For entrepreneurs seeking the next big thing, the cannabis industry—estimated to be a $166 billion market globally—could be a lucrative investment. But most of the market’s value is based on illicit activity, and it’s unclear if, or how quickly, states and other countries will move to legalize that activity. Those uncertainties haven’t deterred savvy professionals like alumni Ted Chung W99 and Jeff Monat W00 from finding success in the space. Chung, an entertainment and marketing executive with ties to rapper Snoop Dogg, and Monat, a partner at cannabis-focused private equity firm Merida Capital Partners, recently offered insight into “cannabusiness” alongside other sector leaders during an event hosted by the Wharton Alumni Club of New York on May 15.

One piece of advice? “This industry moves so fast, and you have to be willing to run through walls and think about seven things all the time,” Chung cautioned. But while the evening’s presenters painted a picture of a product category affected by quickly changing conditions, they also depicted a space that, with the right advocates, could become a mainstream market in the U.S. Here are three essential takeaways from the event.

Opportunity Is Everywhere

While the bulk of the $3.8 billion invested globally in the cannabis sector last quarter went to infrastructure such as greenhouses and farms, deal makers also poured money into a range of other areas, including hemp, extracts, software, agriculture technology, and consumption devices like vapes, according to data compiled by investment banking and advisory firm Viridian Capital Advisors.

One such investor, Monat’s firm Merida Capital, has found promise not only in consumer cannabis brands like Henry’s Original and Canndescent but also in subsectors as diverse as data analytics, product testing, and wellness.

The set of potential deals is wide-ranging, but investors could find it increasingly hard to secure reasonable prices because of well-funded companies like Canadian businesses and multi-state operators that are driving up competition, according to Viridian President Scott Greiper. “It’s difficult to be a buyer, and buy right,” he said. But on the flip side,”[It’s] a really good time to be the seller.”


Brands Matter

Consumer-focused companies have a unique opportunity to establish their eminence in the U.S., which is just starting to experience the emergence of well-known brands. “There is the beginning of customer awareness, customer loyalty, and customer preference,” said Greiper. Familiar brands that currently lead the space, he estimated, have captured only small slices of the market in the states where they operate, leaving room for other businesses to make names for themselves.

Chung, an early industry leader behind a number of cannabis companies, has been particularly cognizant of branding power in the sector. Leveraging a network of influencers, he has been pivotal in launching businesses such as consumer line LBS and content producer Merry Jane alongside sector luminaries like Snoop Dogg. “We knew brands very well, so we created a house of brands,” Chung said.


Education Is a Challenge

Pamela Hadfield, co-founder of online health platform HelloMD, tried several remedies for the longtime migraines she suffered before finding relief with cannabis. “Within six months, I had prevented my pain altogether, and six years later, I have not had a migraine since,” she said. That experience changed her mind about the substance and led her to pivot HelloMD from a traditional provider of online medical services to a telehealth company offering cannabis products and services.

To reach a wider audience, Hadfield called for more information among both general consumers and medical patients. “People really don’t know the difference between CBD and THC; they don’t know the difference between hemp and cannabis marijuana—very basic things,” she said. But even more difficult for industry advocates could be convincing doctors to recommend cannabis. “A bigger hurdle in education is educating the medical establishment,” she said.

In the consumer category, proponents like Chung are bridging the information gap in part through media such as the videos and online content made by Merry Jane. “There’s just a level of lack of knowledge and education, and once it’s around you and you have some level of context…then there’s a comfort level and an understanding on what decision you want to make,” Chung said. “The content side of what we do—we look at [that] as a Trojan horse to educate the world.”