“The status quo is not sustainable”
On June 25th 2019, Illinois became the 11th state, along with the District of Columbia, to legalize adult-use cannabis, and the first to do so by the legislative process. This followed a long month of anticipation after the Democrat-controlled House of Representatives passed the measure 66-47 in late May, and it was sent over to the desk of Gov. J.B. Pritzker.
The historic, venture capital-fueled tech boom of the past two decades in Silicon Valley and beyond has turned “innovation” into perhaps one of the most abused terms in our day-to-day lexicon. Years of buzzword status have disconnected us from a meaningful understanding of the real hallmarks of innovation and the conditions that give rise to it. As such, most people wouldn’t consider the cannabis industry the ideal environment to develop new, world-changing technologies; luckily for a small swathe of forward thinking entrepreneurs and investors, most people are wrong.
One of the black box mysteries I am often asked about is valuation of a company during an investment. As I've been preparing for a presentation I’m giving at the MJBizInt’l conference in Toronto next month, I’ve been thinking about a common aspect of the debate - the importance of revenues.
The CBD sector is growing at an exponential rate. If you've walked an industry trade show recently, you've certainly noticed an increasing array of CBD-infused products, and your local dispensary has likely also stocked up. Cannabidiol—CBD—is a phytocannabinoid that has significant medical benefits, but does not make people feel “stoned” and can actually counteract the psychoactivity of THC. The fact that CBD-rich cannabis is non-psychoactive or less psychoactive than THC-dominant strains makes it an appealing option for patients looking for relief from inflammation, pain, anxiety, psychosis, seizures, spasms, and other conditions without disconcerting feelings of lethargy or dysphoria. CBD products include oils, tinctures and vaporizer kits.
Good conversation today with an entrepreneur looking to get into the cannabis industry with a new startup. The first question of the conversation was one we receive a lot so let me take a few moments to post a public answer.