Boom then Bust? Cannabis companies struggle to maintain cash flow through the crisis

Boom then Bust? Cannabis companies struggle to maintain cash flow through the crisis

THE WHAT? The COVID-19 pandemic could shape up to be an ‘extinction-level event’ for the burgeoning cannabis industry, according to a report published by Bloomberg.

THE DETAILS Quoting a study conducted by Marijuana Business Daily, the article revealed that some eight out of 33 firms tracked don’t have enough funding to last more than 10 months.

“It’s going to be an extinction-level event for some companies,” Craig Behnke, Equity Analyst at Marijuana Business Daily told Bloomberg. “But it’s a healthy and necessary process for any industry to go through once it’s had a phase of absolute excess and exuberance.”

THE WHY? With funding all but dried up and cash flow already shaky pre-lockdown, it’s touch and go for many. In other words, cannabis is the latest dot-com – and those that survive could be the Amazon or Google of the CBD world.

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