Marijuana Market Blooming $ Billions
Posted by Marijuana Doctors on 02/04/2016 in Medical Marijuana Legalization
As marijuana continues to go more and more mainstream, and with an ever-increasing speed, it is becoming more and more apparent, that a very fruitful billion dollar industry, is beginning to bloom – bringing a whole new meaning to the phrase, “Funny Money”. A recent report by a leading cannabis industry investment and research firm discovered that legal marijuana sales, in 2015, shot up 17% to $5.4 billion – and is estimated to grow by another astounding 25%, reaching a total of $6.7 billion in total U.S. sales. Astonishing results, given that Colorado only opened its first recreational dispensaries, two short years ago.
The ArcView Market Research, is set to release its fourth edition of, “The State of Legal Marijuana Markets” report, which includes it’s prediction that the legal marijuana markets will grow to a massive $21.8 billion, by 2020. To put it in perspective, the legal cannabis mega-market could essentially blow up bigger than the National Football League, which amassed a fortune of $12 billion, in 2015, and aims to hit the $25 billion mark, by 2027.
“I think that we are going to see in 2016 this next wave of investors, the next wave of business operators, and people who’ve sort of been watching or dipping their toe in, really starting to swing for the fences and take it really seriously,” ArcView CEO Troy Dayton said in an interview.
ArcView’s most recent predictions are a positive step-up from previous reports, which previously underestimated only $2.7 billion in total industry sales, for 2014 – a number that ArcView now estimates was actually closer to $4.6 billion, in 2014 – and underestimated that the industry would only grown to $10.8 billion, by 2018.
ArcView projects that adult-use recreational pot sales will account for 53% of the overall market, by 2020, representing a growth of more than 1,150% over the next 4 years. John Kagia, New Frontier Director of Analytics, and author of this year’s State of Legal Marijuana Markets report, says that the huge jump in last year’s sales, coincides with Washington’s first complete year, of recreational marijuana, as well as the beginning of adult-use legal recreational sales in Oregon. The edibles market has also helped fuel sales, says Kagia. “They also come at higher price points than the flower does, which means the businesses are able to capture higher sales per customer through the sales of these new products.”
As more and more states gear up to go legally green, the cannabis industry continues to gain credibility, among entrepreneurs and investors alike. “A lot of people in the business and finance world, in particular, have kind of taken a ‘wait and see’ approach to the cannabis industry,” Dayton said. But, 2016 is going to change that, predicts Dayton. About a half dozen states are expected to put the issue of legalization to vote, later this year. And although California’s medical marijuana sales already account for a significant chunk of the total industry; once it legalizes recreational pot for adult-use, it will lead to another big boost in overall sales. California is due to vote on legalization, in November 2016.
And as the cannabis industry gains more and more credibility, continued revenue growth will entice and attract investors, to invest deeper. Following in the footsteps of cannabis-focused, Privateer Holdings, who secured a $75 million investment from the Founders Fund – a firm founded by billionaire, Peter Thiel. A clear sign, that it is time to start taking America’s legal marijuana market, very seriously.