Getting Comfortable Being Uncomfortable
It was a balmy October evening in South Beach Miami. I had spent hours during the preceding weeks co-planning a Wharton-Harvard-Stanford weekend full of networking, dining, and general debauchery. The pre-work and event oversight admittedly took a toll on my mental energy, however if being in a space with hundreds of intelligent, interesting, and frankly, attractive people doesn’t energize you I’m not sure what will.
The culminating event was a yacht party equipped with a three-course meal, open bar, and top-notch DJ set. As I stood in line preparing to order my third or fourth espresso martini, I was approached by someone who asked the archetypal networking reception question, “What are you trying to do?”
I began talking about my passion for investing in and supporting companies in the emerging cannabis industry, and how during the previous summer I’d worked at a fascinating start-up in the space — AdaViv. My voice audibly changed as I genuinely get excited when talking about this stuff, however immediately after mentioning cannabis, the person’s engagement visibly deteriorated, and he stepped away from the conversation.
Did he leave his phone in the bathroom? Did he remember he had a call that slipped off of his radar? While these are possible causalities, the abrupt departure was likely due to him not viewing cannabis as a viable industry, and that attitude was projected on its advocates /participants.
As someone who’s been interested in the space for several years, this does get frustrating at times.
Five years ago, Oliver Blume said “an iPhone belongs in your pocket, not on the road” as an expression of his unwillingness to move Porsche towards smart cars. Last month, Herbert Diess, CEO of Volkswagon — parent company of Porsche — went on record saying that smart cars were game changers and positioned to be more impactful than electric vehicles
Four years ago, Jaime Dimon called cryptocurrency a fraud, now JP Morgan offers crypto ETFs and its own digital coin
and let’s not forget that cannabis was originally made a class 1 drug in the Controlled Substance Act of 1970 to criminalize hippies, Blacks, and Hispanics.
People are conditioned to think something is wrong until the masses convince them otherwise. Also, political agendas are more impactful drivers of legislation than ethics or morals.
Backing an idea that family and friends at times are dismissive of can feel isolating, but in 2022 I want to improve on these 2 things
Sharing The Numbers
Like any emerging space, ambiguity and innovation are ever-present within cannabis. From an entrepreneur’s perspective this a beautiful thing.
The legal cannabis market is expected to reach $110 billion by 2028 (currently the market is valued at $20 billion), from a thematic investor’s perspective this is beautiful as well.
While the legal cannabis industry is still in its infancy, there are ample opportunities to start catching the upside in the public markets — lucrative opportunities at that. Over the past three years, the largest public cannabis companies have either performed as well as or comfortably outperformed the S&P 500.
Three Year Performance:
Green Thumb Industries (CNSX: GTII): 151%
Curaleaf Holdings (CNSX: CURA): 83%
Trulieve Cannabis (CNSX: TRUL): 272%
S&P 500: 89%
This growth was caused by a plethora of reasons, however one thing is nearly certain, we can expect more growth once federal legalization happens. Fundamentals will improve as multi-state operators (MSOs) expand into different markets, and public sentiment will improve which will likely be reflected in share prices.
Money talks and bull shit walks. Perhaps by articulating the financial gain to be had, more people will understand why this market is so enticing, but perhaps the potential financial upside won’t convince them to take it seriously. This leads to my second point.
Don’t Feel Compelled to Win Everyone Over
I’m very much so an extrovert. In most conversations I look for that spark- that spark being a shared interest or passion that gets the other person engaged and excited. I draw energy from good conversations and cultivating relationships, but whenever the archetypal networking reception question arises:
“what do you want to do”
for a split second I find myself thinking, “what answer should I craft based on what I know about this person?” If I ultimately tell them about my interest in cannabis and they choose to disengage, that’s OK. I’ll continue to become more comfortable with the dismissiveness by watching my portfolio grow and working with brilliant innovators.
