"People talk about the Colorado model; people talk about the Washington model. I think someday they'll talk about the Canada model," marijuana private equity fund Privateer Holdings CEO Brendan Kennedy said to The New York Times on May 24. "By creating a tightly regulated federal system, by creating a federal license, by making it difficult to navigate in and capital-intensive, Canada has attracted a different kind of player into this industry."
"There are a lot of large egos and puffery in this industry," says Brendan Kennedy, a former Silicon Valley banker who helped found Privateer Holdings, a marijuana-focused private equity firm. "It takes a lot of time and energy to sort through the hyperbole and find the right, legitimate opportunities."
"We are not going to invest in something that is in violation of federal law," said Brendan Kennedy, a managing director of Seattle-based Privateer Holdings Inc., an equity investor in the medical cannabis sector that has raised $22 million and is in the midst of a $50 million raise. Privateer's portfolio investments include Tilray, a licensed Canadian marijuana producer, and Arbormain, a Washington company that leases properties to cannabis-based businesses.
Nanaimo-based Tilray has constructed a large, pristine operation on Vancouver Island, backed by Seattle private equity player Privateer Holdings, which has pumped considerable dollars into the U.S. tech sector over the years.
Privateer Holdings, a Seattle, Washington-based private equity firm strategically invests in the legal medical marijuana space. Of the three founders of Privateer Holdings, two are graduates of Yale School of Management and the other holds an MBA from San Francisco State University.
Experts disagree on the specific numbers, but start-up costs will be in the multimillions. Woloveck says a business could start with $2.1 million in initial investment. Brendan Kennedy, CEO of Privateer Holdings, a marijuana private equity firm, said the cost should be closer to $5 million. Others put the number higher.
“We have a 70,000-square-foot warehouse that is surrounded by physical security including barbwire fences,” said Brendan Kennedy who heads Tilray, the operator of one of the world’s largest legal pot grows.
The company Tilray, a Canadian subsidiary of Seattle-based Privateer Holdings, operates a 70,000-square-foot warehouse on Vancouver Island. “There is a vault inside of it that’s as sophisticated as any bank vault that you’ve ever seen,” said Brendan Kennedy, CEO of Privateer and Tilray. “We have a security team that’s former (Royal Canadian Mounted Police) members, Mounties, on staff.”
Kannalife Sciences Co-Founder Thoma Kikis and Leafly CEO Brendan Kennedy discuss using cannabinoid –based therapeutics to treat chronic traumatic encephalopathy and Leafly’s New York Times marijuana ad. They speak on "Street Smart."
Privateer Holdings is the first private equity company openly investing in the legal weed industry. While a small handful of similar efforts have been publicly announced...Privateer says it has raised the most cash so far. The firm raised $22 million from investors last year and will soon close on another $50 million in funding, according to Groh.
The firm expects to close a $50 million equity financing by September, according to an S.E.C. disclosure it filed Tuesday. When combined with an earlier $7 million equity round, which closed a year ago, and a $15 million convertible bridge loan it obtained in February, the firm will have raised $72 million for the purpose of reinvesting in legitimate pot-related enterprises. No other marijuana-related investment fund appears to be nearly as far along.
The company is Privateer Holdings, and through its subsidiary Arbormain, they are proposing to construct a 200,000-square-foot building in Hawks Prairie at 3640 Hogum Bay Road, which would open its doors to pot producers and processors, but not retailers, said Patrick Moen, managing director at Privateer.
Business is certainly budding for the folks at Privateer Holdings. The Seattle-based marijuana company has raised $18.6 million, which is part of a $75 million Series B round that Privateer plans to close next month.
In order to help make that and other distinctions between Colorado, which started legally allowing the sale of marijuana in January, and Washington, which did so earlier this month, the Privateer Holdings-backed company [Leafly] compiled seven key differences between the two states’ laws into an infographic.
And while entrepreneurs become more involved in the marijuana industry, investors are beginning to show more interest, too. That’s according to Brendan Kennedy, co-founder of a Seattle-based private equity holding company called Privateer Holdings that has acquired four marijuana-related companies in the past four years, including Leafly.