By Patrick May
Posted: 08/29/2014 05:51:09 PM PDT61 Comments
Updated: 08/29/2014 08:51:39 PM PDT
Looking around last week at the exhibitor showroom of CannaCon, the huge marijuana-business expo held outside Seattle, Greg James had something of an epiphany: The pot industry in America is growing like, you guessed it, a weed.
“There was everybody from soil companies to grow-light companies to lawyers and security and insurance firms to a TV network doing shows just on marijuana,” said James, whose Seattle-based Marijuana Venture newsletter has exploded from eight to 84 glossy pages since it launched in March and is already turning a profit. “I’m not sure how many of them will survive, but it’s amazing how fast this thing is moving.”
The legal pot business in the United States, including both the newly legalized retail operations in Washington and Colorado and the medical-marijuana use now allowed in California and 22 other states, is expected to grow this year to $2.6 billion from $1.5 billion in 2013, according to the ArcView Group, a San Francisco-based marijuana research and investment firm. In five years, that number could swell to more than $10 billion. And if backers are successful in getting a legalization measure on the 2016 ballot in California, the Golden State, with its already outsize medical-pot market, could soon be entering a Golden Era of commercialized cannabis.
Although the state in 1996 became the first in the nation to legalize pot for medicinal reasons, California has yet to approve it for the overall adult population, or so-called “adult-use.” Despite that, it has the largest pot market in the nation, according to a widely referenced report last year by ArcView.
“California remains the largest state market at $980 million, even without Adult Use regulations,” said the report. And “once Adult Use is adopted — which is likely by 2017 — the total California market is projected to increase dramatically.”
As marijuana use has become more mainstream, a veritable smorgasbord of professionals and young startups has popped up to feed off and support the pot culture. Lawyers, accountants and real-estate brokers are going after pot clients like hogs to truffles. There are security outfits protecting Mendocino County farms and software developers churning out cannabis-news apps and GPS-enabled tools like Weedly to find the nearest pot club. And there are even pot-friendly resorts where the Hollywood set can go to get high in peace, provided they have a prescription.
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