The Associated Press reports Founders Fund, established in 2005 by PayPal co-founders Ken Howery and Peter Thiel, is making what the investors describe as a “multi-million dollar” investment in Privateer Holdings, a Seattle-based private equity firm seeking to raise $75 million.
Founded by Yale University MBA graduates Brendan Kennedy and Michael Blue, Privateer Holdings is believed to be the first private equity firm to focus strictly on marijuana-related companies. Its holdings include the Canadian medical marijuana producer Tilray and Leafly, the popular online resource and app for medical cannabis information.
One of the most promising projects in Privateer’s pipeline is a line of marijuana products to be launched with the family of Bob Marley called Marley Natural.
Founders Fund partner Geoff Lewis, who is spearheading the firm’s investment in Privateer, told the AP that he believes marijuana legalization is inevitable.
“Public sentiment is there, and it crosses political lines,” said Lewis.
Twenty-three states have legalized medical marijuana. Four states — Colorado, Washington, Alaska and Oregon, plus the District of Columbia — have fully legalized recreational marijuana, although Washington, DC’s move has been blocked by Congress. There are also campaigns underway to legalize cannabis in 14 additional states by 2017.
While the tide of legalization slowly sweeps the nation, Lewis’ claim of “inevitable” legality for the plant seems all but certain. As public acceptance of marijuana continues to grow — beginning in late 2013, public opinion polls began showing majority support for legalization — more states will repeal bans on the plant, which remains classified as a Schedule I narcotic by the federal government.
One of the last remaining major barriers faced by state-legal marijuana businesses is access to the banking system and the credit it controls. But there are measures afoot to address the issue, and even the Obama administration and some conservative lawmakers, pro-business as ever, have taken up the cause of banking access for legal cannabis companies.
These developments are seemingly at odds with the government’s continued insistence that marijuana remain ranked among the most dangerous, addictive and medically useless drugs, a category which includes heroin and LSD. But the general atmosphere is one of inexorable legalization, and “ganjapreneurs” like Privateer CEO Brendan Kennedy see plenty of green in their future.
“There will be a lot of people who wake up [now] and realize they need to look at this industry just as they have looked at other emerging industries around the world,” Kennedy told the AP.
Founders Fund, which is based in San Francisco, was an early investor in Facebook. It currently has investments in Elon Musk’s Space X, Spotify and Airbnb.
