How Cannabis Companies Can Survive—And Thrive—In A Broken System: Lessons From Ross Gerber
As the cannabis industry grapples with ongoing legal and financial challenges, companies are looking for ways to navigate a complex environment. Ross Gerber, co-founder, president, and CEO of Gerber Kawasaki Wealth and Investment Management, shared his views on how cannabis businesses can better position themselves for success ahead of the upcoming Benzinga Cannabis Capital Conference, where he will speak.
Gerber, a long-time advocate and investor in the cannabis space, highlighted the financial challenges many companies face due to federal regulations. One of the primary obstacles is the burden of excessive taxation under the 280E tax code, which limits profitability.
“The federal laws have created two major barriers for cannabis companies—over-taxation and restricted access to capital markets,” Gerber explained. These issues make it difficult for even well-managed companies to thrive in the current environment.
The Capital Structure Challenge
Gerber emphasized the importance of financial discipline in this restrictive landscape. According to him, managing a company’s capital structure is crucial. “What matters most is whether these companies are cash flow positive and how they handle debt in an environment where …