Groundbreaking New Report Reveals the Top Sectors for Cannabis Investors; Consulting Services See Highest YOY Growth
Overall, investment in the ancillary market (i.e., businesses that do not touch the plant) grew 161% in 2016 compared to 2015.
The sectors that saw the highest year-over-year growth were Consulting Services, which grew 737% and Investments/Mergers & Acquisitions, which grew 366%. Consumption devices grew 117% over the same period.
The strong growth in consulting services reflects the demand for guidance sought by businesses as they establish operations in newly legal markets, or as they invest in more mature markets that have grown increasingly competitive.
Ancillary markets do not face the same restrictions on interstate commerce as businesses that touch the plant, which makes ancillary businesses easier to launch across multiple state markets.
The ancillary markets will remain attractive for investors, as they are perceived to be less risky than businesses that touch the plant, and because they are often more easily scalable.
Next week, NFD will explore the sectors that have seen the highest investment in businesses that touch the plant.
CORRECTION:In last week's CannaBit, the legislation analyzed, H.R. 1823 - Marijuana Revenue & Regulation Act, was improperly labeled in the bullet points. It was mistakenly labeled the Small Business Tax Equity Act of 2017.