Advice needed on investing in smoke shop

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United4826

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United4826
Currently a CFI at the moment in the US. Want to be a pilot at the airlines in the future. I know this question has probably been asked with regards to being in cannabis. But this is not marijuana, this would be nicotine/hemp. Since the hiring pipeline is a little backed up now, I figured I would search for other opportunities while waiting. I have an opportunity to be a part investor in a smoke shop. It is NOT a marijuana dispensary. At the moment there is mainly nicotine stuff in the store and there is a consideration to expand into hemp products.

For the location of the store, hemp would be legal on both the state and federal levels.

Just for clarification I do not smoke anything at all and dont plan to.

I would not be participating in the store. I would purely be an investor and would get a cut of the profits. I have a couple of questions if anyone has any thoughts about this.

  1. I would assume I would not even disclose this on my current/prior employments at all to the airlines? Since it would not be employment. I would not be on payroll, I am not a material participant in running the business, I would not be managing in any way shape or form. Besides making sure that the store initially exists, I would not even be stepping foot inside. Simply, if the business makes money I get a check. Since it's purely an investment, it would seem odd to disclose this as employment.
  2. If the airline found out about it, would they care? This isn't like Marijuana where it's illegal federally but legal state level and the dispensaries operate in a gray area. This would be hemp that is legal both federal and state. I know in the finance world, they try to stay away from this stuff period, legal or not because it's cannabis related and they just dont bother with it and stay away from anything related at all. I just have no idea if the airlines care or not.
  3. Would this ever be an issue being a pilot at a major and traveling in and out of countries where hemp would be illegal? (have not smoked the stuff, not planning to smoke the stuff, and would not even come into contact with the stuff).
Thank you in advance for anyone that has insight into this.
 
Interesting first post.

Assuming you're not trolling (big assumption), the fact that you're even asking the question indicates that you're not altogether comfortable with it.

I've never seen a place on any employment application or medical form that asks for a list of investments, so initially I think you're clear there. HOWEVER, we're not talking a publically traded stock here. Consider the future. What documents tie you to the business? Are you listed on incorporation papers, tax documents, etc.? If something hokey ever comes up with this place, you will be tied to it and your name will come out.

There are lots of ways to make a buck. Why mess with this one? As @Bill says, why pedal crap that addicts people and does them harm? Why not invest in something less shady, like a Nevada brothel?
 
Its a business. Not one I like, but if it brings in money, there's no immediate reason not to invest. How do you exit the business when/if the time comes? What's the "out" if things don't go well from a business perspective? Who's on the hook for the lease if you close the business?
 
Half Fast said:
Interesting first post.

Assuming you're not trolling (big assumption), the fact that you're even asking the question indicates that you're not altogether comfortable with it.

I've never seen a place on any employment application or medical form that asks for a list of investments, so initially I think you're clear there. HOWEVER, we're not talking a publically traded stock here. Consider the future. What documents tie you to the business? Are you listed on incorporation papers, tax documents, etc.? If something hokey ever comes up with this place, you will be tied to it and your name will come out.

There are lots of ways to make a buck. Why mess with this one? As @Bill says, why pedal crap that addicts people and does them harm? Why not invest in something less shady, like a Nevada brothel?
Click to expand...
Same thing was asked on Reddit earlier
 
Asking pilots for financial advice is the real problem here…

Pretty soon, the faa is tryin like hell, you’re gonna be able to go to a pilot for all mental health issues.

Like Tom MacDonald says, dumb.
 
If you don't work there, don't sell or buy or use any of it, and assuming you're not listed as an owner, how would it be different than having money invested in Altria (MO), Philip Morris (PM), Green Thumb (GTBIF), Curaleaf (CURLF), IIPR, or any similar tobacco and/or cannabis related companies? Would you give your prospective employer an up to date list of all of your investments?
 
So your answer to to notgetting hired with the airlines is to commit a federal felony. Interesting logic.
 
This business you’re going to invest in; as a silent partner how do you plan to verify the books?

What do you know about how the business/industry runs today?

Will the returns beat an S&P500 index fund?

Are you willing to lose your entire investment?

ETA: what does the partnership agreement say about death and dissolution?
What is the active partners exoerience?
How is the business being valued and how do you know what your investment percentage is?
 
This is a great question for the lawyer setting up the LLC, subchapter S, or whatever. If it is set up correctly, its just an investment.
 
:) Just my 2 cents. It's not an opportunity in the sense that you think it is. It's an opportunity to give money to someone who's always had a dream of opening a smoke shop. So consider if rather than having a job, you'd instead like to give your money to a stranger and just speed up the process of going broke. Maybe I'm wrong, but if so you don't need to prove it to me.
 
I own a home in CO, and I recall a lot of media attention when they went legal for pot. The general theme was that the pot business was going to be massive profits, and low overhead, with the product literally growing on trees(yes, I know that cannabis does not grow on a tree. It's a metaphor, get over it).

And then, the tax man opened his wallet. The state license board took a healthy cut(per year?). Investor capital which was in theory hot and heavy - didn't show up due to concerns over federal banking regs. Now - the CO pot market dust seems to have settled out, and all I see are mainly the mom and pop stores along the highways. Maybe there's big profit, I don't know and have really never cared. Not a consumer and have no interest in starting.

Risk assessment; If US bonds are rated on a scale of 1, and the Irish lottery is rated 100, I would put passive investment in a smoke shop around 80-ish. How much product that come off the truck actually makes it to the shop retail shelf? I can see product wastage(going in/through the store clerks) at 10%? 30%? 70%? And, passive investor, how would one know? Gonna weigh it coming in, and then retail going out? No longer passive now.

Summary, well - I've heard of stupider investments. Like maybe Tupperware, or used cars near a mil base. But passive investment in the pot market might be right up near the top.
 
This OP is a troll, obviously. But I'll play along.

Morally, I'd rather own a pot/smoke shop than a liquor store. A thousand times over.

Though I feel like you're about 4 years too late for this investment. The craze and capital influx for this market was circa 2020-2021. You're just signing up to be part of an already crowded and commoditized industry at this point. I'd bet profitability proves... Elusive.

How it looks on a resume? Bottom of my list of concerns. It's an investment. A bad one.
 
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re who cares- how many tobacco smokers initiate a new smoking habit at say age 40?
Essentially none. Not zero, but it’s a negligible proportion of smokers. The vast majority initiate the addiction in their teens.

That’s why I care- because it’s not a rational choice full grown adults make. Tobacco is addictive, it harms, and it kills. And that hurts our society.

YMMV. You asked.
 
shrug, legal business on all accounts, have fun with that. plus all the crap going on today, smoking is pretty far down for anyone to worry about
 
RussR said:
You guys are killing me!



Peddle. Or do you mean delivery by bicycle?



Peddle! Although I've ridden some pretty terrible bikes, I guess you could call that pedaling crap.

And for honorable mention:



Affect!

:D:);):D
Click to expand...

Dammit, Jim, I’m an engineer not a spell/grammar checker.
 
DaleB said:
What felony do you see here? Just curious.
Click to expand...
Some states still have restrictive, complex, or prohibitive regulations on growing, processing, or selling specific hemp-derived products. When it crosses state borders it may become a federal offense.
 
I have no idea what the tobacco business outlook is like right now, but I wouldn't think it's a growth opportunity. And the hemp business is iffy for different reasons. Note the OP is talking about legal "hemp", not "marijuana". When the farm bill was passed legalizing low (under 0.3%) THC hemp, they left a huge loophole. It was intended to allow the production of hemp fiber and CBD products containing an insignificant trace amount of THC but that 0.3% number inadvertently allowed the production of beverages and other products containing a not-insignificant amount by adding water or other ingredients to keep the percentage under 0.3... which is why you're now seeing THC infused seltzers and gummies and such at convenience stores even in states where weed is still illegal.

BUT... legislation has already been passed to close the loophole, so unless repealed or changed that business will evaporate when it takes effect later this year, making it an iffy financial opportunity.
 
Clip4 said:
Some states still have restrictive, complex, or prohibitive regulations on growing, processing, or selling specific hemp-derived products. When it crosses state borders it may become a federal offense.
Click to expand...
Some states probably do. The OP already stated that was not an issue (if we take them at their word). And even if not, as a passive investor I don't see any felony there. I'm not a prosecutor, though. I'm sure a sufficiently motivated prosecutor could find something to get an indictment for most people by the time they have their morning coffee poured.
 
DaleB said:
Some states probably do. The OP already stated that was not an issue (if we take them at their word). And even if not, as a passive investor I don't see any felony there. I'm not a prosecutor, though. I'm sure a sufficiently motivated prosecutor could find something to get an indictment for most people by the time they have their morning coffee poured.
Click to expand...
Seems pretty clear:

"For the location of the store, hemp would be legal on both the state and federal levels."

That's true in a bunch of places, including my state. No reason to doubt it
 
The op joined 3:40pm, 29march, last seen 3:48pm, 29 march
 
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