NEW YORK: The legalization of cannabis for medical and adult use in Canada represents a milestone in the growing trend toward legalization and decriminalization of cannabis and cannabis products, according to Altitude Investment Management.
“Canada is the second country in the world, after Uruguay, to legalize cannabis for both medical purposes and adult use, and it is the first country in North America to do so,” observed Jon Trauben, partner at Altitude.
He added, “We believe that the legalization in Canada offers a roadmap to invest in the companies that will form the basis of the legal cannabis industry in the coming years. Altitude Investment Management’s portfolio strategy rests on this premise, and we are confident that the growth of the legalized industry will continue to provide compelling investment opportunities globally.”
Altitude Investment Management invests in a range of early-stage to growth companies supporting the fast-growing legal global cannabis industry. Its portfolio includes companies that touch the plant as well as ancillary businesses supporting the industry. Trauben said, “The production of cannabis represents a fraction of the overall investment opportunities. The industry requires support from software, financial services, distribution and more. Our investment discipline has us looking at the best management teams that can build a moat around the business.”
The size of the Canadian market is estimated at a few billion dollars a year at present. The Canadian Parliamentary Budget Office stated that 700,000 kilograms of cannabis at C$10 a gram would be needed to displace the products currently on the black market. Liz Stahura, President of BDS Analytics, recently stated that the legal global cannabis market will expand from $13 billion this year to $32 billion in the next five years.
Trauben stated, “The truth is that there are more than a few unknowns when it comes to market size, speed of growth, and displacement of illicit cannabis, but the important thing from our perspective is that the global trend toward legalization continues and Canada’s new regulatory system governing medical and adult use cannabis is a milestone along that path.”
The Altitude fund is led by John Brecker, Jon Trauben, Michael Goldberg, and Roderick Stephan. Collectively the partners have over 100 years of Wall Street investment management experience and have managed investor capital in the alternative asset management space for the majority of their careers. Altitude already has a portfolio of 15 companies spanning the cannabis industry–– including: BDS Analytics, Flowhub, Canndescent, C4 Distro, Enlighten, PathogenDX, and Würk––and will use capital to continue to invest across the global industry.