Mitch's shares are restricted for a couple years, so you don't have to worry about Cono's management selling shares. As far as the operation goes, they are building a solid manufacturing base. That being said, they either have zero management skills and the company will tank OR they have a reason for the large expansion. With Mitch putting up $750,000 of his own cash so far, I'm placing my bets with Mitch. That's the decision everyone has to make: do you believe they have large distribution ahead? If you don't believe they do, then I would get out in a hurry. But if you do think they have some larger deals coming based on the expansion, then hang on tight and see what develops. Pretty simple. Like you said, that's the chance you take with start-ups!
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