(Washington) American rapper and producer Jay-Z has launched a $ 10 million investment fund to support small businesses in the cannabis industry owned by African Americans or companies controlled by visible minorities.
Shawn “Jay-Z” Carter, who wants to become a leader in the legal cannabis industry in the United States, was able to bring together this venture capital instrument after the takeover in December of a direct-to-consumer platform in California, Caliva and a cannabis manufacturer, Left Coast.
“With an initial goal of $ 10 million in fundraising and an annual contribution of at least 2% of net income, we are focused on diversifying business leadership and the workforce,” a company statement said. mother, The Parent Company (ex-Subversive Capital) of which Jay-Z is the “Chief Visionary Officer”.
The Parent Company (TPCO), now a SPAC – a vehicle intended to raise funds on the stock market – has been listed since last week on a Canadian financial platform, the NEO Exchange. Singer Rihanna is also among the investors.
The company undertakes to invest 2% of its income each year in this new “Social Equity Investment Fund”, created by the rapper.
The San Jose, Calif.-Based holding company claims $ 185 million in 2020 revenue for a cannabis market valued at $ 7.5 billion for California, where marijuana use is permitted for recreational use as in fifteen other American states.
Soon more than the wine market
For the country as a whole, where cannabis use remains illegal at the federal level, the marijuana market could reach $ 75 billion by 2030, according to a study by Cowen Bank in New York, surpassing that of wine valued at 68 billion.
“I wanted to do something concrete, to bring my share”, indicated Jay-Z to the Wall Street Journal this week, denouncing imbalances in the cannabis industry as African Americans are more often jailed for marijuana-related offenses, but very little represented in its legalized trade.
“It’s amazing how this could have happened,” added the rapper. “We are the ones who paid the price in the war on drugs and all of a sudden America did an about-face to create a sector that is worth billions of dollars,” he said.
The musician and businessman, married to Beyoncé, will manage the fund alongside his right-hand man, Desiree Perez, the CEO of his management company Roc Nation.
The latter, who was convicted 25 years ago for possession of an illicit substance, has just been pardoned by President Trump, within the framework of 73 pardons granted by the Republican president before his departure.
According to a 2017 study by the National Institutes of Health, African Americans are incarcerated for drug-related offenses, at rates five to seven times higher than those of white people.
In the cannabis industry, in Massachusetts for example, where the trade has been legalized since 2016, only 6% of those registered to sell or produce marijuana are from the African American minority, according to the Wall Street Journal.