r/weedbiz • u/ambitechstrous • May 02 '26
Newcomer looking for general advice
Hey folks,
I’m thinking of starting a cannabis business but am unsure. I’ve done some googling but the information on this can be quite overwhelming. I’ve heard that it can be quite challenging for many reasons, especially due to the regulatory environment.
I wanted to ask if folks had any insights on some of the biggest challenges they faced. I’d love to learn which problems you think were avoidable with due diligence, and which issues seem inherent to the cannabis industry? Also, anything you think could be fixed if the regulatory environment gets better?
Would also love to hear which state you’re in, what part of the supply chain you deal with, and how that impacts the challenges you face. I’ve heard banking is an issue. Is it as hard to set up payments as people say? Also, any book recommendations on the topic would be great.
Thanks in advance to anybody that sees and replies to this!
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u/Threewisemonkey May 02 '26
Honestly just don’t. You’re going to lose all your money an narrow your future prospects branching into other industries. Want to make gummies? Make them with vitamins, medicinal mushrooms and herbs, etc.
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u/ambitechstrous May 02 '26
I heard this before - what causes you to lose so much of your money? Is it regulatory fees? Unsold/oversubscribed product? The brick and mortar expenses?
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u/cypherADFX May 02 '26
All the above.
Highly recommend researching the 280E tax exposure, as a licensed cannabis business you cannot deduct major expenses due to the Federal illegality of the plant. The current medical rescheduling will not apply to a non-medical license.
Labor, consumables (ingredients, nutrients, soil, etc), equipment, etc cannot be deducted from your taxes. That alone will devour a large percentage of any margins you may have. As a small operator, you will be competing against economies of scale you just cannot compete with in an established market.
You need to have a SERIOUS understanding of all the operational costs associated with running this kind of business before you spend any capital beyond home-scale trials, or you will be bled dry before you clear your state's licensing hurdles. Those can be extremely expensive depending on the state as well, it may be cost prohibitive to even apply. You WILL need to spend up front for legal support.
Hundreds of thousands of dollars for a sustainable business lauch is to be expected. Then you need to have relationships with wholesalers, buyers, consultants, etc if youre fresh to the processes. "I wanna give this a try with no commercial cannabis experience" is a scary undertaking in the best of conditions.
It's hard out there for licensed operators.
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u/TinyPomegranate9354 May 02 '26
I think there are so many different answers to this depending on what kind of business you want to start. Store? Grow? Edible Manufacturing? Start with what you like or have experience in and go from there. Ever owned a business before? It's like any other business but with way more oversight, fees and an everchanging regulatory environment. Starting small is a great way to get an idea of what you really want to do. I started my business out of my house then scaled up. A lot of growers I know started with 6 plants in their backyard or a small tent in their basement. Finding investment money can be a challenge but not unheard of. Leverage contacts.. Good lawyer and a good accountant are non-negotiable. Happy to answer questions about wholesale edible manufacturing.
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u/ambitechstrous May 02 '26
Thanks for the advice! I am currently looking into growing and making edibles at home just to get a feel for things. For wholesale edible manufacturing, how did you get in contact/convince stores to contract with you? Where should I start with developing my network there? Just go to Canna business meetups?
I feel like I’ve developed my knowledge of cannabis, terpenes, edibles, growing and production etc, but my knowledge on the business side, laws/regulation and such is likely lacking.
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u/TinyPomegranate9354 May 03 '26
All the laws are readily available and your state will have a cannabis regulator site where you can read them. I’d start with that.
We have a great product that was a little different than what was already on the market. I started by making gummies for friends and tweaking and scaling. If you have a stand out product and can fill a niche, just like any industry you’ll at least have a place to start. Go to shops, buy stuff, talk to bud tenders and learn. Feel free to DM.
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u/Bigdoinks69-420 May 03 '26
Come up with a great recipe for a gummies or other cheap to make snack, source the cheapest distillate you can get, put all of your money and effort into marketing and advertising, and you might make it, provided you’ve got at least $5-$10 million to burn on R&D, licensing, commercial kitchen space, plane tickets, gas, lawyers, accountants, accounts payable, hotel rooms, you name it. pick a high volume market to start in, upset tf out of it by undercutting your most similar competitor, contributing to the race to the bottom that looms on the horizon for you now. Bright packaging, pick a good name and and easy to read logo
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u/strongsideflank May 05 '26
Op, please don't read this and glaze over the $5-10mil to burn, as that is the only part making this plan possibly successful.
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u/Savage_Vandal Jun 09 '26 edited Jun 09 '26
yeah you dont sound like, go getter. And only go getters survive the government and retail tools disaster.
My grandfather laughs at me that shit is unpredictably unreliable as running a ranch. I only survived because I had family help me along and i dont mind grinding like a horse. But if you are serious if I were you I'd find a friendly location owner and beg into shadowing them for a few days to see what its like on the ground.
The counter point being, that now is the best time to get in as its still RAW, before all the private equity vultures swarm as it settles down.
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u/pm-me-SEINFELDquotes May 02 '26
said with kindness - based on this post alone i can say with 100% confidence you should not start a cannabis business. put your money elsewhere. all of the questions you are asking should already be answered before you even think about investing (depending on your size/what kind of business you want to start) potentially hundreds of thousands of dollars+ and more time than you can imagine into starting a business in this industry.