Colorado’s marijuana industry opened to outside investors
Special to the Daily |
Colorado’s prohibition on publicly traded cannabis companies, which dates back to legalization and was previously preserved by former Gov. John Hickenlooper, is now a relic of the past.
Gov. Jared Polis signed legislation Wednesday ending the ban, opening up Colorado’s cannabis industry to outside investors for the first time. A publicly traded Denver company says it can now acquire two cannabis companies in the state, earning it millions of dollars in annual revenue.
“There are arguments to be made from both sides of this,” said Kris Krane, co-founder of the cannabis firm 4Front, which does not operate in Colorado. “I think there are some positives that are going to come from opening this up to public companies and there are probably some negatives as well.”
The change in law is expected to bring new cannabis products to Colorado from companies that have previously stayed away from the state. It could also accelerate consolidation, with large national chains purchasing Colorado’s smaller cannabis shops faster than ever, Krane says.
“In the long term, you may see a downward impact on pricing, because you’re going to have companies that are now able to build operations of scale and efficiencies of scales they probably wouldn’t have been able to build without that kind of capital,” he added.
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