Good Tree Capital Does Good for Black Cannabis Business and Communities

By BCB Staff Writer | July 3, 2020

Share on facebook
Facebook
Share on twitter
Twitter
Share on linkedin
LinkedIn
Share on pinterest
Pinterest
Share on tumblr
Tumblr
Share on reddit
Reddit

One of the most challenging aspects of entrepreneurship is figuring out how to align business goals with people who can help advance toward those. Specifically, in the cannabis industry, due to the lack of loan availability, angel investors often get involved. These investors, some start-ups themselves, will lend money to growing canna-businesses in return for ownership equity.

There are now chances to hook a promising start-up company with investors who are hoping for change, and some, like Seattle-based Good Tree Capital, are funneling their assistance to specific niches.

Seke Ballard, founder and CEO of Good Tree Capital, made the decision to utilize his business to help African-American communities

Seke Ballard, founder and CEO of Good Tree Capital, made the decision to utilize his business to help African-American communities in the wake of the Charleston, SC, Emanuel AME Church shooting in 2015. Ballard did some data mining and found a loan bias discrepancy, in which African-Americans were 2.2 x more likely to have a loan application rejected even if they completed the entire process. After he cashed in his Amazon stock, Ballard moved to Chicago to help the underserved, and often criminalized, African-American population. Upon finding a pocket of Chicagoan minority entrepreneurs who wanted a chance to succeed in the upcoming cannabis industry, Ballard knew he had channeled his niche.

Ballard vowed to use his company to give away up to $250,000 to 100 social equity applicants in Illinois; these applicants will receive the funds in the form of a no-or low-interest loan that will adequately cover costs accrued in dispensary application licensing fees. Upon a closer look into the Massachusetts Social Equity Fund, the framework for minority inclusion in canna-business, Ballard realized that of the recent 247 people who completed dispensary applications, only three qualified as “economic empowerment” applicants. This meant that they came from disproportionately impacted parts of the state. The Illinois Department of Commerce and Economic Opportunity released a comprehensive map detailing 683 census tracts as “disproportionately impacted” areas.

“As Illinois enters the next phase of its adult-use cannabis program, we are committed to a process that is efficient, timely, and most critically, continues to place equity at the forefront,” Gov. JB Pritzker said in a statement. “From ensuring social equity applicants receive points on their application to providing grants and technical assistance, this is a process that does more than any other state in the nation to make equity a priority.”

At $2,500 per dispensary application, the barrier to entry was no longer getting the business off the ground successfully; instead, it was even getting the license in the first place. Although the Illinois legalization factors in $30 million for low-interest loans and removes real estate as a pre-requisite for licensing, it’s still not enough. Additionally, the Illinois Cannabis Business Development Fund, part of Illinois’ forward-thinking pledge to enhance minority inclusion, although promising, only provides loans to applicants after an application had been completed and filed.

Begun in October 2019, Ballard and Good Tree Capital promised to fund all the fees for the first round of social equity applicants in Illinois. Once the January 1, 2020 legalization was effective, Good Tree Capital began to provide financing for applicants who met social equity guidelines, but the financial assistance didn’t stop there.

Once the $2,500 licensing fee has been paid, and the application has been approved, Good Tree Capital also provides a letter of credit to help businesses to get off on the right foot. This loan can be used for real estate investments, building renovations, employee hiring processes, technology advancements, inventory, and networking.

SHARE ON :

Share on facebook
Facebook
Share on twitter
Twitter
Share on linkedin
LinkedIn
Share on pinterest
Pinterest
Share on tumblr
Tumblr
Share on reddit
Reddit

Wanda James Rewind: Black CannaCon’21 Edition

As we prepare for Black CannaCon’21 we are doing a rewind edition …

Read More

Anthony Winston

Black CannaBusiness founder Kristi Price sits down with Winston Engineering owner and …

Read More

Tavarres King

Black CannaBusiness founder Kristi Price sits down with Suite 420 Access CEO …

Read More

Raheem Uqdah

Black CannaBusiness founder Kristi Price sits down with Curaleaf’s new Corporate Social …

Read More

James Moore

Black CannaBusiness founder Kristi Price talks to business finance expert James Moore …

Read More

Naomi Granger

Black CannaBusiness founder Kristi Price catches up with the founder of the …

Read More

SUBSCRIBE TO BLACK CANNABUSINESS NOW

Scroll to Top