On Wednesday, RLNTLSS Brands founder and President Gloria Govan announced her appointment as General Partner of Alta II, a real estate lender with the goal to provide innovative and efficient financing solutions to the cannabis sector -- namely for minorities and women.
Recent data shows that Black entrepreneurs represent a staggeringly low portion of cannabis business ownership, with similar shortcomings among women. Part of this challenge lies with the unique limitations imposed in the cannabis real estate industry.
Govan brings over a decade of experience and her commitment to Diversity, Equity and Inclusion (DE&I) to the cannabis real estate lending market. Govan's mother was diagnosed with breast cancer in 2005, pushing her to enter the cannabis industry. She owns 13 vertically integrated licenses across Southern California.
Under the partnership with Alta II, her goal is to increase access to financing for minority-owned cannabis businesses -- particularly companies owned by women of color.
"Women- and minority-run cannabis businesses often encounter unique barriers in the real estate market, such as difficulty accessing capital due to historical disparities, discrimination leading to limited property options, and challenges in establishing business relationships within a predominantly male and non-diverse industry," Govan tells Forbes in an email. "Additionally, regulatory restrictions and zoning laws can further complicate the search for suitable locations, impacting their ability to compete effectively."
There's no real reason for the lack of opportunities women face in the industry. "Despite statistically demonstrating a 60% higher ROI than non-women-led businesses, companies led by women receive less than 2% of funding," Govan says. "This stark discrepancy underscores the immense potential for growth and profitability that exists within women-led businesses, demanding a urgent reevaluation of investment practices and a concerted effort to bridge this gap."
Govan's husband and former Laker Matt Barnes also dabbled in the cannabis industry with a goal to promote social equity.
Under her new role, she will help to launch a $100 million dollar fund to be used to provide real estate financing for qualified cannabis businesses.
"With access to a $100 million fund, my strategy to supporting overlooked businesses like women and minority-owned ones could/will involve creating partnerships with community organizations and networks that specialize in providing financial resources and mentorship to such businesses," Govan adds. "Collaborating with local chambers of commerce, industry associations, and venture capital firms that focus on diversity and inclusion will help identify potential lenders and investment opportunities. And finally, by actively seeking out businesses with promising growth prospects, you can not only provide capital but also establish tailored mentorship programs to enhance their chances of success."
Since 2019, Alta has raised and deployed over $75 million in private capital, exceeding its original target of $50 million. The second iteration, Alta II, launched in the first quarter of 2024 with the goal to raise $100 million, will target retail and industrial properties that are operated by creditworthy cannabis companies at all points in the supply chain.
Alta aims to empower cannabis companies to realize their full potential by providing financing structures including sale-leasebacks and senior secured term loans. Adhering to its commitment to enhancing diversity in the sector and de-stigmatizing cannabis use, Alta seeks to collaborate with entrepreneurs who share the same values.
"Alta has embraced and supported the cannabis industry for years, quickly becoming one of the top real estate lenders in the space. With the launch of Alta II, we will continue executing our mission of providing growth capital to cannabis companies through real estate. As a minority-owned fund manager, we look forward to Gloria joining our team to reaffirm our commitment to diversity, equality, and inclusion in our underwriting and investment practices," Jade Green, General Partner of Alta and Alta II, said in the announcement.
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