SOURCE: New Frontier Data

New Frontier Data

October 20, 2016 09:00 ET

First-Ever Legal Cannabis Investment Study: 68% of Investors Are Now Open to Businesses that Touch Marijuana

WASHINGTON, DC--(Marketwired - October 20, 2016) - New Frontier Data, the authority in cannabis Big Data and analytics, in partnership with Arcview Market Research, the leading publisher of cannabis market research, and The Arcview Investor Network, the leading private forum for high net worth accredited investors, has released its 2016 Cannabis Investment Study. The study unveils insights from Arcview's members and shows that despite the differences in regulations affecting businesses that touch cannabis and ancillary businesses that do not touch cannabis, the majority of investors (68%) are now interested in opportunities on both sides of the market.

"It is notable to see investors' appetite is now broadening beyond just ancillary services where there has been less stigma and risk attached in the past. With the cannabis industry forecasted to grow at a compounded annual rate of 29% over the next four years, making it one of the fastest growing industries in the U.S., investors are now open to exploring any opportunity in the sector whether it touches the plant or not," said New Frontier Data CEO and Founder Giadha DeCarcer.

"The Arcview Investor Network is, by far, the largest single source of deal flow in the fastest growing industry in America and the largest single group of investors placing capital in the sector. We were honored to be the focus of the first ever deep-dive study on actual investor's attitudes and actions so far. There are many interesting insights in this report that could have far reaching impacts for entrepreneurs raising capital and other investors considering placing bets in this sector," said Arcview Group CEO Troy Dayton.

When looking at the industry's specific verticals, the highest proportion of investors were interested in ancillary commercial products (62%). Nearly half the investors (46%) were interested in non-flower products, reflecting the very strong growth in consumer demand for edibles and concentrates over the past few years. Cultivation facilities, which are the third most popular investor focus (38%), are especially attractive in markets that tightly limit the number of grower licenses. Other areas, including industrial equipment, hemp and consulting services, were of interest to a smaller group of investors, reflecting the more limited opportunities and the specialized business expertise required for those sectors.

Other key insights in this report include:

  • 65% of investors made their first investment in 2014 or later, and 71% expect to invest more in 2016 than they did in 2015.
  • Nine in ten investors are interested in medical and adult use markets, but only 36% are interested in CBD-only markets.
  • At the state level, the two markets investors are most interested in are California (57%) and Colorado (37%).
  • However, looking globally, 64% of investors expressed interest in the Canadian market, (a higher level of interest than was seen in any individual U.S. state market).
  • Preferred stock is the favored deal structure for 76% of the investors, followed by convertible debt at 73%. Public stocks were the least preferred investment approach.

The report is downloadable at https://frontierfinancials.com/investor2016 and www.ArcViewMarketResearch.com and can be ordered for $349.

About New Frontier Data:
New Frontier Data provides objective, rigorous and comprehensive analysis and reporting for the nascent and underserved cannabis industry. New Frontier's data and reports have been cited in over 45 countries around the world to inform industry leaders. New Frontier, the premiere Big Data shop in the sector looks beyond the plant cultivation and distribution, to raise the industry bar and improve visibility into what will inevitably soon be a mature and more complex industry. Founded in 2014, New Frontier is headquartered in Washington, D.C. and has additional offices in Denver. For more information or media inquiries, please visit www.frontierfinancials.com or contact Gretchen Gailey at 202-489-3821 or ggailey@frontierfinancials.com.

About The Arcview Group:
Founded in 2010, The Arcview Group is responsible for a number of groundbreaking ventures in the cannabis industry. The ArcView Investor Network includes more than 550+ dues-paying accredited investors who have put more than $84 million behind 131 companies. The next big members-only Arcview Investor Forum is scheduled for Las Vegas November 14-15. Arcview Market Research produces the State of Legal Marijuana Markets report, which is the most oft-cited market report. Arcview is a partner in Canopy, a seed-stage mentor-driven business accelerator. Arcview is also co-founder of Cannasure Insurance Services, the leading provider of business insurance to the cannabis industry. For more info on The Arcview Group please visit www.arcviewgroup.com or contact Abby Benjamin at 720-518-7611.

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