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into cannabis. Declaring a 40% share of the U.S. point-of-sale market,
Venegas also claims that Helix is the second-largest provider of reporting
and tracking services among state and local government regulators.
Meanwhile, the industry is abuzz with the separate but equally intrigu-
ing hemp market, which received a long-sought-after boost with the pas-
sage of the 2018 Farm Bill in December. A key provision in the law essen-
tially legalized industrial hemp—marijuana’s nonintoxicating sibling—and
trendy cannabidiol (CBD), derived from its fl owers, or buds, and seeds.
CBD has already fostered an array of oils, supplements, beauty products,
foods, and beverages, many promising health benefi ts, although most are
scientifi cally unsubstantiated. Currently, the only CBD product approved
by the Food and Drug Administration (FDA) is a prescription oil, called
Epidiolex, to treat two types of epilepsy. The lanky hemp plant’s stalks
also produce fi ber for manufacturing paper, textiles, auto parts, building
materials, and other products.
The burgeoning industrial hemp marketplace rang up $1.1 billion in
sales in 2018, a number which is estimated to more than double by 2022
to $2.6 billion. Even though the U.S. Department of Agriculture, the FDA,
and individual states still need to fi nalize regulations governing hemp, that
fi gure may be a conservative assessment, considering that top pharmacy
chains, independent retailers, and online vendors are now selling a wide
range of CBD products.
CBD e-commerce is one focus for Southern California’s Pineapple
Ventures, Inc. through its Pineapple Express branded website. “We ship
nationwide quality-tested, 100% hemp-derived CBD products containing
no THC,” says CEO Shawn Credle, referring to the psy-
choactive ingredient in cannabis. “Our wellness products
come from the hemp plant and include joint creams,
body butters, tinctures—for people and pets.”
The company has also launched a legal cannabis
delivery service in California, via PineappleExpress.com,
and is merging into public company Pineapple Express
Inc., [PNPL]. It’s assembling a fl eet of 35 vehicles, aiming
to drive $2.6 million in door-to-door cannabis sales per
month, Credle says. The state legalized recreational
cannabis last year. Pineapple Ventures is courting illegal
delivery services to acquire their “book of business,”
Credle explains. “We are gaining traction in this strategy,
which will allow us to expand faster. There is obvious
value in being legally compliant!”
The NCIA is stridently advocating for CBD regulations
as a way to weed out a confusing consumer market. “We
want regulations that are sensible and balanced with the
public good, along with the ability for companies to pro-
vide quality medicine to patients,” says Smith. “Arguably,”
he surmises, “the hemp industry could have a greater
impact economically than the marijuana industry, just as
an agricultural commodity.”
As of February, 41 states allowed the cultivation
of hemp for commercial, research, or pilot programs,
although only 24 states had farmers actually growing it
last year. Total hemp acreage in the U.S. was at 78,176
acres, up from 25,713 in 2017, and the acreage should be
markedly higher in the coming years.
Cultivation of marijuana—legal and illegal—dwarfs
hemp, nowhere more so than in California, which is
renowned for its abundance of growers, most notably
in upstate Humboldt County. That’s home to Eel River
Organics (ERO), a family-operated legal cannabis opera-
tion nestled in the shadow of coastal redwoods. ERO is
setting the standard for sustainable agriculture with their
outdoor dry farm. Through companion and cover crop
diversity, they produce exceptionally high-quality plants
with minimal external inputs—including no need for ir-
rigation. Eel River’s products, including traditional fl ower
and pre-rolls, vape-pen oils, concentrates, and edibles,
are marketed through more than 150 retail outlets and via
delivery services.
Cannabis is quickly becoming a signifi cant job
creator, too. In March, Leafl y—a Seattle-based informa-
tion resource for everything cannabis and a subsidiary
of the private equity fi rm Privateer Holdings—released a
jobs report for the legal marijuana industry stating that it
employs 211,000 full-time workers, 64,389 of them hiredS7 http://www.fortune.com/adsectionsContinued from S3