How $100,000 can unlock the next $1 billion market
Multiplying your initial investment is a fundamental idea in business, and a meaningful political strategy. When I talk to my friends in the VC world, they always talk in terms of a multiplier—i.e. how much their investment will multiply in its return value. Private sector leaders that are involved in politics apply that same thinking to their political spending. One major ROI opportunity for the pro-Cannabis community is the 2020 state senate elections in Minnesota.
Where things are today in Minnesota
In Minnesota, adult use cannabis is projected to be an over $1 billion annual industry, and Minnesota is primed to be the 3rd state to legalize by legislative action and not a ballot initiative. Democratic Farmer–Labor governor Tim Walz recently directed his commissioners of relevant executive agencies to prepare for adult use cannabis legalization. DFL House Majority Leader Ryan Winkler said his caucus is ready to move forward on legalization, and he would consider being the chief sponsor.
Unfortunately for the pro-Cannabis community, the Republican controlled Senate has a different perspective.
Republican Senate Majority Leader Paul Gazelka has been vocal that legalization is dead on arrival in his chamber. Leader Gazelka is concerned about increased traffic incidence, the effect on the youth, and drug treatment.
Political overview of Minnesota
Elections have consequences. The Minnesota Senate is up for re-election in 2020 and the Republicans are defending their 35-32 majority. History will not be on their side, as 2016 was only the second time in 40 years the Republicans controlled of the Senate.
The 2016 Presidential Election had an impact on down ballet state candidates in the Republican’s favor. Donald Trump received more votes in Minnesota than any Republican presidential candidate in history. Hillary Clinton had the poorest showing of a Democratic candidate in Minnesota since Al Gore in 2000, which didn’t help DFLers hold swing seats.
However, the DFL dominated the 2018 cycle, which the pro-Cannabis should be encouraged by when looking to 2020. In 2018, the DFL won every election for executive office, took control of the House, and Minnesota elected two Democratic United States Senators. The Senate serves 4-year terms so was not up for reelection.
What is possible?
With two Republican seats preventing recreational adult use, the legal Cannabis industry and the pro-Cannabis community can get a significant multiplier for its campaign dollars.
Think about it like this. There were three races where Republicans won by a total of 889 votes. In total, all six candidates raised $469,536. Targeting these types of races, or the seven Republicans that narrowly beat a DFL incumbent in 2016 could be a game-changer. If the pro-Cannabis community strategically targeted $100,000 in state senate elections, it could flip two Republican seats and unlock a $1 billion industry.
If a potential 1,000:1 multiplier wasn’t a good enough deal, remember when I said Minnesota could be the 3rd state to legalize adult use cannabis through legislative action? The 11 other states legalized by ballot initiatives, which cost millions of dollars to successfully execute.
Looking forward
So while the Cannabis industry, which did an estimated $10 billion in sales in 2018, could smartly leverage $100,000 this election cycle to help a chamber change parties thereby opening a $1 billion market, the real question the pro-Cannabis community should be asking themselves is what the cost and multiplier will be to build a bipartisan consensus for legal adult use cannabis?
