Wealthy investors are pouring millions into the cannabis industry in a bid to capitalize on the gold rush that’s expected when California legalizes recreational marijuana on January 1, 2018. They’re backing development of new medicinal products, such as “budtender” apps like PotBot, which promises to scour 750 strains of cannabis to help customers find the perfect match.
Pot has been legal for medical use here since 1996, but with broader legalization, the industry is poised to explode. Experts say the market for marijuana and related products in California will reach $6.5 billion in 2020, and likely spark legalization efforts elsewhere. Troy Dayton, CEO of The Arcview Group, an Oakland-based cannabis investment and research firm, stated that “California is the sixth largest economy in the world. Colorado and Washington are pilot studies by comparison.” The federal Drug Enforcement Agency continues to classify marijuana – like heroin and LSD – as a Schedule I drug, defined as highly prone to abuse and having “no accepted medical use.”
Given that most states have already legalized cannabis for medical use, and seven states plus the District of Columbia allow recreational use, most investors think that federal officials eventually will relent and regulate marijuana more like alcohol. For now, most publicly traded companies have shied away from the industry. Most large venture firms, which receive money from public companies and pension funds, also have steered clear due to both risk and morality clauses in their investor agreements.
If you need help in defending a drug related prosecution, call Frank T. Luciano. He has over 40 years of experience and is a lifetime member of the legal committee for the National Reformation of Marijuana Laws.