks

The freeze out by traditional banks and major credit card processors has forced the medical marijuana industry into a “cash only” industry, where customers are forced to carry large sums of cash like criminals to dispensaries. Despite these setbacks, some payment organizations have found creative ways to manage marijuana merchant accounts through payment cards where consumers perform in-person transactions via a PIN-based terminal. The transaction is then processed as a cash withdrawal using a debit card or cash advance.

marijuana-merchant-account.com has easy payment processing solutions for retail and delivery dispensaries. Don’t leave your patients vulnerable to robbery or make them feel like criminals, by having to carry large amounts of cash to purchase their medication. Our services let your patients donate at the point of sale using a credit or debit card and a PIN number.

Our MMJ delivery services also offer electronic payments on the go. Patients simply swipe their card, enter the PIN using a PCI compliant device and access their funds for donation to Medical Marijuana merchants.

It’s just that easy! Contact us at: 1-800-466-1809 to set up your marijuana merchant account today.

Colorado’s Recreational Marijuana Sales Bigger Than They Seem

Posted on April 15, 2014 by admin

According to recent tax data released by Colorado, recreational marijuana sales increased by five percent in February. Sales reached $15.1 million. While this figure is good it is lower than expected. Though February was a shorter month than January which skews the actual perception of how much sales have grown.

Sales were approximately $539,285 each day in the month of February. This, when compared with $464,516 in January, shows that there was actually an increase of around 15%. This would have created a total of $17 million in February vs. $14.4 million in January, if February wasn’t a shorter month. Making sales a few million higher.

As recreational sales rise steadily and are expected to continue to climb as the year progresses, medical marijuana hasn’t suffered as some previously feared. Sales for medical marijuana rose 12% in February reaching $35.2 million. These figures prove that the recreational market is not impacting the medical market revenues. With medical and recreational markets both growing steadily and not adversely affecting each other the industry stands to increase as the year goes on.

The state collects taxes and fees on both recreational and medical marijuana. In February the state collected $3.2 million in taxes and fees related to the marijuana industry. A percentage of that, $438,253 is connected to a 2.9% sales tax on recreational marijuana and $1.43 million is connected to a 10% sales tax on any retail cannabis transactions including ancillary products related to marijuana.

Also as the dispensaries see increases in their sales it will be important to streamline a marijuana payment processing method to better capture sales and assist customers. Currently cash is the only form of payment accepted in dispensaries though that may change soon with the advent of new applications and technology.

Despite the good figures state lawmakers are holding off on making plans for the funds. As the forecast of the tax revenues could be different than what the various offices initially predicted. Therefore until more information can create a more accurate forecast the finalizing of spending plans for the tax revenues are on hold. Especially as the revenue estimates, created by the governor’s office, that were presented to voters who approved the marijuana tax plan in Colorado haven’t yet been consistent with the official tax report.

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Marijuana Sales Set to Grow Five Fold in Five Years

Posted on April 15, 2014 by admin

The marijuana business factbook has released data that alleges that the marijuana industry is set to boom. It published figures that purport an increase of five-fold in a five year time frame. This growth quantified will be an increase from an estimated $2.2-$2.6 billion in the current year to $7.4-8.2 billion by 2018. These figures include both medical and recreational marijuana sales. They also account for the addition of an estimated four to five more states passing legislation for medical and/or recreational cannabis usage.

While figures for this year are exactly in line with predictions the lift that is predicted in sales by 2018 is due to the passing of the Cole Memorandum in August. The memorandum by the Federal Department of Justice simply claims a hands off approach to the marijuana industry, though local and state regulations must be adhered to and oversight must be strict.

After this statement from the Federal Department of Justice estimates have increased though it has been noted that they are still quite conservative. The estimates do not account for wholesale cannabis sales nor the multiple ancillary ‘cannabusiness’ and their revenues such as equipment, real estate, etc. It also doesn’t account for the future of marijuana payment processing which is set to expand largely as currently cash is the only method of payment accepted in dispensaries. All of these factors could potentially account for billions more in revenue. Additionally with the predicted addition of four or five more recreational states and two or three medical cannabis states sales will skyrocket.

Currently recreational marijuana sales are legal in merely two states. Though with the predicted additions of four to five more states, 2018 is likely to be the first year that recreational marijuana sales match or even exceed medical marijuana sales in the United States.

None of the figures or estimates include the black market sales of marijuana. It is estimated that the black market has sales figures that are close to $40 billion. This illustrates far reaching potential for the industry beyond 2018. Another note on the future potential of the medical or recreational marijuana industry is that many consumers who currently use the black market have indicated that they would willingly change to a legal dispensary or marijuana supplier when it becomes available in their area.

App Attempts to Make Marijuana Payment Processing Easier

Posted on April 15, 2014 by admin

With the sales of medical marijuana expected to grow exponentially in the coming years, the cash only payment system currently in place will see a challenge from a new mobile app designed to streamline marijuana payment processing. Itonis, the maker of the MyECheck proprietary mobile app, plans to market its services to medical marijuana dispensaries in order to make marijuana payment processing seamless. There will be a reasonable per transaction cost that will generate revenue for the company which provides cash free point of sale facilitation.

Currently all dispensaries despite the legality of the sale of marijuana in its respective state, must conduct all business with cash only policies due to banking limitations. The mobile app however is designed to function as an electronic check and would allow safe and secure money transfers between transacting parties. This would bridge the gap that is missing in marijuana sales and marijuana payment processing.

Medical and recreational marijuana sales are expected to grow significantly in the next years, especially with the legalization of marijuana use in Colorado and Washington recently. In Colorado for example the Joint Budget Committee has projected marijuana tax revenues to be more than $610 million over the course of the next year and a half.

The company’s CEO, Mark Cheung is confident that the potential revenue stream from the transaction fee the company will charge for each transaction will push Itonis into a new sector that will create financial gains for the company. Initially incorporated in Nevada on July 5, 2005 under a different name, Kenshou, Inc. later changed its name to Itonis on December 2, 2005. Itonis’ recent push to enter this market could break new ground as there is a clear gap in marijuana payment processing for dispensaries currently.

The company could not only become a new marijuana payment processing platform, it could also gain traction with small businesses. Many other companies have had success marketing themselves as simple payment platforms that provide a basic yet crucial service. PayPal and Square have both become highly profitable offering payment processing for a nominal fee.

For Marijuana Dispensary Processing, contact us today!

Canadian MMJ Industry Experiences Overwhelming Investor Interest

Posted on April 10, 2014 by admin

While the medical marijuana industry is taking small steps in the States, it is experiencing unexpected growth in Canada. As the industry is presently experiencing in the state of Colorado, it is difficult to raise money and find funding especially when trying to start a marijuana-related business.

According to the article Crowdfunding Site to Provide New Financing Option for Cannabis Startups, Marijuana Projects by MMJ Business Daily, “Landing loans and investments is so tough that more than 80% of cannabis business owners rely solely on their own personal savings and credit cards to launch their operations.”

Canada, however, is experiencing a higher level of investment interest than was anticipated. It was the goal of PharmaCan’s CEO, Paul Rosen, to raise $5 million. However, according to Rosen himself, the response he received was “overwhelming”.

PharmaCan, an investment company, is invested in The Peace Naturals Project and the Whistler Medical Marijuana Corporation. Both of these institutions have received licenses from Health Canada which allow them produce and distribute medical marijuana. In a statement to MMJ Business Daily, “Rosen said he is confident that a third company he’s invested in – Vert Medical/Green Medical – will also receive a production license.”

When PharmaCan began its venture for financing, it did not expect to receive the kind of response that it did. To Paul Rosen’s surprise, the company not only met its goal of raising $5 million but surpassed it by reaching $9 million. In total, PharmaCan has seen $10 million in marijuana investment during the past year.

On April 1 of this year, Canada expects to kick off its new medical marijuana program. In addition to this big step, a federal judge has ruled that Canadian home growers are permitted to continue to grow their own marijuana. In the article Huge MMJ Interest in British Columbia, But Bans Possible by Marijuana Business Daily, it was reported that “Health Canada is currently accepting license applications for medical marijuana businesses, and about one quarter of the country’s 450 applications for commercial cultivation of cannabis have come from British Columbia.”

All in all, it will be interesting to compare the growth of the Canadian marijuana industry with that of the U.S. after some time has passed. With the overwhelming amount of support and investment the industry has received in Canada and U.S. firms looking to tap the Canadian medical marijuana market, it looks as though it is well on its way to becoming a booming industry for the country.

New Yorkers Overwhelming Support Medical Marijuana and the Passage of the Compassionate Care Act

Posted on April 9, 2014 by admin

In a poll conducted by Quinnipiac University released on February 17^th, it was revealed that 88-9 percent of New York voters support the legalization of medical marijuana. In another poll, 57-39 percent of voters support the legalization of small amounts of marijuana for personal use.

It should come as no surprise that New York is overwhelmingly for the legalization of medical marijuana. Since 1997, the Compassionate Care Act has been floating around waiting to be seriously considered. According to the Compassionate Care NY website’s description of the Act, “The New York proposal was drafted with careful, strict controls: under tight regulation, a patient who has been certified by a healthcare provider to use medical marijuana would register with the New York State Department of Health and receive a patient identification card. Specially approved organizations — such as hospitals or community health centers — would dispense the medical marijuana to registered patients, under DOH supervision.”

Especially with the success the Marijuana industry has experienced in Colorado upon medical marijuana being legalized, New Yorkers are hoping that now is finally the time for the Compassionate Care Act to finally be passed. In an article on HuffPost by Christopher Mathias with State Sen. Diane Savino (D) (sponsor of the measure), Savino “told HuffPost that she “easily” has enough votes to pass the bill now, even if not every one of those senators has publicly announced his or her support.” A confident Savino also revealed that her confidence stems from knowing she has 40 votes to pass the bill, which is ideal considering that the bill only needs 32 yes votes in order for it to be passed.

In an effort to work around the waiting process, Gov. Andrew Cuomo (D) revealed a plan to help those who desperately need the help of medical marijuana as they combat serious, specific illnesses. The governor’s plan involves a limited medical marijuana program which does not require the normal legalization process. In the article on HuffPost by Mathias, he writes that “Under the governor’s plan, medical pot is available at 20 hospitals for people suffering from specific illnesses. Savino has called the plan “unworkable” and expressed serious doubts that the federal government would allow it.” Some patients suffering from illnesses that are in need of such treatment have even considered moving to Colorado now that medical marijuana has been legalized there.

While there is interest in using marijuana for personal use, as seen in the poll revealing a vote of 57-39 percent, it seems that the big push here is for the use of medical marijuana to be passed for the betterment of patients. Many people are upset that the Compassionate Care Act has been sitting on the back burner for so long. In an interview with HuffPost’s Mathias, State Sen. Mark Grisanti (R) stated, “It’s time to put politics aside, and put people first.” For now, New York State will simply have to wait for the legalization of medical marijuana to be passed.

Marijuana Enforcement Division Grows with the Colorado Marijuana Industry

Posted on April 9, 2014 by admin

With Colorado’s recreational marijuana industry growing at such a rapid rate the regulatory bureau has had to step in and oversee operations. The growth is primarily due to the expected expansion of recreational as well as medical industries. Even though marijuana has been legalized in Colorado the state is still trying to regulate the drug and tie up some of the loose ends.

State officials have received notices of intent from 255 businesses which have plans to apply for a license after July, at which time the state will open up its recreational industry to businesses that were not originally medical marijuana businesses. The state agency overseeing Colorado’s experiment of marijuana legalization is adding enforcement agents, data analysis, along with undercover operatives. Officials believe these steps will make businesses more accountable.

Just a year ago, there was a state audit that criticized what was then the Medical Marijuana Enforcement Division for not being able to track who was growing or selling marijuana. Budgeting and management was bad and there was no definition of marijuana’s role.

Now that there is more solid funding from application and licensing fees the Medical Enforcement Division has a stronger financial footing. This is the agencies third director in the last four years but finally the medical marijuana license applications have been caught up to the applications submitted in mid-2010.

Some industries are still questioning if the agency is capable of handling the challenges, more new businesses, and enforcing the product testing. In 2012 the division had to close three field offices and lay off the staff after a moratorium on new business applications force it to stretch operating expenses budgeted for one year over two years.

The Marijuana Division currently has 30 employees and they would like to see that number increased to 55 hopefully by the end of the fiscal year, in June. With increased manpower they are hoping to open some other offices in Colorado Springs, Northern Colorado and the Grand Junction.

Part of the expansion has made way for the secret shopper program. This will make sure businesses are not selling to minors. This plan is called the “underage compliance program” it is similar to the programs that are used in the liquor industry. There will be consumers sent out to retail shops to try and purchase marijuana. Then the operatives will go to the medical dispensaries and try to purchase cannabis without an official MMJ card. Although Colorado has a smoke your marijuana and feel good attitude these are some questions that linger yet unsaid aloud.

It would appear Colorado has the resources to hire and fund a Marijuana Division for the recreational marijuana industry but what about other states?
Will people who use marijuana be able to travel from state to state or country to country with their marijuana?
Will there be a breathalyzer for someone stoned behind the wheel of a moving vehicle?
Will medical marijuana smokers be able to smoke during work hours?
What about the individuals who drink, smoke marijuana and drive?

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Author Archives: admin

420 Day in Colorado!

Is the Government turning their heads on Privateer Holdings?

Obama Administration Ok’s Bank and Marijuana Merchant Account Transactions

Traditional Payment Processing Services Freeze Out Medical Marijuana Merchant Accounts

Colorado’s Recreational Marijuana Sales Bigger Than They Seem

Marijuana Sales Set to Grow Five Fold in Five Years

App Attempts to Make Marijuana Payment Processing Easier

Canadian MMJ Industry Experiences Overwhelming Investor Interest

New Yorkers Overwhelming Support Medical Marijuana and the Passage of the Compassionate Care Act

Marijuana Enforcement Division Grows with the Colorado Marijuana Industry

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