The tides seem to be turning for the medical marijuana industry with 20 states currently legalizing the drug for medical purposes. Along with this change of tides private equity firms seem to be taking a more serious look at the marijuana industry and seizing the opportunity to corner a blossoming market.
Marijuana and the American Public
Public opinion polls have shown that a majority of americans now favor legalization. This demonstrates the mainstream approval of cannabis in the country which opens up the potential market for recreational pot. With the opening of this market it’s evident that the marijuana industry, both recreational and medicinal, is striving to shed it’s Cheech and Chong image and achieve business legitimization.
Medicinal marijuana proponents and states such as Illinois have focused on medical marijuana being accessible for patient care. Countless studies have proven the positive effects and easing of pain that medicinal marijuana has upon patients who suffer from debilitating diseases such as cancer, alzheimer’s, arthritis, and epilepsy.
Recreational marijuana proponents are doing the same by outlining the potential economic, and social benefits to legalization. Dr. Bruce Bedrick, CEO of Medbox, Inc. stated that passage of medical marijuana legislation “aims to legitimize the industry, and take marijuana off the streets and into properly run and licensed dispensaries." Many have called for taxation and regulation of the industry in the same manner in which alcohol is regulated in order to cut down on prison populations, generate more taxation revenue for states as well as cut support to dangerous organized crime entities.
Marijuana and the Business Owner
Two private equity fund investors from the Silicon Valley, Michael Blue and Brendan Kennedy saw an opportunity and left the tech industry behind to set up a private equity company that would buy up firms serving the marijuana market. This could spell huge payouts as cannabis becomes legalized in more states each November. However, it’s not as though financiers are holding off on investing. In the meantime, Investors are looking to back consulting firms, insurance agencies and software companies to serve the marijuana market in order to get ahead of a boom in investments.
With investment firms and serious capital to be accrued in this blossoming market the image of marijuana is completely changing from hippie to yuppie. Which is great for prospective dispensary owners or medical marijuana entrepreneurs.
