With investors becoming more cautious and capital more expensive, only the strongest cannabis firms will survive a downturn in the global economy.
Cannabis startups in Europe are facing a harder time raising capital amid recession fears and sinking stock markets, but that could ultimately help the industry.
“This period will be really good for clearing out those who were just trying to make a quick buck,” said Alastair Moore, the founder of Hanway Associates, a research firm focused on marijuana. “That’s a good thing for the sector.”
Startups likely to survive include those that have already built strong, sustainable business models, according to Moore. That will help them keep winning over investors who are becoming more cautious, he said.