MedMen was once the belle of the legal cannabis ball in the hearts of many in the media and investment worlds. Founded in 2010 by Adam Bierman and Andrew Modlin in West Hollywood, California, the brand started to ascend rapidly.
2018 was a particularly beneficial year for MedMen, with its brand name and investor value boosted by media pieces gushing over its “futuristic” stores and significant retail gambles, including the launch of a medical dispensary on Fifth Avenue, New York City’s most expensive street to rent retail space on.
Between 2018 and 2019, MedMen staked its place across various states, with adult-use and medical dispensaries opening in states like New York, Nevada, and Florida.
In Florida, MedMen would launch an aggressive plan to build 25 stores. Additional production efforts included two 45,000-square-foot facilities constructed in California and Nevada. Other significant brand expansion efforts included the planned acquisition of PharmaCann for $682 million but was never completed.
Meanwhile, MedMen stepped out onto the public stage, listing on the Canadian Stock Exchange in May 2018 via a reverse takeover.
MedMen’s Upward Trajectory Turns South
Good press continued into early 2019, with the brand earning accolades for collaborating on a YouTube video spot highlighting the racial and social injustices of the American drug war.
While the positive press kept coming, internal red flags began to rise up in the public around February 2019. C-suite lawsuits and financial struggles over the next few months led to the ouster of Bierman and Modlin, with both stepping down in 2020.
By 2023, MedMen was on its fifth CEO in three years, Ellen Deutsch Harrison. Reports of an imminent collapse were often discussed in the same media that once frequently praised MedMen as the future of the legal cannabis market.
After much rapid expansion, MedMen began to sell off assets in 2019, with a $133 asset sale to REIT Treehouse. By 2022, the company was announcing its exit from the Florida market via a sale to Green Sentry Holdings. The reported $67 million sale was $16 million less than the initially announced deal.
The following year, after a lengthy dispute, MedMen sold 99.9% of its New York assets to fellow multistate operator Ascend Wellness Holdings for $88 million, combining the sale of the assets and legal settlement costs. By the end of 2023, the company would exit Arizona and Nevada via a deal with Mint Cannabis.
In late January 2024, Harrison and board chair Michael Serruya announced their departures from the company. Two days later, additional corporate layoffs took place. The brand’s bloodletting continued in early March 2024 when the company announced the closure of all but two California retail locations in Los Angeles and San Diego.
Soured Relationships
Scores of sentiments have poured in since the announcement of MedMen’s California rollback. Feedback from industry conversations, social media posts, and thought pieces highlights an array of feelings on what appears to be the brand’s demise.
While no one wants to celebrate the job loss of workers, MedMen’s significant scaling back marks the latest in a long process, where many have predicted–and some wanted to see–the brand’s death in recent years.
MedMen has seemingly never recovered from the early market, work culture, and other market concerns over the years. As such, the once-market giant has created a long trail of broken relationships and negative sentiments over the years. They include former business partners like Olivia Alexander, CEO of CBD brand Kush Queen, a California-based producer of various products, including bath bombs, flower, edibles, topicals and other infused items.
“They were good to us. We were good to them,” said Alexander of her years-long relationship which saw Kush Queen featured in numerous California MedMen locations. In addition to store shelf placement, Alexander’s company was prominently featured on the cover of MedMen’s brief media publication, Ember.
“There was [no] bad blood for a long-ass time,” Alexander told Texas Trend.
Alexander, who detailed her experience in a now industry-viral January 2024 LinkedIn post, said the fallout stemmed from a nonpayment of $1560 to Kush Queen’s longtime distributor. The CEO noted that MedMen settled the invoice after the post gained traction.
Alexander, who praised MedMen for its prior efforts towards diverse hiring and small brand support, didn’t celebrate the brand’s downfall.
“I don’t hate corporate cannabis,” she said, adding, “I believe in a diverse industry where brands big and small can all come by all together because that’s what would make this industry the best.”
Despite her experience, Alexander wants to see further investment into the cannabis industry while recognizing the legacy of cannabis culture. However, she hopes her former business partner won’t be involved.
“I hope MedMen never, ever, ever gets to hold a license again in this space,” she said.
Numerous positive posts from past MedMen workers were posted on social media outlets. Texas Trend contacted several for comments but did not receive any before this story’s publication.
A Cautionary Tale?
MedMen’s downfall is being considered a possible sign for the market at large. Alan Brochstein, founder of the digital publication New Cannabis Ventures, stopped covering MedMen after exiting Florida’s market.
While feeling MedMen was at fault for its downfall, Brochstein said that market regulations, namely federal tax code 280E, could end other top names. Still, he placed MedMen’s outcome on its own missteps.
“The market didn’t help, but the company is to blame,” said Brochstein.
Jason Ambrosino, an Army veteran and licensed New York operator, touched on broader economic trends that he feels MedMen fell into. Ambrosino, founder, owner and CEO of Veterans Hemp Market and Veterans Holdings Inc, said the investor space has long been shifting, highlighting the dotcom boom of the late 90s and early 2000s as the starting point for the change.
“People started investing on speculation,” he said, calling the system “a broken model that doesn’t necessarily work because if you don’t grow, you’re dead.”
Ambrosino said MedMen, a company valued at $3 billion in 2018, rapidly became a massive entity with no bankruptcy protection. “They had horrible examples of mismanagement because they thought the money was just going to keep coming in over and over and over.”
The New York operator and many others in the space over the years have predicted that a period of consolidation was long on the market’s horizon. Ambrosino feels that large cannabis companies could lose out if they don’t have their fundamentals in order.
Once a beacon of aspiration, MedMen now serves as a warning sign to brands. What the future holds for the once prominent brand or the other major players remains to be seen. In any case, the latest news from MedMen signals the collapse of what was legal cannabis’ early American Colossus of Rhodes.
