Out of State Investors Now Able to Join Colorado Cannabis Industry
People and companies interested in Colorado marijuana investing can now join the Colorado cannabis industry, whether they are located in the state or not. Former Governor John Hickenlooper vetoed similar legislation in 2018, but a bill was signed in May 2019 that will allow outside investors to infuse cash into the Colorado marijuana market as of November 1st. Some investors wasted no time jumping in. Within the first month of this law taking effect, cannabis consulting firm Medicine Man Technologies out of Denver announced more than $300 million in acquisitions, including a chain of local dispensaries known as Strawberry Fields. Medicine Man CEO Andy Williams stated, “This is a monumental time for us, and we believe the growth potential is both substantial and compelling.” In a similar move, another of Denver’s largest dispensary chains, The Green Solution, was purchased by Columbia Care, Inc., a publicly-traded cannabis company based in New York state for approximately $140 million.
Chuck Smith, CEO of Dixie Brands, a manufacturer of cannabis products based in Denver, had this to say in a public statement; “By permitting access to capital through private and public investments with appropriate guardrails, this bill ensures that Colorado businesses keep their headquarters in the state, remain competitive, invest in research and development and other innovation and continue to contribute significant tax dollars to the state.” Although acquisitions and investments in the cannabis market are subject to regulatory approval prior to being finalized, concerns have been expressed that the cannabis industry could soon become monopolized by a small handful of key players as larger national brands swallow up smaller local cannabis companies, leaving the small investor out in the cold. Currently, there are strong anti-trust measures in place to prevent too much power being granted to too few players.
What does all this mean for consumers? Although it is exciting to see the interest in funding the Colorado cannabis industry, the addition of new money from outside investors doesn’t necessarily bode well for a level playing field. Moving forward, it appears likely that this change in legislation will result in fewer groups owning more cannabis dispensaries. Should these groups begin purchasing marijuana manufacturers and cultivators as well, consumers could see a wider variety of products becoming readily available in the cannabis marketplace. The bottom line? The marijuana landscape in Colorado is about to change, and this change is likely to lead to more product options for the consumer and more competition between dispensaries to gain your business.
Medical Alternatives Clinic in Colorado Springs exists to help you discover the best possible treatment option for your situation and offer our recommendations on which medical marijuana treatment may work for you. Give us a call today at (719) 246-0393, or email us directly at email@example.com to request an appointment. We are happy to provide you with a copy of any paperwork you need for your medical records.