Safe Harbor Financial completed its special-purpose acquisition corporation (SPAC) deal with Northern Lights Acquisition Corp. last week, a deal its CEO said will position the cannabis financial services provider to tap executive-level talent and pursue strategic acquisitions.
“What we really want to accomplish is to be a one-stop financial service provider to the cannabis industry that is as reliable as the Safe Harbor reputation has become over the last eight years,” Safe Harbor CEO Sundie Seefried said.
Safe Harbor, which announced its plans to go public via a SPAC in February, was spun off from Partner Colorado Credit Union last year.
Seefried launched the division in 2015 and left her role as CEO of the Arvada, Colorado-based credit union to focus solely on growing the cannabis banking venture.
“A lot of my attention, strategically, has been distracted by the cannabis banking program,” Seefried said ahead of Safe Harbor’s spinoff last year.
Since its inception, the cannabis banking services provider, which has operations in 20 states, says it has assisted in onboarding more than $12 billion in deposit transactions for customers.
Seefried said one of her goals following the SPAC is to grow the company’s leadership.
“We want to have a dedicated set of officers to do nothing but help grow the entity at this time. We didn’t have that when we were under Partner Colorado Credit Union,” she said. “We had just me guiding it, but now we’re actually being able to hire in some national talent.”
The company tapped Tyler Beuerlein as its chief strategic business development officer in April.
Beuerlein previously served as chief business development officer for Hypur, a payment processing and compliance technology firm for cannabis businesses and other high-risk industries.
While at Hypur, Beuerlein was responsible for more than 1,000 direct cannabis bank account referrals and helped facilitate more than $500 million worth of cannabis-related transactions and loans to the state-legal cannabis system, according to Safe Harbor.
Seefried said the firm has also tapped a CFO with public accounting experience who is set to join the firm soon.
“We think that between the talent brought on and the ability to acquire other single-service providers with this access to capital markets now, we really serve the cannabis industry with reliable services that they need,” Seefried said.
Safe Harbor has a staff of 35 — a number that will grow as the company executes on its acquisition strategy, Seefried said.
Like the specialized banking services Safe Harbor provides for cannabis firms, the company is eyeing another area in which the industry struggles to secure reliable services: insurance.
Marijuana’s federal designation as a Schedule 1 drug means banks and credit unions face significant legal, operational and regulatory risks — and the aforementioned compliance demands — if they choose to extend services to cannabis-related businesses. As a result, many financial institutions, as well as insurance providers, are reluctant to enter the space.
“They lose insurance because people don’t want to actually insure anything cannabis-related. They get kicked out of their broker-dealer account, they get payment processing issues,” Seefried said.
The company, which hopes to add the service through future acquisition deals, is also on the hunt to secure a second sponsor bank, Seefried said.
“Strategically, the best thing for us to do is to have two sponsor banks. Never put all your eggs in one basket,” she said.
While Safe Harbor still works with Partner Colorado Credit Union, securing a second bank partnership will help it keep pace with future growth, Seefried said.
“We want to have a main sponsor bank that has a large enough balance sheet to handle the consolidation of all activities under Safe Harbor,” Seefried said.
The firm is also aware of the benefits that come with linking up with an international lender, she added.
“Down the road, as companies go international, they’re going to need international access to banking. It’s going to be necessary,” she said.
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