Entrepreneurs and investors are leaving their high-paying corporate jobs to focus on the fast-growing marijuana industry, Reuters reports. Alan Gertner used to be head of Google’s Asia-Pacific sales team, but he had decided to trade his comfortable corporate job for something a lot less conventional. He is currently building a cannabis brand from a small Toronto office. Gertner managed to raise 10 million dollars in capital in just 10 months. Eric Eslao, a former senior production manager at Apple, also jumped on the bandwagon about a year ago to focus on producing cannabis chocolate bars.
The legal cannabis market is currently worth about eight billion dollars. According to Arcview Market Research, it is predicted to triple in size by 2021. If these predictions come true, the legal cannabis market will outperform America’s most profitable sports organization, the NFL, which aims to reach 25 billion dollars by 2027.
The significant influx of capital is what helps finance the paychecks of 150,000 workers in the legal cannabis industry in the United States. The industry had a job growth of 20 percent this year. The stigma of joining this industry, legal risks and challenges, and mixed signals of Donald Trump’s administration, however, may present a problem.The banks that work with cannabis-related businesses operate in states where the industry is legalized and are limited to accepting cash deposits. On the other hand, Americans increasingly support marijuana legalization, according to a Reuters poll.
Ian Laird, the co-founder of New Leaf Data Services LLC, said, “The evolution or rollback of prohibition is inevitable. It’s not like it stopped anyone from getting it.”
— Damir Mujezinovic (@damir_92sa) December 6, 2017
Cannabis investment is still dominated by wealthy individuals, although that is expected to change as the industry grows. The wide-open landscape of opportunity is what draws investors. They are focused on support services and technology. This is how they manage to bypass the legal risk cultivating and selling cannabis still entails.
At the moment, the cannabis business seems to be about risk arbitrage. Medical cannabis producers are experiencing high returns because the risk is currently high. That too is expected to change soon, since the industry itself keeps creating jobs, as well as tax revenue. Apart from that, Americans are becoming aware of the futility in preventing marijuana use.