Brendan Kennedy wants to build the Coca-Cola of cannabis. The PepsiCo of pot. The Procter & Gamble of ganja.

Ok, we'll stop now.

As CEO and co-founder of Privateer Holdings, a private equity firm focused on legal cannabis, Kennedy is trying to build a family of globally recognized and trusted brands in what has historically been an artisanal, underground, and, need we mention, illegal industry. Now, he has attracted funding from one of Silicon Valley's most respected venture capital firms to help him to do just that.

Today, Founders Fund—the Peter Thiel-backed venture capital firm behind Facebook, SpaceX, Airbnb, and more—announced a multimillion dollar investment in Privateer, marking the first time Founders Fund, and indeed any top tier VC firm, has invested in a so-called "cannabusiness." It's part of a larger $75 million round that Privateer will soon close, which Business Insider reported would value Privateer at $425 million. Privateer declined to comment on that number.

The money will help grow the three businesses currently operating under the Privateer umbrella: Tilray, an online medical marijuana distributor based in Canada; Leafly, a Yelp-like site for marijuana strain and dispensary reviews; and the newest addition to the Privateer family, Marley Natural, a New York City startup founded in partnership with Bob Marley’s family. Later this year, Marley Natural will begin selling a range of cannabis-related products, from lotions to vaporizers to a strain of Jamaican cannabis.

>'We do believe the end of prohibition is inevitable, and we believe this company is well-positioned to be a major player.'

But Founders Fund’s cash—and cachet—doesn’t just benefit Privateer, Kennedy says. This investment lends credibility to the entire industry, which, as a recent WIRED story explored, is loaded with still untapped opportunity. "This is an important step in the mainstreaming of the industry as a whole," Kennedy says. "A group of smart people has been looking at this industry for a year and a half and made a conscious decision to enter it."

Indeed, both public and regulatory acceptance of legalization has grown tremendously in recent years. Medical marijuana is legal in 23 states and Washington D.C. Meanwhile, Oregon, Washington D.C. and Washington state, Colorado, and Alaska have all legalized marijuana for recreational use. Add to that the fact that 51 percent of Americans support the legalization of cannabis, according to Gallup, and it's little wonder that Founders Fund sees promise in this market.

"We do believe the end of prohibition is inevitable, and we believe this company is well-positioned to be a major player," says Geoff Lewis, a partner at Founders Fund.

'Regulation Follows Consumer Sentiment'

Lewis compares the risk Founders Fund is taking to the risks it took investing in Airbnb, which faced regulatory hurdles of its own. "We made the investment, and ultimately the regulations are coming together," he says. "Our sense on regulatory stuff is: regulation follows consumer sentiment."

These are much the same reasons Kennedy got involved in this field to begin with. Far from a "High Times-ish" (his words) stoner, Kennedy received his MBA at Yale before becoming chief operating officer of Silicon Valley Bank Analytics. That's where he first saw the opportunities in the cannabis industry. He spent months researching the industry and found that for all its promise, it was still a farmer's market-style industry run by small growers with Ziploc bags. As an aspiring pot entrepreneur who defied tired stereotypes, he wanted to build a brand that would do the same.

"We came to the conclusion that cannabis is a mainstream product. It’s consumed by mainstream Americans on a daily basis, and what was really missing were mainstream brands people could relate to, that aren't scary, and don't insult people," he says. And so, he and his co-founders, Michael Blue and Christian Groh, left their jobs to launch Privateer.

The 10-Year Jump

Today, Privateer operates a 60,000 square foot federally licensed facility in Canada, where it grows cannabis for Tilray's 4,000 customers. This year, Tilray is on track to generate $25 million in online orders. Meanwhile, Leafly is attracting some 4 million users a month and is slated to bring in $12 million in ad revenue this year.

But it's the partnership with the Marley family, which includes a royalty agreement and 30-year license for Marley Natural, that Kennedy says could play the biggest role in building that global brand. "We just jumped ahead 10 years," he says. "We couldn't think of another global cultural icon that was more closely tied to the product, and it was a natural tie in."

Of course, there's only so much that brand building can accomplish in the face of strong regulatory opposition. For evidence of that, see the regulatory shitstorm raining down on Uber, one of the strongest brands of the last few years. At least in the short term, growth of this industry within the United States will undoubtedly be hamstrung by cloudy regulations.

That's one reason why Lewis says people will likely find Founders' Fund's investment to be "quite surprising." But he believes they will come around. "I think many of the best investments seem a little crazy at first," he says, "and then they prove themselves out over time."