Cannabis investor Privateer Holdings tacks on another $40 million in funding

Cannabis investor Privateer Holdings tacks on another $40 million in funding

Posted 18 seconds ago by Connie Loizos (@cookie)
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In just five days, nine states will vote on marijuana legalization measures, so it’s perhaps not a surprise that the five-year-old, Seattle-based marijuana private equity investor Privateer Holdings is disclosing that it just raised $40 million in convertible debt from undisclosed investors. The round brings Privateer’s total funding to $122 million. Earlier investors include Founders Fund, which led the company’s $75 million Series B round in March 2015, and Subversive Capital.

Cowen and Co is predicting that within 10 years, legal pot sales will hit $50 billion in the U.S., up from $6 billion today.

In an interview yesterday with Reuters, Privateer CEO Brendan Kennedy said he’s hoping his firm’s newest round of funding will reach $100 million but that many interested investors are waiting to see what happens this Tuesday. Those who provided the company with that $40 million will receive a15 percent discount when they get equity in Privateer, he added.

The company, which primarily invests in U.S. companies, owns or has stakes in at least three companies, including Leafly, a cannabis website and mobile application centered around user-generated reviews of cannabis strains, products and dispensaries; Tilray, a startup that provides pharmaceutical-grade cannabis products to patients, researchers, pharmacies and governments around the world from a $25 million, federally licensed facility in British Columbia; and Marley Natural, a cannabis lifestyle brand that makes, among other things, body oil infused with cold-pressed hemp seed oil and Jamaican botanicals. (In 2014, Privateer signed a 30-year licensing deal with the late musician Bob Marley’s family to launch the brand.)

Privateer Holdings isn’t the only cannabis-focused fund, but it’s among few (so far). In June, MedMen Management, which consults for the medical-marijuana industry, launched its own private equity fund, MedMen Opportunity Fund. It’s looking to raise $100 million from investors.

Before cofounding Privateer, Kennedy was a managing director of strategic projects and a managing director with Silicon Valley Bank.

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