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The Colorado cannabis industry has continued to see incremental revenue growth during 2015. The tax data released by the Colorado Department of Revenue and the revenue reported by thejointblog.com prove that the success seen in 2014 was not a fluke; it was just the start of something much bigger.
In March, Colorado set a new monthly sales record for the third month straight. During the month, Colorado’s legal cannabis industry generated approximately $74 million in revenue from the sale of marijuana. Recreational marijuana accounted for 56% of sales ($42 million) while medical marijuana accounted for 44% of sales ($32 million).
During the first quarter 2015, Colorado generated $24.5 million in tax revenue from the sale of medical and recreational marijuana. After accounting for all marijuana taxes and fees, the state generated $27.8 million in tax revenue during the first quarter!
Investors can capitalize off of Colorado’s growth
Although there are no Colorado based publicly traded dispensary companies; investors can invest in companies who are levered to the growth of the Colorado cannabis industry. The growth of the industry has led to the creation of sectors comprised of ancillary businesses which sell products and services such as specialty soils, climate control systems, grow lights, vaporizers, security solutions, and more. Some of the cannabis companies based in Colorado include:
- Monarch America (BTFL) is based out of Denver and operates under, Monarch America and the Big Tomato. Monarch is the company’s management and consulting business and provides services for building out indoor grow and cultivation facilities. The Big Tomato supplies hydroponics and indoor gardening supplies through a retail storefront and supply warehouse.
- Blue Line Protection Group (BLPG) is based out of Highland Ranch and provides armed protection, financial solutions, logistics, and compliance services for legal cannabis businesses. These services include on-site security, transportation and compliance verification for marijuana businesses to operate according to local, state and federal regulations.
- MassRoots, Inc. (MSRT) is a Boulder based technology company that is considered to be the “Facebook” of the marijuana industry. MassRoots is one of the largest and most active communities of cannabis consumers. In May, the company announced that it has more than 325,000 registered and over 500 companies on its MassRoots for Business network. MassRoots recently created a partnership and acquired an equity position in Flowhub, a seed-to-sale company.
- Two Rivers Water & Farming (TURV) is a Denver based company levered to the marijuana industry through its subsidiary, GrowCo, which provides greenhouses for licensed marijuana growers. In early May, GrowCo announced that they expect to receive a certificate of occupancy for its first greenhouse within 45 days. The facility is comprised of a 91,000 sq. ft. greenhouse and a 15,000 sq. ft. processing warehouse. GrowCo expects to build four greenhouses over the next 18 months and will then be able to lease 360,000 sq. ft. of greenhouse space and 60,000 sq. ft. of processing space.
- CannLabs, Inc. (CANL) is based out of Denver and provides cloud-based analytics and scientific methods to serve the cannabis industry in the United States and Canada. The company provides cannabis testing services for potency, microbial contamination, heavy metals, residual solvents, and pesticides. CannLabs also offers data/analytics, consulting, and educational services to companies.
Timing is everything
At the 2015 TED conference in Vancouver, Bill Gross spoke about the top 5 factors that influence the success of a startup company after having examined more than 200 companies – successes and failures. He found that the number one factor is timing (42%) and the number two factor is the team/execution (32%).
Although many of the Colorado based cannabis companies have a leg up on the competition due to timing, they now need to execute.
Important Investor Disclosures:
Mushroomstocks LLC is not a FINRA member firm. Mushroomstocks LLC is responsible for the preparation and distribution of research created in the United States. Mushroomstocks LLC is located at 40 SW 13th St. Suite 1002, Miami, FL 33130.
Technical 420 LLC, and any of its directors, officers, employees, affiliates, or subsidiaries does not accept any form of compensation from companies in return for writing reports on them. Also Technical 420 LLC, and any of its directors, officers, employees, affiliates, or subsidiaries do not hold any stock positions in companies covered by MushroomstocksLLC.
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