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Ben Kaplan is the author of Catch a Fire: The Blaze and Bust of the Canadian Cannabis Industry, out Jan. 14 on Dundurn Press.

Forgotten in the midst of the 2020 cannabis stock market meltdown is the production, employment and real estate boom that emerged from the end of marijuana prohibitionin Canada. When the government acted boldly to legalize recreational cannabis on Oct. 17, 2018, Canadian entrepreneurs steered 16 homegrown startups to valuations of more than $1-billion each. These companies spent hundreds of millions of dollars around the world (but mostly in Canada) to build greenhouses, lighting systems, million-dollar cannabis-storage vaults, and grew thousands of tonnes of a hot new agricultural product.

Canada, it’s been said, doesn’t make stuff any more. Labour productivity in construction is at a 30-year low and our business sector hasn’t expanded since 2019. We’re getting killed by the United States in the goods sector and stagnation might already be causing deterioration in Canadian public services. But legal marijuana showed Canadian productivity can blossom.

The hype, the stock pump-and-dumps, the bad actors and the valuations that towered over revenue figures like storm clouds over the beach turned people off the industry. But cannabis production thrived – quickly, regulated, and at scale. Licensed cannabis producers created thousands of new jobs, employing engineers, electricians, surveyors and scientists to meet demand that in 2016 Deloitte estimated would exceed $12-billion a year. When the Cannabis Act was passed, the legal market grew from about 350,000 medical users to 28 million potential new customers over the age of 19.

Cannabis is often viewed as a failed business story. Indeed, companies – and investors – lost millions of dollars in the boom, although bankruptcies in the sector slowed to a handful in 2023. The industry is nevertheless an example of Canadian might, when the government and business banded together to do something that hadn’t been attempted anywhere in the world. We raised capital and deployed it, building an industry that still produces the best, cleanest, most highly regulated and consistent cannabis in the world.

The timeline to get to that point was astounding. In 18 months after recreational cannabis legalization, marijuana went from illegal to “essential service,” with pot shops remaining open during the pandemic, not only helping save Canadian jobs and agriculture, but also supporting commercial real estate when shuttered storefronts dominated main streets across the country.

“We didn’t set out to say, ‘Oh, I’m from Canada, can I please come in sixth?’” Canopy Growth WEED-T founder Bruce Linton, who secured $5-billion in funding from Constellation Brands, told me. Canopy’s valuation reached $22-billion in 2018 and the Smiths Falls, Ont.-based company has operations in Germany, Australia and Peru.

In cannabis, Canadian founders didn’t run to New York or Silicon Valley for adviceon how to run their companies. Cannabis brands were headquartered in Canadian small towns. Mr. Linton served Tim Hortons’ coffee to Snoop Dogg and Martha Stewart in Smiths Falls; and Altria, Marriott and Coca-Cola executives looking to explore CBD partnerships met with Mr. Linton and Aurora Cannabis’s ACB-T Terry Booth, his Albertan rival, in their hometowns. These companies didn’t chase Americans. The Americans had to come here.

Cannabis production wasn’t only massive – it was homegrown, and stayed Canadian-owned. There was patriotism in marijuana, so marijuana tycoons kept their capital in Moncton, Gatineau, Leamington, Ont., and Calgary, headquarters of Raj Grover’s High Tide HITI-X, which had revenue growth of 6 per cent year-over-year in its most recent quarter, proving Canadian weed productivity does not have to end.

Canada can produce more than uranium and oil. There are more than 150,000 Canadians working in legal cannabis, and millions of licensed square feet of cannabis greenhouses in this country produce more than a billion grams a year. Across Canada, there are 3,600 licensed shops and more than $15-billion has been collected in taxes from cannabis.

Marijuana lost Canadian retail investors billions and attracted bad actors as big, fast money always does. But it showed Canada doesn’t lack gumption, chutzpah or know-how. We need the next big opportunity to ramp up Canadian productivity. Something like legal cannabis, incentivizing Canadian business to light a fuse.