'Hold The Line Or Pivot Hard': Cannabis Industry Veterans Sound Off On Surviving 2025

In 2025, cannabis isn't a gold rush. It's a grind.

Most stocks are down more than 90% from their highs. Capital is tight. Retail shelves are crowded with low-margin products. At this year's Benzinga Cannabis Capital Conference in Chicago, the optimism of earlier cycles gave way to something more sober: survival talk.

Two industry veterans, Rachel Wright, CPA and founder of Verdant Strategies and 420 CPA, and Seth Yakatan, founder of Katan Associates International, offered candid, unfiltered perspectives on what's really happening behind the scenes. Wright, one of the earliest CPAs to specialize in cannabis, works closely with operators navigating complex tax rules, compliance and expansion. Yakatan, a fixture in capital markets and early-stage investing, has guided dozens of companies through growth, collapse and realignment.

They're still standing. And they're not sugarcoating anything.

From Chaos To Compliance: ‘We Actually Have Banking Now’

When Wright first started working in cannabis more than a decade ago, most businesses didn't have books — or if they did, they were a mess.

"We would have to essentially create books for people based on information that we had — POS systems, if they had a cash ledger, things like that," she said. "Fast forward a few years, now we actually do have banking… we also have real legit payroll companies that are supporting the industry."

The maturation of professional services, from accounting to legal support, is helping operators run cleaner, more efficient businesses. But Wright says success still hinges on who's in charge.

"Sometimes the founders need to step aside and hire the professionals," she said. "And let the professionals do what the professionals do."

Operational discipline isn't optional anymore. She cited price compression across all markets as one of the biggest threats, especially in newer states like New York, where companies don't get a long runway before margin pressure kicks in. "You have to learn how to operate a real business. Data is key. Cash is king. Managing that is really, really key."

Over the last 12 months, Wright says her firm helped save cannabis clients more than $50 million through tax amendments and audit work. And despite years of industry lobbying to eliminate Section 280E of the federal tax code, she doesn't see it as a death sentence.

"I think 280E is navigable," she said. "I don't see it as much of a problem — and not as much of a motivation to reschedule."

‘If The Government Gives, It's Going To Take Away’

That last point surprised many attendees. While most operators have called for federal rescheduling to fix 280E burdens, Wright takes a contrarian stance.

"I want to preserve the small and medium-sized businesses. We don't want 7-Elevens carrying cannabis," she said. "I like to preserve the culture — the people who've been in this industry for a long time."

For Wright, rescheduling isn't a guaranteed win. It's a trade-off.

"If the government gives, it's going to take away," she warned. "It's not going to give a free carrot to us at all. It's going to come with a price."

That price, in her view, could be new excise taxes that ultimately harm small businesses more than 280E ever did.

‘Don't Believe The Hype’: Yakatan On Capital, THCA And Europe

Seth Yakatan didn't mince words either.

"You're at a really tough spot in the industry," he said. "The models that were underwritten… haven't largely worked. Or some of them haven't worked."

For existing operators, his advice is simple: "Go in and dominate the markets you're in and hold serve."

For new investors? Proceed with caution.

"I'm telling them to analyze each macro state-level economy that they're looking at," he said. "Base your future investment judgment on historical survival performance."

When asked about hemp-derived THCA products, a booming but controversial segment, Yakatan was blunt:

"Don't believe the hype. Cannabis and hemp are not markets for tourists. Stay out if you're not in. And if you're in, you know what you know."

Hype vs. Reality: Where The Smart Money's Looking

Yakatan says there's still opportunity, especially in private lower-middle market companies with functioning models, but it's no longer a race for scale.

"It's a game of pennies now," he said. "Pennies add up."

On the product side, he flagged one trend that's both overhyped and legitimate: infused pre-rolls. Brands like Jeter, Stiiizy and Aura are dominating SKU velocity, and two-gram disposable vapes are next.

"In markets where they're not [common], they're going to come," he said.

Wright echoed the importance of staying agile across geographies, product verticals and structure. Whether asset-light or asset-heavy, she said, the best strategy depends on the market.

"We need to evolve geographically, product, service offering, verticals," she said. "In some states, you might want to go asset-heavy. In others, you might want to go asset-light and just get your brand out."

Both Wright and Yakatan acknowledged the pull of international markets, especially Europe. Yakatan called Germany's rollout "part of the ‘soup du jour’ in news cycles," and cautioned that many U.S. companies are using European hype to distract from domestic struggles.

"Seven of the 30 largest U.S. cannabis companies have a European operation story that's masking other issues inside the business," he said.

Wright, on the other hand, is already active in Europe and says her international tax background made it a natural next step.

"I was ecstatic," she said of cannabis expanding in Europe. "I started planting seeds, getting to know people — movers and shakers — that are already there."

The Bottom Line: Run A Real Business

Wright and Yakatan may operate in different parts of the cannabis economy, but their core message is the same: survive by getting serious.

No shortcuts. No saviors. Just smart, lean, experienced leadership.

"Where I see people failing," said Wright, "is in efficiencies, staffing, leadership team, a full business plan… It's really just like running a business. It's the fundamentals at the end of the day."

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