Viridian: Investment money pouring into cannabis industry

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Investors pumped $1.23 billion into the legal marijuana industry during the first five weeks of 2018, nearly matching the $1.29 billion in investments in all of 2016.

The $1.23 billion is nearly 600% more than the $178 million invested in cannabis during the first five weeks of 2017, according to research by New York-based Viridian Capital Advisors, which tracks MJ-related investments. The findings were reported by Benzinga.

There were 65 capital raises in the first five weeks of 2018, including nine worth more than $50 million, according to the Viridian Cannabis Deal tracker.

The average raise size in the first five weeks of 2018 was $19 million, compared with an average raise of $5.9 million in the first five weeks of 2017.

Other cannabis investing highlights from the first five weeks of 2018:

  • Publicly traded companies conducted 72% of the raises, down from 76% last year.
  • Equity-backed raises comprised 87.6% of the total number of raises, up from 70% last year.
  • Public companies received 75% of the total dollars raised during the first five weeks of the year, up from 71% in 2017.
  • The $300 million-plus that private companies raised in 2018 is six times more than what they received in the first five weeks of last year.
  • Cultivation and retail companies received most of the investments.

“Investments in cultivation and retail this year have been driven predominantly by the Canadian players,” Viridian Capital Advisors Vice President Harrison Phillips told Benzinga.