The West Coast has long had a steady hold on the marijuana industry, but as legalization spreads east, it may be losing its grip.
Massachusetts is home to one of the fastest-growing markets, projected to reach more than $2 billion in the recreational cannabis market alone by 2023, according to a recent analysis by the Brightfield Group, a Chicago-based cannabis market research firm. That’s 10 percent of the total market share, tied with New York and coming behind only California.
The group estimates the medical market will also grow, to about $125 million over the same period. Bay Staters are likely to continue registering for medical marijuana cards, despite easier access to the recreational substance.
Massachusetts voters approved recreational marijuana legalization in 2016, but it’s taken a while for the state to catch up: The first dispensaries in the state opened just last year. There still isn’t a legal dispensary in Boston, but there is one in Brookline. (The slow rollout has spelled bad news for the state’s expected tax revenue, the Boston Globe reported in March.)
That doesn’t mean Massachusetts cannabis companies haven’t been finding ways to corner the market in the meantime. Wakefield-based Curaleaf Holdings is one of the largest legal cannabis operators in the nation, operating in 12 states. According to the National Conference of State Legislatures, 10 states and Washington, D.C., have legalized recreational marijuana for adults; most other states have a comprehensive medical marijuana program.
For anyone clutching their pearls at the idea of legal joints on every corner, consider this: Digital news sites are publishing listicles of luxury dispensaries, lifestyle bloggers have created a CBD-spiked mint julep, and CBD is being sold basically everywhere—in bath bombs, dog treats, and gummies alike. That’s reportedly a boon for New England hemp farmers.
Curaleaf posted $35.3 million in total revenue in the first quarter of 2019, it told investors Thursday. And it just acquired yet another company: Emerald, a dispensary located just outside Phoenix, Arizona. But the biggest M&A news of the year so far is Curaleaf’s merger with Portland, Oregon-based Cura Partners, an all-stock deal valued at $949 million that would make Curaleaf the largest legal cannabis dealer in the world.
“We were already a leader of the cannabis industry,” Curaleaf executive chairman Boris Jordan said on a conference call. “But this transaction makes it clear that Curaleaf stands alone at the top.”
And Curaleaf is just one example illustrating the quick and astronomical rise of cannabis companies. Athol, Mass.-based Ascend Wellness, a company that cultivates and processes marijuana, raised $55 million in February this year to support its expansion in the East Coast. The company has raised $100 million in venture funding thus far and plans to open three retail dispensaries in the Boston area this year.
Editor's note: For more on how cannabis startups raise money, click here.
