Some investment gurus are comparing medical marijuana investment opportunities to the 1849 Gold Rush that lead to the declaration of the state of California. There were three types of beneficiaries in those days. These were the miners who did the work, the bartenders and ladies that entertained them after dark, and the investors who bankrolled their businesses.
As prohibition fades before relentless challenge for universal legalization, the possibilities are increasingly evident of making relatively large sums of money through direct investment. If California is budgeting $134 million in tax revenue, how much money do you think is changing hands at the coalface? Ten per cent of that through passive investment seems a better prospect than publicly traded shell and penny stocks.
Tracking Down a Good Direct Investment in MMJ
Specialist assessment is required before passive investment in the emerging medical marijuana industry, because the company owners lack seasoned business skills. Many are emerging entrepreneurs who have been growing medical marijuana in their backyards, and in some instances selling. They may lack the skills to promote a good investment that just needs cash to take a positive step.
The other point to consider is culture. When a medical marijuana company passes the $1 million a year turnover mark, it becomes a disruptive element in a traditional market. A rumor of defective product – or a grass-roots price war – requires a determined answer. Two questions need answering. Will the executives fight back? Will they seek, and hear the investor’s business advice?
Investing in an Ancillary Medical Marijuana Business
Investing in a related business that can operate legally in America may not be as immediately profitable, but it has the advantage of not directly contravening federal law. Sectors that have proven ability to perform well include:
– The biotechnology sector anticipating a boom in pharmaceutical products
– The infused products and extracts sector producing edibles / blends
– The consulting service sector capitalizing on the need for licensing / facilities
All these companies have to file 10-Q reports. These are in the public domain, and are a great source of unaudited financial statements, and quarter-to-quarter comparisons enabling the shrewd investor put their money where there is success.