Wrigley billionaire drops chewing gum for medical marijuana
William Wrigley Jr leads a $65m investment round for medical cannabis startup Surterra Wellness
New York — The scion of a family that made a fortune in chewing gum is moving into the marijuana business.
William Wrigley Jr II, who helped orchestrate the sale of his family’s business to Mars in 2008, led a $65m investment round for Surterra Wellness, a medical cannabis startup in Georgia with licences to operate in Florida and Texas. The funding brings the total raised so far to $100m, according to Surterra.
Wrigley, 54, who left the gum and candy business after the sale, backs companies through a personal investment arm based in West Palm Beach, Florida. After an initial investment in Surterra in September, Wrigley is boosting his stake and assuming the role of chairman. Surterra is his first direct investment in the marijuana industry.
Wrigley, known as Beau, said he got into the industry mainly because of marijuana’s medical benefits. He said he was tapping his experience with product distribution and brand-building to drive growth at Surterra. The cannabis company operates 10 medical dispensaries in Florida, including one in Miami Beach, and has a licence to operate in the nascent Texas market.
"When I understood the massive benefits, it really changed my mind about the industry," Wrigley said. "You don’t see too many opportunities to have that kind of an impact in an industry that is being created from scratch."
Wrigley, a billionaire whose great-grandfather founded Wrigley Company in 1891, has not yet invested in the burgeoning recreational marijuana market, which hit the East Coast recently in Massachusetts. But he is watching as more states look to cash in on legal sales for adults of a drug still considered illegal by the federal government.
Dozens of states now allow medical marijuana use, and the FDA recently approved the first-ever cannabis-derived drug.
Wrigley said the federal government is likely to take more steps to loosen regulations. So far the federal ban in the US has mostly prevented banks and big institutional investors from taking part in the cannabis boom. As Canada prepares to legalise the drug for adult use in October, money is pouring across the border.
Wrigley said Surterra planned eventually to participate in the domestic recreational market, which is forecast to surge above $5bn this year. Nine states have legalised the sale and consumption of marijuana by adults. When including medical sales, the US market will hit $11bn this year, according to a report by Arcview Market Research and BDS Analytics.
Despite hesitation because of the federal ban, the transition of billions of dollars into the legal US economy from the black market is drawing a lot of interest from investors.
"Everyone seems to be in because they think they’re going to make tons of money," Wrigley said. "Some will and some will be sorely surprised at how complex it is."