About two years ago, I was in San Diego, California having a drink with a friend. We were sitting at a bar in the Gaslamp Quarter the night before a trip down into Baja.
While we were trying to solve all of the world’s problems – that’s what you do at a bar, right? – the topic of cannabis came up. As most of you know, I believe investing in cannabis is one of the best opportunities in the world right now. (And we’ve also been extremely active in the industry.)
Even though there has already been a lot traction and news in the cannabis market, I still believe there is a lot of upside left. That said, there are also A LOT of people that are going to lose A LOT of money over the next several years.
That’s because there have been dozens, if not hundreds, of companies that have popped up in the past couple of years and raised millions of dollars from naive investors. Many of these companies raised money just because they said, ‘We’re in the cannabis business!’ Little did many investors know that most of those companies really have nothing behind their facade.
Anyway… back to the conversation I was having with my friend in San Diego…
As we were talking about cannabis, I told him that I thought cannabis would become a significant threat to alcohol within the next 5-10 years. He looked at me and laughed. “There is NO way that will ever happen,” he said.
Sitting at the bar there was nothing more we could do but argue back and forth. I didn’t have any data to show him or any specific trends to point to. (But, that’s kind of the point of arguing at a bar, right? You never really solve anything.)
Now, two years later, I remember that conversation because cannabis has gotten even more traction than I expected. Nearly every month future growth estimates are re-forecasted, as the market continues to grow faster than most have predicted.
Here are some very surprising statistics that have been published recently:
- Nearly every single major alcohol company has made significant investments in the cannabis industry. One such deal is Constellation Brands’ investment of $4 billion into Canopy Growth.
- From a recent NBC news article, “Beer is going to be one of the biggest markets for marijuana-based products.”
- Cannabis sales are set to surpass NFL revenue by 2020, and is on track to break $100 billion by 2023. –NY Post
- State Banker Associations from all 50 US States and Puerto Rico are requesting that the Federal Government change laws to allow for cannabis banking. –Forbes
- Two out of every three Americans now support cannabis legalization. –Gallop
- Almost 10% of adults over the age of 60 have used cannabis in the past year. –CNBC
While I might have been laughed at a couple of years ago… I may be the one having the final laugh if the cannabis industry continues to develop as it has been. And if you haven’t been able to get involved, just know that there is still plenty of time to enter the market.
You can go at it alone, as there are deals around every corner that you can get explore. Or, you can go with a team that has deep experience and relations within the industry.