Marijuana investor insights: Q&A with venture capitalist Codie Sanchez

Of all the choices cannabis investors make as they consider where to place their bets, few are more important than the deals they turn down, according to Codie Sanchez, a partner at early stage investment funds CS Ventures and Magma Partners.

“In investing, you have to say no to 100 times more deals than you say yes to,” Sanchez said. “Most won’t succeed.”

A former mutual fund manager at Goldman Sachs and consultant to firms including Facebook, Apple and Amazon, Sanchez is a featured speaker on Wednesday at MJBizCon in Las Vegas.

Recently, she shared her leading investment strategies and insights with Marijuana Business Daily.

Where are your top cannabis investments focused right now?

I have investments in Cresco Capital, BlueBonnet Ventures and I’m most involved in the food and beverage space.

What sectors or trends are you most excited about?

There is a growing number of well-established companies that are asking not “if” but “how and when” they will need to add some sort of (cannabis) component or derivative to their product line.

It’s moving from the back to the front of everyone’s mind – from coffee companies, to beverage to performance foods and a lot more.

It’s going to be fascinating to see what comes next.

What’s your major piece of investment advice?

My best investment is always in knowledge. Sounds cheesy, except it’s absolutely true.

I’m not interested in (being) lucky. I’m interested in repeatable processes and insights to generate consistent returns.

I’m really big on the people component. Anytime I consider a new investment, I first go to the people in my network to see if they’ve made similar investments. Then I look at the team.

These are complex, cash-intense businesses. Anything I’m investing in is because the team is really solid.

What’s your top advice for operators?

Raise while the money is easy, because it will not always be easy.

If you don’t have 18 to 24 months of capital to grow, I would start thinking about that raise.

You have to consider what’s going to happen to your product when a correction happens, because it’s going to happen.

What drew you into cannabis?

I started looking at cannabis not as a recreational drug, but as a medicinal alternative.

My significant other is active-duty Special Operations Forces, and we back a nonprofit that’s focused on helping veterans get off the opioid cocktail and look at alternative solutions.

To think we might be able to combat PTSD (post-traumatic stress disorder) and TBI (traumatic brain injury) with a plant like cannabis – to bring families together and to bring soldiers truly home. That is a cause worth fighting for.

This interview has been edited for length and clarity.

Lisa Bernard-Kuhn can be reached at [email protected]

5 comments on “Marijuana investor insights: Q&A with venture capitalist Codie Sanchez
  1. Michael Davis on

    The key to the Cannabis industry is not in the production of the plant and grow operations but in creating the demand for those products. There are only 4 things that influence the demand for any industry. (1) Marketing and Advertising (2) Media. (3) Entertainment and (4) Hospitality. Investing in any of those 4 with a viable entity will be a no-brainer. There will be a major shift in this industry in 3-5 years and will be deemed the Cannabis Bubble similar to what the Internet Bubble occurred in 1998-2000. The difference between the internet and cannabis is that the internet was all smoke and mirrors prior to 2000, while cannabis is an actual physical product, people want and are willing to pay cash money for and has an expiration or shelf life. In the next 2 years, I estimate that $500 billion will pour into cannabis through direct investing, publicly traded stock and corporate loans and in 2 years the feeding frenzy will be full force like the internet and investors will (pun intended) throwing all their money at anything that smells of cannabis.

    Reply
    • Jasen T Perri on

      I agree with you on all points. I hope to truck along till that time. It’s just getting hard for the little guy to stay in the game.

      Reply
  2. John Saputo on

    All of my Cannabis stock with the exception or IIPR have been losing ground in October and November and I finally said to myself enough!!! I am not investing in cannabis stocks until this bubble is over. However there are “pick & shovel”, food & beverages that are consistently growing in value. Could you share with me your top 5 picks that you like and that are growing in value on a week to week basis? I am not looking for advice just want to know what YOU like. Thank you…John

    Reply
    • Codie on

      Heya John. Codie here my two cents that I did myself is go invest in a PE fund first. I do this because I want to see how a pro analyzes it and get into deals the public can’t. That’s the secret.

      Reply

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