Medicine Man Technologies is based in Denver, Colorado, but it is looking to grow into a national or international business. It has recently spent more than $300 million on entities both in Colorado and in other states. These acquisitions have increased the company’s revenue from roughly $10 million at the start of 2019 to about $170 million. The purchases were funded in part by an investment from a firm called Dye Capital in Florida.
A change to Colorado’s cannabis law has made it possible for Medicine Man Technologies to expand as rapidly as it has. The changes will go into effect on Nov. 1, and when they do, companies will be allowed to use money from other states to fund their operations. It is believed that the transactions will close at some point in the early spring or early summer of 2020.
While the company didn’t start acquiring companies until 2019, it had been planning an expansion for several years. The expansion plan was derailed for a time when the organization’s CEO passed away. Furthermore, the management team of Medicine Man Technologies needed technical and financial help completing the transactions. They found a partner in Dye Capital after a chance encounter with one of its partners at a restaurant.
The use of mergers and acquisitions may make it easier for companies to grow without having to develop their own products or distribution systems. However, it is generally a good idea to have an attorney provide insight and guidance into the process of such a transaction. An attorney may be able to prepare paperwork or take other steps to help a merger or acquisition close in a timely manner. Legal counsel may also represent a business owner’s interests in disputes related to the transaction.