In a major milestone for the entire legal cannabis industry, Privateer Holdings today announced that Founders Fund, one of the world’s top venture capital firms with more than $2 billion in assets under management, has made a multi-million dollar investment in Privateer Holdings’ Series B round. The investment from Founders Fund marks the first time a major institutional player has placed capital in the cannabis industry, and is a significant next step as the industry moves out of the shadows and into the light.
“Founders Fund is known for making some of the most lucrative and radically transformational investments of the past decade,” said Privateer Holdings CEO Brendan Kennedy. “With this investment they are signaling that they, like us, believe that the end of prohibition and the social harms it causes is inevitable.”
“Privateer Holdings has emerged as the market leader in legal cannabis, which we believe will become a massive industry within the next decade,” said Founders Fund Partner Geoff Lewis, who is leading the firm’s investment in Privateer Holdings. “We’ve been evaluating the cannabis industry for several years and we haven’t seen another company that comes close to Privateer Holdings in terms of strategy, professionalism, talent, expertise, and potential for growth.”
Privateer Holdings, the world’s first private equity firm investing exclusively in the legal cannabis industry, was founded in 2010 by three MBAs with decades of experience in private equity and venture capital. The firm previously closed $22 million in funding through the combination of a Series A fundraising round and a convertible bridge note. Until today’s announcement, Privateer Holdings’ investors consisted solely of ultra-high net worth individuals and family offices.
Founders Fund was the first institutional investor in revolutionary companies SpaceX and Palantir Technologies, and one of the earliest investors in Facebook. The firm is sector and stage agnostic, with a portfolio that includes Airbnb, Counsyl, Knewton, Lyft, Oculus, SolarCity, Spotify, Stripe, and ZocDoc. Recent portfolio company exits include The Climate Corporation, DeepMind, and Yammer.
In an industry as fast-moving as the cannabis industry, Privateer Holdings has established itself as a company of firsts:
- Privateer Holdings was the first private equity firm to make an investment in the cannabis industry when it acquired Leafly in 2011.
- Privateer Holdings was the first to close a Series A funding round for $7 million in 2013.
- Patrick Moen became the first agent to leave the U.S. Drug Enforcement Administration for a position in the cannabis industry when he joined Privateer Holdings in November 2013.
- Privateer Holdings is the only American company to operate a federally licensed commercial cannabis cultivation operation at its Tilray facility in Nanaimo, British Columbia.
- On Aug. 3, Leafly became the first cannabis company to place a full-page print advertisement in The New York Times.
- Privateer Holdings, in partnership with the family of Bob Marley, launched the world’s first global cannabis brand Marley Natural on November 18, 2014.
- Privateer Holdings has now received the first major institutional investment in the legal cannabis industry.
Privateer Holdings will use the investment from Founders Fund to continue building mainstream companies and professional brands that elevate the conversation about cannabis for patients and consumers around the world.