The time has finally come for marijuana stocks…
After years of wild stock price swings, evolving legislation, and political posturing, the marijuana sector has finally found its first major backer.
PayPal founder and famed venture capitalist Peter Thiel just sank $75 million into the space, by investing in Privateer Holdings — a Seattle-based company that has large investments in several marijuana-related enterprises.
Thiel’s backing legitimizes this young, budding industry. His Founder’s Fund has been in on the ground floor of many other disruptive and wildly profitable sectors like Facebook, Spotify, and Airbnb. It’s safe to say that he knows an emerging industry when he sees it…
And the marijuana industry is going to be simply massive.
Here’s why the stars are aligning for marijuana right now… and why you should get on board before the next billionaire dumps a ton of money into the sector.
Privateer Holdings currently operates three large companies in the marijuana space.
It operates Canadian medical marijuana producer Tilray, which is a mail-order business for medical marijuana companies in Canada — where medical marijuana regulations are much more relaxed than here in the U.S. Last year alone it unloaded 35,000 shipments of marijuana.
Privateer also holds Leafly, the world’s largest resource for information about both medical and recreational cannabis. Leafly allows you to explore different cannabis strains for their medical effectiveness, flavors, and overall quality — much like an Angie’s List or Yelp for marijuana.
Leafly is hugely popular in the space: it averages over 4 million monthly visitors to the website. It expects to be profitable by next year.
Now, while both of those companies operate in the medical marijuana space, Privateer is positioning itself for the widespread legalization of recreational use as well.
And right now, especially in the recreational markets — it’s the wild west out there. If early investors place the right bets, they’ll be rewarded with one of the biggest growth markets in the recent history of investing.
“There are no standards, no leaders, no significant brands — we’re at the point where the industry is being ‘productized’, where suddenly someone buying cannabis might begin seeing it packaged nicely, in a way that implies safety, consistency and quality. That’s a big leap from buying something in a Ziploc bag,” noted co-founder and CEO of Privateer Brendan Kennedy.
I’d say…
Speaking of branding, Privateer scored perhaps the best possible endorsement for a marijuana product: the late reggae legend Bob Marley.
Privateer’s newest subsidiary is Marley Naturals, the world’s first global cannabis brand. By tapping into Marley’s overwhelming popularity — especially amongst marijuana users — it has the opportunity to revolutionize the branding of marijuana from that sketchy plastic ziploc bag into a legitimized product line with attractive packaging, an iconic pitchman, and a full line of products.
It won’t just sell Marley-branded “herb”, but also topical products like cannabis and herb-infused lotions, balms, and oils for those that may not smoke marijuana, but can still enjoy it in other forms. This sets them up for the eventual legalization of these products in the next few years.
That also means you may have to wait several years for serious profits from companies that only focus on recreational products.
That’s why I’m looking elsewhere right now…
You see, I’m not terribly interested in investing in speculative recreational marijuana stocks. Right now, only four U.S. states have legalized it for recreational use. However, 23 have legalized it for medical use, and that number is poised to grow each and every year.
Medical marijuana can deliver benefits for far-reaching medical conditions like:
- Cancer
- Epilepsy
- Neuropathy
- Multiple sclerosis
- Fibromyalgia
- Back pain
- Type 2 diabetes
- Schizophrenia
- Post-traumatic stress disorder (PTSD)
Those are each huge markets. And cannabis has shown remarkable promise in each field. That’s why my money is on those companies that can harness the unique healing properties. The profit potential for these life-changing marijuana-based pharmaceuticals is to the moon. Just look at these estimates:
It could be even bigger than that: CNBC estimates the legal marijuana market could reach as high as $120 billion globally! So, as you can see in the above chart, for the next few years, the safe money is going into the medical marijuana sector.
Now that Thiel has sounded the first shot, it’s off to the races. As more large investors plow money into the sector, it will be a boon to the whole industry. Get it before the next billionaire takes his shot…
