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Corona distributor bets legal marijuana has a corporate future
Monday, November 20, 2017
Corona distributor Constellation Brands’ purchase of a 9 percent stake in Canadian marijuana company Canopy Growth Corp. is a step in the direction of corporate involvement in the legal weed business.
In another sign that corporate types, especially those with backgrounds in the alcohol business, are interested in marijuana, the former marketing chief for Budweiser brewer Anheuser-Busch InBev has made two investments in marijuana startups and likens legal marijuana to the craft beer industry.
Constellation made its $195 million investment in Canopy Growth last month, and has options to buy more shares at a later time. Canopy is a leading producer of medical marijuana with plans to expand into recreational marijuana at some point.
The Wall Street Journal reports:
“We think that it’s highly likely, given what’s happened at the state level,” Rob Sands, chief executive of the Victor, N.Y.-based beer, wine and spirits company, said in an interview. “We’re obviously trying to get first-mover advantage.”
Constellation—flush with cash after posting a 13% increase in beer sales in its latest quarter—is interested in developing drinkable cannabis products that don’t contain alcohol, he said. Products currently on the market in U.S. states where they are legal include buzz-inducing sodas, coffees and fruit elixirs.
While Constellation’s foray into marijuana investing is notable for its size and ambition, other players in the industry have also shown interest in the legal marijuana business.
One of those players is Chris Burggraeve, AB InBEV’s former chief marketing officer. He has moved into investing in marijuana startups. The Chicago Tribune reports:
Burggraeve, 52, has made two investments in the space. Most recently, he joined the advisory board of GreenRush Group. The San Francisco-based startup, which says it aims to be the Amazon of weed, closed its $3.6 million Series A fundraising round last week. Burggraeve, a native of Belgium with a master’s degree in economics, also co-founded Toast, which makes pre-rolled joints.
The former beer executive is one of many entrepreneurs and investors increasingly flocking to the cannabis industry from the traditional business world…
…”This is one of the fastest-growing categories globally,” he said. “Why? Because people want it. When consumers want something, you ignore it at your peril.”
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