Public medical marijuana companies have been gaining more traction and attracting more publicity than ever as a growing number of companies compete for a piece of the burgeoning market. Today, the Wall Street Journal released an article chronicling the emerging medical marijuana sector. The article discusses both emerging companies and those that have already established themselves in the market. Among the latter group, the author mentions General Cannabis (OTCPK: CANA). The coverage is the most recent in the flurry of media attentions General Cannabis has been attracting of late.
This particular piece brings to light not only the potential benefits to taking a position in the emerging market, but highlights those companies that have developed a business model tailored to the fragmented and occasionally politically challenged industry.
“Ancillary companies outside of the direct growing and sales stream are having the easiest time attracting investors, such as hydroponics supplier GrowOp Technology Ltd., or General Cannabis Inc. which in the last year bought businesses ranging from marijuana dispensary Web site WeedMaps to a dispensary management business that oversees 12 clinics,” reads the piece.
“General Cannabis Chief Executive Jim Pakulis, whose company already is public, is now preparing a secondary offering of shares from current owners, including himself. He describes his business as ‘a technology company with an affinity for medical cannabis.’”
Today, 15 states have legalized the use of medicinal cannabis with a host of others considering measures. The more states that implement legalization legislation, the larger the growth potential becomes. There’s an enormous amount of prospective capital there, estimated between $45-$55 billion, and the companies that are capitalize on that while skirting problems that challenged the industry in the past.
Rather than distributing the medical marijuana itself, General Cannabis develops web destinations, like the highly popular WeedMaps.com, which connects patients to dispensaries. The website has 1,800 of the country’s estimated 2000 medical marijuana dispensaries in its database. The website identifies the nearest dispensary to a zip code alongside a bevy of user reviews on the available services and products.
What General Cannabis, through WeedMaps.com and their management services intends to do is give shape to an industry that has a history of being fragmented. The stigma on medicinal marijuana has faded significantly and in that is opportunity, a factors stressed in the Wall Street Journal piece. General Cannabis recognizes that opportunity and takes it upon itself to implement greater structure and fluidity between patients and distributors and the reverse scenario.
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