KCBS_740 SAN FRANCISCO (KCBS) — The marijuana industry is budding, and venture capitalists are taking a page from the tech industry as they look to get in on the ground floor.

CEO and Co-founder of venture capital and private equity firm The ArcView Group Troy Dayton forecast that the marijuana industry will grow from a $7.1 billion market this year to a $22.8 billion by 2020.

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“That’s a 31-percent annual compound growth rate, and a lot of that starts to happen after 2018, because we’re on the ballot in nine states in November, with either medical, or adult use,” Dayton told KPIX 5.

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But, Dayton warned that so-called mom-and-pop investors should be wary of where they invest, as institutional investing firms haven’t yet jumped onto the marijuana-industry train.

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“Be very, very careful about the penny-stock hustlers, who are captivating on the excitement,” Dayton said.