Two prominent cannabis investors explain how the macroeconomy is affecting the industry. Cannabis VC deals have slowed dramatically in 2022. So far this year, only 41 cannabis-related companies — globally — have raised venture capital, making 2022 on track to see the smallest amount of deals and funding since 2017. $300 million has been raised in venture capital in 2022, while $1.6 billion was raised in 2017. What's going on? Two of the cannabis industry's most prominent investors join Karson Humiston in this week's podcast to talk trends and strategy, and offer some analysis of this emerging market's seemingly rough year. Emily Paxhia, Co-founder and Managing Partner of Poseidon Asset Management and Ian Dominguez, Founder and Portfolio Manager of Delta Emerald Ventures join Vangst's Founder and CEO as she flips the script and gets to ask investors the tough questions. Produced by PodConx Proud To Work In Cannabis - https://podconx.com/podcasts/proud-to-work-in-cannabis Karson Humiston - https://podconx.com/guests/karson-humiston Vangst - https://vangst.com/ Ian Dominguez - LinkedIn Emily Paxhia - LinkedIn Delta Emerald Ventures - https://www.deltaemerald.com/ Poseidon Asset Management - https://www.poseidonassetmanagement.com/
Two prominent cannabis investors explain how the macroeconomy is affecting the industry.
Cannabis VC deals have slowed dramatically in 2022. So far this year, only 41 cannabis-related companies — globally — have raised venture capital, making 2022 on track to see the smallest amount of deals and funding since 2017. $300 million has been raised in venture capital in 2022, while $1.6 billion was raised in 2017. What's going on?
Two of the cannabis industry's most prominent investors join Karson Humiston in this week's podcast to talk trends and strategy, and offer some analysis of this emerging market's seemingly rough year. Emily Paxhia, Co-founder and Managing Partner of Poseidon Asset Management and Ian Dominguez, Founder and Portfolio Manager of Delta Emerald Ventures join Vangst's Founder and CEO as she flips the script and gets to ask investors the tough questions.
Proud To Work In Cannabis - https://podconx.com/podcasts/proud-to-work-in-cannabis
Karson Humiston - https://podconx.com/guests/karson-humiston
Vangst - https://vangst.com/
Ian Dominguez - LinkedIn
Emily Paxhia - LinkedIn
Delta Emerald Ventures - https://www.deltaemerald.com/
Poseidon Asset Management - https://www.poseidonassetmanagement.com/
VT State Of Cannabis Investing
Karson Humiston: [00:00:00] Hey everybody. And welcome to the proud to work in cannabis podcast. I'm your host Carson. Humiston the founder of angst. And today we're doing something a little bit different today. We have two amazing investors in the space that are joining us, and we are gonna have a conversation about what is going on in the cannabis investment world so far this year there's only.
41 cannabis related companies globally that have raised venture capital. So at the current pace, this year's on track to be the lowest total amount of deals and total amount of funding since 2017. So far this year, the cannabis, businesses have raised about 300 million in venture capital compared to 1.6 billion in 2021.
So obviously a dramatic drop and a lot of people wanna hear directly from investors around what's going on. So it's gonna be a, a very pointed conversation. We have two of the best investors on the space with us. So let let's turn it to you. I, I would love for each of you to [00:01:00] introduce yourselves and a little bit about your funds before we kick off this conversation.
Emily, why don't we start.
emily Paxhia: hi everyone. And thank you so much Carson for, including us in this discussion. I think
actually Ian and I, I think are two, our, our groups are two very active investors,
in the space who have been deploying capital, so it's, it should be a really interesting discussion, but
you know, co-founder managing partner,
Poseidon Poseidon has. Three
private funds and an ETF and seven
direct syndicate vehicles that.
We run alongside of the funds. you know, we.
range In our investment stages from our most recent
strategy is focused on a,
post seat stage. So we are playing in the earlier
kind of. Spectrum of the venture capital
world. and then we are participants in the public.
markets, obviously through some of our other vehicles. So
we really like having that continuum of
exposure.
because it does help us to understand what's going on in the companies that are quote unquote more mature, even though this industry.
has a long way to go, All the way through to the companies that are really just starting. And
taking for the first time, capital That's not just friends and family [00:02:00] or angel capital. So it's pretty exciting.
Ian Dominguez: Uh, yeah, I'm Ian Dominguez. I'm the, , founder and portfolio manager of Delta Emerald ventures.
we, are
most different from FCI in that , we don't actively trade public investments. We do have a investment that is public, but, , I guess historically invested in.
companies and we'll do that for the foreseeable future. and another area that we spend a lot of time thinking about is on the data and technology side of things. I think, , Poseidon and, and Delta Emerald have a number of technology investments in the space. and, this is definitely an area that we spend a lot of time thinking.
Karson Humiston: And, and this podcast is especially fun for me as a founder because usually, investors are asking me questions. So this is the chance for me to ask in investors questions. So I I've been really looking forward to this episode. Why don't we start off with just giving, you know, your perspective on right.
[00:03:00] Why the dramatic drop in funding into the cannabis space in 2022, right? New states, seemingly are opening up more people than ever are consuming cannabis. there's there's a lot of good happening. Like why are investors, materially slowing down, deploying money into this space?
emily Paxhia: you know, cannabis has been it's, it's in an emerging a Mar market, cycle. right. And so you're gonna see gyrations in.
terms of how the ebbs and flows of capital really work here. last year
was crazy. I mean, we had like
the meme stock thing. There was a
record number of IPOs that, that
happened in the last 24 months. And then this year we've seen the lowest number of IPOs I'm talking.
very broadly speaking, not cannabis,
just broadly speaking on a macroeconomic level. Um, the lowest
number.
of IPOs since 2008, I believe were, were down past that at this point.
So you can see all of those indicators are moving.
to kind of more of a risk off, thing. The other thing I would say is that cannabis
has often been coupled with the crypto [00:04:00] industry. and crypto was running.
incredibly hot for quite a long time while
cannabis was kind of busy building businesses and focusing on fundamentals, crypto was running hot on kind of like cocktails and dreams, I would say, but that there has recently been a reckoning.
And I do think there's a little bit of a Venn diagram that overlaps in folks who have had, I Know, some, of our colleagues.
who are investors have had exposure on that side and have felt quite a bit of pain. And so,
you know,
just seeing some of the things that have occurred there. Directionally. There's
a lot of pointing to kind of like, let's go a little bit more risk off. there's a lot of pain and also in the public markets on, on the
broader level.
on some of these tech companies that we've seen draw down 70, 70 5%. So there's pain out there.
and. You know, as
we're watching tomorrow is, another update from the fed about what's gonna happen next. And I know people are kind of, you could see how the markets were moving today and, and
that's all very high level. Right. But I do think it trickles down and I was just at the code [00:05:00] conference two weeks ago, which was, I've been there twice now. And it's really tremendous cuz I get to.
Meet with other.
venture capitalists who are in just like the
broader tech sector. I get to hear how
they're thinking about things I get to hear from founders from tremendous companies And hear are the things that they went through. Like I'll never
forget seeing a founder, Sue Butterfield from slack, talking,
about how he, you know, almost MIS payroll a couple times. Like
those are really.
valuable stories when you're trying to keep a bigger perspective as an investor and, uh, across the board when I was, um, in the. Socializing sessions around code.
I was hearing from the traditional tech VCs that they've largely been kind of holding steady. And I hear the same thing from the hedge fund community. Just kind of holding off on deploying capital. They're definitely raising capital. So in many senses, they're loading the guns to go when it's time.
But I think. There was a little bit of, let's take the summer to work with our portfolio companies, make sure the portfolio companies are stabilized to the extent that they can, or maybe top them up a little [00:06:00] bit
and then we'll start really.
leaning in again in the fall. So that, was, that was a pretty large.
consensus. So I don't think cannabis
exists in a vacuum
I think it's it's. a
more acute experience here because we've never been experiencing
a massive flow of capital. I mean, ne not never, but rarely have we seen a massive flow of capital into this industry. So I think we feel it very acutely in this sector when it happens.
Ian Dominguez: Yeah, I think the only thing I would add there is that, the same kind of Torrid pace that we saw outside of. The cannabis industry, not sure that we ever got that crazy in cannabis. I think to your, to your point, Emily. It hits different when it's not like the faucets were ever completely turned on in the first place.
And, and, for reasons we all know and understand very well that's the reality in cannabis and has been, and will continue to, to be, in the near term, at least. So, That
aspect I think is consistent with what we've seen outside of cannabis. , I would echo the slowdown that [00:07:00] happened in the summer.
I know that that happened. Outside of cannabis as well. people, if you think about it from the side of the investors as well, it's been really two years plus of some pretty Torri deal making. And so I think a lot of people just kind of took the summer to kind of get their bearings. I do think we're gonna see more deals happen in this fall.
Now I'm speaking specifically in cannabis, and there's probably gonna be a bit of a D bifurcation between, Companies that are in a position to, move a little bit more aggressively, potentially see some, deals made between companies, that's one potential path.
And then the other is that there's a lot of companies that are gonna need capital and some of them will be able to raise money and some of them won't be able to raise money. And that's just the reality of an industry as early as we are in cannabis.
Karson Humiston: So for your companies that are, are out there, what are you advising them to do , in this moment?
Ian Dominguez: yeah, get profitable and gain runway. If, if you don't have a clear line of sight to [00:08:00] profitability, yourself more time at a minimum. And, something else that I think is, is it's high time , that we do this in, in cannabis and it's it's happening now is I think a, a bit of humility when it comes to what in any one company can or cannot accomplish on their own.
And, I won't, run through a list, but I think it wouldn't be that difficult to, Pick out some examples where some companies perhaps got a little bit out over their skis. And I think we all have to have, you know, a reckoning and, and , some honesty with ourselves about what, what can we actually accomplish with what we have.
And other than that, it's looking to partnerships or to not, duplicate workflows that are happening across this industry. those are some, some ways I, I see this industry pushing forward.
emily Paxhia: Yeah. I mean,
I feel like I have a little bit of,
a bear inside me at all times and maybe it's cuz I'm from Buffalo. And so we're, I'm used to losing super bowls or
Karson Humiston: well, not, not [00:09:00] yesterday
emily Paxhia: yet. That was,
the game, but we'll, save that for another time. but
I've always been the person saying,
look we have to be
very careful. cuz we don't know where the next
Sources of capital are going to come from. I mean, we've been doing this since 2014. I, it has been a
tricky landscape to navigate, and it has been
interesting to
see where the, you know, the light of capital has been, which
companies get shined upon the most in that aspect
And so kind, I have a lot of
empathy,
for founders who have been trying to navigate. Stage, especially for founders, who've gotten, some of the VCs that have been very focused on kind of growth at all costs. As know,
Ian pointed out very stupidly, like a focus on a path to profitability and really, prudence around use of resources.
And I think that
makes for a very sharp execution around a business. But I think, you know, some founders, know, got some folks involved in the organization and got into that mode and mindset and then. for them all of a sudden in about may or June, I think the breaks were slammed on, and then came the mantra.
[00:10:00] You have to have 24, 36 months
of runway or a path to profitability, or,
you know,
and It's it's just a whip saw for a founder Who's trying to answer to
a few different.
masters And, grow a business. and so,
you know, I have a lot of empathy around that
So I try to take a really. kind of like a fine instrument to each company and work alongside the founders to try to help them to calibrate their business the best that they can.
Cuz you never know sometimes like, I think You have very active
engaged investor base. And
. Some
founders, have the ability to turn around and say, Hey guys,
we're refining our strategy.
It Would also be great if we could
do. A bridge round of financing, just to make sure
that we're in a good position and many investors.
who have the, the capital would happily lean in on that and try to bolster the business so that they don't have to worry about going out for a big strategic raise when sentiment is, is quite down.
so it it's just something I've been trying.
to be really, Thoughtful about, and cuz you can read a Million different resources,
and, [00:11:00] and you can just paint everything with a big brush of what needs to happen.
But I'm a firm believer that each business deserves, specific attention about how it should navigate these times.
Karson Humiston: Yeah. It's you, two are very unique in the sense of that. I think from my perspective in working with you, you take a look. Individual business and help get that business on the right path. But I mean, the amount of investors that sent me the Sequoia and YC article, like my biggest complaint about VCs as a founder is that like, there's not a lot of original thought. And so suddenly everyone woke up one day and said everyone needs 24 months a runway. When in the beginning of the year, the first board meeting of the year, everyone signed off on this growth plan where you burn all your cash over the next 18 months. And you know, it puts founders in a hard place. The executive team and the board agree on, we're gonna execute this strategy. And then six months in, we say, now we need 24 months. I mean, that, that is a massive, massive change to the business. And, I think [00:12:00] that more investors should be like you and Ian, where you get in the weeds with founders and help them figure out how to actually execute that plan. Because going from raising in six months to having 24 months of runway, it's like. 360. So what are ways that, you know, you guys actually are getting in the weeds with founders and helping them dramatically change their business strategy from raising in six months to getting to 24 months of runway, because it's like basically executing a, a different business plan.
Ian Dominguez: yeah. I think. Across the board return on investment is becoming more important. And that's not just coming from the perspective of an investor. I'm saying, talking about weed operators in this space.
If you're a dispensary, if you are a, a grower, you have, your own investors to answer to and your own profitability that you're trying to hit.
And, the shockwave that throughs the system is really more about, thinking. Really deliberately about what spend, what are you spending money [00:13:00] on and how is it driving your own profitability? And that's through the entire supply chain across every company, people are thinking about that. Right? So, this is where we're gonna find out what actually is worth.
Spending money on. And , I think we're starting to see signs of that. both at the retail level and at the, at the grow. I don't have as strong of a view on how the processing and manufacturing is kind of thinking about it, but I have to guess it's similar. and so I, I think being able to provide that, pitch.
And data that can actually back up to your customers or prospective customers, that if you spend this amount of money, this is what's gonna happen. That's what people are looking for. also just, the customers get to the other side of this. A lot of customers are going to go, under, you there are 3000 brands in California cannabis today, based on our math.
And let's say I'm at off by a factor of [00:14:00] two still, it would be very difficult to say that I can consistently pick the best ones today just by sheer numbers. , and I think that's filtering through the. Industry right now, just that was picking out one particular region. but I think I'm not blowing anyone's hair back by, by calling out that there are a lot of brands in California.
emily Paxhia: my hair's blown back in. Um, You know,
the way, the ways that I've done this is I've Actually just sat down with the founder
and have gone through,
and, you know, I know Vant, you know, you're all about talent and and sourcing talent and distributing, and sometimes redistributing talent through the industry.
As we see these changes occur.
But I, one of the things I noticed with The founders who really embraced this head on and I'm speaking more of the later stage founders than the earlier stage. The earlier stage
folks have got their hands in. Everything is necessarily until they start building their teams around them.
But a lot of these later stage founders, I [00:15:00] feel like head built the teams around them and what this presented was an opportunity for them to get their hands.
back
into the. Of the business, to which they used to,
back in the seed stage rounds. And I feel like it
was everything from
the sales process, to the product development.
And and I think that while we don't want founders to get stretched too thin, I do think that there's, a, you know, that
entrepreneurial spirit that drives a founder, I think I've noticed an invigorating quality to that,
of getting back into those modes of I'm always selling, I'm always understanding what's going on in the product. rather than.
like relying on The layers of organization.
I've developed underneath Now we'll get back to that. But , I think about the Ben Horowits book, the hard thing about hard things. It's like there's wartime
CEOs and there's peace time. And I think we're not necessarily in a,
full war.
Maybe we are, maybe I'm just tired and I can't even tell the war from the peace anymore, but, I think The founders who roll
up their sleeves and dig in. And, and I
feel like it's my job as a partner to [00:16:00] sit there alongside them and not, not dictate things, but to be a sounding board and just share what I see from. , of course, without disclosing private information, but sharing general feedback of what I've seen going on in other businesses so that I can try to be helpful in that manner. so those are some things.
that we've done and, and I've been impressed by the founders and the fortitude because. We've gone
through
this a few times in cannabis. So, at some point we're gonna hit the velocity moment. for real, like there, there were massive moments where
you know, capital flowed into the space, especially following the constellation investment in, can be growth Corp and,
And things like that.
But I think those were very early market, moments, but I think what comes next is a very sustained tailwind that we should see. We are always looking at catalysts around the policy side, but I think it's actually going to substantially come from private industry.
So I'm pretty
bullish on
Ian Dominguez: And, and, you know, like talent movement is bullish in the sense that, , People vote with their especially people that are in this [00:17:00] industry. They know more than most people about the industry. And, we have to be, I think just acknowledging that this is going to be a, a difficult time for, a number of cannabis companies.
The good news is people don't necessarily go down with ships. They're able to move. that is another way that the market is trying to better understand what companies are gonna be in this for the long haul. And it means a lot to us when we see a particular leader at one company moving to another company.
and I think you're seeing a lot of that happening right now. that is maybe an obvious statement. When you have things like layoffs, of course, people are gonna be looking for new jobs. But, I think it's notable that a lot of, at least anecdotally the people that I'm seeing, they're not leaving the industry, they're making choices now they have better information.
Okay. That, that, that was one experience. Where am I going next? And that is really interesting to me personally, in terms of being like a leading indicator of, [00:18:00] of where this industry's probably gonna go.
emily Paxhia: Hmm, great point.
Karson Humiston: liked, I really liked both the points you made. Emily. The one that I thought was really interesting, from a founder's perspective is that, you know, for a period of time, when there was seemingly more cash available, a lot of guidance from BCS was build out an executive team. around you. And so myself included and a lot of my peers, we, we probably overhired for where we were at the stage of the business.
And at the time that felt like the right decision. And now when you don't have unlimited resources and you say, okay, what are the roles that are. Like without this role, we cannot grow. When you ask yourself that question. I think
it was, you know, you were one of our other investors. One tip they gave me was before you, like, when you look at every single position, ask yourself, is this what's holding us back from growth.
And when you look at it at that lens, like, you know, I think that a lot of founders found that they had a lot of [00:19:00] excess and they had a lot, maybe had overhired and there was things. There was, you know, multiple people doing multiple things. So I do think that a lot of founders that I've talked to myself included, this has given us a chance to really look at our business and figure out to Ian's point, what are we spending money on and what kind of a return are we getting on it?
And having that discipline, I'm optimistic that we'll get all of the businesses that are gonna survive long term in a place where at the end of this, when funding does become available, then we're spending money. True growth, right? The economics of the business are solid. We can pour fuel on the fire and go out and really grow and be as lean and mean and have the strongest unit economics as possible.
So, you know, the optimist in me is that everyone's gonna come out of this with like lean mean, , ready to go businesses. So that, , I hope a positive for people listening. And that leads me to my next question around. You guys both just said in the beginning of the, podcast, and we've seen that you are deploying money in the space, [00:20:00] how are you deciding what companies to deploy in, in a market where, you know, frankly, you can be much pickier. I'm sure that companies aren't getting 10 term sheets at, you know, maybe what used to previously felt like, ridiculous valuations. And so when you can really choose what companies and teams you wanna back, how are you guys making those decisions?
Ian Dominguez: I mean, not, not much has changed for us in the sense that, that we really look for, founders that really understand their customers well and, are able to explain very clearly, , how those customers are getting value and, and, you know, even better if you've got a plan of how you're gonna find more and more customers to satisfy them in more and more ways.
But I, I, I do think we are entering again, we're entering a period where there's like a rethinking about a lot of the spin that was taking place in cannabis. There's still, I think a lot of, of room to get more efficient. And I, I, I would just take a moment here to say [00:21:00] that, you to the extent that prices, continue to compress at wholesale and retail.
I am of the opinion that that's a good thing. That's good for the end consumer. I, I want more access, more afford affordability and , more places across the country. And so , I'm not bothered by that. I think it's gonna lead to more unit growth. Now it's going to make it more difficult for the average operator.
to survive in that type of environment, but that's kind of where learning to use tools or hiring people that are good at improving process, that, that's the way that, we're gonna separate, real executors versus people that, that have been, let's say, uh, enjoying, relatively high prices in certain markets for an extended period of.
emily Paxhia: Yeah, I mean,
we've been similar. We've been pretty focused on the same traits and, and you know, when, where we're
investing on the post seed stage, which is such a cool stage to be back at, it, you know, we have a bit of a longer timeline to [00:22:00] work with this. Stuff and, and investing is all about, you know, time entry, point teams, all of these things come into play, but, just, we're being very, careful in selecting the
teams that we think are being really thoughtful about their capital allocation and thinking about what comes next to, in terms of being able to ultimately attract more capital to the business because this is venture. And so it, it is necessary. Generally speaking. That a , a company at that stage will be looking to do another round of financing before you see an exit, although M and a may heat
up well and, and has heated up, but hasn't, I mean, the way I think about M.
and a is there's like distressed M and a, and then there's also a creed of M and a where the, some of the parts is greater than the two things coming together.
So, it's just
an interesting time, Yeah, we've just been really leaning in on, on that. But I, I have enjoyed Recently
seeing some companies that had
pitched us
and had that prior kind of strategy in place clearly had not succeeded in raising the round, came back around and what I. [00:23:00] Was impressed by with some of these teams, is that they got very clear on their businesses, very clear on how they were going to get to, improving their Mar their operational margins and how they were going to, contemplate expansion without just burning, burning, burning.
there's and, you could see they'd done real work on it by digging in on data and, and having it supported there and how they'd actually made subsequent decisions Based
on. Data, not just based on, oh, this feels like the right thing to do
in the business, which business is about intuition,
but I like to think it's intuition and then you can
use data to try to bolster that and show that you're actually on the right path.
so, so those are some of the things that I I'm thinking about, but it is kind of nice
to be looking at this earlier stage during this time at growth stage, I. is challenging. And we've got, multiple companies in that stage. And like I said, back in may, June, it was a lot of work with them to make sure they were good to go for a period of time.
Wonderful.
Karson Humiston: cool things for me as a founder about working with a lot of [00:24:00] cannabis investors, is that they're also. Founders right. You, in, in a sense you, you both started your own funds, raised funds, managed teams and your founders just as much as I am. So , there's a difference between founders and, and funders.
So from you guys perspective as founders, what are the conversations with your LPs, like at this time and how have they changed over the last 12?
emily Paxhia: Uh,
we are a
firm that believes in transparency And
communication. So we send out, depending on the fund, we have different, uh, cadence of reporting, but it it's at least quarterly. And if there's an event. We send out a special update. We're actually hosting a full blown investor day in New York in, October where we're gonna take folks around to see, the dispensaries in New Jersey, from some of the operators that we work with
and then have, founders do a panel panel discussions regarding their Different area. and, you know, I just [00:25:00] think
it with there's no hiding from
the
fact that cannabis has gotten beaten up, from a, the market standpoint. And so the way we feel about it is, , let's make sure we communicate
with them
we're very, uh, clear about what we
think, are the challenges and what we think are the opportunities.
And I think it's the only way
you can be an investor with, uh, you know, the fiduciary
duty that you have, but also. Honestly, to be able
to sleep at night
it's an immense responsibility to manage, investments and to be responsible for that. And every single thing that doesn't go perfectly is definitely,
it feels like a, an immense blow, but, you know, the important thing I'm.
trying to
help our investors to understand
is that actually. these companies
have a lot of really
good
things going for them because they do.
and especially when I
like zoom out, as we've been talking about and look at some of these companies outside of the industry, I mean, I think about some of the companies that were meant to go IPO last year that didn't have profitability, even in the business plan.[00:26:00]
you
Karson Humiston: people were like, what are
emily Paxhia: Yeah, no, it was
not a thing.
The metrics have changed. And so, but in cannabis we've been living in a very capital constrained environment, relatively speaking. And so when I look at these businesses, I actually see a lot of really good things.
And I think Ian just made some excellent points too. Like the normalization around pricing in this industry. Bringing it down, focusing on units. We need to be focusing on products more than you know, milligrams of
THC as an industry. And we're going to get there. It's just something we have to go through as maturation exists.
And so that's my whole point of view is just to make sure that, you know, our investors have visibility to see what the actual businesses are doing, not just what the headlines around the cannabis quote unquote industry or market are saying.
And,
so that's what I view my responsibility as.
Karson Humiston: and I also think it's like such a long game. I mean, I think about last, the last two years where I would see companies in and outside of the cannabis industry, raising. A hundred times more capital than banks than having like the [00:27:00] best headlines ever. And you start to think to yourself, wow, this company is a hundred times better than our company.
And when you, unpeel the onion, That, that that might not be the reality at the end of the day. Business is business and we're all out here to build businesses, to generate, revenue and returns for our investors. And so I think it's a long game and I think a lot of companies in and outside of cannabis that had, really great. Headlines over the last two years, the, the game's not over yet. And there's a lot of companies that stayed, lean and mean companies in both of your portfolios that have great businesses and a lot of great things going for them that could ultimately be some of the most, successful and best outcomes in, in this space.
And so I think everyone's kind of coming back down to earth right now and the best companies are gonna win in the
Ian Dominguez: Yeah, yeah. I think one lesson here is to, to choose your round size wisely. , , there are deals that have gotten done recently, and I think you'll see more get done in, in this fall. and probably into the new year [00:28:00] and smaller rounds, you know, they have a way of creating constraints and a higher degree of focus.
smaller rounds can, or tend to move faster. And
I think. It's can be difficult to, to handle
all the expectations and, stuff that comes with a large round. I think this is a, a cleansing and, beneficial moment for this, this whole industry.
emily Paxhia: Mm-hmm mm-hmm.
Karson Humiston: Well, good. Well, we're, we're running out of time here, but I think we're ending on a. Positive note, right. Even though it feels painful. the the three of us were at Benga last week and there was a lot of companies out there really struggling to raise, but the best companies will figure out a way to make it forward.
They'll clean up their core business. They'll figure out how to better service their customers. And ultimately the best companies will rise to the top. So I, I I'm feeling inspired after this podcast. Do you, do you have any closing remarks that you'd like to leave our audience?
Ian Dominguez: [00:29:00] There there's one thing I, I I'd like to say, and it's, it's not even, my idea, but I like it so much that I'm gonna, use it here. And, someone pointed out to me that.
know, Beningo was, a bit surprising in that the sentiment felt more positive than what this person thought going in.
And I think it's important for us to remember that the channels that people use to get information. I E LinkedIn in the case of the cannabis industry, we all, I think at this point are aware of some of the drawbacks that social media can have on communities, including the, the tendency for, you know, let's say the algorithm to favor.
Negative news. And, no question cannabis is going through going through it right now. It's it is a difficult time for operators. but there are very positive aspects to what's going on right now. And I don't want especially founders that are, feel, emotionally challenged and, feel like there's no way out.[00:30:00]
be willing to raise your hand and get some help about it because it's, it's, I think it's a really important thing to remember that, none of us are alone in this and it is difficult, but you know, it, there, there are paths forward.
Karson Humiston: I love that. And I think that's the perfect way to end. So thank you both for joining us. We'll have to do an, we'll have to do an episode in one year from now, September 20, 23, to see where we've landed, but thank you so much for joining and excited to continue working with both of
emily Paxhia: Thank you.
Ian Dominguez: Thanks Carson.