Inside a Brooklyn ballroom, investors smoothed their suits and opened their iPads, preparing for a day of sizing up hungry entrepreneurs and impassioned lobbyists.
One after another, startup founders took to the stage, making their cases for a round of venture capital. There was a building materials manufacturer, a catering company and, as one would expect, the inventor of a vaporizer.
It was high time to monetize pot.
Here at the Investor Pitch Forum this week, hosted by the cannabis industry investment and research firm The Arcview Group, some 200 investors Arcview described as "high net worth" met with dozens of companies looking to cash in on the promising new market of legal recreational marijuana.
Cultivating Spirits, a caterer that pairs organic dishes with fine wines and just the right weed, got the attention of more than a dozen investors. Philip Wolf, who started the Silverthorne, Colo., company in early 2014, melded laid-back Colorado with high-powered New York in a snappily fitted suit and long hair coiffed in a bun.
Mule Extracts, a cannabis-oil extraction company, generated some buzz, too. Chief Executive Officer Rachel E. Kurtz made it through a Shark Tank-style wringer and came out the other end to applause, hopeful of finding an investor at the forum.
It's a good time to be investing in the space, at least in terms of market expansion. Recreational weed is already legal in Colorado, Alaska, Oregon, Washington, and Washington D.C., and it's on the ballot in nine states in November. If California legalizes it, the industry could triple in size, to $18 billion. Analysts expect it to balloon to $50 billion by 2026.
Investors at the forum constantly and animatedly discussed the legalization efforts, which will have a big impact on their returns. Arcview CEO Troy Dayton stressed the importance of lobbying efforts in key states, including California, and expressed frustration with the Drug Enforcement Administration, which has maintained marijuana as a schedule 1 drug. Such was the animus in the room against benighted drug policy that at one point it took Dayton halfway around the world to the Philippines for a weary, unexpected aside about President Rodrigo Duterte and the nation's harsh anti-drug measures.
The fieriest speech was delivered by Ellen Flenniken, managing director of development at the Drug Policy Alliance, an organization that pushes for legalization, seeking to "roll back the excesses of the drug war ... and promote sensible drug policy reforms." Flenniken asked investors to donate to lobbying efforts that could turn the vote in their favor in such battleground states as Nevada and Arizona. There, legalization faces opposition from casino magnate Sheldon Adelson, a longtime opponent, and the pharmaceutical industry, whose prescription painkillers could be undercut by marijuana.
Following her plea, the emcee asked if anyone in the crowd would donate $100,000 to the cause, a request met with crickets. The ask was lowered to $50,000, then $25,000, before several bit at $10,000. More donations rolled in at $5,000 and $1,000, and others were written down privately, without the fanfare of a public announcement in a room full of peers.