A business school drop-out from Los Angeles wants to build what he calls the “Anheuser-Busch of marijuana,” readying for the day when pot’s “prohibition” fully ends in the U.S.
Justin Hartfield, 29, dropped out of University of California, Irvine’s part-time business school program to launch Emerald Ocean Capital with a business partner.
Though smoking marijuana is not legal federally, he wants to position his private equity fund to manufacture and distribute marijuana if or when it does become legalized nationally.
“It’s literally just another prohibition, but instead of prohibiting alcohol, it’s marijuana,” he said.
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He hopes to close a $10 million round of funding by early next year, but he declined to reveal how much he has raised thus far.
As pot-related business ventures have increased, the Financial Industry Regulatory Authority, the largest independent regulator of U.S. securities firms, issued a warning earlier this year about marijuana-related stock scams.
Hartfield says he sees the marijuana industry forming in the same way he says the large beer brewers, like Coors Brewing Company, have formed: “a few families of businesses that do really well and provide a quality product at a good price point.”
Anheuser-Busch Companies, with its dozen or so breweries in the U.S., is the American subsidiary of Belgian-Brazilian company Anheuser-Busch InBev.
“America’s not ready for ‘Anheuser-Busch producing marijuana’ yet because it’s still federally illegal,” Hartfield says.
He’s preparing for a time when he can manufacture and distribute branded cannabis in stores and online.
“At the end of prohibition Anheuser-Busch had Clydesdales mounted with beer and the called media to take pictures,” Hartfield said. “They were ready.”
And he says he and his business partner have positioned themselves for the endeavor since 2007, “longer than anyone else.”
With his medical marijuana card, Hartfield is an avid marijuana fan. “I smoke marijuana every day,” he said.
He declined to say what medical condition calls for his medical marijuana card.
Hartfield predicts marijuana will be federally legalized within the next decade. He said California or New York will be the next states, after Washington and Colorado, to legalize its recreational use, either in 2014 or 2016. And five or so years after that, he predicts the federal government will follow suit.
Hartfield, who was interviewed by the New York Post this week, said he wanted his company to gain publicity in New York, the first state to end the prohibition of liquor.
“New York is a pioneering, business-driven state. I expect the same in 2014 or 2016,” he said.
Hartfield’s background is in Internet marketing while his business partner, Doug Francis, previously owned Marijuana Medicine Evaluation Centers.
They own the domain Marijuana.com.
“We’re not just doing this because we see a business opportunity, but because we believe in the plant and that people shouldn’t be going to jail. It’s not just a business for us but a political opportunity,” he said.
He said he hopes to raise $10 million not from institutional investors, but from like-minded CEOs or entrepreneurs interested in alternative investments.