LAS VEGAS, Nev. — Daniel Yazbeck stepped to the podium before about 140 investors in a Las Vegas conference room with 15 minutes to persuade them to bankroll a handheld testing device that helps pot users evaluate marijuana.
LAS VEGAS, Nev. — Daniel Yazbeck stepped to the podium before about 140 investors in a Las Vegas conference room with 15 minutes to persuade them to bankroll a handheld testing device that helps pot users evaluate marijuana.
Yazbeck, a lead investor in the product called MyDx, part of La Jolla, Calif.-based CDx Inc., told the group he was seeking $1.25 million in exchange for a 20 percent stake in the analyzer company. He was the first of 12 entrepreneurs invited to pitch at a conference organized by ArcView Group, a San Francisco-based firm of angel investors.
“It’s a tool that will not only educate but will also empower people with healthier lives by knowing what’s in everything they eat, drink and inhale,” Yazbeck, 36, said Thursday before showing a video on the tester, which also will be able to detect pesticides in food and contaminants in water.
The meeting coincides with the start of legal marijuana sales in Colorado, where retail shops opened Jan. 1 to long lines of consumers. Investor interest has surged since voters in Colorado and Washington state became the first to legalize recreational marijuana use in 2012. Stores are expected to open in Washington later this year.
“Welcome to the golden age of cannabis investing,” Steve DeAngelo, ArcView’s president, said at the start of the meeting.
“There will never, ever be another time when the deals for investors will be as good as they will be over the course of the next couple of years,” said DeAngelo, co-founder of Harborside Health Center, a medical-marijuana dispensary in Oakland and San Jose, California. “So be cautious, do your due diligence, be deliberate, be wise. But have your checkbooks ready. The time is now.”
Jon Cooper and Dooma Wendschuh, co-founders of Denver-based Ebbu, took to the stage to pitch marijuana products from prerolled joints to refills for e-cigarettes, all labeled to show the high they produce, ranging from “chill” and “giggle” to “bliss” and “energy.”
“What happens when you walk into a dispensary?” Cooper told the crowd. “You see rows and rows of glass jars and each of them contain a different strain.”
“With upwards of 500 different strains, you can see how this is really confusing for the cannabis consumer. How do you find a strain that’s right for you?” Cooper said.
“No more half-hour conversations with the budtender,” Wendschuh said of their labeling system. “It’s simple, and it’s going to change the world.”
Investors at the meeting included Joby Pritzker, whose family started Hyatt Hotels Corp. and who declined to be interviewed.
Tom Bollich, a founding employee of Zynga Inc., the San Francisco-based maker of “Farmville,” said investing in the marijuana business feels similar to the mobile applications industry.
“It’s like the wild, wild West,” said Bollich, chief executive officer of Hydro Innovations, a Boulder, Colo.-based company that makes climate-control systems for marijuana growers.
“Right now, it’s a gold rush and we’re trying to sell shovels,” Bollich said outside the conference room, between brief interviews that resembled speed dating. Investors and entrepreneurs lined up across from each other with a few minutes to talk before moving to the next person.
Twenty states, including California and Massachusetts, allow the medical use of marijuana. While federal law still classifies the drug as an illegal substance, the U.S. Justice Department said in August that it wouldn’t challenge the legalization laws in Washington and Colorado, provided the states prevent out-of-state distribution, access to minors and drugged driving, among other things.
President Obama said he didn’t think marijuana is “more dangerous than alcohol,” in an interview with the New Yorker published Jan. 19. Noting that he smoked the drug during his youth, he also said he views it now as a “bad habit and a vice,” and “not something I encourage.”
Leaster Gibson, 38, an investor from Springfield, Mo., said he’s interested in backing a couple of companies that made pitches, while declining to name them.
“Marijuana is the best growth industry probably in the next five to 10 years,” Gibson said in an interview in the conference hall’s courtyard, where the smell of marijuana filled the air. “I think there’s a tremendous amount of money to be made.”