Cannabis social media platform MassRoots ousted its CEO Isaac Dietrich from his role in the company on Monday in a vote by the Denver-based company’s Board of Directors.
The development, first reported by Debra Borchardt of the Green Market Report, comes on the heels of MassRoots agreement to acquire cannabis tech company CannaRegs, which tracks changes in cannabis regulations and taxation at the municipal, state, and federal levels.
Under Dietrich’s direction, MassRoots bought the company for $12 million in stock—a decision that may have ultimately led to his demise. Borchardt wrote:
Some members of the company’s board (and supposedly including Kveton) had been unhappy with Dietrich’s decision to acquire CannaRegs for $12 million. Several in the cannabis industry complained that the price was too high for the company even though private investors had been willing to pay $10 million for CannaRegs and the company had no debt and was bringing in $500,000 a year in revenues.
Scott Kveton has been named the company’s new CEO, Borchardt reports. The company has yet to make any public statements about the news. Leafly reached a MassRoots representative this afternoon, who confirmed Dietrich’s ouster but declined to speak on the record.
The last 12 months for MassRoots have been a bit of a rollercoaster ride for the company. In late May, news reports swirled that the company needed $5 million dollars to stay afloat. At the end of the first quarter, on March 31, the company posted total revenue of $134,721, according to documents filed with the Securities and Exchange Commission. The net loss for the same period was $7,447,177.
At the time, Dietrich told Leafly that his company had been making “significant investments” to the company’s technical infrastructures to improve the value of the company’s public stock, which is traded on over-the-counter markets.
Over the weekend, MassRoots stock rose to around $0.44 cents a share. On Monday it plunged over 23%, down to $0.33 cents per share.