What Investors Want to See in Your Cannabis Financials
Key Points for Cannabis Investors
Get investor-ready with audit-level financial transparency, clear KPIs, and a structured data room.
Avoid red flags by aligning your accounting, tax strategy, and cost allocations with cannabis compliance.
Use our free downloadable checklist to streamline your prep for due diligence and investor meetings.
Introduction to Cannabis Financials
Let’s be real—raising capital in the cannabis industry isn’t just about a good pitch deck and solid vibes. Investors are digging into your financials, and they’re bringing sharp pencils. Whether you're prepping for a seed round, Series A, or strategic partnership, your financial readiness is what builds trust and opens wallets.
So what do savvy cannabis investors actually want to see in your books? Let’s break it down with a straight-shooting do/don’t guide—and a downloadable checklist to make sure you’ve got your financial house in order.
DO: Build Financials That Are Transparent and Audit-Ready
Why it matters: Investors want to know they’re not walking into a compliance mess or a numbers game that only your bookkeeper understands. Transparency wins trust.
What to do:
Prepare monthly financial reports (P&L, balance sheet, cash flow) with GAAP accrual accounting.
Ensure clear cost accounting—especially around COGS allocations to navigate 280E.
Have a customized cannabis chart of accounts that breaks down revenue streams, inventory, taxes, and expenses with clarity.
Maintain detailed tie-out reports and backup documentation.
💡 Growise clients receive month-end financials and tie-outs that help operators stay investor-ready year-round.
DON’T: Leave Compliance to Chance
Why it matters: Investors aren’t interested in risky bets. If your tax compliance is messy or your 280E deductions are aggressive and undocumented, it’s a hard pass.
What to avoid:
Filing taxes without supporting documentation or audit trails.
Using cash-based records or commingling personal and business finances.
Ignoring state and local cannabis tax obligations, like excise and sales tax filings.
DO: Know Your KPIs and Cash Flow Inside Out
Why it matters: If you can’t speak confidently about your burn rate, runway, gross margin, or CAC-to-LTV ratio (yes, even in cannabis), you’re not ready.
What to track:
Unit economics by product type or location.
Monthly cash burn and runway.
Gross margin, after factoring in real COGS, not just wishful deductions.
Customer acquisition cost (CAC) and lifetime value (LTV) if you’re vertically integrated or retail-facing.
Pro tip: Partner with a cannabis CFO who can model your cash needs and forecast with precision.
DON’T: Leave Your Data Room in a Shoebox
Why it matters: Investors don’t just want numbers—they want documentation. Your data room is your proof of professionalism.
Avoid this:
Unorganized folders with random receipts and invoices.
Missing bank statements, tax returns, or ownership docs.
No SOPs or backup for how financials are prepared.
What to include in your investor-ready data room:
3 years of financials and tax returns
Ownership and cap table
Cannabis licenses and compliance history
Debt schedules and loan agreements
Pro forma projections and key KPIs
Final Word: Investors Fund Confidence, Not Just Ideas
In cannabis, trust is currency. If your financials are clean, your tax game is tight, and your vision is backed by solid data, you’re already ahead of the pack.
At Growise CPAs, we help operators get there—with outsourced CFO services, strategic tax planning, and investor-ready reporting. Let’s make sure when opportunity knocks, your financials open the door.
Read more about the benefits of outsourcing your accounting function.