Legal marijuana is big business -- or at least that's what investors are banking on. On Tuesday, 22 cannabis entrepreneurs pitched their business ideas to more than sixty investors gathered at the Denver Athletic Club in the second Mile High confab hosted by the California-based ArcView Group, which connects investors with pot-related startups.
Though not all of the deals are finalized yet, ArcView CEO Troy Dayton estimated that the pitch slam resulted in "well over $1 million" in investment.
"What we saw yesterday was the beginning of building a foundation for a new industry," said Steve DeAngelo, president of ArcView and CEO of the Harborside Health Center medical marijuana dispensary in California, touted as the largest dispensary in the world and featured on the Discovery Channel's Weed Wars.
According to Dayton, the August 29 U.S. Department of Justice memo, which made it clear that the Obama administration would not stand in the way of states like Colorado whose voters legalized small amounts of marijuana for adults, cleared the path for investors to pour money into pot, "the next great American industry." And thanks to Amendment 64, Colorado is one of the first places where it's going to happen, he added.
"We are nearing the post-prohibition era in this country," said Aaron Smith, executive director of the National Cannabis Industry Association.
The businesses that pitched on Tuesday included Denver-based Canna Security America, described as "the premier security solutions provider for the cannabis industry." The press conference was held at the firm's brand new office, which staffers moved into a few days ago thanks to previous investments made possible by ArcView.
Other businesses included grower Medicine Man Denver, portable vaporizer UpToke and cannabis social network MassRoots. Dayton said the entrepreneurs asked for investments ranging from $100,000 up to one request for $24 million. Four of the 22 businesses that pitched directly handle marijuana, a first for ArcView. Before the federal memo, DeAngelo said investors mostly put money into ancillary businesses, such as growing equipment manufacturers and companies that make smoking devices.
Among the investors in attendance on Tuesday were locals Adam Denmark Cohen, co-founder of MJardin, "an investment fund for the legal cannabis industry," and Tripp Keber, managing director of Dixie Elixirs & Edibles. "I think there's going to be a lot of happy and well-funded cannabis entrepreneurs out there," Keber said.
Colorado rules include a two-year residency requirement for anyone licensed to produce or sell marijuana -- and that requirement extends to investors, as well. However, ArcView says that 90 percent of its investors are from other states and countries, and they're hoping that state legislators will eventually ease the residency requirement.
ArcView also announced that its investors raised $22,000 for Colorado flood relief efforts. "We are going to bring benefits to communities and not harms," DeAngelo said.
More from our Marijuana archive: "Marijuana: Many ski towns allowing recreational pot sales."Follow me on Twitter @MelanieAsmar or e-mail me at email@example.com