Since my first job on Wall Street at Lehman Brothers, I was taught to raise money. And now, with a landmark vote by the EU to reclassify cannabis as medicine, the race to raise cannabis money is on. 

Europe has watched cannabis reform unfold in the US and Canada for some time; European countries have accordingly followed North American trends for every industry group. Business creativity knows no borders and raising capital has no limits. 

Here are 9 considerations for raising capital for European startups:

1) Don’t Be Intimidated by Existing Players

It’s not uncommon for entrepreneurs to feel a little imposter syndrome when considering whether to enter a market. You might wonder if there’s room for a new company like yours in an industry with as much activity as cannabis. But remember, a few years ago, practically every company on the continent was in its startup phase. Most of the biggest players have lost more money than they can count and are going through C-suite resets. The market is always changing and it’s big enough for all of you. Remember, cannabis is currently a $200B worldwide business from legal and illegal sales, that has a long way to go since legal sales only saw $18B of that $200B.

2) Give Your Company Character

Make sure you give your company the kind of character that communicates to investors that you are special and will succeed. My biggest advice to accomplish this is to invest time and energy in carefully crafting outward-facing branding and messaging. Ideally, you should identify your company’s values, culture, specialties, and voice and feel confident in them before coming to market. Once you’re out in the open, be consistent to build trust.

3) Set Short Term Goals

Most entrepreneurs aspire to be big players, but don’t get too far ahead of yourself. Concentrate on concrete short-term goals like building one facility first. If you can build a starter facility that is operational, you are ahead of the game. Just take a look at some of the Canadian entrepreneurs who were early to Europe; most seriously overextended. Investors get lost sometimes in the big picture if the beginning goals aren’t achievable or well-defined. But they always return to the question: “how are you spending our money?”

4) Be Fair to Investors

Treat your investors the way you would want to be treated if you were investing in a company. Generally, the more experience and money the founders are putting in, the more equity for the founders. Try to give them equity or debt/equity terms favorable enough that it’s hard for them to refuse.

5) Be Bold – but Reasonable – About Your Future

Everyone paints a rosy picture for investors, but you’ll have the upper hand if you back up your claims with step-by-step expansion plans and additional money raises. Nobody became a billionaire by doing only one money raise.

6) Paperwork is Unavoidable

Europe has more manual paperwork processes than most places in the world. Constant needs for apostille paperwork and documentation are burdensome requirements, but they’re requirements nonetheless. Investors will all want to check that your “paperwork” is in order and it’s almost impossible to do anything without the proper documents. You and your team will be better off if you are diligent, organized, and transparent with them.

7) Be Aware of Language Barriers and Differing Rules 

You may or may not know that European countries have different official languages and require documentation to be completed in that language. Be aware of this and don’t be a “dumb American”. Have a professional translator if you don’t have someone on your team that can. Not speaking their language isn’t an excuse.

8) Equity Versus Loans 

Many countries have fees to add capital to a company. This effectively limits the ability to simply add debt or equity. Some locales even charge a 1% fee for new capital. Make sure you understand the local rules for the company you are setting up and the countries you are working from. 

9) Accounting

Understanding local accounting is very important for your investors; they will want to know that you have a grasp on all the countries you are working in. Consult professionals in this space always.

When you take Europe as a whole, the start-up spirit for cannabis has taken hold, especially with re-classification. Navigating an individual country’s web of accounting differences and languages are structural issues that can be conquered with diligent studies. Giving investors confidence you have a winner is up to you. Europe is definitely an exciting pure medical cannabis opportunity and like North America, it will keep on growing.