Brendan Kennedy was an early mover in the market as the world started to legalise cannabis. It seemed like a crazy and risky decision a decade ago. Now, he's sitting on a fortune. Jane Lewis reports.
When Brendan Kennedy gave up his job in finance to gamble on the commercial potential of legal cannabis, everyone thought he was crazy. Nine years on, he has become "a poster child of the green rush", says The Times. He presides over Tilray, a self-described "global leader in cannabis research, cultivation, processing and distribution", which has ridden "an extraordinary global surge towards legalisation".
After becoming the first big cannabis firm to float on Nasdaq in July 2018, its shares soared. On modest revenues of $20m, Tilray was quickly valued at more than $20bn. Kennedy's own pay package a mix of cash, shares and stock options jumped to $250m, putting him up there with Tesla's Elon Musk as America's second-highest-paid CEO. Tilray "wears the crown as the hottest initial public offering of 2018", raved Fortune.
Subscribe to MoneyWeek
Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE
Sign up to Money Morning
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Big Cannabis teams up with Big Booze
"An unassuming, almost bashful figure," Kennedy, 47, describes being "caught off-guard" by the feverish reaction. Tilray's shares have since fallen: it is now valued at just $2.4bn. But it is still at a critical phase of its evolution as "Big Cannabis" goes mainstream, says Fortune. Thanks to a ground-breaking deal with Swiss pharmaceutical firm Novartis to develop treatments for epilepsy and post-traumatic stress, Tilray already distributes to the medical cannabis market in five continents. A separate deal with Bob Marley's estate has secured the rights to the reggae star's name to market weed-infused lotions. And now Tilray is getting into bed with "Big Booze", recently striking a $100m deal with Anheuser-Busch InBev to create a cannabis-infused substitute for beer.
Kennedy has always shied away from the weed himself, says Fortune, and he had a conservative upbringing. He attended the Jesuit prep school of St. Ignatius, where his father taught science, later studying architecture at Berkeley. In the early 1990s he moved to Seattle to write engineering software eventually finding his business feet evaluating fledgling start-ups at Silicon Valley Bank. Colleagues rate his singular "knack for scanning data for auguries of the future and uncanny memory for dates and figures During the spring of 2010, the data began telling Kennedy a story about cannabis".
Creating the new Coke
Looking at the embryonic market, "what we saw was a mess", he told the Financial Times in 2015. "There were no industry leaders, no standards, it was very fragmentedWe couldn't find anyone we could trust our money with." He founded a private-equity firm, Privateer, to bridge the gap later moving into production with Tilray. Typically forensic research has paid off: in the quest to create a "standard" product, thousands of clones of the original mother plants are grown at Tilray's headquarters in British Columbia. "The real value in the market is going to be having the Coke-calibre brand," an early backer, Peter Thiel's Founders Fund, noted.
When he ploughed his savings into Privateer, Kennedy admits the fear of failure produced "a darkness unlike anything I'd ever faced". Everything, from hiring a lawyer to securing a bank account, was difficult. The scene has changed beyond recognition, but the "ambassador of Big Cannabis" is still "operating in a kind of twilight zone" of legal uncertainty, says The Times. What's his tip for dealing with US immigration officials? "Well, I don't say, I was just in Jamaica touring cannabis farms'."
-
Inheritance tax reforms: government urged to rethink curbs on rural reliefsMPs want the government to delay changes to inheritance rax reliefs for farmers
-
‘I’m among the thousands of millionaires leaving the UK – the new tax rules don’t make sense ’MoneyWeek spoke to a serial entrepreneur who is leaving the UK following the abolition of the non-dom tax status
-
Why Britain should join the race to corner the cannabis marketOpinion Germany’s government is to legalise cannabis – but Britain risks getting left behind in a growing new industry, says Matthew Lynn.
-
Britain will miss out on the legalised cannabis highOpinion With legalised cannabis, a new multi-billion-dollar industry is beginning to flower. But Britain won’t get a look-in, says Matthew Lynn.
-
The war on pot has failed – so should we legalise cannabis?
Features Cannabis is legal in Canada and several US states. Now England’s chief medical officer wants to loosen restrictions on medical marijuana. The tide is turning in favour of liberalisation, says Alex Rankine
