Washington Cannabis Business Loans

Bespoke Financial helps address the funding needs for Cannabis businesses in Washington with financing services specifically tailored to their needs. Grow your Cannabis businesses in Washington with Bespoke Financial.
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FAQ’s

Number one

How do I get licensed for a cannabis business in Washington?

Getting a marijuana business license in Washington requires time and effort. Specifically, there are five different categories of commercial licensing for marijuana businesses in the state of Washington.

  • Producer license: There are three tiers of marijuana producers, each with their own type of license requirements.  
  • Processor license: This license allows business owners to dry, cure, prepare, and sell marijuana to licenses cannabis retailers in the state of Washington. 
  • Retailer license: This license allows business owners to sell marijuana and cannabis-based products to legal residents 21 years or older. 
  • Transportation license: This license allows the physical transportation of marijuana within the state of Washinton. 
  • Marijuana Research: This license enables scientists, medical professionals, and other researchers to research cannabis through the guidelines provided in RCW 69.50.372. Medical marijuana and marijuana that is used for medical purposes or research is generally looked at differently than recreational marijuana. Whereas it may be more difficult for a marijuana business to receive a cannabis business loan  if the loan is going to be used for a recreational marijuana enterprise, cannabis companies and others in the marijuana industry are closely scrutinized by the United States government.

Note that operators in WA cannot be fully vertically integrated, meaning you cannot hold a retailer license while also holding a producer or processor license.

The Liquor and Cannabis Board in Washington also offers additional certifications called endorsements that provide special privileges to certain cannabis businesses. These include: 

Medical endorsement: Allows cannabis retailers to sell marijuana for medical use to qualifying patients and designated providers, and allows businesses to provide marijuana at no cost to qualifying patients and providers 

Marijuana-Infused Edibles Processor endorsement: Allows licensees to commercially produce wholesale food items infused with marijuana, marijuana extracts, or marijuana concentrates 

Marijuana Research endorsement: Allows the licensee to produce, process, or possess marijuana in order to conduct scientific research on marijuana and marijuana-derived products 

Marijuana Transportation endorsement: Allows the licensee to physically transport or deliver marijuana, marijuana concentrates, and marijuana-infused products between licensed marijuana businesses in Washington State 

The state of Washington has some restrictions on which businesses are allowed to receive a cannabis license; these include:

  • Residency Requirements: Those interested in opening a cannabis business in Washington must be able to prove they have lived in the state for at least six months.
  • Criminal background checks. Washington has a somewhat unique criminal background check system. If you receive eight or more “points” on this system, your business cannot be granted a cannabis license.
  • True Parties of Interest: Under Washington state laws, all “True Parties of Interest” in your cannabis business must be submitted and evaluated by the state.
Number Two

Can I borrow from a bank in Washington?

In Washington, marijuana businesses are rarely able to borrow capital from traditional commercial lending institutions. Why? Because on the federal level, marijuana is still listed as a Schedule I controlled substance—and, as far as banks are concerned, that is a risk they want to avoid. The federal government is responsible for backing banks and providing many other benefits. As such, bankers typically want to operate clearly within the lines of traditional lending. Even if you have a perfect credit score and a large bank account, traditional lending institutions will typically still deny you business funding and or business financing. 

That’s where Bespoke Financial comes in. 

A new cannabis business license will generally cost $1,381 dollars to obtain, along with additional state, local, and application fees. Make sure to check the local regulations on cannabis, as counties and municipalities in Washington State are able to opt-out of legalization, and some prohibit the growth, sale, and use of cannabis. Unless otherwise guided by local regulations, all cannabis businesses must be at least 1,000 feet away as the crow flies, property line to property line, from the following: 

  • Elementary or secondary school
  • Playground
  • Recreation center or facility
  • Child care center
  • Public park
  • Public transit center
  • Library
  • Game arcades

Note that there are other costs associated with cannabis businesses other than license fees. These can include things like the cost of real estate, as well as advertising and marketing costs and the amount of money it takes to pay employees. All of these, especially real estate costs, tend to add up which is why it is so important for cannabis business owners in the United States to explore their financing options, including options for things like equipment financing, with qualified professions. 

As a business owner, if you can not receive a cannabis loan than you must seek alternative financing in the form of a small business loan by Bespoke Financial which offer invoice financing, inventory financing, and more.

Note that the Washington State Liquor and Cannabis Board adopted a rule in 2016 that allows out of state individuals and entities the opportunity to provide financing for cannabis businesses in Washington State. However, there are strict rules that govern this policy. Out of state businesses and individuals are able to gift or lend money to cannabis businesses in Washington state and remove the six-month residency requirement for gifting and lending, but all lenders must undergo criminal background checks, and the sources of the loans or gifts must be verified. Lenders are financiers who are not allowed to hold an equity position in a Washington state cannabis business if they do not meet the six-month residency requirement, so only certain types of loans are available. With the cannabis industry growing rapidly in Washington state, a variety of businesses have sprung up around providing financing for cannabis-related businesses, including hedge funds and investors, specifically focusing on cannabis financing. 

While a marijuana dispensary may be highly regulated in the state of Washington, there are still a variety of marijuana businesses not only allowed, but also encouraged in the state. These include CBD businesses and others.

Number three

How can I obtain financing for my cannabis business in Washington?

Securing financing for a cannabis business in Washington can be difficult. Thankfully, cannabis entrepreneurs have options in the form of alternative finance methods such as invoice and inventory financing.

  • Invoice Financing: Most cannabis businesses wait 30-90 days before receiving payment on their open invoices, creating working capital strains and hindering growth. Invoice financing helps by providing your business with capital when you need it. When you’re approved for invoice financing, we’ll provide you with an advance of up to 75% on a nominated accounts receivable invoice. 
  • Inventory Financing: Don’t let cash flow issues slow down your growth. Stay on top of your invoices with inventory financing. When you’re approved for Bespoke’s inventory financing, we’ll pay your vendors directly so you can demand COD pricing. 
number four

What should I watch out for when it comes to cannabis financing in Washington?

Because financing a cannabis business can be tough, predatory lenders have been known to flood local lending markets in states like California and Colorado and Washington. These unethical lenders are known to charge 50% and sometimes even higher interest rates. 

Cannabis business owners should not be drawn in to scam short-term loans with high-interest rates, and they should explore alternative finance methods like invoice or inventory financing.  

Another issue is scam artists who advertise a “legitimate” way to use credit card sales in cannabis businesses. Spoiler alert: there’s currently no such thing. If you’re concerned that a scammer might be targeting you, the best way to check their legitimacy is to ask about the documentation required to receive financing from them. If an offer seems too good to be true – for example, they don’t require a background check on everyone in your business, don’t ask for banking statements, don’t ruin your credit, and don’t demand financial reports – it almost certainly is. If you choose Bespoke Financial for your cannabis financing needs in Washington state, you won’t have to worry about being taken advantage of. 

Number five

What do I need to know about running my business in Washington?

Understand that operating in the cannabis industry is unlike any other business in the state of Washington. You will be monitored closely and will have to be diligent about complying with local and state ordinances and or laws.