Wednesday, August 10, 2022

Andrew Hunzicker: Cannabis Accounting and Tax Training Program

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Andrew Hunzicker is the Co-Founder and Owner of DOPE CFO, @dopeCFO. With broad experience providing executive leadership and business counsel to companies across industries including retail, manufacturing, energy, medical/bio, and tech, Andrew co-founded DOPE CFO and has built up a national cannabis accounting/bookkeeping training program to help students in over 38 states unlock a new world of clients.

Andrew was runner up for Portland Business Journal’s CFO of the Year in 2017, making him the first cannabis CFO to ever be nominated.

He is an expert in cannabis startups, CFO services, turnaround and high-growth strategies, capital sourcing, mergers, exits and wealth protection.

We got the opportunity to interview Andrew. Learn more about him and his company DOPE CFO.

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What is DOPE CFO and your role within it?

Andrew Hunzicker: DOPE CFO is a national Cannabis Accounting & Tax Training program that provides educational resources to accounting professionals (CPAs, EAs, Bookkeepers, etc): knowledge required to help cannabis business owners ensure full compliance with rigid regulations at the city, county, state and federal levels. Accounting, tax and financial regulation in the U.S. cannabis industry is unlike any other field in the world, and many cannabis companies—who would otherwise succeed in the profitable and rapidly-growing industry—are facing high penalties, revoked licenses and imprisonment due to a lack of specialized understanding surrounding best practices.

Cannabis companies require complex, accurate Absorption/Cost accounting in order to remain compliant and audit-ready, but currently none of the Big 4 serve the cannabis sector, nor is there GAAP guidance. DOPE CFO provides the critical missing piece that allows Accountants to quickly enter the cannabis space, and learn the proper way to serve these companies. The program helps students provide world-class service to cannabis clients, including our proprietary VIP system, Perpetual Data Room, and over 170 work papers (including cannabis Chart of Accountants and Cost Accounting Templates) to establish financially successful cannabusinesses of their own. Since launching in January 2018, DOPE CFO has grown to more than 180 students in 39 states nationwide.

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When was DOPE CFO founded and what drew you to the cannabis industry?

Andrew Hunzicker: I first entered the cannabis niche in 2014 and was CFO at a prominent cannabis cultivator (Hifi Farms) and was quickly drawn in by many factors: exploding niche (fastest growing in US), huge lack of accountants and guidance, complex accounting (cultivation/farming, chemical manufacture, food production, labs, & retail, complex cost accounting required, consolidations, multi-entity, related parties and more), very easy to find and help CEOs and Investors, Ave revenue size for a “mom and pop” dispensary or farm, usually mid 7 figures, entrepreneurs and CEOs passionate about this movement, and the fun factor. I started helping accountants in 2015 when they sought me out for help in the space and that need to be evolved into DOPE CFO in 2017 when I founded with my partner Naomi Granger, CPA, MBA.

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Why should people choose DOPE CFO?

Andrew Hunzicker: At this point, there is no other “shortcut” available for those that want to enter the cannabis space (bookkeeping, Controller, CFO, tax prep, etc), want to learn the ins and outs quickly for serving these companies in their day to day accounting (not just preparing tax return once a year), who want to learn everything quickly about the niche (legal/political, accounting, tax (280e, 471), operations, compliance,), and also our world-class system to find and serve these businesses as well as earn very high fees (cannabis clients simply pay more).

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What trends do you see shaping the industry and where do you think it’s going?

Andrew Hunzicker: Eventually, 280e will go away, but we will still have a great niche: complex accounting, multi-entity, verticals, etc. That is still a while out, and in the meantime, compliance will remain key (and even after 280e, likely to have FDA involved) so this niche will need thousands of Accountants and trained experts for a long time.

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What’s the most difficult experience you’ve had in the industry so far?

Andrew Hunzicker: Client service can be demanding: cleanup work is often a big “mess”, and educating the CEOs around why this is a good thing (adds huge value to their firm) that they have great books that are “audit ready, lender-ready, investor ready, any time/all the time”.

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And the most rewarding?

Andrew Hunzicker: When our many students and CEOs send nice thank you letters and recommendations around how happy they are that they found us. As we tell CEOs, “we work remote, you will never see our pretty face, we do things right, we know exactly how to do cannabis accounting and tax, our fees are extremely high, but you will be able to sleep at night, your firm will grow in value substantially, and will be very thankful you found us, just as all our other clients are”.

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Do you have any advice for hopeful cannabis entrepreneurs who are considering joining the industry?

Andrew Hunzicker: Yes, focus every day on building your education, expertise, and knowledge: join digital and real-world cannabis groups (grassroots lobbying, political, accounting, etc), attend events, learn all the issues: accounting, tax, political, operations, software, cash/banking, etc.

This is my general advice to any small firm owner: Pick a great niche (cannabis is the best), become an expert and provide world class service to your clients. The icing on the cake in cannabis is you can become a participant, as this is more than a niche, it’s a national movement, and by doing that, you actually get to know MANY CEOS (they are the ones pushing this movement locally and nationally) and establish your brand.

Thank you so much, Andrew, for taking the time to do the interview. We really appreciate it.

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