Benzinga Cannabis Hour Recap: From SSO To MSO — Mission Dispensaries Exec Chats 4Front Deal

At Benzinga, we report a lot about MSOs, or multi-state operators. These would be cannabis companies such as Cresco Labs Inc. CRLBF, Curaleaf Holdings Inc. CURLF, Green Thumb Industries Inc. GTBIF and Trulieve Cannabis Corp. TCNNF, which have operations that span across many legal cannabis states.

A term we haven't used is "SSO," or single-state operator — at least until today. 

"I may have just coined it," Mission Dispensaries, 4Front EVP, Operations Mark Passerini said when he appeared as a guest on Thursday's Benzinga Cannabis Hour. 

Up until 2019, Passerini had been focusing on medical cannabis in one state — Michigan — through Om of Medicine, a company he co-founded. Om sold to 4Front Ventures Corp. FFNTF, a company that currently has operations across five states: Illinois, Massachusetts, California, Michigan and Washington.

"Our values aligned with Mission's and 4Front's," he told co-hosts Patrick Lane and Javier Hasse. "Their consulting group helped about 65 applicants around the country to win licenses."

And with regulations being vastly different from one state to the next, partnering with an MSO like 4Front was "an easy decision," Passerini explained, citing the company's multi-market expertise.

"I think that's obviously a huge leg up for us in choosing who we would be partnering with," he said. "The more states that come on board... the quicker the industry thrives as a whole."

As for which states 4Front is headed next, Passerini says "every state is interesting for their own reasons." 

"We're looking at adding a second retail store in Chicago," he said. "That is on track for the end of this year."

Massachusetts and California are also on the list.

Other guests in this week's Benzinga Cannabis Hour episode include:

• Salveo Capital managing director Michael Gruber offers his advice to cannabis startups currently on the hunt for funding: 1) Be realistic with expectations and "Grounded in Reality" in terms of valuations. Otherwise you risk losing credibility. 2) When folks are willing to give you more money than you ask for, don't worry about share dilution. "Take as much money as you can." 3) Capital efficiency. Concentrate generating cash — the sooner the better. 
• Mazakali CEO Sumit Mehta says cannabis is the most politically popular industry. And while it's not counter cyclical or recession proof, Mehta would call it "recession resistant, essential and uncorrelated as an asset class." Is the stigma gone for investors? Yes, Mehta says, adding: "What started as a trickle a quarter century ago, has picked up steam quite rapidly and continues to gain a foothold across the country."

The Benzinga Cannabis Hour is produced every week and brings together top executives, entrepreneurs, and experts from all corners of the cannabis industry. Each show features three or more guests from a broad spectrum of expertise in cannabis.

To tune in, watch the embedded video below; head over to the official Benzinga YouTube channel; or visit BZCannabisHour.com and join the live chat to have your questions answered in real time. Cannabis Hour is also published on most major podcasting platforms, including Spotify, Google Podcasts, Breaker, Pocket Casts, and more.