But what are its mooted benefits, who are some of the key players in Scotland, and what kind of outlook does the sector have?
CBD is a compound derived from the hemp plant, and is separate from the psychoactive component tetrahydrocannabinol (THC) that may be present in products but in mere trace amounts. CBD is legally sold in oils, drops, sweets, baked goods, drinks and capsules, for example.
The many purported benefits of the substance include helping manage depression, anxiety, and sleep disorders, and lessoning the symptoms of eczema.
Perth-based firm Voyager has just announced the closure of its crowdfunder – having raised £874,000 from some 350 investors, a significant leap from its initial target of £175,000, and closing after just five days instead of the planned 40.
The company adds that it was the first multi-product CBD company in the UK to successfully complete crowdfunding, with the latest raise following another over-subscribed seed funding round that saw it attract £500,000 from investors in November of last year.
Voyager has launched 16 products, with seven more scheduled for release this month, and more planned in the run-up to summer – as it aims to become “the trusted brand in this increasingly popular health and wellness space”.
Founder and boss Nick Tulloch sees the market for CBD products growing at pace worldwide, “with predictions it will surpass the entire herbal supplements market to be worth £1 billion in the UK alone in the next four years”.
The UK has been found to already be home to the largest CBD consumer market in Europe, currently worth £400 million, notes Canex. “With Covid-19 leading to loss of jobs and people struggling to cope with lockdown measures and self-quarantines, more Brits turn to CBD for [its] much-needed, therapeutic effects,” adds the organisation, which says it is the UK's largest CBD network.
Kyle Esplin, chair of the Scottish Hemp Association, says CBD “has been in the mainstream with consumers for a while now and its popularity continues to grow”. He expects more high-street retailers to stock it through 2021, and more talk about its use in sports.
Focused on the latter is Scottish-founded Pure Sport CBD, which says it was launched “to help frequently drug-tested professional athletes be less reliant on painkillers and be able to use an effective, healthier alternative, safe in the knowledge that it’s completely risk-free, as each batch is tested independently in a laboratory to guarantee there is 0 per cent THC”.
It claims to already be the world’s most lab-tested CBD brand, and has attracted investors including Scotland rugby star Finn Russell, with the firm recently raising more than £250,000 in its first significant investment round. Other backers include former Clyde Blowers Capital director Alex Stewart; Brad MacCulloch, a former head of US rates trading in Asia and Europe for Deutsche Bank; and John Hart, former All Blacks head coach and current director of New Zealand Golf.
The firm said the raise took place on a company valuation of more than £2.6m, and builds on a “bumper” 2020 that saw revenues grow fivefold.
Grayson Hart, who founded the business in 2018 with former Glasgow Warriors teammate Adam Ashe, said: “We have an ambition to make Pure Sport the biggest and best CBD brand in the world, and this round of investment marks a significant step on the road to achieving it.”
But there is competition, with sleep-focused Trip describing itself as the UK’s leading premium CBD brand – and reporting a 6,000 per cent year-on-year jump in sales.
Also getting in on the act is craft beer giant BrewDog co-founder Martin Dickie, who has served up HBHM, which stands for Healthy Body Healthy Mind and is the UK’s “first carbon-neutral CBD company”, offering a range of oils.
On the map
Looking at the future of the sector, Mr Esplin says: “We are just starting to put Scotland on the map for hemp production with farmers in Angus and Aberdeenshire starting to grow hemp this year for seed oil and protein powder. We are campaigning to allow farmers to extract CBD from the flowering tops, which is currently prohibited in the UK, where all flowers and leaves being left to rot in the ground after harvesting the seed and stalk.”
He says the Scottish Hemp Association has worked on new recommendations in a paper with Professor Mike Barnes regarding the future of the UK CBD and medical cannabis industry. “In particular, the recommendation to raise the THC limit in hemp plants from 0.2 per cent up to 1 per cent, based on the success of the Swiss model, which will allow UK farmers to be competitive by opening up a wider range of plant varieties with different end uses.”
As for hurdles, he says the organisation has started a campaign across the UK for products containing synthetic CBD to state this on the label. “Consumers should have the right to choose what they put in their body. Hemp is also one of the most environmentally beneficial crops – and consumers show a strong preference towards natural plant-based CBD over synthetic.”
One flagbearer for CBD is Michael Atkinson, investment director at Scottish consumer brands investor Inverleith LLP. The private equity house has, for example, backed Good Hemp, which is a major branded hemp food and drinks producer and has integrated CBD into its plant-based milk.
He has also noted that many global firms are eyeing the sector. “With the CBD industry accelerating at pace, many are eager to ensure that nothing stops the opportunity CBD offers, so that the chance to wake up and drink your CBD coffee and finish your day with your CBD infused rum continues.”