Codie Sanchez and Tiffany Liff may have come from very different backgrounds, but together as two of the top executives at Entourage Effect Capital, they, like their company’s namesake, are more than the sum of their parts.
Raised in Arizona by parents who are immigrants from Spain, Sanchez is a former award-winning journalist who reported on the drug and human trafficking along the southern border of the United States but decided “raising awareness” was not enough. So she turned to finance and saw a greater opportunity to help others.
After finishing Vanguard’s Accelerated Development Program, she moved on to Goldman Sachs to work in the “investments alternative” group. Later, she built out teams of women and minorities at State Street Global Advisors and First Trust before starting investing in cannabis businesses in 2014 and joining Entourage Effect Capital (formerly Cresco Capital Partners) in 2017.
“I have an interesting lens to apply to this industry,” she says.
Liff, meanwhile, is from Florida and majored in finance at Florida State before working at Bank of America and Wachovia Securities, where she focused on transactions for private equity groups and in the distressed market before taking a few years off to raise her children. She continued investing for former clients and herself, but moved toward the cannabis space after her husband was diagnosed with cancer (he has since recovered) and cannabis helped him through his fight, prompting her to research the medical side, including a trip to Colorado.
In 2017, she made her first investment in cannabis, through Cresco Capital Partners. She met the founding partners, Dov Szapiro and Matt Hawkins, at that time as well.
“Because we all had people with capital to deploy into the space, we decided to join forces,” says Liff, who now works as managing director at EEC.
At Entourage, Sanchez and Liff say they work together to bring the biggest impact to the most people. And Sanchez says she has an underlying belief that the only sustainable community service one can do is the kind that’s profitable.
“If I can build as many businesses and they can be as profitable as possible, we give back to the community through employing more people and it creates this virtuous cycle,” she says.
Sanchez, a partner at EEC, says the company is focused on growth in the “equity stage” of a company and is currently invested in 65 different cannabis or cannabis-related companies. Liff, who runs the new business and underwriting divisions, says that the regulations and restrictions that cannabis businesses face is unlike any other, forcing them to fund growth through equity raises, which she calls “highly dilutive” and not the way anyone with access to banking would fund a business because of the expense, requiring the entire space to rely on wealthy individuals, family offices and private equity funds.
“That’s a huge differentiator between cannabis and the traditional space,” says Liff, calling it “amazing” that so many companies have been as successful as they have.
Sanchez agrees, citing, like Liff, the additional regulations and taxes that cannabis companies have to deal with, and says that because so many businesses are cash-strapped, it’s a good time for smart investors. She says it reminds her of the tech bubble of the late 1990s, with a hint of the 2008 housing crisis, but says because of that, it’s great time for investors to get in because of the long-term possibilities.
She also says her experience in cannabis has been “really powerful” because of the “ecosystem of ways you can give back.”
“As you fund businesses, you immediately see the widespread impact,” says Sanchez.
Liff says that the cannabis space is interesting compared to her traditional investing background, but adds, “it’s not for the faint of heart.”
“I feel like at the end of the day I would hire any CEO of a cannabis company that has been successful because they can probably do anything,” she says.