Three years ago, a purchase was made in Exeter with the promise of turning his community into a major hub for Canada's legal pot industry, with high-paying jobs. However, before any of the 200 anticipated jobs were filled, it became clear that Canada was already producing more marijuana than needed. The 1-million-square-foot greenhouse sat empty for two years before being sold for one-third of its original price. Exeter's experience with the greenhouse reflects the larger Canadian story of high expectations followed by disappointment in the legal pot business. Analysts attribute the failed projections to Canada's tightly regulated distribution system, which restricts advertising and marketing. The slow opening of stores in certain provinces, especially Ontario, is contributing to the issue. Additionally, surveys have indicated that a significant number of Canadians are not interested in trying out a new habit. "We were excited about it," remarked 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 main intention was to address inequalities in the justice system rather than create a significant new industry. Despite this, investors viewed the situation differently, leading to a surge of investment in companies preparing to capitalize on the legalization. This "green rush" saw money flowing into businesses not only in Canada but also looking towards the expanding US market. Greenhouses that had been unused for years were renovated and sold at high prices, while new indoor growing facilities were established nationwide. Newspapers, which had been reducing their staff, hired journalists to cover the emerging marijuana industry. Similar to plastics in the movie "The Graduate," marijuana appeared to be on track to become Canada's next big industry. The investment frenzy mirrored the dot-com stock boom of the late 1990s, but ultimately ended in a similar crash. Despite a slight rebound due to increased legalization in the United States, with New York recently legalizing marijuana and voters in four states supporting legalization in November, a major marijuana stock index is still down approximately 70% from its highest point in 2018. Even 2 1/2 years after legalization, many marijuana producers in Canada continue to experience significant financial losses. A significant new rival is on the horizon; Mexico recently passed a law allowing recreational marijuana use. This could make it even tougher for Canada's cannabis producers. Kyle Murray, vice dean at the University of Alberta School of Business, predicts there will be a series of shakeouts in the industry. Canopy Growth, Canada's biggest producer, reported a loss of CA$1.2 billion in the first nine months of its current operating year, comparable to the dot-com boom and subsequent bust. There have been widespread job cuts in the industry, leading to mergers among large producers seeking strength through increased size. Numerous greenhouses across multiple provinces have permanently closed down. Analysts had anticipated that marijuana sales in Canada would follow a similar trend to the spike in liquor sales in the United States post-Prohibition, resulting in major investments in the marijuana industry. However, Brendan Kennedy, the CEO of Tilray, a significant grower in Nanaimo, British Columbia, which experienced a $272 million loss last year, stated that the industry in Canada has not progressed as quickly as expected. Kennedy faces a challenge when it comes to competing with the illicit market due to the strict regulations. Despite many leaders in Canada's marijuana industry facing losses and being replaced, Kennedy will continue to be a director after the merger between Tilray and Aphria. Initially, Ontario had planned to sell marijuana through government-owned liquor stores, but this was canceled by the new Conservative government, leaving only online sales through a provincial website. The province's plans have changed twice since then, resulting in a staggered introduction of privately owned shops. Despite a recent increase in licensing, Ontario has only approved 575 shops, compared to Alberta's 583 shops, even though Alberta has a population one-third the size of Ontario's. Although initial expectations for profits from marijuana were too high, Murray believes a successful business will eventually emerge, especially with the growing number of Ontario shops. Additionally, the fact that prices have become more competitive with street prices should also boost legal sales. Murray stated that the poor start does not necessarily indicate a bad market, as there were initially too many companies and too much money involved. He believes that eventually, some companies will become very successful and potentially become global leaders. A positive development has been seen in British Columbia, where sales in legal stores increased by 24% from June to October 2020, despite the province being previously known for its illegal marijuana industry. In Quebec, the government-owned cannabis store operator, Société Québécoise du Cannabis, initially faced a nearly CA$5 million loss in its first fiscal year but has since turned profitable. While some larger growers in Canada are looking to foreign markets, particularly for medical marijuana, as their next opportunity, many analysts are doubtful. Brent McKnight, a professor at McMaster University, suggests that Mexico's recent steps towards creating the world's largest legal market could spell trouble for marijuana growing in Canada. Trade agreements may prevent Canada from stopping imports from Mexico, and Mexico's lower labor costs and warmer climate could give it a competitive edge. He mentioned that this would definitely cause prices to go down for local growers, and there are concerns about the impact of large publicly traded companies dominating the industry as Canada's market consolidates. Even before legalization, nonprofit "compassion clubs" were selling marijuana to medicinal users. The current system's focus on profits has marginalized many individuals from minority communities from participating in the industry, according to Dr. Daniel Werb, a public health researcher in Toronto. Research has shown a lack of diversity in the leadership of legal suppliers. Sellers in Indigenous communities have also been uncertain about their legal status, as they are not typically targeted in police raids but also operate outside of the legal system. Some shops in Ontario's Indigenous communities have started to receive licenses. Werb expressed concerns about the lack of diversity and creativity in the cannabis industry, suggesting that there was a missed opportunity for a more inclusive and innovative approach.