Not a surprise...

California's 'Apple Store of weed' is $410M in debt

By Lester Black

California’s first cannabis company valued at over a billion dollars appears to have completed its long descent into failure. MedMen, once hailed as the “Apple Store of weed,” declared bankruptcy last week, according to a press release published by the company late Friday. 

The Los Angeles-based company said it currently has $410 million in debt, according to Law360, and has filed for bankruptcy in Canada. Its California subsidiary has been placed in receivership in Los Angeles.

MedMen was once the golden child of California’s legal cannabis market, opening sleek retail locations that mimicked the minimalism of Apple Stores and promising that it could sell massive amounts of cannabis by presenting the drug as a modern product without the baggage of prohibition. National media outlets like Esquire and Vanity Fair profiled the company, and it listed itself on a Canadian Securities Exchange in 2018. 

The company’s $1.6 billion valuation allowed MedMen’s executives to spend lavishly, including purchasing luxury cars, expensive security details and private jets. The retailer opened locations in Beverly Hills and Fifth Avenue in New York City, one of the most expensive real estate locations in the world, even though New York state had yet to fully legalize cannabis. At its peak, it reported employed more than 1,300 people and had stores in seven states, including three in the Bay Area.

But the company quickly hit serious financial problems. By 2020, it was struggling to pay its bills, CNN reported, and earlier this year its stock dropped to $0, from a former high of more than $6. MedMen has spent the past two years selling off assets in an attempt to become profitable, but the sales do not appear to have been enough. The Friday news release said that the company is anticipating some of its creditors will take enforcement actions against it.

MedMen’s San Francisco and Oakland stores are both closed, according to messages on the stores’ voicemail machines.