High Times, a cannabis-focused news outlet, is the first initial public offering to sell shares for cryptocurrency.
The Los Angeles-based media company publishes a monthly print and online publication focused on cannabis. It registered its IPO with the Nasdaq stock exchange.
Under Regulation A+, the company has already starting raising funds in cryptocurrency. The regulation is an alternative means of raising capital for smaller, early stage businesses. It was initiated in 2012 under the Jumpstart Our Business (JOBS) Act, a law intended to support small business growth and employment by lowering regulatory hurdles for companies trying to go public and allowing firms to have more private shareholders.
High Times is offering shares for $11 each.
— Anthony Nutt (@AkulaBrandsNutt) August 4, 2018
“Cryptocurrencies have created a new investor base across the world—we’re just giving them more stable opportunities for investment,” said CEO Adam Levin. “Beginning with our Reg. A+ crowdfunding, we’ve been focused on giving everyone from retail investors to long-time fans more ways to own a piece of High Times. While we didn’t believe that the ICO process was the right move for our brand, it would’ve been foolish to leave this emerging investor base out as we continue to transform into a diversified media, events and merchandise giant.”
Founded in 1974, High Times plans to expand its magazine and online presence, and continue its efforts to legalize cannabis. It’s one of the first cannabis-related brands to go public on the Nasdaq, and the first-ever stock offering to accept Bitcoin and Ethereum.
But Reg. A+ investment opportunities often struggle to show a return. Like initial coin offerings and any other investment, these IPOs require due diligence.
According to Barron’s,
“We studied the hundreds of mini-IPOs made under the Jumpstart Our Business Startups Act (JOBS) rule called Regulation A+. There are earnest entrepreneurs with real products. But sad to say, most Reg A+ businesses haven’t gotten beyond the startup phase known as the pipedream. Cannabis paraphernalia. Flying cars and guns. The founder of rock band Blink-182 Tom DeLonge seeks your money to study UFOs, telepathy, and light-speed travel, but declined to talk to Barron’s about it.
Investors so far have little to show for the hundreds of millions of dollars that the U.S. Securities and Exchange Commission says have gone into these IPOs since Reg A+ took effect in 2015. Investment returns are hard to find, mainly because only a few dozen of the 300-odd Reg A+ stocks have gotten so far as to list on the NYSE, NASDAQ, or OTC markets, where you can trade or at least get a price quote.”
HighTimes may be the unicorn. They’re making it easy for investors to get a piece of the pie. By using a credit or debit card, anyone can purchase shares directly from HighTimes – prior to the NASDAQ listing.
Update: 8/14/18 – High Times has reversed its decision to to accept Bitcoin in its IPO, according to an August 13 filing with the SEC.