strength

Which Pro Sports League Will Take Cannabis Industry Money First?

Weed is legal in Canada on October 17 and the CFL already has a sponsorship offer. Who’s next?

Mobile Hero Imaeg 1080x1168
Steve Russell/Toronto Star via Getty Images

Social Mark Extra Background %281%29 4 0
September 4, 2018

On October 17, recreational marijuana use will be legal in Canada. This development has sent multiple cannabis companies’ stock price into the stratosphere; Tilray, a major cannabis producer in Canada, has seen a 750 percent increase in share prices since their IPO in July. Given that Tilray is just one of the many companies jockeying for position in the new marketplace, the feeding frenzy—which financial pundits have named “the green rush”—has no end in sight. And yeah, the money is nothing to sneeze at; the consulting firm Deloitte estimates that that legal weed sales in Canada will generate $7B in 2019.

 

Anytime there’s potential for a new, untapped revenue stream, no one is paying closer attention to this development than the world of pro sports, who always want a piece of the action.

 

According to Sports Business Journal, Canadian cannabis company Aphria has an offer on the table with the Canadian Football League for a league-wide sponsorship deal. However, it would be complicated for the CFL to accept sponsorship money without striking cannabis—as well as drug tests for cannabis—from their Collective Bargaining Agreement. A league can’t take money from a company that promotes a substance that’s banned among the league’s player population. With weed being federally legal in Canada, though, a previous hurdle is removed, clearing the way for further progress.

However, the CFL’s CBA doesn’t expire until 2019, so a resolution before that point seems unlikely, no matter how much money the cannabis industry is willing to cough up. So if it’s going to take a league like the CFL a year or more to sort this out, one can imagine that any kind of development in American pro sports is three to five years away, minimum. Recreational marijuana use is only legal in nine states and still illegal at the federal level, so the idea of removing cannabis-related provisions from the four major sports’ CBAs is a pipe dream, at least for the new future.

 

However, it’s a matter of time before someone makes a grab for the money. And there’s going to be a lot of it.

 

If I had to guess which American league would be the pioneer in this landscape, the safest bet is the NBA. Of all the major sports, the NBA’s Players’ Association governs the fewest players, making CBA negotiations a little more tenable (in theory), and commissioner Adam Silver is very good about sensing the oncoming tide.

 

Since the NBA is already popular with the 18 to 34 demographic everyone is pandering to at this point in time—see their NBA2K pro league—doubling down on that interest via cannabis partnerships would be a natural strategy. The NBA covets the concept of being the most player-friendly league of all American pro sports and I can’t imagine the league asking for a major concession in return for the elimination of a cannabis drug test. This happening in the NFL, a league presided over by incredibly conservative billionaire owners, would be another story.

 

But that doesn’t mean the NFL is out on cannabis. Many active and former players have advocated for marijuana use as a legal pain relief alternative and as a substance to help combat CTE. The NFL is still the biggest American league with an annual revenue of $13.68B, a number that is perpetually rising despite the constant bad press around the game.

 

You think the NFL isn’t coming for that cannabis money? I wouldn’t bet against them.