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

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.

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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.”

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Photo by Wendy Davis