A forum called “Insights From The Front Lines Of The Cannabis Industry” was held on June 13 on a beautiful summer evening in New York City atop the Empire Hotel. New York was named the Empire state because it was considered to be the center of all business in America and it has become the center of cannabis investing even though the plant isn’t fully legal in the state. That could change soon.

The event was hosted by MGO, Ello, Wilson Elser, and Aon. The panelists included Kevin Murphy Chairman and CEO, Acreage Holdings (CSE: ACRG.U), Tiffany Liff Managing Director, Cresco Capital Partners, Evan Eneman CEO, MGO / ELLO Cannabis Alliance, Matt Markiewicz Managing Director, Innovation Shares, Eduardo Provencio General Counsel, Mary’s Brands, and Mitch Baruchowitz Managing Partner, Merida Capital.

New York’s legalization was discussed as Murphy said it is quickly changing. “Last week, I’d have said there was a 20% chance. Today I give it a 60/40 chance. I think on Wednesday it may happen,” he said. That sure sent a buzz through the crowd. He conceded that having former Speaker of the House John Boehner on the company’s board kept his company informed of political maneuverings. Murphy has also been actively working on the SAFE Banking Act. As a company with its roots in New York, he is keen to see changes at the state level.

Access To Capital

A key theme seemed to emerge among some of the panelists was the access to capital. “The industry has gone from basement growers who just wanted to have a bigger basement to getting a license. Now it is about the aggregation of licenses,” said Murphy. “Our biggest competition isn’t from each other but from the black market.”

Liff also noted that in the early days’ companies were forced to go public even if they weren’t really ready because there was no other way to access capital. “There are more options now,” she said. She also reiterated that she really focuses on backing the management team.

“Running a public company is not that awesome,” said Murphy. “There is an extra layer or two of accountability. Having said that, it gives us the opportunity to access capital.”

Baruchowitz pointed out that new companies often give themselves rich valuations based on angel investors and believe this should bring them more capital. “When your angel round is friends and family, that doesn’t justify certain valuations. They get shocked when they get asked the hard questions as they ask for more capital. A lot of the newcomers don’t know the grind.”

Illegal vs. Legal

Baruchowitz noted that since New York didn’t have the same ballot pressures that other states have, legalization could come easier. Having said that, the panelists noted that the quasi-illegal status has had some benefits. Baruchowitz said he believes the medicalization of cannabis is about to go on hyperdrive through legalization.

The illegality of cannabis has also caused some volatility in the cannabis company stocks. Markiewicz runs an ETF and noted that the volatility scares many advisors. He keeps an eye out for negative sentiment when reviewing his companies. The illegal nature attracts some less than savory players at times. Still, Murphy said that ETF’s provide liquidity for the stocks. “The more liquidity, the better for all of us,” he said.