Trying to Sell Wall Street on the Value of Marijuana


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Trying to Sell Wall Street on the Value of Marijuana
Kalvin Savanh grew up in Portland, Ore., and, during high school, he said, he grew marijuana. About 15 years later, Mr. Savanh, 33, still helps grow it — but now it is legal.

On Friday, Mr. Savanh and a childhood friend, William Serafica, the co-founders of Dynamiq Lightning, a Portland-based company that sells products for indoor cannabis cultivation, met near Wall Street with about 40 potential investors to encourage them to enter the cannabis industry at a time when 19 states have legalized the use of marijuana for medical purposes.

The two were among representatives from 18 start-up companies who attended a conference organized by the ArcView Investor Network, a group of entrepreneurs looking to invest in legal cannabis companies. The companies represented do not grow or sell marijuana, but rather provide services to the industry — like security, lighting and storage.

“This is a historical moment,” said Troy Danton, 36, chief executive officer of the ArcView Group. Likening the rise of the cannabis industry to the technology boom of the 1990s, he said he saw marijuana as the next frontier. “We’re announcing to Wall Street, this is the real deal,” he said.

Still, those involved in the business face a twofold challenge. On one hand, many states — including New York — have not legalized marijuana for medical purposes. Many in the industry also acknowledge that marijuana faces a lingering image problem.

Brendan Kennedy, 41, whose Seattle-based private equity firm, Privateer Holdings, invests in the cannabis industry, said he worried that his firm would be thought of as “the cannabis guys,” adding, “We learned most preconceptions are wrong.”

The key, he said, is in presentation. Pointing to a corporate-looking sign for the company Leafly, a Web site that allows users to review medical cannabis strains and dispensaries, he said: “There aren’t pot leaves. There is no Grateful Dead. There are no nurses in bikinis.”

While those in the industry spoke optimistically about marijuana moving from the fringe to the mainstream in the next several years, and of more states legalizing it, resistance remains.

In New York, it is doubtful that the Legislature will vote to legalize marijuana this year. While the Assembly approved a measure last week, the Senate has never brought it up for a vote. In a radio interview in April, Gov. Andrew M. Cuomo said: “I think we have to be very, very careful. Yes, there are potential upsides. But you don’t want to increase the distribution of drugs by creating another system.”

Still, those gathered at the conference on Friday were upbeat about their long-term prospects.

Daniel Williams, 35, the president of Canna Security America, a Denver-based security solutions company for the medical marijuana industry, was optimistic. “I believe once we hit the 25-state mark, that will be the tipping point of federal legalization.” Besides, he said, “the cannabis industry is growing so quickly, there’s no stopping it.”

Thomas Kaplan contributed reporting.

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