Civilized founders pushed out

Welcome to Insider Cannabis, our weekly newsletter where we're bringing you an inside look at the deals, trends, and personalities driving the multibillion-dollar global cannabis boom.

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Hello everyone,

In some respects, the fight over how to legalize cannabis is a microcosm of larger social debates, pitting social justice activists against more free-market-oriented folks.

Take the debate this week over the SAFE Banking Act.

The cannabis banking bill passed the House for the fifth time last night. This go-around, language from the bill - which would open up the banking system to cannabis companies and allow consumers to pay with credit cards - was shoehorned into the National Defense Authorization Act.

The NDAA usually passes the Senate without much fanfare. But Senate Majority Leader Chuck Schumer, Sen. Ron Wyden, and Sen. Cory Booker have their own more comprehensive cannabis bill, The Cannabis Opportunity and Administration Act. Booker has said that he opposes adding cannabis banking protections to the Senate's version of the NDAA ahead of broader criminal justice reforms.

It remains to be seen whether SAFE will be included in the Senate's version of the NDAA. Many cannabis activists say that the SAFE Act would only help banks and large cannabis companies make more money in the industry. They'd rather see full-scale legalization or at least record expungement and other criminal and social justice measures passed first.

But supporters of the SAFE Act say it's a necessary tool to help protect and grow small businesses since many social equity license holders are unable to get loans or open lines of credit to start their businesses, and that dealing in all cash is a safety risk.

In other news, Amazon doubled down on its support for cannabis legalization and said it was lobbying the federal government for legalization. Aurora Cannabis closed a major facility and cut around 8% of its workforce. The company delayed its earnings until next week. Tilray closed its Nanaimo, British Columbia facility as well.

California will be adding a cannabis competition to its state fair, where farmers will show off their best buds.

I'll be moderating a panel about the New York cannabis opportunity at the Prohibition Partners x Business of Cannabis conference in New York City on Wednesday, September 29. I'm looking forward to seeing many of you in person, and let me know if you'll be around.

- Jeremy Berke (@jfberke)

If you like what you read, share this newsletter with your colleagues, friends, boss, spouse, strangers on the internet, or whomever else would like a weekly dose of cannabis news.

Here's what we wrote about this week:

Investors are pushing out the founders of troubled cannabis startup Civilized. We got ahold of the full memo.

Investors are pushing Civilized founders Derek and Terri Riedle out of the company, according to a memo circulated among investors on Monday and obtained by Insider. The investors say the founders, Derek and Terri Riedle, saddled the company with debt.

A startup accelerator that's worked with J&J and L'Oréal is getting into psychedelics as the industry goes mainstream

A new accelerator program is targeting early-stage ancillary startups focused on psychedelics, in the latest sign that psychedelics are entering the mainstream and that funding dollars are trailing closely behind.

The House just passed cannabis reforms as part of a defense bill. Here's what would change for businesses and their customers.

The US House of Representatives has passed the Secure and Fair Enforcement Banking Act, or SAFE Banking Act, yet again.

Lawmakers tucked the cannabis banking bill into the National Defense Authorization Act that passed lower chamber on Thursday. It's not clear whether the Senate will include cannabis reforms in its version of the defense package once the upper chamber takes it up.

Executive moves

• New York Governor Kathy Hochul on Wednesday announced two more appointees - Reuben R. McDaniel, III and Jessica Garcia - to the board of the Office of Cannabis Management, the regulatory body responsible for building out the adult-use cannabis industry in the state.

Deals, launches, and IPOs

• Cannabis tech company Dispense said on Tuesday that it had raised a $2 million seed round led by NextView Ventures and Poseidon Asset Management.
• Michigan-based cannabis company SKYMINT said on Tuesday that it raised $78 million and acquired 3Fifteen Cannabis. Investors in the round include Tropics LP, an affiliate of Sundial Growers' JV SunStream Bancorp Inc., and Merida Capital Holdings.
• Christine De La Rosa, the CEO of The People's Ecosystem, is raising a $50 million fund to invest in BIPOC and women-led cannabis businesses.
• Psychedelics company Delic Holdings Corp said on Monday it would acquire Ketamine Wellness Centers Inc, increasing its footprint to 12 clinic locations across the US, in a $5 million cash-and-stock deal.
• Crain Communications is acquiring cannabis financial media site Green Market Report. The terms of the deal were not disclosed.

Policy moves

• The House of Representatives on Thursday passed the SAFE Banking Act, a cannabis banking bill, as part of the National Defense Authorization Act. It's not clear whether the Senate will include cannabis reforms in its version of the defense package once the upper chamber takes it up.
• Italy is expected to hold a referendum on legalizing cannabis early next year after organizers gathered the 500,000 signatures within a week, reports Reuters.

Research and data

• A new report from the nonprofit Economic Policy Institute found that unionized cannabis workers could make $8,690 more per year than non-unionized peers.
• Psychedelics company Atai Life Sciences said on Tuesday that its platform company DemeRx has started its early-stage clinical trials of ibogaine to treat opioid use disorder.
• Cannabis data firm BDSA says in a report that cannabis sales will hit $31 billion this year, a 41% increase over last year. By 2026, BDSA expects cannabis sales to exceed $62 billion.

Earnings

• MedMen reported its Q4 and FY21 results on Thursday. The company reported $42 million in revenue and a net loss of $46 million in Q4. For the full year, the company reported $145 million in revenue and a net loss of $157.6 million.

What we're reading

Why Amazon wants to make sure everyone knows it's totally cool with smoking pot now (Insider)

Lawyers, race and money: Illinois' messy weed experiment (Politico)

'Millions of pounds' of legal marijuana diverted to underground market, California lawsuit alleges (MJ Biz Daily)

Getting high before exercise is the secret to sticking with a fitness routine, some athletes say (Insider)

Illegal marijuana farms take West's water in 'blatant theft' (Associated Press)

Marijuana banking sponsor discusses path through Senate after House approves reform for fifth time (Marijuana Moment)