Is Warren Buffett Getting Into The Marijuana Industry?

By November 5, 2014Marijuana Facts

For so long, members of ‘traditional business’ mocked the marijuana industry. Investors wouldn’t come anywhere near the marijuana industry. Finally, the times changed after the 2012 when Colorado and Washington legalized marijuana. Good old Warren used to sell ice cream, candy and soft drinks, all of which have made him a billionaire. He is the fourth-richest person in the world and if that guy sees the potential in legal marijuana business, then something big is cooking in that kitchen. Allegedly, a subsidiary of his Berkshire Hathaway Inc., a company called Cubic Designs is on its way to profit from good old marijuana.

1,000 fliers for weed dispensaries

It wasn’t Warren himself distributing those fliers, but one of his companies – Cubic Designs Inc., which makes platforms for maximizing usable floor space in warehouses. “Double your growing space,” the flier starts of with tagline in capital letters, above an image of an indoor facility with photoshopped rows of young plants. The flier was sent to weed dispensaries during recent weeks, offering to help growers expand.

Warren wants you to grow your profits

It seems as if Warren (or one of his CEO’s) has found his niche in the blooming marijuana business. Just so we’re on the same page, let us make some things clear before we move on. You see, when you legalize marijuana, the demand for plant’s flowers isn’t the only thing to rise. The demand for places where you can grow that plant will also substantially increase. Finding a real estate to grow your crops has never been an easy task wherever you wanted to grow, however, now it’s even harder and above all, it’s becoming more and more expensive to purchase an industrial warehouse for your marijuana venture. So it seems that once again Warren Buffet’s entrepreneurial instinct did well by simply jumping in to fill a market need.

The opportunity was already there

It didn’t take long for guys from Cubic Designs to spot the opportunity after a few growers approached them asking about their platforms, according to Shannon Salchert, the company’s marketing coordinator. In an interview for Bloomberg he explained all about warehouse space getting smaller and smaller in Denver, where growers are looking for facilities to cultivate their product. That demand has allowed landlords to raise prices. “We sold a few mezzanines into that market and decided internally, ‘Why don’t we do some marketing?’” Salchert said.

The company’s marketing department faced a challenge of reaching growers who don’t advertise their names and locations. The next best thing was to distribute those leaflets in dispensaries in states such as California, Colorado and Washington, hoping that somehow they will be forwarded to growers in need of their product. We are not sure how many growers took on their offer, or if those fliers reached any of them, but it’s definitely a situation worth following.


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