Making money off marijuana is nothing new…but making it legally is somewhat of a novelty. With the recreational legalization of cannabis in the states of Washington and Colorado, investors and entrepreneurs are looking into ways of entering the business legally. The assumption is that sooner or later marijuana will be legalized in the United States and become a booming market. Those that latch on in the earliest stages are most likely to see the greatest profit from the industry as it grows.
According to estimated projections, the legal cannabis industry (currently at $1.3 billion in sales) will quadruple by the year 2018. It looks like the fruit is ripe for the picking…but how does one get into the industry? Is it safe? As in any industry, there are risks. Seeing as how producing and selling marijuana for non-medicinal purposes is illegal nationwide on the federal level, you must use extra caution before investing any time or money.
The most obvious way of getting into the business is direct sales. Opening a dispensary is currently only legal in two states (sorta): Washington and Colorado. You could of course do your best to enter the market there — but keep in mind that you are not the only one with that idea. You will be starting behind the rest and will find it difficult to go through all the paperwork required.
If this is your entry of choice, then your best bet would be to wait until weed is legalized in your state or in your neighboring states. Nevertheless, because marijuana is still illegal on a federal level, the Feds can come in and confiscate all of your merchandise whenever they see fit. This will destroy your initial investment as well as make the chances of any insurance company insuring you slim; you’d simply be too much of a risk.
You could work on starting your own bakery or candy store selling consumption cannabis products. This would again require marijuana to be legal in your state, but you may want to look into the legality behind opening an online bakeshop “based” out of either state where recreational marijuana use is legal and selling the goods via the Internet only to those living in said states.
Opening a bakeshop once marijuana is legalized on a federal level is a great idea as long as you are a skilled baker or candy maker. Just like as in any other business, you will have competition. You may do well at first, being one of the few shops in your area, but it is unlikely that your competition would remain so sparse.
Starting a processing company that would turn the weed into concentrated THC oils is definitely a good business. Now that vapor-pens are beginning to become popular along with the electronic cigarette industry, producing THC cartridges may be your golden ticket. If not, then you may want to consider producing the equipment used to grow the marijuana.
Of course, that will require quite a bit of investment as well as engineers that know what they are doing. You could also consider growing the plants themselves, but the licensing procedures are not very user friendly and the process of cultivating plants that are medical grade (which as of now is required) is no walk in the park either.
If you are a science or botany geek then you may look into creating different growing nutrients that would be specific to the cannabis plant. Since cannabis is not your average plant and is smoked — unlike most other plants — there is a market for those that can improve the growth of the plants of producers.
This is a great business to get into prior to the legalization of marijuana because it requires no illegal activity — other than whatever research you may need to do on the down low. You would be able to pitch your product to current medicinal producers and eventually sell to producers nationwide after the legalization of the plant.
Once marijuana becomes legal, companies will begin to sprout up left and right. The two things that every company will need is consultancy and the right software needed to run their business. If you have a background in business and a passion for marijuana, learning more about the plant, its uses and methods of growing could lead to a successful consultancy business.
If you are a techie then consider creating software that will help producers or distributors keep track of inventory or other steps along the line of production all the way to the line of sale. There are already several apps focusing on marijuana that are attracting millions of visitors a month.
With the marijuana market only in the earliest stages of budding, the possibilities of starting a successful company or banking it by investing in one are endless. But be careful where you put your money. This market stemmed from a black-market and for this reason many shady characters are looming about posing as trustful partners or entrepreneurs.
Before you invest any money, contact your lawyer to make sure that what you are doing and the venture you about to embark on are completely legal. You don’t want to get onto the radar of the Feds. Don’t get overly excited, but do the due diligence. The cannabis market will explode in the near future — best get a head start on doing your research.