Weedmaps CEO Chris Beals. Weedmaps
Cannabis-tech firm Weedmaps laid off 10% of employees, per an August 4 memo.
The company’s stock has suffered this year, falling over 55%.
Cannabis is far from recession-proof, as Weedmaps’ recent layoffs show.
Layoffs have already come for tech. Now, they’re coming for cannabis too.
Cannabis-tech firm Weedmaps is cutting 10% of its workforce, Insider has learned. The company had 606 full-time workers at the end of 2021. In an email dated August 4 that was obtained by Insider, CEO Chris Beals cited a slowdown in legal cannabis sales in states like Colorado and California, the rising price of gas, and broader economic conditions that point to a coming recession.
“There are certainly lessons I will learn from this, and we will continue to do the best we can to grow and guide the business for employees, clients and investors. In regard to the slowdown of end markets, I was wrong in predicting that this would bottom out at the start of the year and that we would start to see a recovery,” Beals wrote.
A Weedmaps spokesperson confirmed the layoffs to Insider. In a follow-up statement, Beals said that given the macroeconomic challenges, the “prudent approach was to plan more conservatively for the coming quarters.”
“Though difficult, we believe this restructure better positions the company to weather end market turbulence and operate profitably in the second half of the year,” Beals said in the statement.
Weedmaps lists recreational and medical cannabis shops on its site, allowing consumers to browse dispensaries and see reviews of marijuana products. It also provides a way for cannabis businesses to engage with customers and market products.
The layoffs point to coming troubles in the cannabis industry, which has proven to be far from recession-proof as some commentators have suggested.
Like many other publicly traded cannabis companies, Weedmaps stock has suffered this year. Nasdaq-listed shares have dropped over 55% this year, as legal cannabis sales have slowed and broader economic shocks have hit the market.
Weedmaps was also the subject of a pair of July complaints that alleged the firm was listing illegal marijuana products and shops on its platform, as Marijuana Business Daily reported.
To Read The Rest Of This Article By Jeremy Berke on Business Insider
Published: August 15, 2022
Founder & Interim Editor of L.A. Cannabis News