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This spring, rumors were swirling that HERBL, one of California’s largest cannabis distribution companies, was on the verge of collapse. So Mike Beaudry, the company’s CEO, sent out an email on May 18 declaring that “these rumors are categorically not true. HERBL continues to be fully operational.”
Less than a month later, HERBL had completely collapsed.
HERBL’s failure left a trail of damage that hurt small pot brands and shorted the state some $17 million in unpaid taxes. HERBL is only the latest high-flying California pot startup to crumble, following companies like Flow Kana, which raised $175 million in capital only to collapse, and MedMen, the California startup that earned a billion-dollar valuation calling itself the Apple Store of Weed only to find itself this year on the brink of financial ruin.
California state law requires distributor companies to work as middlemen between pot producers and retailers. HERBL’s demise has become a giant flashing red warning sign because of the vital role distributors play in California’s market; if a company as large and entrenched as HERBL can go under, experts say, then there are deep problems in the industry that will only lead to more company failures.
www.sfgate.com
Less than a month later, HERBL had completely collapsed.
HERBL’s failure left a trail of damage that hurt small pot brands and shorted the state some $17 million in unpaid taxes. HERBL is only the latest high-flying California pot startup to crumble, following companies like Flow Kana, which raised $175 million in capital only to collapse, and MedMen, the California startup that earned a billion-dollar valuation calling itself the Apple Store of Weed only to find itself this year on the brink of financial ruin.
California state law requires distributor companies to work as middlemen between pot producers and retailers. HERBL’s demise has become a giant flashing red warning sign because of the vital role distributors play in California’s market; if a company as large and entrenched as HERBL can go under, experts say, then there are deep problems in the industry that will only lead to more company failures.
The biggest pot distributor in California has collapsed
California’s biggest cannabis distributor collapsed this summer after posting $700 million in sales a year earlier.
www.sfgate.com
