Justin Hartfield has been involved in the business of selling marijuana for years, running the Yelp-style website WeedMaps.com and serving as the gate keeper and advertiser for legal marijuana dispensaries across the U.S.
He's made a fortune from the venture, all the while remaining firmly on the legal side of the business by working on the sidelines and never personally selling weed.
Hartfield is involved with the privately held Ghost Group, and he and his business partner Doug Francis just announced the launch of Emerald Ocean Capital, a venture capital firm that seeks to invest in marijuana businesses in the newly-legal industry.
The firm comes along at a critical time in the marijuana reform process. Two states, Colorado and Washington, have legalized the drug, while several others are reportedly considering making the substance more available.
Indeed, the "green rush," as many entrepreneurs involved in the rush have taken to calling it, is a critical part of the construction of a legitimate marijuana industry.
Hartfield's new venture taps into that entrepreneurial spirit with the intention to bring investors directly to the most exciting companies in the legal marijuana space.
We interviewed Hartfield about his new venture.
Business Insider: How did you become the first guy to start a marijuana venture capital firm?
Justin Hartfield: In 2008 I was running a Search Engine Optimization consulting business. I got my medical marijuana card and I stumbled upon a hole in the market.
I wanted to go to a dispensary but there wasn’t really a website where they all were. I decided to create this site  and slowly but surely we built it up to be one day acquired by a publicly traded company, SearchCore.
Through a year or two I was going back and forth with SearchCore. They decided to sell their marijuana assets off to a private group, which I’m now part of.
It’s been an interesting journey between then and now. I’m happy to say the company’s doing great as a private company and we’re trying to expand into other opportunities.
This fund is just a natural extension of what we’ve seen. People--in the last six months or a year--were asking us, “How can I be involved?” and “how can I invest?”
We really believe this is the future, and we decided we couldn’t turn down all these people who wanted to give us their hard earned money to invest in a legalized future.
BI: So it came organically from investors trying to get involved?
Justin Hartfield: Exactly. It’s what the market demanded and we’re putting it out as an experiment just like how we launched our other businesses.
That’s why we don't have a set target dollar amount for this fund, we want to take inquiries and see how many individuals, how many institutions want to get involved.
Then, once we have a good idea, create a kind of cap toward the end of the year, then we'll start the process of our investments.
BI: Who is interested?
Justin Hartfield: A lot of it is entrepreneurs from all over the spectrum who have made money privately. They’re kind of disruptive individuals themselves. They see an opportunity and want to invest.
We’re also seeing interestingly enough an investor pool aged 70, 55 years plus. They made their market exit like 20 years ago, they have their cash on the sidelines and they see this as a golden opportunity to get back in the game again.
Most of them were introduced to cannabis because a loved one or themselves needed it for a medical reason. They discovered how amazing it was for their condition and they’re like “S---, I can make a lot of money off of this."
BI: Are you still seeking investors?
Justin Hartfield: Yeah, we are. We’re seeking accredited investors and if people are interested, we welcome them to go to Ghost
BI: What kind of investments are you looking at?
Justin Hartfield: We’re targeting businesses that are on the ancillary of the marijuana industry. We’re not looking right now to invest in manufacturing and distributing or retail end of the the actual plant.
We are looking at all the opportunities that exist to the side of that, in the ancillary business, particularly technology--both software and hardware--and also in medicine, product development.
We’re building brands that are going to be sustainable post-legalization.
BI: How is the ancillary side of the market helping the legitimization of legal marijuana?
Justin Hartfield: Every business that opens up strengthens the industry. It brings more legitimacy to it and increases the size of the pie for everybody.
It’s not an industry if there’s only a couple of players or cartels or whatever. What we’re seeing is people getting more and more invested in marijuana and therefore ending marijuana prohibition. It’s been really kind of amazing to see.
BI: What firm would you like to invest in that doesn’t necessarily exist already?
Justin Hartfield: There’s a tremendous amount. This is a potentially $200 Billion industry if you look at what James Shivley is saying.
In that size of an industry, it supports an ecosystem that’s very rich. It supports B2B [Business to Business], B2E [Business to Employee], B2T [Business to Technology] products that don’t exist in the marijuana market.
If you look at any mature industry, like alcohol, there’s so many different products that exist for that which don’t currently exist for marijuana.
We’re looking for new technology and new software. That’s what’s really driving innovation in the world.
BI: How big do you think this can get?
Justin Hartfield: That’s the billion dollar, hundred billion dollar question.
I’m comparing it to the wine market right now. Between 15 and 25 billion dollars at a minimum, but it doesn’t really include what other value created additives that marijuana has.
Like coffee shops in Amsterdam. In Amsterdam there’s so many different locations that depend directly on the marijuana tourism.
Maybe they’re gift shops that say marijuana needs apparel, maybe there’s head shops that sell bongs.
There’s so many different businesses that feed off the marijuana business that it’s very hard to estimate how much. We could all be underestimating it when you think of the medical markets.
BI: What advice do you have for other investors thinking about jumping into the marijuana industry?
Justin Hartfield: I would say that as an emerging market it’s always changing and it’s always completely dependent on loopholes in the federal and state law.
For a truly sustained market, for international players to try to be involved in it, it has to be federally legal. It has to be regulated like alcohol with sensible, reasonable regulations for everybody. A market can be created and the government can get their cut as well.
Specific advice I’d give to investors? Hop on in, the water’s warm.
BI: But of course, even with this firm--and with your time behind WeedMaps--you’re actually doing nothing illegal.
Justin Hartfield: Exactly! It gives us great position to understand the market.
And when legalization finally comes, we can pivot towards that market.
We said that with, we want to sell more marijuana than anyone else in the world when it’s federally legal. is the perfect place to do it.
BI: The Amazon.com of pot?
Justin Hartfield: Exactly.
BI: From a business perspective, what do you think of what’s going on with legalization these days?
Justin Hartfield: I really want to encourage what’s happening in New York and what’s continuing to happen in Colorado and Washington.
Politicians--Liz Krueger in New York being a good example--they’re finally coming out of the closet on this issue.
They’re saying “Medical is great, and we need it, but we also need legalized marijuana in this state for about a hundred different reasons.”
So anyway, I’m really encouraged by what New York and other states like Illinois are doing to move this issue forward.
This interview originally appeared on Business Insider.
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