$168 million
That’s the amount of money investors have poured into the hemp industry so far this year.
That figure – which is as of April 26 – is more than 10 times larger than the same period last year when only $32.4 million had been raised, according to Viridian Capital Advisors.
Investors tracking the market are anticipating a continued flood of new capital into the space.
“I think, in the next 60 days or so, we are going to see that number double or even triple,” said Charles Wellso, co-founder and managing partner at Colorado-based Sanitas Peak Financial, an investment group focused on industrial hemp that launched a $50 million private equity fund in December.
There is little doubt the passage of the U.S Farm Bill provided a confidence boost for investors in this sector, where much of the funding, at least in the U.S., is focused on hemp-derived CBD.
But CBD is not the only game in town.
“There is a broader matrix with other uses, including clothing, food and animal feed,” said Nicholas Mortimer, also a co-founder and managing partner at Sanitas. “These other industrial uses will eventually eclipse CBD, which will be more like an herbal supplement when its luster wears off.”
Equity raises have outpaced debt raises in the first four month of the year, with $99 million raised through equity deals versus $69 million through debt facilities. Most of the debt financing – $65 million – came from one transaction that involved Loveland, Colorado-based Mile High Labs earlier in April.
Mile High Labs, a manufacturer of CBD crude oil, distillate and isolate, is borrowing the money to buy “millions of pounds” of pelletized hemp for CBD extraction.
