Nevada Pot Scene Dubbed ‘New Amsterdam Of The West’

20582973_sMarijuana investors and potential entrepreneurs may have a new state to set their eyes on.

People have dubbed Nevada as “the new Amsterdam of the West” and there’s a reason for that, said Leslie Bocskor, founding chair of the Nevada Cannabis Industry Association and cannabis investor.

“The [marijuana] opportunity in Nevada is huge,” Bocskor stressed.

Ancillary And Niche Businesses

The state is rife with new cannabis ventures, especially ancillary businesses. These businesses do not directly handle the herb but instead support producers and dispensaries by providing marijuana-related products and services. Some of the most common ancillary needs are technology, real estate, consulting, and waste management. There are also accessory vendors, security officers, greenhouse manufacturers, and even lawyers.

Ashcraft & Barr, for example, is a local law firm that is now serving the medical marijuana industry. The firm has been specializing in business regulation; in December, it created a practice dedicated to the Nevada MMJ industry, in partnership with Vicente Sederberg, a Colorado-based group of cannabis law experts.

There are rules specific to the cannabis industry, such as regulation, taxation, and business operations, explained Alicia Ashcraft, managing partner at Ashcraft & Barr. Such rules need more specialization and expertise. She said that her law firm is “helping businesses tread through” those rules so that they can legally open.

Ancillary industries are considered more opportune in the legal pot market because their more established counterparts are still hesitant to enter this market. Many are deterred by the remaining federal classification of cannabis as an illegal drug. An upshot of this is that most banks would not service the industry, so marijuana businesses are largely cash-only. Other companies also believe that there are still reputational risks associated with the plant.

But even unusual niche businesses are finding an equally fertile ground in the Nevada cannabis market. Businesses like marijuana interior design firms, modeling agencies, social networks, and delivery services are popping up in Las Vegas and other cities.

One such niche company is Smokin Hot Talent, a talent agency that provides models for cannabis-related photoshoots and events. It is a young company – launched only in 2014 – but its models have already made appearances in such events as last year’s Hempfest. The models, known as “smokesmodels”, are advocates, patients, and supporters of the marijuana movement.

Major Factors

Two of the biggest factors that make Nevada a rising marijuana market are its reciprocal card policy and its tourism economy.

The state’s card policy is particularly a magnet for visitors from other legal-cannabis states such as California, which claims to have the country’s largest cardholding population. This makes Nevada a prime location for ancillary services like cannabis delivery, marijuana-themed boutique hotels, and marijuana smokers clubs.

Add its reputation as a tourism state and Nevada is poised to see more marijuana sales. Mike Nahass, director at licensed cannabis producer and agriculture firm Terra Tech, said that tourists are “conditioned […] to overspend in Las Vegas”. For him, that will happen to the marijuana industry as well.

Even more, marijuana opportunities in the state would increase if it votes in 2016 to approve recreational cannabis use.

Investor network and market research firm The ArcView Group sees the growth of the marijuana industry in Nevada, especially in terms of ancillary businesses. ArcView founder and CEO Troy Dayton stated that a lot of businesses want to expand into the state because the market will have “huge, huge growth”. Specifically, ArcView expects the Nevada cannabis market to grow a whopping 341% in 2015.

Nationally, US legal cannabis sales have already ballooned from $1.5 billion in 2013 to $2.7 billion in 2014 – a 74% growth, according to ArcView research. This paints an even more promising landscape for emerging cannabis states like Nevada.

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