I have helped cannabis companies with their strategy and product development who got funding from investors. So, I have not personally invested myself but I can share that experience.
The biggest issue is the ever-changing regulations that are inconsistent state to state. Having the farm bill pass this past December was amazing, but then a swift government shut down made things very confusing. As the laws and enforcement of those laws moves from ambiguous to clear, the risks associated with cannabis companies will balance out. I do think that will take a couple years though.
So right now, there are tons of unknowns and risks from an investor side. For example, there are a limited number of banks willing to represent cannabis companies and will charge high risk fees due to the industry. Or something (that happened recently) like the FDA decides UPC codes are required on CBD oil to link to the batch certificate of analysis....if you just produced 10,000 units without this packaging, you are out that money or need to be nimble in adapting quickly.
My biggest advice is making sure you team up with experts in the field who can help you stay on top of this consistently which should reassure investors that you are factoring in reducing this risk.
I hope that helped. Good luck with everything!
Anecdotally I can report that there's more money waiting to go into cannabis than there are opportunities to invest. That would not likely be the balance if a return on investment were unlikely. But the dollar levels at which investments are being made are not trivial either, in the millions, not thousands, for single locations.
As @Bridget McMullan points out, there are still many federal issues around funds used in the industry, including lack of banking access, as well as the persistent threat of a total loss should federal law be enforced. There are many risks because of the unstable legal status. And rapid changes in regulation at the state level can be cause for costly and unanticipated expenses. This is probably why you see more large cash investments than small, because they need to be able to absorb and respond to changes at the drop of a hat.
Until there are stable standards, it will continue to be a high-risk/high-reward business, no pun intended.
I invested a lot in Cannabis in my 20's and woke up 10 years later and can't remember what happened. Where did all that time and money go? Hah, just trying to lighten your day...