“A lot of U.S. investors still are unsure about the legality: There’s not a lot of awareness about the fact that it’s federally legal in Canada versus the U.S.,” he said. “By listing on Nasdaq, it will open up the opportunities for a lot of U.S. investors that otherwise were unsure -- even on the institutional level.”

Clouds Over Industry
The confusion isn’t without cause. Cannabis is still federally illegal in the U.S. Attorney General Jeff Sessions in January rescinded the Obama-era protections that allowed state-legal industries to thrive.

Still, that illegality doesn’t prevent U.S. investors from putting money into foreign companies that operate legally in their respective countries, Gorenstein said.

Cronos was “laser-focused” on making sure it was absolutely ready to conform to the U.S. SEC standards before filing its application to list on Nasdaq. That made the process relatively smooth.

“It was an exercise in checking everything we do and looking in the mirror and asking are there any gaps, because if we’re used as an example for other cannabis companies, we want to make sure that we’re setting the right example,” Gorenstein said.

Even before he founded Cronos, Gorenstein was no stranger to regulated industries. He started his career as an M&A lawyer, mainly working with alcohol and pharmaceutical companies.

Constellation Deal
There may be opportunities to team up with big companies in those spaces. Constellation Brands Inc., which sells Corona in the U.S., last year made a direct investment in Canopy Growth, one of Cronos’s competitors. A bigger partner can help capitalize on the industry’s enormous growth potential over the next few years.

“We’re driving to go from zero to Pepsi in two years,” Gorenstein said. “That’s quite a bit to do without any help, so having partnerships -- whether it’s an investor, distribution, joint development with alcohol and pharmaceutical companies -- is very, very helpful.”

Gorenstein’s legal background has kept the company rooted in compliance, he said. Federal illegality in the U.S. is what drove Cronos’s founders to locate and expand the company in Canada, where the plant has been federally legal for medical use since 2001. Still, Gorenstein said he hopes Cronos’s listing will bolster companies on both sides of the border.

“This hopefully serves as a catalyst and is helpful to the U.S. companies as well just in terms of eroding stigma,” he said. “Because we do want to see the industry move forward as a whole.”