💸 The Tape

The momentum for legalizing adult-use cannabis in Pennsylvania is building, with 70% of voters in support. However, despite this growing support, some state lawmakers still see legalization as having "no path forward." This has led to ongoing hearings and intense negotiations with Governor Josh Shapiro, who is ready to roll out the green carpet for cannabis legalization.

Governor Shapiro's budget secretary recently made a historic announcement at a public hearing, affirming that the Governor's budget would indeed include adult-use legislation. This marks the first time that cannabis legalization has been a key element of Pennsylvania's budget proposal. However, Republican senators are pushing back on various parts of the Governor's budget, including the cannabis legalization aspect.

As these negotiations heat up, the stakes are high. The Governor has factored revenue from cannabis legalization into his budget, and the debate around this topic has become a significant part of the hearings. The Republican Senate is looking to raise the ante in these negotiations, making it clear that this will be a contentious process.

Another hot topic in these negotiations is skill gaming, which adds another layer of complexity to the discussions. The cross-point between the two sides will involve trading off different policy priorities and finding common ground.

Despite the contention, the seriousness with which the state legislature is approaching the legalization proposal is a positive sign. The negotiations will be intense, but there is hope that adult-use cannabis legalization in Pennsylvania will ultimately pass.

Yesterday, Governor Josh Shapiro made yet another public tweet about rolling out the green carpet in an effort to legalize adult use cannabis in the state. Shapiro made a point about how Pennsylvanians who want to buy adult-use cannabis are driving across the border to one of five neighboring states where it’s legal.

Based off of that, up to 60% of the customers at those stores just over the border are Pennsylvanians, and as a result the Keystone state is losing out on an industry that would bring $1.3 billion in revenue.

📈 Dog Walkers.

Senator John Fetterman’s Petition

What’s Going On Here: Sen. John Fetterman’s (D-PA) campaign is actively promoting his support for marijuana legalization, encouraging people to sign a petition to demonstrate the strong backing he has on the issue.

In a campaign email sent Saturday, Fetterman’s team emphasized that he “stands firm in his beliefs” and is “proud to be fighting for legal weed” alongside other priorities like health care reform and labor rights in the Senate.

Why You Should Care: Fetterman outlined that legalizing marijuana means increased revenue, job creation, justice, and personal freedom.” With cannabis reform badly needed for the overall growth of the industry, more voices advocating for change in Washington should not go unnoticed.

Canada Reaches All Time High

What’s Going On Here: Cannabis sales in Canada may have been slowing down in recent years, but December 2024 delivered a welcome surprise for the industry. The month closed with nearly $500 million in sales, marking an increase of almost $23 million compared to the previous year. This uptick suggests that while Canada’s market is maturing, there’s still room for growth and resilience.

Why You Should Care: Back in 2023, Canada’s cannabis industry was grappling with an oversupply problem. Fast forward to today, and with the majority of Canadian LP’s shifting their focus to international markets and supply tightening, it’s leading to a more balanced and sustainable market.

🗞️ The News

📺 YouTube

Institutional Investor Gives His Take on Cannabis Investment Opportunity

What we covered:

✅ Institutional Investor Matt Hawkins, Founder and Managing Partner of Entourage Effect Capital joined us yesterday. Entourage Effect Capital manages a private cannabis fund and has invested over $200 million in more than 60 cannabis companies, driving industry growth and innovation across various sectors. They’ll discuss the following:

1. Trends he sees in institutional investors' view of investing in cannabis stocks.

2. How he is positioning his investment focus in the current investment climate.

3. Whether he is seeing distressed assets, and if so, in which markets and sectors: retail, distribution, or cultivation.

4. Latest updates on courting a major institutional investor due to the prospects of cannabis reform on the horizon.