The Business of Marijuana

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I know that marijuana is legal now in some states. That’s pretty wild, but I’m curious: how shady is the legal marijuana business? It’s hard for me to believe that a drug that was illegal so recently is now at the center of an industry full of legitimate businesses. And isn’t marijuana still illegal at the federal level? Are there legitimate investors and businesses really operating in such a weird legal limbo?


Marijuana has been legal in at least some states and in at least some forms since 1996. Before that, of course, it was exclusively available on the black market–a very shady place indeed. But things are different now–very, very different.


Legalizing marijuana is not something that any state has done lightly. When states consider legalizing marijuana, they weigh consequences and take careful steps to ensure that the newly legal drug is tightly regulated. Marijuana companies face a sea of red tape as they get started, and marijuana dispensaries and individual users are restricted in all sorts of ways: shops can only be opened in certain areas, for instance, and the same goes for smokers, who are generally restricted to smoking in their own homes and cannot, of course, drive while under the influence.


And you’re quite right that marijuana remains illegal at the federal level. That, among other concerns, has had some consequences for investment–some large Wall Street firms steer clear of marijuana stocks. But, in general, this hasn’t made the marijuana business “shadier”–in fact, it’s just the opposite.


All of these restrictions and challenges mean that marijuana businesses actually have to be quite professional, say legal experts who specialize in business plans for medical marijuana dispensaries. Recreational and medical marijuana growers and distributors have a lot of legal restrictions to juggle, and must be organized, well-funded, and careful. Marijuana businesses hold insurance, carefully vet their hires, and keep lawyers on retainer. They are, in general, as professional as you can imagine, and the industry as a whole is a respectable one.


It’s also a growing one. The marijuana business employed 121,000 people legally in 2017; that number could get as high (no pun intended) as 292,000 by 2021.


Recreational and medical marijuana are still relatively new to the legal business world, but this fast-growing sector is far from “shady.” By and large, the hard-working people in this new business space are careful and professional.


“Life is an improvisation. You have no idea what’s going to happen next and you are mostly just making things up as you go along.” — Stephen Colbert