Chicago-based Cresco Labs announced Friday that it had raised $125 million from seven institutional investors off a valuation of approximately 5 billion. A day earlier, the vertically-integrated operator bought its way into the “white hot” Florida market by acquiring Bluma Wellness for $213 million in equity

“It’s been a good environment over the last 10 days,” said CEO and co-founder Charlie Bachtell during a phone interview last Friday. “We saw an opportunity to raise capital in this environment and we saw that our competitors were raising capital. You don’t want to be outflanked by your competitors.” 

The Bluma acquisition will yield Cresco 54,0000 square feet of cultivation space, seven dispensaries and capacity to build more production and processing facilities and open up eight additional “One Plant Florida”-branded stores.

The purchase is also part of Bachtell’s “rinse and repeat” strategy to acquire cannabis operations that are strategically located in the most populous cannabis-legal states. Most of these states, including Illinois, New York, and Arizona, currently only license the cultivation and sale of cannabis to a limited number of entities. 

Today, investors favor companies with operations in populous states with license caps.

On January 27, Chicago-based Verano expects to get final approval to raise $75 million through a reverse takeover of a Canadian shell entity that will value the seven-year-old cannabis company at close to $3 billion. In November, Verano acquired Florida-based AltMet for stock as it pursues its own multi-state strategy.

Beyond buying into a Florida footprint, Batchell said Bluma’s “omni channel” marketing approach that de-emphasizes brick and mortar retail in favor of manufacturing consistent products and building household brands for people who like to get high is very compatible with his cannabis company that owns several well known bud brands.

Green Thumb Industries, the largest cannabis company in the Midwest, entered the Florida market through acquisition in 2018. 

“Florida has a unique model through forced vertical integration,” Batchell said. “There is no business-to-business. You are responsible for everything you own. This creates an execution game.”

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Brad Spirrison is a journalist, serial entrepreneur and media ecologist. He lives in Chicago with his son. Interests include music, meditation and Miles Davis.