Why the Industry’s Premier Brands Choose The Flowery — and What’s Coming Next in New York & Florida ft. Ilya Shmidt

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Bryan Fields: What's up, guys? Welcome back to another episode of The Dime. I'm Bryan Fields, and with me as always is Kellan Finney. And this week we've got a very special guest, Ilya Shmidt of The Flowery. Ilya, thanks for taking the time. How are you doing today? Ilya Shmidt: I'm great, thank you guys for having me. Excited to dive in. Kellan, how are you doing? Kellan Finney: I'm doing really well, really excited to talk to Ilya, really excited to dive into the knowledge transfer from the West Coast to the East Coast. I think Ilya is a perfect representation of the transition of cannabis across the country right now. I'm excited to dive into all those details. But how are you, Bryan? Bryan Fields: Yeah, you're absolutely right, and that is a fair representation. But what we're going to talk about today is the East Coast and the impact of some of the brands that Ilya is bringing there, and how the educational aspect works. So we've got a little East Coast/West Coast battle, but it's really important to focus where you are today. Where are your feet currently on the ground — East Coast or West Coast? Ilya Shmidt: I am currently in Miami, Florida right now, at our office in Wynwood. Bryan Fields: Let the record reflect. That's fair. For our listeners unfamiliar with you, can you give a quick background on how you found your way into the cannabis space? Ilya Shmidt: I just really wanted free weed — that's how I started out. I had an accounting background and was kind of in between jobs, so I went to go work with my buddy at his store. He paid me under the table, gave me free weed, and it just kind of snowballed from there — into running my own store, being a buyer, then becoming a partner in the store, then starting little side hustles and meeting a ton of awesome people who were growing in the industry at the same time. That led me over here. Bryan Fields: So, The Flowery — take us through what it does today and where it's located. Ilya Shmidt: The Flowery is one of the very few licenses in Florida. We started about six years ago in Homestead, family-owned, doing only deliveries at first. Then we opened up a larger facility about four years ago where we started really pumping out gas, and we expanded our retail footprint from one store three years ago up to the 11 stores we currently have in Florida. We've got a lot of great brand partnerships and over 500 people currently working for us down here. It's quite the sight to see how much we've been able to accomplish in a short amount of time. Bryan Fields: The brand partnerships were the first thing that caught my attention. How does that start — how do you first acquire one of those names and build the trust to get started, and then how does it move forward? Ilya Shmidt: It's kind of a snowball effect because a lot of these brands know each other — they've done collaborations together and grown in the same facilities. It started with brands like Packwoods or Preferred, and obviously 710 Labs was the first brand partnership we had — that really put us on the map. Working with people like Brad Skelly over there — they have a real dedication to excellence, just like we do. From there we brought on people like Dave from Preferred to help build out our facility, and other people started catching wind of the work we were doing and trusted names like 710 Labs and Preferred. We started talking to people from Wizard Trees, Backpack Boyz, and Runtz and DOAC, to name a few. Bryan Fields: How does that vetting process work? Once you had the first one and it was successful, you don't want to intrude on that success, but you also want to grow. How do you balance that? Ilya Shmidt: It's tough — honestly, it's kind of a courtship. Like they're coming over, doing multiple trips, checking out our facility, and at the same time we're looking at their brand — does it align with us? There's also a big component people don't realize: is there IP that goes along with your brand? What unique genetics do you have? What unique technology do your vapes use? What are you doing in marketing that sets you apart? Does your brand resonate across state lines, or even across the world? Those are things we consider. And when they're looking at us, they're looking at whether we can grow their product to the standard their customer base expects. Luckily, we've been able to succeed and represent their brands in a positive way. Bryan Fields: How long does the courtship process take? Ilya Shmidt: Honestly, sometimes years. Take Wizard Trees, for example — we brought them on maybe a year ago, but we were talking to Scott over two years ago, right around the time Dave from Preferred started working with us, because they're close from the California market. Other ones work out pretty quickly — Runtz happened fast because they loved what we were doing down here, and we were lucky to have a Runtz cut at the time. Once they saw what we did with it, they gave us a few more to work with. Kellan Finney: Does your team run the grow too? Ilya Shmidt: We're completely vertical in Florida. It's not super common in a lot of markets, but you have to be vertical if you have a license here. We can't do deals with anybody else for cultivation — we grow our own weed, trim it, extract it, package it, distribute it to the stores, deliver it, all of it. I call it a full body with different organs — if one organ isn't working, you're screwed. Kellan Finney: The reason I ask is I'm envisioning all these brands with different strains needing certain environments, and balancing that with continuous production must be tough. Ilya Shmidt: These guys are very hands-on. Our VP of production, Brian Roberts — kudos to him, he's one of the best growers out there — has a close relationship with people like Scott, Dave, and Ryan. They trust him, they come down, check in on him, they're texting all day every day, and we're living up to those standards. Bryan Fields: There's no doubt about that. But it has to be a difficult balance — when someone walks into a store and sees six premier brands, it's not as simple as always buying Wizard Trees anymore. They're kind of competing with each other in some ways, but it's also great synergy for customers to try something new. Ilya Shmidt: You can look at other industries the same way — you go to Bloomingdale's and know they carry the best brands, a one-stop shop for quality, versus getting a t-shirt at Kmart. Our brand partners actually enjoy being part of that — it gives them relevancy, like "I'm on the shelf next to 710 Labs, next to DOAC." It's less competition and more being part of the family. Bryan Fields: That makes sense. And there's probably an element where a smaller, lesser-known brand wants to position itself among these bigger names. Ilya Shmidt: Exactly. We're pretty cautious about what we bring on, not just from a brand perspective but capacity — we can only grow so much. It's hard to open new facilities and dial them in properly, so we lean on our brand partners to put out new fire. But don't forget, The Flowery is a brand in itself, and we want to keep growing it too. We have a lot of unique cuts and products that you could say are technically competing on the shelf, but luckily there's room for everybody to eat. Kellan Finney: Do you guys have like a wall in the facility — like this room is off-limits, this is our cuts only? Ilya Shmidt: Not really, except maybe with 710 a little bit, because they grow their strains to different standards and have a very unique extraction process for their hash — that's what put them on the map. They have some separate rooms for extraction just for quality control purposes, but overall we treat everybody a little differently based on their SOPs. We respect their proprietary processes and information — that's part of why they like working with us. Kellan Finney: There's probably some fun conversations, and maybe some tricky ones, where one brand wants to see what another is doing. Does that happen? Ilya Shmidt: Yeah, a lot of people want to see the sauce. We don't just let anybody walk through, but if you're a brand partner, you're in the industry, and a lot of these brands are friends with each other anyway. There's no crazy secret sauce — it's really just respect for the plant and the process. Don't rush it. That's usually the difference between a superior and inferior product — rushing to market rather than curing or extracting properly. Bryan Fields: But some of the fun aspects are just getting to see behind the scenes, even if it's not the special stuff. Ilya Shmidt: Absolutely — people are curious about the lights we use, what we're feeding, things like that. I can't speak to all of it since it's not my department, but yes, our facility and processes are definitely a sight to see. Very few facilities in the world are working at the capacity and production rate we are. Kellan Finney: I imagine there's some incubation effect too — best-of-the-best brands rubbing off on each other, like Silicon Valley creates knowledge growth. Ilya Shmidt: Exactly, and we're also trying to create our own cult following. We have an R&D cut called Deep Space that sells out every time we drop it — made in-house, shout out to Brian Roberts again. That's the kind of disruption we're trying to do in the Florida market. Bryan Fields: Is there a company outside the industry that your team looks to emulate? Ilya Shmidt: That question comes up a lot, and we try to avoid comparing ourselves directly — even using the Bloomingdale's metaphor earlier, I was kind of biting my tongue. But there are companies we respect for certain strategies — Starbucks, for example, changed the standard so people happily pay six dollars for coffee and tip on top of it. Or Costco, my favorite place to shop, where you get everything in bulk at a reasonable price — if you're buying a good amount of product, you should get a break. We don't like comparing ourselves to anybody outside the industry — we want people to compare themselves to us. Bryan Fields: One challenge in a role like yours must be positioning brands fairly for visibility while rotating products in a way that works for the team and keeps brands feeling properly showcased. Ilya Shmidt: Exactly what we're trying to do. Everyone's fighting for shelf space and wants a full line of products — vapes, pre-rolls, edibles. You can't blame anybody; everyone wants the full line. It's more on us to make every brand, including ours, available across formats — but ultimately we're flower first. I think the majority of our sales come from whole flower and joints. On a regular basis we have over 60 strains in rotation across close to a dozen brands. We're also opening another facility soon that's going to produce a lot of amazing weed. Competition drives brands to be better — you don't want to get complacent. Bryan Fields: Do some brands focus on specific SKUs and lead with that within the partnership — like 710 Labs focusing on their vapes or hash specifically? Ilya Shmidt: You nailed it — 710 Labs is a great example. They make the best hash in the world, in a few formats: sauce, live rosin, their Percy line, and their popular rosin chews. And their flower is naturally incredible too, because amazing hash comes from amazing flower. What they noticed in our market versus others is that it's very flower-first, so they increased their flower production here more than they might elsewhere. Kellan Finney: Thinking about the cultivation side — if a brand wants to expand production, how does that conversation happen internally? Ilya Shmidt: It comes down to what value they can add to the market and the company — do they have a built-in following, will they help on the marketing end. It's not enough to just put your brand out with a nice cut of weed; what separates you from the competition? Some brands have celebrities attached, cool swag, unique vapes, or ancillary products. It's also about relationship — do we like these guys on a personal level? We've been lucky to meet great people in this industry, and we're always having conversations. We want to keep bringing new brands and new cultivars because everybody wants new, new, new. Bryan Fields: One thing you do really well is relationships that can scale into new states — like New York — giving newer brands a chance to get in on the ground level with some urgency, since spots may go to bigger names first. Ilya Shmidt: Yes, that's something we're working on. We currently have five stores in New York, working with great licensed partners helping our operations there. Depending on the next phase of New York's legal framework, the next step would be bringing our brands over there under our umbrella. It's on the radar, but for now we're working within what we're able to do — our retail footprint — and making sure our stores carry all the partner brands we carry in Florida. If Dave or Scott are dropping a strain in New York, we want it sent right to us so our customer base gets first access. New York is a beast in itself — watching it grow over the last year, not just us but the whole state and the OCM, has been quite a sight to see. Bryan Fields: Can you tell us some of the store locations? Ilya Shmidt: Shameless plug — we've got a store in SoHo that's currently open, Upper West Side, Queens, Williamsburg, Staten Island, and a few more coming online — Canal Street, East Village, and another Staten Island location. We're looking to do big things out there. Kellan Finney: Do the stores carry the same popular products across locations, or does it vary by neighborhood? Ilya Shmidt: We like to keep it fairly uniform — if you go to our app, flowerynyc.com, you want to see the same products across markets. But it's impossible to be 100% uniform; Upper West Side might sell more edibles, Brooklyn might sell more flower. I use the 80/20 rule — 80% of our product and brand offerings are the same everywhere, and 20% is unique to the individual market. For example, Kea is super popular on the Upper West Side for edibles, while Heirloom's beverages might be the most popular in a Staten Island store. A lot of it depends on brand support — are they doing pop-ins, are the budtenders educated on the product? Some brands in growth mode don't have the manpower to hit every store in New York. Bryan Fields: New York has such distinct neighborhood pockets, and with your wide variety of brands, that makes for an interesting puzzle. Ilya Shmidt: Yeah, I can't believe how many brands have opened up in New York, especially craft brands popping up, plus ones I used to work with in California that I now see in New York — even the same people. I love it. Bryan Fields: From a sales side, do you ever spot a category that's missing in New York that you know works elsewhere? Ilya Shmidt: New York allows a lot of product out there, but one category I thought about before this call is THCV — I don't think it's hit yet as a category. I started seeing it pop up in New York, which is awesome. It didn't really hit in California either — brands like Level had some great THCV products that just didn't pop off. I'm really hoping it catches on because it's such a unique part of the plant that people aren't giving enough shine to. Bryan Fields: What do you think is the missing piece to make it pop off? Ilya Shmidt: Education, in every market. People shop by THC percentage rather than understanding terpene percentage or CBD content, which might actually be the key to unlocking what they're looking for. That's what's unique about Florida — it's a medical market, so patients only have a certain amount they can purchase every month or two, so every purchase has to be thought through: what flavors do I like, is this a real indica, what's the THC and terpene percentage, what terpenes do I react to. They consult doctors who give prescriptions and point them in the right direction. Other markets rush into recreational and people keep buying the same way they did from the guy down the street rather than actually paying attention to the plant. I love customers who keep a journal comparing strains — that's something The Flowery respects, the educational piece. I never want a customer to know more than our budtenders. Kellan Finney: It must be a hard balance to educate budtenders given how much misinformation is out there and how fast people want to level up their knowledge. Ilya Shmidt: There's constant education. We can't recommend, we can only suggest, using the right language. As soon as you're onboarded, you get proper training about the plant, our company culture, and our brands. Every employee has access to a training platform updated weekly with new products we're dropping — details on exactly what our grower and the brand say about it, because we want to give brands direct access to our people so nobody misinterprets their voice. People are hungry for that information because they love the plant — that's why a lot of people get into cannabis in the first place. Kellan Finney: Is there a knowledge transfer or similarity in how you train budtenders in New York versus Florida, given one is medical and one is recreational? Ilya Shmidt: It's easier training a budtender for a medical market because there's more required knowledge — how prescriptions work, HIPAA, privacy, what you can and can't say. Every Florida store has a consultation room where a patient can speak privately with a budtender about what's going on with them and get suggestions. In New York, we can't train everybody on every brand — there's just too many. Instead, we train on the plant, and budtenders learn about brands while working the floor, then put two and two together. There's also less pressure on New York customers to find the perfect product compared to Florida patients. Bryan Fields: I'm sure a big part of that education is budtenders actually trying the products themselves so they can articulate the experience. Ilya Shmidt: Yes, though I always tell people to take anecdotal reports with a grain of salt — everyone's biochemistry is different. If I smoke a sativa I might crawl up the walls, but I've met people who smoke sativas to fall asleep. Everything you read might say otherwise, but that's genuinely what works for them. So take what any budtender or I tell you with a grain of salt, because your chemistry will be different. Bryan Fields: Any underrated brands you think will be rocket ships a few years from now? Ilya Shmidt: CBX out of California is always a favorite — we don't have them in Florida and I don't see them in New York, but I like what they're doing and I've known the guys since Cali. They're hesitant to expand, probably because of quality control in new markets, which I respect — there's a lot of opportunity for them to grow. In New York, Heirloom is super cool — they grow their own apples on an orchard and use them to make their juices for edibles. I hadn't seen them before I got to New York, and they're pretty much the number one edible brand there right now despite not having been in cannabis very long. Bryan Fields: Any chance of brands flowing from East to West instead of the usual West to East — maybe The Flowery included? Ilya Shmidt: Who knows — I'm not saying we're going West Coast, but we're focused on Florida and New York right now. As for brands, I'd point to some great ones in New York — To the Moon is making a lot of noise on the streets with great branding and good people behind it. Jonty is another cool one I haven't seen in other markets. There's just so many — right now I'm dealing with about 50 brands on shelf in New York at any given time, so it's a lot to juggle. Bryan Fields: If I walked into a store in New York, which brand should I really be considering that I might not know about? Ilya Shmidt: Runtz is pretty good up there. Our brands Preferred are up there too, and Wizard Trees is going to hit the market soon — look out for that. For a value proposition brand that grows really good indoor, I like The Botanist a lot; it does really well in a lot of our stores. Dank is probably the number one flower brand in New York right now — reasonably priced, pretty good quality flower, and good marketing and brand support. Bryan Fields: Have you had to pass on any partnerships that just didn't fit the culture in Florida? Ilya Shmidt: Yeah, a few. I have personal relationships with some awesome brands that just didn't fit The Flowery lineup, unfortunately. We've tried some brands out and the market here didn't react the way we hoped — it's trial and error, same as marketing anywhere else. It's not going to be everyone's flavor all the time, but we maintain good relationships with brands we don't carry, because the market could evolve. We don't burn bridges — everyone in cannabis is kind of working toward the same goal. Kellan Finney: Has it ever come down to environmental factors — like a strain that thrives in California's dry climate not performing the same in Florida's humidity? Ilya Shmidt: You'd think so, but our facility is state-of-the-art with a lot of controls and fail-safes, which is why we've been successful bringing on brands that maybe couldn't grow at the same quality or control at other MMTCs. That question comes up a lot, but so far, knock on wood, we've been able to mitigate it. Bryan Fields: Any future plans for expansion, maybe international? Ilya Shmidt: There's some consideration, but I can't spill any beans on this podcast. Florida and New York are such big markets for us that we're focused on growth there. We only have 11 stores and own a small piece of the Florida market, and we want to make our product available to patients all over the state. That alone is basically a full-time job, so we want to remain realistic about how fast we scale and where we put our resources. Bryan Fields: I think that's smart — people forget that early cannabis operators overextended themselves. Florida, still medical, is a mega beast waiting to turn recreational, and New York stumbled out of the gate but is finally finding its footing. Ilya Shmidt: Couldn't have said it better. Going back and forth between New York and Miami, and still visiting family in California when I can, gets tiring sometimes, but who's going to complain about traveling to those states for work? Could be worse. Bryan Fields: Any lessons you've learned in cannabis that surprised you? Ilya Shmidt: A big one is about leadership — don't ask anybody to do something you're not able to do yourself. Nobody is more important than anybody else, because at any stage of the process, from cultivation to selling, if one thing goes wrong, everything goes wrong. If the power goes out for an hour, you lose your whole crop. Every person is just as important as everybody else, and you give them that respect. Another lesson on branding and marketing: you can sell any product once, but a proof of concept is somebody coming back to buy it a second time. People will buy something once because a celebrity is promoting it, but if it's not truly differentiated, they won't come back. That second sale is more important than the first. Bryan Fields: What's the most expensive lesson you've ever learned? Ilya Shmidt: Be mindful of who you're doing business with — watch out who you trust. I hate to say it because I'm a super easygoing person, but back when this industry was more of a gray market with cash and handshake deals, you had to really know who you were doing business with. There's a line from Gang Starr's song "Moment of Truth" that reminds me of it: "It's lonely at the top, and whatever you do, you always got to watch [those] around you, nobody's invincible, no plan is foolproof." Bryan Fields: Dream smoking session, three people dead or alive? Ilya Shmidt: Winston Churchill would be one. Prince could be another cool one. And my favorite rapper right now, Curren$y — which is a shame, because we work in the same industry with his Andretti brand, but I've never gotten to meet him. Maybe he'll come by The Flowery soon. Bryan Fields: What advice would you give a brand that wants to work with your stores but doesn't yet have the name recognition or quality to meet that standard? Ilya Shmidt: Find something that sets you apart and stay true to yourself. Consistency is key — a lot of successful people got there because they've been doing the same thing for many years. Have you guys read Outliers by Malcolm Gladwell? There's the 10,000-hour rule — just keep doing it. Great growers aren't successful just because they're smart, it's because they've messed it up so many times they know exactly what to do. Don't change who you are, and if you truly have something special, people will see it. Bryan Fields: Last question — what question do you wish more people asked you? Ilya Shmidt: Probably, "What should I be looking for in a product?" I'd love to get away from the THC-percentage conversation and just shake people and tell them there are other parts of the plant that really matter — a lot of the time it's the terpenes. Bryan Fields: So terpene percentage is the question you'd recommend people ask instead of THC? Ilya Shmidt: Yeah, I'd love to hear that more often — which happens in Florida, but nowhere else really. Bryan Fields: New York's got a lot to catch up on then. Ilya, for our listeners who want to get in touch or visit your stores, where can they find you? Ilya Shmidt: In Florida, go to flowery.co — simple. In New York, floweryny.com. We also just released an app in New York, so check it out for delivery or pickup, and we have an app in Florida too. We're on Instagram — find us. The Flowery is a great experience, and we're putting out some really great products. I hope eventually anybody in the country, and the world, can get their hands on it. Bryan Fields: Love it. We'll link it up in the show notes. Thanks for taking the time — this was a lot of fun. Ilya Shmidt: Appreciate you guys. Kellan Finney: Thank you for taking the time.