Posted on 11/19/2023 5:27:10 PM PST by Oldeconomybuyer
This spring, rumors were swirling that HERBL, one of California’s largest cannabis distribution companies, was on the verge of collapse. So Mike Beaudry, the company’s CEO, sent out an email on May 18 declaring that “these rumors are categorically not true. HERBL continues to be fully operational.” Less than a month later, HERBL had completely collapsed.
HERBL’s failure left a trail of damage that hurt small pot brands and shorted the state some $17 million in unpaid taxes. HERBL is only the latest high-flying California pot startup to crumble, following companies like Flow Kana, which raised $175 million in capital only to collapse, and MedMen, the California startup that earned a billion-dollar valuation calling itself the Apple Store of Weed only to find itself this year on the brink of financial ruin.
Observers in the industry say that HERBL’s demise shows how cannabis companies in California are forced to abide by a more difficult set of rules than other industries.
(Excerpt) Read more at sfgate.com ...
The unrealistic valuations were predicated on people continuously coughing up top dollar and taxes to the legal vendors. Greed from all sides and primarily the government left these high end vendors in a difficult spot when the established distribution network, although illegal, continued to flourish due to extremely low prices relative to the legal sector. Throw in the fact that you can grow your own and the base clientele exercises their options.
Smaller dispensaries are popping up all around that attempt to sell the top end, high priced products, but they also sell lower priced but very good quality product that is competitive with the illegal market.
The tax revenues are much lower, but at least they’re getting some revenues to the government instead of going bust. A lot of learning is happening now, and it’s getting better for the consumer, just not as lucrative for the government or vendors.
I was never for legalization, but since that has passed, I’m happy that pot corporations are going bust and the gvt. is unable to reap the rewards.
“The pot market only works best between dealer and user.
It becomes unaffordable when you add a middle man.”
Middle man being the filthy government wanting to wet it’s filthy beak.
This happened about the same time Snoop said he is giving up smoking weed. hmmm.
Legalizing marijuana was never about raising tax revenue. It was about allowing the illegal market, which pays kickbacks to politicians, to thrive.
Weedies want marijuana to be legal only in the sense that they can buy their pot from their dealer, straight hand-to-hand transaction, without having to worry about the popo making trouble, or the Federal Weed Administration regulating the growth, harvesting, processing, sale, and use of the product. Leftists wanting the weed vote don’t understand this.
To much danger of pot being laced with fentanyl today, I wouldn’t buy it on the street today NO WAY!!
The Chef Classic is a very good line.
17 million in taxes, right there is the problem!!! JEEZE!,
My generation was determined to legalize it. Then the message changed to “legalize it and tax it.” As with “tax the rich” they manage to create messages and policies that are all about more money for the government to blow.
Let me guess. They were doing fine until the EEOC showed up with a court order and made them hire only fat, ugly, and old hookers.
The free market still works.
The Mexican cartels are the biggest distributers.
Headline should read, ‘Herbal goes to pot’ … radical dude
Like, wow man, you know, like uhh. What was I gonna say?
Only a pinko-Rat party can destroy the weed business.
They musta got high off their own supply.
If government can screw up pot, nothing is safe.
“...shorted the state (CA) some $17 million in unpaid taxes.”
Hey CA, just bring in some more illegal aliens. That’ll fix your shortfall problem.
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