The pot industry faces a "massive inflationary bubble," and that means investors have to be careful, a cannabis CEO told CNBC at the World Economic Forum in Davos, Switzerland.
"Many, many people are entering the cannabis space, which is terrific, but they actually have to have a purpose — they should be able to generate a business," said Bruce Linton, chief of Canada-based Canopy Growth.
"Everybody wants to be in the cannabis space, and I think investors have to be selective because … there will be a new name every week," Linton warned.
The legalization of cannabis for recreational use in Canada last year boosted interest in the industry. Some U.S. states have also approved the use of cannabis. Utah and Missouri approved the use of marijuana for medical purposes in November, while Michigan gave the green light to its recreational use.