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Why Retail Cannabis Could Be the Next Big Investment Boom

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Imagine being an investor in Microsoft at the time of the company’s IPO in 1986. Or better yet, buying Amazon shares while it was still just an aspiring online book store in the late 1990s.

Chances to be an early adopter in the next billion-dollar industry are far and few in between – but it’s exactly what is happening today with the nascent cannabis market. After close to a century of prohibition, cannabis is back in the limelight as legalization rolls across the U.S. and Canada.

Visualizing the Retail Boom

Today’s infographic from Choom Holdings Inc demonstrates the consumer interest in retail cannabis, and the challenges and opportunities that come with this potential.

Retail Cannabis Investment Boom

Legal cannabis today is a lucrative modern market in the U.S. and Canada. In 2018, sales were $10.8 billion – and they are expected to grow to $47.3 billion by 2027.

Who’s driving this growth? A recent survey reveals that:

  • 58% of U.S. cannabis consumers use it at least once a week
  • 66% of these weekly users are millennials, aged 18 to 34
  • 46% of cannabis consumers who also drink, prefer it over alcohol
  • 74% of cannabis consumers who also drink, believe it to be safer than alcohol

With more people using cannabis frequently, the disruptive potential of retail cannabis becomes clear.

The Cannabis Supply Issue

Colorado, Washington, Nevada, and most recently California have been among the major U.S. states to legalize recreational cannabis in recent years.

Although cannabis sales across all states have soared, there’s one caveat to mention, which is clearly seen in the case of California. As the state began selling cannabis in stores on January 1st, it also simultaneously ran out of supply when the grey market came rushing up.

This trend of pent-up demand is clear across both mature and new markets – even Canada couldn’t escape the same supply crunch, subjecting customers to long lines and wait times on day one of legalization. For example, only one legal retail store was open in the entire province of British Columbia on October 17th.

It’s not surprising to see why cannabis is such a valuable retail product, though: dispensaries typically outsell Whole Foods and other similar retailers.

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(Source: Marijuana Business Daily)

The Value Play in Cannabis

Seizing an early adoption opportunity is a best-case scenario in the investing world.

Today, such an opportunity may come in the form of retail cannabis. The segment still faces specific hurdles, but these challenges have the potential to convert into golden opportunities as the market matures in North America:

1. Inherited demand
Legal retailers will reach new consumers as the grey market begins to come online.

2. Strong foundation
Retail cannabis is only legal in ten U.S. states, but it already shows strong promise.

3. Building bridges
Retail cannabis stores are just now opening in Canada, but licenses are hard to get.

Retail cannabis is a brave new world for consumers and investors alike – and early entrants to the industry with access to capital and a large retail footprint will likely lead the charge.

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Economy

Economic Growth Forecasts for G7 and BRICS Countries in 2024

The IMF has released its economic growth forecasts for 2024. How do the G7 and BRICS countries compare?

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Faded horizontal bar chart visualization of G7 and BRICS countries' real GDP growth forecasts for 2024.

G7 & BRICS Real GDP Growth Forecasts for 2024

The International Monetary Fund’s (IMF) has released its real gross domestic product (GDP) growth forecasts for 2024, and while global growth is projected to stay steady at 3.2%, various major nations are seeing declining forecasts.

This chart visualizes the 2024 real GDP growth forecasts using data from the IMF’s 2024 World Economic Outlook for G7 and BRICS member nations along with Saudi Arabia, which is still considering an invitation to join the bloc.

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This visual is part of a special dispatch of the key takeaways exclusively for VC+ members.

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Mixed Economic Growth Prospects for Major Nations in 2024

Economic growth projections by the IMF for major nations are mixed, with the majority of G7 and BRICS countries forecasted to have slower growth in 2024 compared to 2023.

Only three BRICS-invited or member countries, Saudi Arabia, the UAE, and South Africa, have higher projected real GDP growth rates in 2024 than last year.

GroupCountryReal GDP Growth (2023)Real GDP Growth (2024P)
G7🇺🇸 U.S.2.5%2.7%
G7🇨🇦 Canada1.1%1.2%
G7🇯🇵 Japan1.9%0.9%
G7🇫🇷 France0.9%0.7%
G7🇮🇹 Italy0.9%0.7%
G7🇬🇧 UK0.1%0.5%
G7🇩🇪 Germany-0.3%0.2%
BRICS🇮🇳 India7.8%6.8%
BRICS🇨🇳 China5.2%4.6%
BRICS🇦🇪 UAE3.4%3.5%
BRICS🇮🇷 Iran4.7%3.3%
BRICS🇷🇺 Russia3.6%3.2%
BRICS🇪🇬 Egypt3.8%3.0%
BRICS-invited🇸🇦 Saudi Arabia-0.8%2.6%
BRICS🇧🇷 Brazil2.9%2.2%
BRICS🇿🇦 South Africa0.6%0.9%
BRICS🇪🇹 Ethiopia7.2%6.2%
🌍 World3.2%3.2%

China and India are forecasted to maintain relatively high growth rates in 2024 at 4.6% and 6.8% respectively, but compared to the previous year, China is growing 0.6 percentage points slower while India is an entire percentage point slower.

On the other hand, four G7 nations are set to grow faster than last year, which includes Germany making its comeback from its negative real GDP growth of -0.3% in 2023.

Faster Growth for BRICS than G7 Nations

Despite mostly lower growth forecasts in 2024 compared to 2023, BRICS nations still have a significantly higher average growth forecast at 3.6% compared to the G7 average of 1%.

While the G7 countries’ combined GDP is around $15 trillion greater than the BRICS nations, with continued higher growth rates and the potential to add more members, BRICS looks likely to overtake the G7 in economic size within two decades.

BRICS Expansion Stutters Before October 2024 Summit

BRICS’ recent expansion has stuttered slightly, as Argentina’s newly-elected president Javier Milei declined its invitation and Saudi Arabia clarified that the country is still considering its invitation and has not joined BRICS yet.

Even with these initial growing pains, South Africa’s Foreign Minister Naledi Pandor told reporters in February that 34 different countries have submitted applications to join the growing BRICS bloc.

Any changes to the group are likely to be announced leading up to or at the 2024 BRICS summit which takes place October 22-24 in Kazan, Russia.

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