'Grow Smart, Not Fast': Top Advice For The Cannabis Industry From Benzinga's Capital Conference

Zinger Key Points
  • At the Benzinga Cannabis Capital Conference, Talarya Brands’ CEO warned that expanding without optimizing your market risks failure.
  • Speakers stressed the importance of cash flow, strong partnerships, and smart growth strategies.

In today's volatile cannabis industry, expansion can be a double-edged sword. For Dustin Milner, CEO of California's Talarya Brands, the question every cannabis operator should ask before growing is simple: “Why?”

"There's always pressure to grow, especially from investors," Milner said, "but if you haven't maximized efficiencies or nailed down your market, expanding could be a recipe for disaster."

He warned that many cannabis companies rush to new markets without fully optimizing their existing ones—leading to high-risk ventures that don't always pay off.

See Also: Shopping For Cannabis With All Five Senses And Other Merchandising Strategies To Improve Customer Experience And Brand Positioning

At the Benzinga Cannabis Capital Conference in Chicago, Illinois, Janice O'Reilly, Consulting Partner at AAFCPAs' National Cannabis Practice, moderated a panel on growth strategies that brought together industry leaders to discuss smart expansion.

The Importance Of Smart Partnering

Jennifer Briggs Fisher, a partner at Goodwin, shared that expanding cannabis operations across states requires more than legal contracts.

"A lot of clients come to us with big plans, but often haven't fully researched the regulatory landscape or vetted their partners," Briggs said.

For cannabis operators, failing to build strong partnerships has led to disputes and expensive litigation. According to Briggs, the best expansions stem from careful planning, thorough research, and clear partnership agreements tailored to each state's unique regulatory framework.

Organic Growth Vs. Acquisitions

Brandon Barksdale, CEO of Remedy Maryland, navigates a constant debate between organic and inorganic growth. Remedy has focused on building horizontally within Maryland's market by carefully tracking what customers want and providing a broad product selection.

"We're always evaluating where the strongest opportunities are," Barksdale explained. While acquisitions can bring quick expansion, he stressed that organic growth provides better control and aligns with Remedy's goal of consistent market presence.

Timing, he added, is everything: "Sometimes it's about putting your head down and letting opportunities come to you when they're right."

Cash Flow Trumps Top Line

From an investment standpoint, Seth Yakatan, co-founder of Katan Associates, believes that in cannabis, cash flow beats growth in sheer revenue.

Yakatan challenged the industry's multi-state operator (MSO) model, suggesting that prioritizing aggressive top-line expansion without profitability leads to inevitable downfall.

"Long-term, cash flow wins. The companies with the staying power are the ones who can be profitable," he said, noting the California market's recent slew of business failures as proof.

Milner echoed this, pointing out that focusing on cash flow and profitability has been Talarya’s approach for survival in California's fiercely competitive market.

"We saw competitors growing faster, taking the spotlight, but we stayed focused on building a solid business," he shared, "and we're still here while many of them aren't."

Read Next:

Photo by Wendy Davis

Market News and Data brought to you by Benzinga APIs
Comments
Loading...
Posted In: CannabisEventsTop StoriesMarketsAAFCPAs' National Cannabis PracticeBrandon Bersdalecannabis industryCCCDustin MilnerGoodwinJanice O'ReillyJennifer Briggs FisherKatan AssociatesRemedy MarylandSeth YakatanStories That MatterTalarya Brands
Benzinga simplifies the market for smarter investing

Trade confidently with insights and alerts from analyst ratings, free reports and breaking news that affects the stocks you care about.

Join Now: Free!

Cannabis is evolving – don’t get left behind!

Curious about what’s next for the industry and how to leverage California’s unique market?

Join top executives, policymakers, and investors at the Benzinga Cannabis Market Spotlight in Anaheim, CA, at the House of Blues on November 12. Dive deep into the latest strategies, investment trends, and brand insights that are shaping the future of cannabis!

Get your tickets now to secure your spot and avoid last-minute price hikes.