The cannabis social media company has experienced a rollercoaster year, with its biggest surprise coming this week.
MassRoots founder, Isaac Dietrich, has found a way to regain control of the company he founded. In an 8k filing with the Securities and Exchange Commission, it was confirmed that CEO Scott Kveton has resigned. The filing also confirmed that all other board members are no longer with the company.
Kveton and the other board members had only recently taken over after they forced Dietrich to vacate his position as CEO in October. But Dietrich was able to turn the tables.
“Scott will have no role in MassRoots going forward,” said Dietrich, according to Green Market Report. “I’m excited to get back to work for the shareholders.”
How did it all get to this point?
While MassRoots was able to gain popularity as a social media outlet for those who wanted to promote pictures of buds, bongs, and dab rigs, it has had a rough year behind the scenes.
In May of 2016, the company was denied its highly coveted listing on the Nasdaq Stock Exchange. Then, months later, Mass Roots defaulted on its debt payments and laid off most of its staff.
Despite the turmoil, Dietrich was able to keep investments coming in. MassRoots agreed to a deal to acquire CannaRegs, a cannabis law compliance specialist, for $12 million. The expectation was that CannaRegs would become a valuable asset in anticipation of California recreational marijuana sales as businesses would need their services to navigate the complex new regulations. But the board members at MassRoots felt the price tag was too steep.
This was part of a growing concern for MassRoots board members that Dietrich was running the company recklessly. Soon after, Kveton confronted Dietrich about accusations of illegal drug use at the workplace, inappropriate sexual conduct, and misuse of company funds. The board then forced Dietrich out as CEO and Kveton filed a lawsuit against Dietrich.
But Dietrich was able to rally investors and eventually get all of the board members removed. He is now back at the helm of MassRoots. Kveton has dropped his lawsuit.
Dietrich has signaled a continued interest in acquiring CannaRegs and still seems intent on shifting MassRoots’ focus from social media to a cannabis compliance giant.
So far, it has been a wild ride for Dietrich and MassRoots. But he has survived quite a bit. Can MassRoots find a way to recover and thrive as the legal cannabis market expands?
