Last week, BuzzFeed delved into Sean Parker, Napster founder and early Facebook investor, and his recent investments in marijuana-related startups and political organizations. Known to many for his multi-billion dollar net worth, his lawsuit loss to the the Recording Industry of America and his $600 million Foundation, Parker has engaged in the “complex and messy politics of weed legalization.”
Venture capitalists are starting to test the waters and we have seen several investments in marijuana-related startups. Parker has invested in Privateer Holdings, and Snoop Dogg announced a cannabis-focused fund called Casa Verde. No matter where you stand on the pot issue, there is no denying that the legalization of cannabis will open up tremendous business opportunities. And where there is money to be made, there are investors ready to get in.
So how does this relate to the politics of disruption? Surely, the path to legalization of a current Schedule I drug has little in common with other disruptive technologies. Think again.
Know the landscape
High-growth companies must pick their target audiences well. Pinterest founder’s Ben Silbermann didn’t just focus on getting his product in the hands of coastal tech hipsters. Instead, he and his team got Pinterest into the hands of those who would embrace their product and become the product’s early advocates: young mothers and bloggers.
Much the same, Parker’s investment in the California marijuana ballot battle is deliberate. The seventh-largest economy in the world, California is a revenue-generating powerhouse with a legacy medical marijuana industry and tolerance for recreational use. He is dipping his political toes in a state where he has the best chance of winning – always a good strategy.
Rally your allies
Startups also recognize that partners can come from the unlikeliest of places. In 2013, Airbnb brought on Chip Conley, founder of Joie de Vivre hotels, as their head of global hospitality. Instead of ignoring the hotel experience, Airbnb hired a hotel leader to import some of the best hospitality traits to the top of the home-sharing company.
The California quest for pot legalization hasn’t been an easy one, with various groups on on the same side of the debate sometimes conflicting with or even fighting against one another. Parker rallied his supporters and is crafting his own ballot initiative, built upon the decades of work from medical and recreational activists across the state.
If at first you don’t succeed…
Winners don’t accept losing.
When Michael Dell took his namesake company private for $25 billion in 2013, Dell Inc. was struggling to make money in the face of the rise of tablets. Few thought the company could stage a comeback after a 72% slump in its last public quarter. This week, Dell announced a $67 billion acquisition of EMC Corp. The Wall Street Journal headline says it all: EMC Takeover Marks Return of Michael Dell.
This is not Parker’s first entre into marijuana politics, as he’s lost in California just five years ago. This “don’t take no for an answer” approach applies to any political or tech battle, anywhere across the country – often times patience (or absolute stubbornness) is a political virtue.
As more technology companies run headlong into policy challenges, lessons can sprout from the greenest of opportunities.