Co-founded by chief executive officer Brendan Kennedy, an MBA graduate of Yale School of Management, Privateer’s latest round brings total fundraising to $82 million.
The Series B round is led by Founders Fund, a San Francisco-based venture capital firm known for backing technology companies including Facebook, Airbnb and Spotify, the music streaming service.
Brendan said the cannabis market is transitioning from a global state of prohibition to one of legalization. “Cannabis prohibition and the destructive social injustices it causes are going to end sooner than people think,” he said.
He added that Privateer will use responsible brands to set the standard for the industry in terms of quality, professionalism and social purpose.
The legal US marijuana market grew by 74% last year to $2.7 billion, from $1.5 billion in 2013, according to ArcView, the investor network.
It remains illegal under US federal law. But medical use of the drug is legal in 23 states, and recreational use is allowed in Colorado, Washington, Oregon and Alaska.
Pot entrepreneurs hope that figure will rise. Privateer poached Patrick Moen, a former agent at the US Drug Enforcement Administration, in November 2013 – the first from the organization to join the legal marijuana market.
Privateer will use the new financing to build a global portfolio of cannabis brands – it already sells Bob Marley-branded products through its Marley Natural subsidiary – operating in multiple geographies around the world.
The private equity firm’s businesses include Tilray, a Canadian medical marijuana producer, and online cannabis ratings website Leafly.
Privateer has a number of other MBAs on its executive team, including Michael Blue, its CFO who also graduated from Yale, and Christian Groh, the COO who has an MBA from San Francisco State University.
Michael said that the trio set out to transform the legal cannabis industry. He added: “We closed the Series B round with a group of sophisticated family offices and institutional investors who made seven- and eight-figure investments. That’s a vote of confidence for the entire industry and an important step forward in finally ending cannabis prohibition.”
Privateer’s employee ranks are awash with big-name US business schools. The company has employed gradates of Tuck School of Business and the University of Washington, among other academic institutions, who believe in its vision of taking pot from illicit to legal.
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