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Bob Marley-branded weed is helping pot startups break funding records

Bob Marley-branded weed is helping pot startups break funding records

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As support for legalizing marijuana in the US continues to grow, investors are on the lookout for companies that can cash in. So far, the smart money seems to be on Privateer Holdings: a Seattle-based private equity firm that secured a 30-year licensing deal to use Bob Marley's name and likeness to sell "heirloom Jamaican cannabis strains" and other Marley-branded merchandise. In a recent funding round, Privateer Holdings raised $75 million, bringing its total pot to $82 million and making it the best-funded player in the fledgling marijuana industry.

Bob Marley's postmortem earnings were $20 million in 2014

Privateer's success is thanks at least in part to its licensing deal with Marley's family. The firm's Marley Natural brand launched last year and aims to start selling its products worldwide by the end of 2015. Leveraging Marley's fame is a bit of a no-brainer for the industry. Not only do people rightly associate Marley with marijuana use, but the reggae icon's image has already been used to sell everything from coffee to clothes. In fact, Forbes estimates that Marley was the fifth-highest paid dead celebrity last year, with postmortem earnings of around $20 million in 2014 alone.

However, Privateer has more in stock than just Marley Natural. Another of the firm's holdings is Leafly, an online directory that lists weed strains and shops as well as articles and discussions, and that went from 100,000 visits a month in 2012 to 5 million a month this year, according to TechCrunch. Another Privateer company is Tilray, which farms, packages, and sells pharmaceutical-grade cannabis in Canada.

Currently, medical marijuana is legal in 23 states in the US, with recreational use legalized in four. With its array of brands, Privateer can target this growing market from multiple angles — observing trends and tastes on Leafly, and supplying the product via companies like Tilray. Privateer Holdings CEO and co-founder Brendan Kennedy told TechCrunch that the firm wants to create brands that "inspire trust [and] create legitimacy."

"a mainstream consumer product."

"Our thesis was that this will be a mainstream consumer product used by mainstream Americans, and they will be looking for mainstream professional brands that don’t insult or offend them," said Kennedy. Currently, Privateer is focused on expansion, with the firm reportedly aiming to grow its staff from 250 to 1,000 in 2015 and enter half a dozen new markets by the end of the year.