Three years ago, a purchase was made in Exeter with the promise of turning the community into a major hub for Canada's legal pot industry, bringing high-paying jobs. However, before any of the 200 anticipated jobs were filled or a single marijuana seed was planted, it was clear that Canada was producing more marijuana than the market demanded. After sitting unused for two years, the 1-million-square-foot greenhouse was sold for a fraction of its original price. Exeter's experience with the greenhouse reflects the broader Canadian trend of high hopes followed by disappointment in the legal pot business. Analysts attribute the failure of optimistic forecasts to Canada's tightly regulated distribution system that restricts advertising and marketing. The slow opening of stores in certain provinces, especially Ontario, is contributing to the delay. Additionally, surveys have indicated that a significant number of Canadians are not enthusiastic about trying a new habit. "We were excited about it," stated Mayor George Finch, while standing outside Exeter's historic Town Hall. "It seemed almost too good to be true, right? It's unfortunate." "When Prime Minister Justin Trudeau's government legalized marijuana in 2018, the primary goal was to promote a fairer justice system rather than to create a significant new industry. However, investors had a different perspective, and leading up to legalization, there was a surge of investment in companies looking to capitalize on the Canadian market and potentially expand to the US market as well. This led to a 'green rush' on the Toronto Stock Exchange, with money flowing into start-ups and existing companies. Old greenhouses were renovated and sold at high prices, and new indoor growing facilities were established nationwide. Newspapers, which had been downsizing, hired journalists to cover the emerging marijuana industry." Similar to the plastics industry in the film "The Graduate," marijuana appeared to be on track to become Canada's next big industry. The enthusiasm for investments in marijuana stocks mirrored the excitement of the dot-com stock boom of the late 1990s, but ultimately led to a similar crash. Despite a slight rebound due to increased legalisation in the United States, with New York recently legalising marijuana and four states voting for legalisation in November, a major marijuana stock index remains down by 70% from its peak in 2018. Even 2 1/2 years after legalisation, many marijuana producers in Canada are still experiencing significant financial losses. A significant new rival is on the horizon; Mexico recently passed a law allowing recreational marijuana use. This could make the competitive landscape even more difficult for Canada's cannabis producers. Kyle Murray, vice dean at the University of Alberta School of Business, predicts that there may be a series of industry shakeouts as a result. The situation is reminiscent of the dot-com boom and subsequent bust. Canopy Growth, Canada's biggest producer, reported a loss of CA$1.2 billion, or approximately $950 million, in the first nine months of its current fiscal year. The industry has experienced layoffs, with large producers merging to increase their size and strength. Many greenhouses in various provinces have permanently closed. Analysts had high hopes for the marijuana industry in Canada, expecting sales to follow the same trend as liquor sales in the US after Prohibition. However, the industry has not progressed as quickly as anticipated, according to Brendan Kennedy, the CEO of Tilray, a major grower based in Nanaimo, British Columbia, which incurred a $272 million loss last year. Kennedy, a prominent figure in Canada's marijuana industry, has faced challenges competing with the illicit market due to strict regulations. Despite many industry pioneers being ousted as losses mounted and stocks fell, Kennedy will continue as a director after a planned merger between Tilray and Aphria creates the world's largest cannabis company. In Ontario, initial plans to sell marijuana through government-owned liquor stores were scrapped by a new Conservative government in 2018, leaving only online sales through a provincial website. The province's plans have changed twice since then, resulting in a uneven introduction of privately owned shops. Ontario has only approved 575 shops, despite a recent increase in licensing, while Alberta, with about one-third of Ontario's population, has 583 shops. Although initial expectations for marijuana profits were too high, Murray believes that a successful business will eventually emerge, as evidenced by the increasing number of Ontario shops. The fact that prices are now closer to street prices should also boost legal sales. Murray stated that the slow start does not indicate a bad market, attributing it to the initial influx of money and companies. He believes that in time, there will be successful companies that will become global leaders. A positive development is the growth of sales in legal marijuana stores in British Columbia, which was once the center of Canada's illegal marijuana industry, with a 24% increase from June to October 2020. In Quebec, the government-owned cannabis store operator, Société Québécoise du Cannabis, initially faced losses of nearly CA$5 million in its first fiscal year, but has since turned a profit. Despite disappointment among some of the larger Canadian growers, who are looking to foreign markets, particularly for medical marijuana, for growth opportunities, many analysts are doubtful. Brent McKnight, a professor at McMaster University, believes that Mexico's recent steps toward creating a large legal market could threaten Canada's marijuana industry due to lower labor costs and a more favorable climate. Trade agreements may prevent Canada from restricting imports from Mexico, further complicating the situation. He stated that this would definitely cause prices to go down for local growers. With Canada's industry having to consolidate in order to survive, there are concerns about who will be negatively impacted as large, publicly traded companies take over. Before marijuana was legalized, many of the initial shops that went against Canadian laws were nonprofit "compassion clubs" that sold to those using cannabis for medical reasons. Dr. Daniel Werb, a public health researcher and drug policy analyst at St. Michael's Hospital in Toronto, noted that the current system, which prioritizes large corporate growers and profits, has excluded many individuals from minority communities from participating in the industry. Werb, part of a research group, has found that there is a lack of diversity in the leadership of the new legal suppliers. Vendors in Indigenous communities have been left in a state of uncertainty, not facing police raids but also operating outside of the legal system. Ontario has started licensing shops in some of these communities, but there are concerns about the lack of diversity and imagination in the cannabis industry. This missed opportunity could have allowed for a more creative approach to the industry, according to Werb.