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When you take the legal complications away, the "marijuana business" is nothing but farming. Beyond that, it's farming involving a crop that is (relatively spea

When you take the legal complications away, the "marijuana business" is nothing but farming. Beyond that, it's farming involving a crop that is (relatively speaking) very cheap and easy to grow. Once the laws are straightened out, I see no reason why big agribusiness won't completely crush all the startups entering this space. They have the scale, resources and experience to produce cannabis vastly cheaper than anybody else could hope to. A few small boutique farms might be able to eek out an existence (maybe we'll see "fair trade" marijuana?) but it's not anything I would ask a VC to put money into.

YokoZar 12y ago
Eh it's a bit more complicated than that. Marijuana cultivars vary tremendously, but not in a way that's particularly amenable to "here try a bite and see" like when you see strange fruits at a farmer's market. As a consequence you're going to see a lot of value placed on consumer information -- many of the startups highlighted in the article are about things like customer reviews of various strains, for instance. And more broadly even under a much more lax legal environment marijuana will still require things like proper packaging (eg the scentless bags produced by one of the highlighted startups). It's also unclear how much of the cost is actually production. If 90% of the cost is stuff like flat taxes on end product, then big agribusiness with low production costs can't actually get much cheaper.