Investors gather in Chicago seeking cannabis businesses
The country’s largest cannabis investor group held a pitch forum in Chicago.
It looked like a typical business conference in a hotel ballroom, with people in suits shaking hands and exchanging cards. But the biggest difference was that it focuses on a federally illegal substance.
“While we’re slaying stereotypes, I also want to open up and make room for the people who may fit the stereotype. I know some great people that I’ve done business with that have long hair, or hippies or all the other things that we associate with it. Because once again, the hippies keep being right,” said Troy Dayton, CEO of the ArcView Group.
Dayton was addressing a room full of marijuana industry investors. The industry is expected to be valued at $2.6 billion by the end of this year. More than 100 companies applied online to make their business pitch and only a dozen were chosen for ArcView’s forum.
“There’s a lot of competition between investors. There’s a lot of competition between companies. And everybody’s trying to elbow and move,” he said.
The room vibe was part Apple product launch and part speed dating.
Joshua Hill is from Washington state. His handle bar mustache fluttered as he talked to a table of investors about his company Oil Slick. He moved from table to table talking about a non-stick product used to handle sticky cannabis concentrates. His pitch was successful.
“We came here seeking a million dollars for our upcoming projects. Just this morning, I just left a meeting with some investors form ArcView,” he said. “They’ve signed a memorandum of understanding, which is the first stage of getting funded. So they’ve committed to raising that million for us.”
There was also companies making pitches in a shark tank like presentation.
Keith McCarty from San Francisco worked in the tech industry before he moved over to cannabis. He launched an app called Eaze just six weeks ago, and he’s hoping to raise more capital.
The app is like Uber for medical marijuana where drivers deliver from dispensaries to patients.
McCarty’s product won’t be seen in Illinois anytime soon because state laws restrict anyone other than a certified patient or caregiver to make a pickup. But that doesn’t mean Illinois investors won’t bite.
Dayton said all the companies pitching at the Chicago forum were from out of state, but many of the investors in attendance were from Illinois. ArcView has about 330 members with about 30 from Illinois. Annual membership fees range from $2,500 to $15,000.
“It’s just really significant for the whole industry that there’s now a Midwestern state with a legal cannabis industry. And so it’s great for us all to come here and visit and meet all the people who are the applicants,” Dayton said.
He said these business pitch forums will get larger, more competitive and increasingly commonplace as states move toward legalization.
Susie An is WBEZ’s business reporter. Follow her @soosieon