First cannabis investment fund launches in South Africa

Investors can invest from a minimum of R50 000

By Edward Tsumele

As interest in legal cannabis gains momentum around the world, with the US already boasting multi-billion dollar cannabis start-ups, especially in the 15 states that have legalised cannabis, a new first cannabis investment fund has been launched in South Africa.

Canada is already a leader in having developed a legal frame work that fully legalised cannabis for recreation, industrial hemp and medical cannabis, opening up opportunities for start-ups to operate optimally. Today the country boasts the biggest cannabis company in the world with the recent merger of two companies Tilray and Aphria, two of the biggest cannabis companies in Canada.

With existing medical and recreational cannabis businesses in Canada and Europe, the new conglomerate is positioning itself to eventually enter the biggest cannabis market in the world: the U.S.

 It is against this global context of cannabis business success especially in Canada and the US that this new fund called Silverleaf Investments is launched, and is open to any investor, who has a minimum of R50 000 to invest. The investment will enable the fund to invest the money in the value chain of the legal cannabis business in South Africa, with a relatively health return of investment expected in the next five years.

Launched last week by industry pioneers and cannabis business experts Pierre Van Hoven and Cliff Giesenow, those who invest in the fund before the end of February will enjoy tax incentives.

The taxpayer gets a deduction of the full value of the investment in the first year. This saves the taxpayer tax – 45% for individuals and trusts, and 28% for companies if they have sufficient taxable income. Only Capital Gains Tax is payable once the investors gets their money back (+-5yrs later),” van Hoven the joint chief executive officer of SilverLeaf Investments told Cannabis Business Africa/CBA in an interview yesterday, February, 21, 2021.

SilverLeaf Investments Fund hopes to stimulate local investment in the industry. “I am convinced this industry can help us address our problems especially in the areas of job creation and rural economic development,” says van der Hoven.

Van der Hoven’s fellow CEO, Cliff Giesenow, says that “When this unregulated market is professionalised and legitimised, South Africa will become a powerhouse green economy with one of the most conducive cannabis-growing climates in the world.”

 SilverLeaf Investments believes that the cannabis industry is strongly aligned with the South African government’s strategic development priorities, which include growth within the agricultural and agri-processing sectors that can lead to foreign exchange earnings through export. And, at all levels, there is tremendous room for job creation, community involvement, and skills development, all of which have knock-on effects for economic transformation, rural economic development, and general economic growth.

Where SilverLeaf Investments is aiming to be of service is in addressing the gap that exists between the industry’s potential and its current funding deficit. Many early stage companies are running out of funding and runway to take off. There is a massive need for initial investment to foster growth in the local industry and development for the value chain. The country’s cannabis industry needs scaling up alongside the implementation of an array of ancillary services and business beyond cultivation.

The process of investing in the fund is relatively simple: go to the website www.silverleafinvestments.co.za, download the form (attached), complete and provide the necessary details and pay the money in before the end of February.

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