Companies spent millions of dollars combined trying to win one of New York’s five coveted medical marijuana business licenses, but investors aren’t exactly bullish on the market’s potential now that permits have been awarded.
Many institutional investors are concerned with state limits on the MMJ industry in New York, expressing concerns that each licensed company can only have four dispensaries statewide (for a grand total of 20 storefronts) and that the qualifying medical conditions list is relatively short.
“We believe it’s going to be an extremely limited market,” the CEO of Invest in Cannabis told the New York Business Journal.
The investment firm has 24 companies across the nation in its portfolio and is based in New York City. Yet the CEO sees the state’s market potential as “pretty small because of… the amount of customers that actually have the potential to enter the market.”
Other concerns include a potential lack of physicians willing to write recommendations for MMJ and the fact that there are better opportunities in other markets.
Still, some New York observers are optimistic, the Journal reported.
“I think it will start small and slow, but once it takes shape, it’s going to be one of the biggest markets,” one entrepreneur said.