CANNAINVESTOR Magazine January / February 2017 - Page 85

Though they have been in operation for over a century Cowen & Co. are aiming to be the experts in cannabis finance as the industry continues to expand. Before recreational cannabis became a reality financial institutions stayed far away from the industry due to federal illegality. However, now that 28 states are medically legal and eight states including the District of Columbia are recreational the smart financiers are jumping in head first. Cowen & Co is at the forefront of this march by bringing people together at their Cannabis Colloquium featuring panelists like Jeffrey Friedland and teaming with cannabis industry giants like Leafly.

This colloquium was meant for anyone looking to figure out the future of the consumer in cannabis, they were aimed at financial investors, healthcare professionals, industrial agriculture, and more. The risk involved in hosting this colloquium is heavily fueled by the fact that cannabis sales are projected to rise from $6 billion to $50 billion in 10 years according to a 110-page report put together by ten different Cowen & Co-researchers. The report follows the investment banking arm of Cowen & Co advising Canopy Growth Corp. and eventually raising $60 million by December 2016. Despite this recent jump into legal cannabis and Senator Elizabeth Warren’s recent call to action regarding cannabis banking, it is still very hard for cannabis companies and dispensaries to raise capital.

With the new administration, many companies in the American sector are nervous that business matters, specifically federal banking matters, will become even vaguer and difficult to determine. Luckily, it is quite possible that the momentum of this industry cannot be ignored, but financial investment teams should keep an eye on certain aspects of cannabis to keep playing it safe with the law and their other holdings. There are three targets of cannabis for investors to focus on that will not only prove to be exceptionally expansive but also more safe than throwing money into and edibles company or another facet of the sector that legislators continue to argue over. With the election as a tipping point let’s look at the somewhat safe spaces for investors to focus on in 2017.

Cannabis-Based Biotech

The biotech industry is a big target in the sector for investors under the new president. Many experts believe that traditional companies will enter the industry and the smaller players will certainly be acquired after some small growth. Though it is smart to keep focusing on the stocks that are on major highs like CARA, saving a small portion of our capital to acquire these small businesses could pay off heavily in the eleventh hour.