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First Quarter 2019 Shows BIG Capital Raises In Hemp Sector

International and domestic investors are watching the North American hemp sector very closely these days. That’s mainly because it has generated more than ten times the revenue it had at this point last year. Since April 2019, the US hemp sector has amassed more than $136 million compared to only $12.5 million in 2018.


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According to Viridian Capital Advisors, for the week ending on April 12, 2019:

  • The three most lucrative capital raises in the hemp industry totaled over $154 million
  • Mile High Labs took out a $65 million loan for hemp pellets to extract CBD from
  • Northern Swan Holdings invested $58 million in the ancillary product’s market
  • Valens GroWorks closed an equity raise of $32.3 million for facility expansion

The hemp sector is one important component of the larger cannabis industry. The comprehensive cannabis industry includes the hemp sector plus recreational marijuana, medical marijuana, CBD products, edibles, and more. The current cannabis startup failure rate is surprisingly low!

Forbes reports that many investors were unsure about the future of the cannabis industry until the end of 2018. In October of that year, Canada became the second country (after Uruguay) to remove the federal prohibition of marijuana. Since them startup cannabis businesses have been booming with no signs of slowing down.

This caused a lot of apprehension in cannabis investments as the landscape stabilized and people began to trust their instincts again. Of course, stellar revenue stats from US states that have relaxed regulations and are profiting hugely from marijuana sales also contribute to this renewed investor confidence.

Investment capital is now pouring in from various corporate players that are forming juggernaut-style startups. For instance, Canadian cannabis giant Canopy Growth just acquired New York-based Acreage Holdings in a $3.4 billion merger; the largest M&A transaction ever in the marijuana industry.

Forbes analysts assert that 2019 is the year that investors will begin to understand and believe that the cannabis industry is booming because of much more than simple hype and excitement. The numbers support the huge buzz that is now firmly linked to this emerging global megamarket.

The stats continue to support successful business ventures from various areas within the cannabis industry. Cultivation facilities, dispensaries, edible manufacturing, CBD extraction facilities, recreational consumer products, marijuana equipment leasing companies, and dozens of other business models are showing very positive numbers, consistently.

Coincidentally, consumer spending in the cannabis industry is expected to rise at least 40% in the coming year. Companies that finance marijuana businesses like https://www.cannabiscreditlines.comare in very high demand today.

Another result of increased confidence within this booming industry is that substandard cannabis companies will begin to fall away as higher quality businesses continue to saturate the markets. The cream will rise, which is better for the consumers in the end. Still, most startup cannabis businesses are doing very well with excellent profit predictions for the upcoming years.

References
Marijuana Business Daily - Weekly Deal Watch: Capital raises in hemp sector spike in first part of 2019
Viridian Capital Advisors
Forbes - Budding Cannabis Trends In 2019

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