The marijuana industry is still small, fragmented, regional and struggling — legally — to its feet. But shrewd entrepreneurs recognize now is the time to leap into the fray, as pot is likely to be legal in 14 states within five years and medically legal in New York and Florida within one year.
Those are some of the robust predictions of Troy Dayton, chief executive officer of the ArcView Group, which brings together venture capitalists and idea people in the cannabis empire, now exploding out from under secretive grow lights into broad daylight.
"Right now, it's the perfect storm," said Dayton, keynote speaker at the jam-packed, two-day Oregon Medical Marijuana Business Conference at Ashland Springs Hotel.
Demand and prices in pot-legal states are burgeoning, but prices will trend down, he said. The U.S. marijuana market hit $1.53 billion in 2013 and likely will reach $2.57 billion this year, according to his market research, and "you couldn't find another business growing faster," he said.
Dayton predicts Oregon voters will legalize adult use of cannabis in the November election. Nationally, he said, the market will sail over $10 billion in five years.
For investors, cannabis entrepreneurs and those in ancillary areas, "there is low competition right now," he said. "The field is wide open. There's a huge knowledge gap and a lot of need to fill it. They're going to need a lot of professional services. Usually, there are multinational players leading it, but not here. You have a perception of risk but it's rapidly diminishing."
Often overlooked in the pot legalization brouhaha is hemp cannabis, an industrial plant without the psychoactive THC, said speaker Edgar Winters, an Eagle Point seed farmer who was celebrating passage by the U.S. House Wednesday of a bill that would allow nine states, including Oregon and California, to use hemp for research and academic purposes.
He and three other Rogue Valley hemp farmers will plant their first crop this spring and send it to markets to be made into fiber, hemp-wood, biodegradable plastics and medicines for such ills as chemotherapy sickness, melanoma, arthritis and inflammation.
The vast majority of hemp will be planted in Eastern Oregon, an arid clime where hemp grows better, he said in an interview. Winters, a Master Gardener who recently studied the plant at Oregon State University, is lecturing at area rural schools, seeking to interest Future Farmers of America in a career in hemp farming.
Dayton emphasized there will be profits to be made from ancillary cannabis businesses, including security, testing, packaging, software, climate control, insurance and anything connected with perfecting the product and assuring organic standards.
"You're going to see an absolute explosion of innovations in the agricultural field," said Dayton. "We're going to get it out in the sun, finally, and reduce our ecological footprint."
One such innovator is Central Point's Stacy Page, inventor of the Grasshopper, which separates the THC resin from pot buds in a matter of minutes by high-speed whirling of the plant in dry ice.
"It produces kief, very high in THC," said Page. "It can be smoked as is, pressed into hash or blended into butter for making edibles. Edible is going to be huge, because many people don't like to smoke it."
Page got the idea for the invention when he tried to refine the old way, by hand, and said to himself that there has to be a better way.
"This will do in hours what it took days to do by hand," said Page. He has sold 20 of them so far, at $2,500 each.
"Live experience" associated with cannabis — entertainment, music, comedy, grow tours — is growing fast, as people form an emotional attachment to the "Green Rush" of arrest-free cannabis, Dayton said.
"Oregon is fertile ground," he said. "We've got people here in the Legislature who stood up for us."
The state already has provided the retail base via passage 15 years ago of the Medical Marijuana Act, he said, and "pretty likely" will legalize adult use this fall by a ballot measure referred from the Legislature.
When asked by Troy for a show of hands, more than half in Thursday's audience signaled they intended to open a shop, raise investment capital and had, in the past, volunteered to work for legalization.
"The hippies were right," he crowed, to much applause. "Remember the first time you decided that punishing people for it was wrong? We were right about organic food, right about the personal computer, right about yoga, right about renewable energy, and they've all become large, successful businesses. This is the next great American business."
John Darling is a freelance writer living in Ashland. E-mail him at email@example.com.