Legalization of recreational marijuana usa
An increasing number of venture capitalist firms are planning to invest in cannabis startups. Many of these firms have already poured about $1.6 billion into startups in the cannabis industry this 2019. This is an increase from under $1.2 billion in 2018, according to a recent report from the data provider PitchBook. Legalization of recreational marijuana usa
At the same time, this is a massive increase from the $16 million invested in 2013, when Colorado became the first state in the United States to give a green light to the commercial cannabis industry.
For an industry like cannabis that didn’t exist legally before 2012 at least, these figures represent some huge growth. Here’s a closer look at some key investments in recent years. Legalization of recreational marijuana usa
- In July 2017, Pax Labs invested $420 million in the cannabis vaporizer manufacturing sector and invested $265 million in Surterra Wellness to develop cannabis medical products.
- New York City-based venture capitalist firm Lerer Hippeau invested in a tech platform for cannabis dispensaries named Leaflink.
- Greycroft, the firm owned and operated by venerable venture capitalist Alan Patricof, participated in the CBD (Cannabidiol) company Prima’s $3.3 million seed round at the beginning of this year. Legalization of recreational marijuana usa
Why investors are embracing cannabis?
The most noteworthy thing is cannabis investments are rapidly embraced by Wall Street and other financial districts. In a poll that included 120 senior executives employed with leading private equity, hedge fund, venture capital (VC) and other institutional investment firms, almost 33% of them said that the cannabis industry has witnessed the greatest market growth potential this year. Legalization of recreational marijuana usa
This significant growth places the cannabis industry at a close second behind the technology industry, according to a leading accounting firm EisnerAmper. The most investments came from hedge funds, with 37% ranking cannabis in first place. Legalization of recreational weed in usa Legalization of recreational weed in usa
All the investments go into different areas of the cannabis industry. Already, the totaled market value of public cannabis stocks trading on Canadian and United States stock exchanges has increased massively, to the tune of tens of billions of dollars. Legalization of recreational marijuana usa
Also, venture capitalist firms made a combined investment of $1.3 billion in 150 cannabis-associated deals in the first half of 2019. This already outstripped the $1 billion in VC money invested throughout the year 2018. Private equity firms also have increased, spending $474 million in 19 cannabis-related transactions during 2018. These firms are investing even more in 2019. Legal weed shop in usa Legal weed shop in usa
Before 2012, cannabis was illegal and prohibited virtually everywhere in the United States (U.S.). Despite still being federally banned there, the drug is now legal for medical purposes in 33 U.S. states and legal in 10 states for recreational purpose. Legalization of recreational marijuana usa
Many other states are also moving towards the legalization of recreational cannabis, while some have embraced lax enforcement policies. For example, in New York City, the laws against recreational cannabis go unenforced, and the drug is smoked openly in public. Is it legal to buy cannabis in usa Is it legal to buy cannabis in usa
Moreover, the non-intoxicating chemical in the cannabis plant, cannabidiol (CBD), is being sold increasingly. Much evidence suggests that CBD is a highly-effective health and beauty aid, and an increasing number of mainstream retailers sell it. Unlike CBD, tetrahydrocannabinol (THC) is the intoxicating chemical that remains a federally-controlled substance. Legalization of recreational marijuana usa
The growth of cannabis technology firms
Cannabis technology firms are becoming increasingly important within the industry. These growing firms support the cannabis industry with their services related to various areas, such as software, hardware, data analytics, and cultivation technologies. Can i buy recreational cannabis in usa Can i buy recreational cannabis in usa
These firms also offer consumer devices — mainly vaporizers. Since these tech firms do not grow, process, distribute, or sell cannabis products themselves, they technically do not violate U.S. federal controlled substance laws. Legalization of recreational marijuana usa
Cannabis tech companies such as LeafLink, Headset, and Treez, all have financial backing from a variety of VC and private equity firms. For instance, LeafLink runs an online platform which is responsible for streamlining the wholesale distribution of cannabis-related products.
Similarly, Headset works with accounting and consulting firm Deloitte, and a market research company Nielsen. It is responsible for providing data analytics for the growing cannabis industry to leading packaged goods companies. Legalization of recreational marijuana usa
And, another popular cannabis tech firm, Treez designs software for retailers working in the cannabis industry.