Marijuana-Adjacent Industries
As more and more states have legalized marijuana, the industry has come out of the shadows and into the mainstream. According to CNN, the industry took in nearly $9 billion in 2017. It’s estimated to grow to $25 billion by 2025. With any field that boasts these kinds of numbers, the marijuana industry has created a host of complementary businesses that cater to the specific needs of cannabis growers and distributors. Furthermore, legalization brought about a wave of professionalization and a mini-boom in white-collar (or maybe we should say green-collar) talent. These complementary businesses include lawyers and law firms, growing technology (sometimes called “weed tech”), and cannabis journalism.
Marijuana exists in a legal grey area. Several states have legalized both medical and recreational uses, including Colorado, California, and Massachusetts. Other states have legalized only medical cannabis, while some states have only legalized marijuana products like extracts or have kept it completely illegal. Yet the drug remains illegal under federal law. This has led to a growth of legal firms that help growers and sellers navigate the licensing and legal process. According to McAllister Garfield, a law firm that specializes in helping growers apply for California marijuana licenses, one of the largest challenge most growers face is the transition from an unregulated to a regulated market. Most states legalized medical marijuana before recreational marijuana, and in the case of California, the plethora of regulatory bodies creates a tangle for cannabis businesses. Due to the conflict between state and federal laws, cannabis businesses also frequently are sometimes subject to federal prosecution, and sometimes require legal protection.
“Weed Tech” is a catch-all term that includes gadgets, growing technology, and software developed to service the cannabis industry. While there are plenty of services that deliver marijuana, and plenty of devices offering creative means of smoking, an ancillary development has been the explosion of companies offering technology to other businesses. Firms like New Frontier Data offer analytics services, while businesses like Baker have developed customer-management technologies specialized to the cannabis industry. The expansion of cannabis regulation created a group of companies focused on testing technologies. Agilent, a company that builds lab equipment, has developed several spectrometers aimed at testing cannabis for impurities like pesticides and heavy metals. Legalized cannabis means that there could be a rise in people driving under the influence, which can’t be detected by alcohol breathalyzers. But law enforcement is on it—with the help of several companies developing breathalyzers for marijuana.
Cannabis journalism has come a long way since long-haired hippies spend their afternoon leafing through the pages of High Times in the 1970’s. Today’s landscape is peppered with business journals like Marijuana Business Daily and Cannabist Analyst. Cannabis journalism has also become big money. According to the New York Post, High Times is being acquired by Origo Acquisition Corporation in a $250 million deal. Cannabis journalism has moved from grubby New York coffee shops to sleek corporate offices and startup spaces, a movement which is driven by the belief in the industry’s phenomenal growth.
As Mary Jane has become subject to Mergers and Acquisitions, it can feel like something has been lost. Call it a loss of counter-cultural cachet the rebellious posture, but it’s difficult to stick it to the man if he’s the one supplying your sticky. There is a further criticism of the booming marijuana industry: there are thousands of men and women who have been prosecuted for low-level drug offenses involving marijuana. They may be in jail, or they may be living with a felony on their permanent record, but, for the most part, they are not the ones getting rich from the boom. One of the greatest obstacles will not be ensuring the industry’s growth, since all signs point to high times ahead, but ensuring that the law reflects the new reality.
