Editor's note: This conversation was recorded prior to the rescheduling news in April 2026. Some of the regulatory context Jesse references reflects the landscape as it stood at the time of recording.
If you ask most cannabis operators how they'd describe the current investment climate, you'll get some version of the same answer: hard. Deals are slow. Valuations are compressed. The institutional capital everyone was promised keeps not arriving.
Jesse Redmond has spent the better part of a decade at the intersection of cannabis and capital markets — as a hedge fund manager, a dispensary operator, a cannabis equity analyst, and now as Chief Strategy and Investor Relations Officer at Leef Brands. His read on the current moment is worth understanding, because it's neither blindly optimistic nor defeatist. It's the kind of honest, contextual view that operators trying to navigate this environment actually need.
The short version: the industry is stalled, but the thesis is intact. And the operators who survive the stall will inherit a very different market.
The cannabis investment landscape has two distinct pools of capital, and right now neither one is flowing freely.
The first pool — early cannabis-focused funds, family offices, and retail investors who got in during the boom years — is largely tapped out. These investors have "doubled down 19 times," as Jesse puts it, and the returns haven't been there to justify continued commitment or new fundraising. Most cannabis VC funds have deployed their capital and can't raise more.
The second pool — institutional capital from pension funds, endowments, large asset managers — has stayed almost entirely on the sidelines. Not because these investors are opposed to cannabis in principle, but because the regulatory uncertainty makes it too complicated. Schedule III hasn't happened. Safer Banking hasn't passed. Without those reforms, the compliance and reputational calculus for institutions doesn't work.
"The institutions aren't gonna let us play with them until we get some regulations in place," Jesse said. "They want Schedule Three, they want safer banking. And then they'll say, cool, we'll come over to your side."
The timeline problem compounds everything. Over 3,000 days have passed since Safer Banking was first introduced in 2017. Over 1,200 days since Biden initiated the scheduling review process. Florida's adult-use ballot measure failed. Pennsylvania remains stalled. Virginia appears to be moving forward, but new state unlocks have been sparse.
That's the stall. And it's real.
Jesse thinks about the policy environment as a sequence of catalysts, each one unlocking a different layer of value:
Schedule III — likely the nearest-term catalyst, though it's been "near-term" for years. Schedule III wouldn't legalize cannabis or unlock interstate commerce on its own, but it would change the tax treatment under 280E, which has been one of the most significant financial burdens on the industry. It would also, as Curaleaf CEO Boris Jordan has argued, create conditions more favorable to Safer Banking passing.
Safer Banking — enables cannabis businesses to access banking services without federal liability exposure for financial institutions. This is the reform that would most directly change the day-to-day operational and fundraising environment for operators.
Uplisting — getting cannabis companies onto major exchanges like NASDAQ or NYSE would unlock access to institutional capital in a way that OTC markets simply don't. Jesse has been in conversations with NASDAQ about what this would require; the current thinking is something like Schedule III plus Safer Banking as necessary conditions, potentially with additional explicit language around uplisting.
Interstate Commerce — the longest-horizon catalyst, but potentially the most economically transformative. Jesse's over/under: probably not before 2027, possibly as late as 2030. It would likely require either explicit legislative action or a significant change in federal enforcement posture.
Descheduling — the most optimistic scenario, currently represented by rumors of a Trump administration descheduling committee. Jesse's honest assessment: "I'm not super confident. Like we've been — how many days did I say — 1,200 days into this rescheduling review and I'm supposed to believe this summer we're gonna start talking about descheduling cannabis. Like sure man, awesome if that happens. But you know, I'm not super confident."
The key insight isn't which catalyst comes first — it's that they build on each other, and none of them are guaranteed on any particular timeline. "Things take longer than we'd hope" is perhaps the single most validated empirical observation in cannabis industry history.
Here's a scenario that should be on every operator's radar: the reform eventually arrives, institutional capital floods in — and finds rubble.
"What worries me is finally when we do get the reform, when we do get the Schedule Three and the Safer... the institutional side might come over and be like, oh man, this is a bunch of rubble over here," Jesse said. "What happened to this space? And there's just gonna be a few strong companies standing that I think will generate the real interest."
This is already playing out in slow motion. Gold Flora is out of business. Forefront is out of business. Cannabis Strategic Ventures is effectively out of business. The list of operators that didn't survive the extended stall period is growing.
The practical implication: when the institutions eventually do show up, they're not going to rescue distressed operators. They're going to look for a small number of companies with clean balance sheets, defensible competitive positions, and credible growth trajectories. The window to be one of those companies is open right now — but it requires building proactively, not waiting for the environment to change.
Jesse's framing for how Leef Brands has been approaching this environment is instructive: the goal is to be someone the incoming capital wants to partner with, not someone who needs to be rescued by it.
That's meant specific, concrete moves. Leef converted $11 million in convertible debt to equity, cleaning up the balance sheet before going back to the market. They raised $4.5 million from Mindset Capital to finish building out their cultivation facility. They've driven gross margins from around 20–25% to 46% in Q4 by running their own clean, low-cost biomass through their extraction business.
None of this is headline-grabbing. It's operational discipline applied consistently in a difficult environment. But the result is that when institutional capital does arrive, Leef is positioned as a company worth acquiring or partnering with — not one that needs emergency financing.
For operators in any segment of the industry, the question to ask is: what does my company look like to an outside investor who has never heard of us? Clean balance sheet or debt-heavy? Defensible margins or dependent on pricing that could compress further? A clear story about why we win, or a bet on a rising tide that hasn't materialized?
It would be easy to read the above as a case for pessimism. It's not meant to be.
The underlying thesis for cannabis investment — adult-use expansion from 24 states toward eventual national access, unlocking of reform catalysts, capital flowing to efficient producers — hasn't changed. What's changed is the timeline. And if you believe the destination is real, a compressed valuation environment is actually an opportunity for investors and operators willing to be selective.
Jesse's investment framing: "Valuations are so compressed that I think we're getting closer to those unlocks on the catalyst side. But I think because of the damage that has taken place over the last few years, you need to be very selective about where you invest and find companies that aren't upside down in their balance sheets and have a meaningful growth trajectory ahead. And in my mind, that comes down to these days to just a handful of names."
The operators who will be those names aren't necessarily the largest or the most recognized. They're the ones who used the stall period to build something real — real margins, real supply chain integrity, real balance sheet discipline — and positioned themselves to scale when the environment finally opens.
The environment is going to open. The question is who's still standing and ready when it does.
Jesse Redmond is Chief Strategy and Investor Relations Officer at Leef Brands and co-host of the Higher Exchanges podcast. This post is based on his conversation on the High Touch podcast.