November 11, 2016 4 min read

Opinions expressed by Entrepreneur contributors are their own.

The 2016 elections were a monumental event in the history of cannabis legislation. With adult-use recreational cannabis now legal in California, Nevada, Massachusetts and Maine and medical cannabis now legal in Montana, North Dakota, Arkansas and Florida we have become a nation in which 25 percent of the population lives in a legal cannabis market.

In addition to the myriad of social benefits this new legislation will produce, we’re going to see a host of positive economic impacts, new business opportunities and the rise of a real growth industry for a product that already has proven demand. This new legislation will result in a better fundraising dynamic with additional capital flooding into the market, an explosion of new companies created, a rise in ancillary services to support this blossoming industry and more companies looking at the space for growth opportunities.

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Due in large part to state and federal law, fundraising has been more difficult for cannabis companies than those within other industries. While some family office and a few traditional VC firms have invested in the industry post-Colorado and Washington legalization, they were exceptions making headlines when they did so -- for example the Founders Fund investment into Privateer Holdings or DCM Ventures bet on Eaze.

With eight new markets, including four with recreational cannabis, there is going to be an influx of new money looking for investment opportunities. The result will be a boom in new cannabis-specific funds, as well as more traditional venture capital getting involved. An expanded market means more opportunity. In states such as California, with its newly legal market and significant investor footprint, we could see a loosening of limited partner operating agreements at more traditional VC firms that historically have prohibited cannabis investment.

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This new legislative landscape will result in an explosion of new companies in the space, from direct operators such as retailers, product manufacturers and growers to all-new ancillary products designed to fill gaps and inefficiencies in the market. With all these new brands we’ll see even more innovation in product categories, methods of consumption and consumer education for the new cannabis consumers that now have access to adult-use cannabis. In addition to the creation of new cannabis specific companies, there will be traditional privately-held companies looking at the cannabis industry as a new growth vertical.

With so much opportunity we’ll see an increase in migration of talent from traditional Fortune 500-type companies into the cannabis cannabis industry, bringing with them additional expertise and lending even more legitimacy to this nascent industry. Jumping into the cannabis vertical from more established industries will be less of a risk after the 2016 elections. Years ago, mentioning that you were starting a career in cannabis would result in raised eyebrows at minimum. Now that same conversation often results in expressions of envy. The influx of expertise around branding and marketing, business development, sales and product development will continue to push the industry forward. This will accelerate the evolving public perception of cannabis as a consumer product similar to alcohol.

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The cannabis industry is an entrepreneur’s playground. Building a market around a product that has an established demand brings with it enormous opportunity. While not without it’s risks and frustrations as new rules and regulations continually get readdressed and amended, the overall tend is positive. The 2016 elections were the tipping point. The narratives we’ll see unfolding over the next few years in these new recreational and medical cannabis markets will be repeated the world over as other countries look to the US as a model for cannabis laws, resulting in unprecedented opportunities in unprecedented times.