When it comes to CBD business, getting financing might not be as straightforward and easy as most other types of businesses. Even though cannabis and marijuana have been legalized in many states and some states even permit their recreational use, the federal government still considers them an illegal substance.
Since federal government regulates the banks, you aren’t likely to get any funding from them for your CBD edibles business. CBD industry is fairly new. This is one of the reasons traditional banks shy away from CBD businesses as they don’t fully understand the market, the model, and the risks involved. Fortunately, there are many alternative funding options available. CBD crowdfunding is an option that has been gaining a lot of popularity in the cannabis industry lately.
Crowdfunding is a fairly new funding solution that has been gaining popularity thanks to social media. Crowdfunding allows you to raise money from hundreds of individuals, with each individual contributing a small amount. In return, these individuals get rewards or equity depending on the setup. Although crowdfunding is a recommended option for CBD edibles businesses, most of the mainstream crowdfunding platforms are still not attracted towards the cannabis industry. However, there are others that are created specifically for the CBD industry and it might be worth getting familiar with them.
Following are the best CBD crowdfunding websites:
CannaFundr is one of the most established CBD crowdfunding platforms as it has been around since 2014. This platform helps you exchange equity for the capital raised. But you don’t have to pay any fees in order to register for the service. Through CannaFundr, you are allowed to upload presentations, pictures, and videos and really sell your vision to investors. Unfortunately, you can’t interact with visitors to get feedback regarding your plan. You can’t view other campaigns either.
Fundanna is another popular CBD crowdfunding platform that connects CBD businesses with investors around the globe. Founded in 2016, Fundanna offers various services such as helping clients spread brand awareness by connecting with advertisers. If your CBD edibles company is not successful, you won’t be required to pay back the money raised. However, you will have to pay the listing fee. Furthermore, if your fundraising goals are reached, then expect a fee assessed.
420fundme is also a CBD crowdfunding platform but it does things a little differently than Fundanna and CannaFundr. You won’t give away equity in your business in exchange for investment. Instead, you will be providing special treatment to your investors e.g. providing early access to your new products, other gifts, etc. 420fundme also offers advertising and marketing services as well as dab dinners and parties to put the investors in a giving mood.
In conclusion, crowdfunding is great for CBD startups. However, it isn’t the only option available if you are looking to raise capital. You might want to look at venture capitalists or private investment. These can be relatively easier to deal with and they are also usually better equipped to deal with any legal issues that might arise.