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The Psychedelic Rush to Become Big Shroom

Analysts and investors are hailing the coming of the ‘Shroom Boom’ — and now the race for the trippy goldmine is on

The psychedelic psilocybe mushroom grows all over the world, sprouting in a hundred different shapes and sizes, in landscapes as disparate as the Australian desert and the wet highlands of Norway. 

To make them sprout, all you need is a spore and the right mix of light, moisture and substrate, be it a bag of brown Uncle Ben’s rice or hay and animal shit spread gently across a barn floor. No matter the soil, it’s a humble beginning for a pretty product, featuring round caps cast in golden ombré and slender stems that look downright elegant. We’ll never know the identity of the man or woman who first spotted these mushrooms and accidentally found God after a taste. All we know is that humans have loved psilocybin for more than 6,000 years. 

That love only seems to have intensified in the last century. These days, everyone knows about shrooms, even if only a tiny percentage of the population actually consumes psychedelics. It’s been a part of the American youth zeitgeist for three generations. It’s a gag in sitcoms and films. And Michael Pollan wrote a bestseller after tripping his face off. Whatever negative stigma used to exist around psychedelic mushrooms, the American consensus is slowly starting to change. Hell, even our Boomer parents increasingly want to cop the stuff. 

Last year, psychedelic mushrooms were decriminalized in Denver, Oakland and Santa Cruz, California. This year, Oregon straight-up legalized the substance for use in therapy treatments and decriminalized possession. No wonder, then, that analysts and investors are hailing the coming of the “Shroom Boom,” with new attention and millions being poured into companies that want to unlock the formula that makes magic mushrooms magic — and then create products to sell en masse. 

Thanks to the federal maze of regulations, the nascent psychedelics industry needs all the private money it can get for research and development. In 2020, investors and lobbyists have that money in hand, as well as tough lessons learned from the “Green Rush” that fueled the explosive (but rocky) legal cannabis market. But a basic dilemma remains for advocates of psychedelics: Will the rush to commercialize just end up with us paying too much for something that can be grown on the cheap?

The problems all stem from the illegality of psilocybe mushrooms under federal law. It’s classified as a “Schedule I” drug, indicating a lack of medical use and a high potential for abuse. (Odd, considering modern studies on psilocybin suggest it can help relieve everything from depression and anxiety to long-term addiction and even recidivism in prison parolees.) 

Things used to be different in the middle of the 20th century, when experimentation with then-unregulated psychedelics took off in America and Europe. Much credit goes to Valentina and R. Gordon Wasson, the couple who widely publicized their experience of hallucinating in an indigenous mushroom ceremony, even notching an article in Life magazine in May 1957. For the next decade, as recreational interest in psychedelics exploded, a cottage industry of researchers found potential life-changing benefits in LSD and psilocybe mushrooms. Then, in 1968, LSD was formally outlawed in America. It was a bald blow to the hippie counterculture, and it stigmatized all other psychedelics for good, too. The money for research dried up overnight. Psychedelic pioneers, including Timothy Leary and Ram Dass, had to go underground or face prosecution. 

Even in the 1990s, conducting psychedelics research meant practically begging philanthropists for dollars, says Albert Garcia-Romeu, who works on psilocybin at the Johns Hopkins Center for Psychedelic & Consciousness Research. The big pharmaceutical corporations wouldn’t touch the stuff, he says, comparing it to the decades-long lack of interest around marijuana as a medical tool. “We exist in a for-profit capitalist health-care system in the U.S., and that’s another major social factor that has limited this research — psilocybin grows in mushrooms that you can find pretty much anywhere that plants grow, and that’s not highly profitable,” Garcia-Romeu argues. “To move it through this very expensive drug development process costs many millions of dollars. Why would anybody do that if they can’t then sell you the psilocybin to recoup their investment?” 

To this day, it remains a massive hurdle to maintain the funding and approvals to do research on psychedelics. It requires a network of people with the appropriate licenses simply to store and transport psilocybin, and even more licenses to synthesize it (as researchers use pure psilocybin, not full mushrooms). And it explains why the “shroom boom” is so exciting, and potentially transformative, for those who conduct psychedelic science in North America and beyond. 

After all, it took a lot of time and money for the alchemy of politics, culture and medical research around marijuana to coalesce into an economic force. Now, it appears the same thing is happening around psychedelics. Financial headlines tell tales of international investors “betting big” on an industry slated to swell to nearly $7 billion in value in the next decade.”Why Investing in Psychedelic Medicine Could Be Better Than Cannabis,” screams a U.S. News and World Report headline.

In the eyes of Tim Laidler, executive director of the Institute for Veterans Education and Transition at the University of British Columbia, there’s a very good reason why the interest is surging: A mental-health crisis, especially during the pandemic, is fueling a hunt for solutions. Citing the polling around increased stress and the rise in suicides in both America and his native Canada, Laidler tells me that psychedelic mushrooms stand as a substantive new tool in the fight to get people long-term help.

“I see it all the time with veterans. A lot of their problems come not just from the traumatic experiences overseas, but from their own hyper-masculine culture of not wanting to talk about their feelings. That’s a very common trait across society, but psilocybin can kind of give them permission to explore,” Laidler says. “They say, ‘Well, I never break down and cry in front of a counselor, but hey, I took this microdose of psilocybin and I really felt something change inside of me,’ and they just let everything out. So it’s almost like can we give them permission to open up.” 

It’s these observations that lead him to become a board member of Havn Life Sciences, a Canadian firm working to research psilocybin and develop products for consumer use. The main task ahead, Laidler says, is to identify the specific compounds within psilocybe mushrooms and document them for use in clinical trials, which could help unlock more medical findings and shift regulatory laws. But he also tells me that Havn Life Sciences is developing “mycological blends” using mushrooms that aren’t illicit, but still have psychoactive effects, in order to create products that can be sold over-the-counter. The end goal isn’t just a potent medicine that can be used in a controlled therapy setting — it’s a spectrum of products that allow people to dabble, Laidler notes. 

“It’s important because people might not want to go see a therapist one-on-one for an hour, but if there’s a retreat, and there’s micro-dosing with a counselor, that, to me, is a great place for psychedelics to move into a more recreational space. It’s not a medical intervention, they’re not in crisis, but it’s about wellness,” he says. 

Anyone who enjoys illicit psychedelics today already understands this — and for Garcia-Romeu, that’s the part that gives him pause. For one, he worries that pushing ahead with legalization of psilocybin in other states could lead to an ugly media backlash if a few people have “bad trips” that get publicity (“And there goes 20 years of work, we’re back in the dark ages of ‘These drugs are dangerous’”). But mostly, on a philosophical level, he worries whether the “shroom boom” just means a middleman getting more of our money.

“We’re talking about the history of an extractive industry that goes down to the Amazon, finds plants that indigenous people use medicinally, takes a specific chemical out of it, turns it into a pill, and sells it to people. Are you facilitating healing? Probably. Is the way it’s done ethical and accessible to all?” Garcia-Romeu tells me. “Those questions are still up in the air, but the answers are probably going to be no.” 

The best-case future of shrooms isn’t a rebirth in the pages of GOOP as a faddish supplement, or jiggered into some proprietary formula and marketed at premium, he argues. Nor is it for people with expendable cash to go on exclusive retreats to microdose while the drug remains out of reach for people of color and working-class families. But it’s also not enough for us to stay in purgatory, eating shrooms grown by a friend of a friend (or bought online). The money for research must flow, because the research could save lives. 

“This is opening up a pathway for a lot more important and interesting research to be done because we’re just starting to scratch the surface with psilocybin and MDMA. There are so many other psychedelics, and there’s so many other drugs that haven’t been touched. For instance, 5-MeO-DMT, all of these 2C compounds that Alexander Shulgin came up with,” Garcia-Romeu says. “That stuff is potentially a gold mine of things that could teach us a lot about the mind and have a lot of therapeutic potential.” 

This is the dilemma of the shroom boom: Powerful psilocybe mushrooms can be cultivated with little money and real estate. But money and real estate is necessary to advance this little mushroom to its true potential. The race for the psychedelic goldmine is officially on. 

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