Image via ArcView
In 2013, America’s legal marijuana industry, both medical and recreational, garnered $1.5 billion in revenue. In 2014, that number ballooned to $2.7 billion, a 74% industry increase, according to The ArcView Group’s recent report on the cannabis industry.
Unsurprisingly, ArcView attributes an estimated 33% or $1.1 billion worth of this increase directly to Colorado and Washington’s adaptation of recreational marijuana. All told, the forward-looking report envisions a fully legal weed-filled America would result in $36.8 billion in retail sales.
As noted, this new data and report on legal weed in 2014 comes courtesy The ArcView Group, an industry leading investment incubator that both links investors with companies and provides detailed reports on the growing cannabis industry. ArcView’s “The State of Legal Marijuana Markets”, now in its third edition, has become arguably the most valuable resource for those looking to enter the cannabis business sphere or simply gain knowledge.
Featuring a year’s worth of data and in-depth reporting, the Executive Summary uses every asset at its disposal ranging from dispensary surveys to state agency data to information via nonprofits. The summary’s mission is simple, as ArcView CEO Troy Dayton tells it:
In the last year, the rise of the cannabis industry went from an interesting cocktail conversation to being taken seriously as the fastest growing industry in America. What a remarkably fast transformation! At this point, it’s hard to imagine that any serious businessperson who is paying attention hasn’t spent sometime thinking about the possibilities in this market.
Clearly, a year has made a major difference for the industry’s national perception and for its economic growth. Here are a few other key notes from the report that stood out as eye-openers:
1) California still owns a heavily weighted market. See:
And aside from Colorado, it’s not even really close:
2) As Matt Ferner at The Huffington Post points out, “More than 1.5 million shoppers purchased legal marijuana from a dispensary, either medical or recreational, in 2014.” I wonder how many of those shoppers were out-of-town tourists versus locals. My guess would be 2 to 1 in favor of the locals.
3) Arizona–yes, Arizona–has the fastest growing medical marijuana market with projected growth of 300% in 2015.
4) Banks still aren’t loaning money to weed people, as Steve DeAngelo of Harborside Health Center notes, “My company does tens of millions of dollars of business a year and can’t get a $10,000 line of credit from a bank.”
5) This is just the tipping point. ArcView predict that 18 states will approve legalization bills by 2020, companies in the industry will adopt more corporate ways, and that all told, a legal America could mean a nearly $40 billion industry–an industry that would then legally trump the organic food industry! Realistically, ArcView pinpoints $10.8 billion as the legal industry’s likely size come 2019.
I’ve given the (digital) report thorough reading, and there’s not much fault to find. Estimates regarding a newly legal, historical, and fast-growing industry like this one are extremely difficult to make. But the folks at ArcView did their due diligence and the result is as detailed and accurate of a snapshot of the industry that you will find.
Projections for an industry’s size may be the most difficult part of this equation given marijuana’s legal uncertainty. But ArcViews estimates fall extremely in line with estimates from other reliable resources that have continually placed a legal America’s value in the $30-40 billion range. Some estimates do say it could be as large as $100 billion, but again, these are estimates.
The one major, obvious conclusion: the marijuana industry has become an unstoppable force with momentum, money, and major backing.
You can purchase The ArcView Group’s full, more in-depth 200+ page report right here.