Rapper and record producer Jay-Z recently opened an investment fund to assist minority cannabis business owners who are trying to get into the cannabis industry.
The fund is the result of Jay-Z’s drive to help Black people get the opportunities they deserve. Minority groups have been largely kept out of the cannabis industry due to bearing the brunt from the War on Drugs, and instead, wealthy, white investors have taken hold. “We were the ones most negatively affected by the War on Drugs, and America has turned around and created a business from it that’s worth billions,” Jay-Z told the Wall Street Journal. “I wanted to do something in a real, concrete way, where I do my part.”
While the industry is growing fast, even despite the ongoing pandemic, black people still have trouble accessing the market due to the fact that they were, and in some places still are, more likely than white people to be arrested for cannabis. Currently, the industry is still 81 percent white, with only 4.3 percent of business owners being Black, according to a 2017 Marijuana Business Daily survey.
In order to create the fund, Jay-Z acquired two cannabis firms based in California: Left Coast Ventures and CMG Partners. Under the heading of Subversive Capital Acquisition Corp., the goal is to fund “Social Equity Ventures” starting with $10 million, and adding in two percent of net income each year to grow the fund.
In addition to this, the money that companies will receive will be significant. The plan is to invest up to $1 million in each cannabis startup it supports. Jay-Z will run the fund along with Desiree Perez, the CEO of Roc Nation, his entertainment company.
Of course, great financial backing or not, one single fund can’t back all the minority business owners and bring full equity to the industry overnight, but the future holds a lot of opportunity for minority groups trying to get into the industry.