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      "description": "The California cannabis company Canndescent has closed a $27.5 million Series C;; led by Green Acre Capital. The funding round valued Canndescent at $200 million to $300 million;; CEO Adrian Sedlin said. In an interview with Business Insider;; Sedlin discussed the challenges of raising growth-stage capital in the cannabis industry. Click here for more BI Prime stories.  Hot off of a $27.5 million funding round;; Canndescent CEO Adrian Sedlin knows a thing or two about raising money in challenging environments.  The California-based Canndescent bills itself as a cannabis CPG;; or consumer packaged goods company. It has two marijuana brands it sells in California: Canndescent and the cheaper Goodbrands.  While lots of capital is available for early-stage cannabis companies;; later-stage startups often have trouble finding investors willing to write them large enough checks — without tapping into the public markets.  \"The capital markets for cannabis are totally broken. Period;; full stop;;\" Sedlin said in a recent interview with Business Insider. \"There is very little true venture investing in our space.\"  Read more: Here's the pitch deck the cannabis-beverage startup K-Zen used to raise $5 million from the seasoned Silicon Valley VC firm DCM Ventures  The company also plans to expand into a series of vape products;; including pens and cartridges;; and is looking to enter the Canadian market once vapes and beverages are allowed to be sold in dispensaries.  Canndescent's latest funding round;; a Series C;; was led by the cannabis-focused venture fund Green Acre Capital and included Altitude Investment Management;; JW Asset Management;; as well as an Asian beer company whose name wasn't disclosed. The round brings Canndescent's valuation to between $200 million and $300 million;; Sedlin said.  Sedlin;; a Harvard MBA who has built and sold five companies over his nearly 30-year career;; said it took about seven months to close Canndescent's Series C. That's slower than the pace of funding when Sedlin was raising money from investors for his previous;; non-cannabis startups. Back then;; he said;; he could close a round in a few months.  Sedlin said there were not many venture funds capable of writing the big checks necessary for growth-stage companies because of the risks involved with investing in a product that's illegal under US federal law.  \"There's a lot of interest in Series A and seed rounds;;\" Sedlin said. \"But growth capital — that traditional later stage;; B;; C;; D series capital — where the check sizes are anywhere from 25 to 150 million bucks? Good luck in cannabis. That doesn't exist.\"  On top of that;; Sedlin said traditional;; institutional venture funds usually reserved a pool of capital for what's known as \"follow-on\" investments into their portfolio companies. Because most large venture funds don't invest in cannabis;; Sedlin said;; numerous smaller funds have \"crept up\" to invest solely in cannabis companies.  Instead of investing in follow-on deals;; these venture funds end up \"competing in certain ways\" against their portfolio companies. For example;; some cannabis funds are investing in and even operating dispensary licenses themselves — which could put them in direct competition with their portfolio companies;; Sedlin said.  \"The people who deploy capital in this space are also acting in principals in other deals;;\" Sedlin said. \"So that creates an awkward dynamic in certain cases.\"  Read more: We got an exclusive look at the pitch deck the buzzy marijuana-tech startup Headset used to raise $12 million and reach deals with Nielsen and Deloitte  Without traditional institutional capital;; there's a mismatch between the capital needs of cannabis companies and the actual pool of capital that's available;; he said.  That dynamic led many cannabis companies to tap into the Canadian capital markets;; where cannabis is legal;; by pursuing reverse mergers on the Canadian Securities Exchange in the last quarter of 2018.  Many of those companies weren't ready to be public companies;; and most were overvalued and have seen since their share prices crater over the past year;; Sedlin said. 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