David Dinenberg, founder and CEO of Kind Financial, is a real estate entrepreneur and entertainment business guy from Philadelphia who moved to Los Angeles to start Kind Financial. He is a cannabis industry authority, meeting with state legislators on cannabis-related issues, and as a mentor with a group of 29 other cannabis investors and entrepreneurs for a cannabis business accelerator, Greenhouse Ventures LLC.
DOPE Magazine found the energetic Dinenberg ready to talk at a cannabis event in Los Angeles.
DOPE Magazine: What was it like when you found out that the Microsoft partnership was confirmed and going forward with Kind?
David Dinenberg: I think I went through a couple of different stages. First, excitement. Second, scared to death. And third was “Good idea.” It was one of those monumental moments in any business lifecycle. As a startup, before you get the cash flow to be positive, you are looking for credibility and trying to find a way to ensure that your business will have a long life. And something like that does that for us.
DM: Many of these businesses in the cannabis industry sprung up from grass roots efforts, the mom-and-pops startups. They see big businesses like Microsoft or Google entering the industry, and that makes them nervous. What would you say to them?
DD: I would say that it’s not the way it used to be any more. That if you want to have legalization and don’t want to wake up every day hoping that you don’t get raided, the industry has to be regulated, just like in tobacco and in gaming and in firearms and in pharmaceuticals. It’s going to have compliance as a background. If you are a mom-and-pop grower or mom-and-pop dispensary or mom-and-pop edible company, the only way your market gets larger, and the only way that product can one day can go across state lines, is through regulation and compliance. And they should embrace that.
DM: You have said that you are a ready-aim-shoot kind of guy, but that this industry seems have people operating more in a ready-shoot-aim mode. Explain that.
DD: My personal opinion is that there is so much press about the industry.. everyone publishes the volume of the industry as billions and billions of dollars. Everyone wants a piece of that. And they want to get to market as soon as they can get to market. My philosophy is this is going to be a real sustainable global industry for the rest of our lives. So creating the right product that can help the market and doing it the best way possible, if that takes longer than I want it to take, I am willing to wait to deliver something that is credible and real and tangible and has a long long shelf life.
DM: How long is it going to take banks to figure out to mitigate risks with their work in the cannabis industry, especially now where there are so many unknowns – such as what a new, incoming administration may or may not do.
DD: My answer will make you even more fearful to be honest with you. Because if the federal government changed the banking law today, you would not be able to get a bank in America tomorrow. There is going to be one, two, or three years of rule-making behind the law change of how the banks can work in this space. It’s going to take a long time. So even if the law changes today, you are years away from traditional banking. I think that, if you are in the industry, you want to act like it’s a real business. Therefore you want to have a checking account where you can deposit money. But the short answer is that there are solutions today. Every bank uses an anti-money laundering (AML) system, right? We provide the cannabis industry that AML system. So at the end of the day, it’s software sophistication and consulting. If done by the right people, banks can bank. Period. People just have to know about it.
DM: In your experience with state legislators, what is it that needs to be made clear to them?
DD: The states truly want to be able to provide necessary medicine to the necessary patients. And I totally absolutely respect that. If you are talking about recreational adult use, I think that everyone should just call it what it is, which is a tax generator and a job creator. There is absolutely nothing wrong with that. I absolutely support that. But recreational marijuana – it’s a fiscal decision. Medicinal marijuana is a health care decision. They are two fundamentally different decisions.