Peter Thiel bashed Twitter's management team for excessive "pot smoking." Now he's going to be a weed industry leader. Alana Kakoyiannis Earlier this year, Peter Thiel caused a stir when he accused Twitter's management of being high on pot.

He later backed away from his comments, saying, "You could smoke a lot of pot and still have a great company, if the business model is as robust as Twitter's."

And Thiel would know, because, as it turns out, he's investing in a marijuana startup.

Thiel's Founders Fund is likely participating in a large round of financing in a cannabis startup, Privateer. The company is raising a $75 million Series B round at a $425 million pre-money valuation, according to documents obtained by Business Insider. If Founders Fund participates in the round however, it may invest at a lower valuation. The round hasn't closed yet, so those numbers are subject to change.

Privateer was founded in 2011 and is positioning itself to be the leader in the weed supply chain, which the company says in its current state is fragmented, poorly managed, and largely run underground, despite "proven demand."

Privateer quietly bought up another startup in the space, Leafly, which is like Yelp for weed products. In 2013, Privateer launched Lafitte Ventures, which focuses on medical marijuana, and Tilray, which mails medical weed to users and generated nearly $200,000 in revenue last year. Privateer is also exploring a testing facility (Arbormain) in Washington state. The founders may launch their own weed-focused investment fund, too, so Privateer can pour money into external cannabis companies.

Medical marijuana is available in at least 22 states as well as Washington, D.C. Privateer estimates the US weed market could be a $20 billion to $50 billion opportunity. Privateer hopes to be the leader across everything from growing and processing various strains of marijuana to supplying and shipping it. It also plans to get into the accessory business, selling devices like pipes and vaporizers to users.

Privateer is already generating meaningful revenue, although the company is not profitable. In 2014 it expects to generate nearly $11 million in net revenue, up from $1.2 million in 2013. Most of that revenue (60% to 70%) is generated by Lafitte Ventures, and the rest is from Leafly. Privateer expects to reach profitability and generate $111 million in 2015 and $440 million in 2016.

Privateer was founded by Brendan Kennedy, Michael Blue, and Christian Groh. Kennedy, who is the company's CEO, and Groh, Privateer's COO, formerly worked with an affiliate of Silicon Valley Bank. Blue, the company's CFO, worked for a private equity firm, Herrington.

Thiel and Privateer did not immediately respond to a request for comment.

*An earlier version of this story stated that Founders Fund was leading rather than participating in the on-going round.