Ease Technologies, once California's largest cannabis delivery company, will cease operations by December 31, 2024.
In a letter shared on LinkedIn, CEO Corey Azzarino confirmed the company's closure. “Due to continued challenges in the California cannabis market, our assets were foreclosed on by our lenders on August 6, 2024.”
According to the United Food and Commercial Workers Union (UFCW), nearly 500 workers will be laid off, many of them union representatives, SFGate reported.
Founded in 2014, Eaze expanded rapidly after California legalized recreational marijuana in 2018, but financial difficulties, ownership changes and legal battles contributed to its decline.
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Turbulent financial history
Eaze's financial problems have been well-documented over the years. The company, once valued at $700 million and dubbed the “Uber of weed,” has faced increasing hurdles, including the resignation of its former CEO following a bank fraud conviction in 2021.
Earlier this year, tech billionaire James Henry Clark foreclosed on Ease after it defaulted on a $36.9 million loan. Clark's company FoundersJT then acquired the company at auction for $56 million, marking the next chapter in the cannabis delivery giant's turmoil, MJBizDaily reported.
Despite the change in ownership, Ease has been unable to bounce back in the face of high operating costs, strict regulations, and competition from both the hemp industry and an unlicensed weed market that has depressed demand in California.
Related article: Gov. Newsom's total cannabis THC ban could devastate California's multibillion-dollar industry, officials say
uncertain future
Eaze's future now lies in the hands of its new owners.
UFCW President Jim Araby expressed concern for the workers affected by this closure and called for further legislative action to address the structural issues affecting California's cannabis market. Eaze plans to provide updates to employees by November 15, 2024.
Azzarino also told MJBizDaily that the final decision on whether to reopen some warehouses or close them permanently will depend on the outcome of Florida's November vote to legalize adult-use cannabis.
Some of its roughly 500 employees may be rehired in 2025, but the company's future remains uncertain.
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