These multistate operators (MSOs) tend to consider:
- Tightly controlled markets with limited license availability. States such as Arizona, Florida, Connecticut, Maryland and North Dakota are prime for MSO expansion because of high barriers to entry and limited competition. In Florida, a few operators have a significant presence across the state. Green Thumb Industries entered the Connecticut market through an acquisition earlier this month, and MedMen moved into Florida through an acquisition last summer.
- States that have – or are expected to have – both medical marijuana and adult use. Markets such as Massachusetts and Nevada gave existing MMJ businesses first crack at recreational licenses, a model that will soon be implemented in Michigan (expected to exceed $1 billion in sales) and could very well be carried out in other states in the near future. New York Gov. Andrew Cuomo has expressed interest in legalizing recreational marijuana, while New Jersey is in the process of becoming the first state to legalize adult use via legislation (rather than by ballot initiative).
- States that are on the speculative end of the spectrum, such as Iowa (whose financial viability is under question), CBD-only Virginia and highly competitive Oklahoma (which has some of the lowest barriers to entry in the U.S.)