MassRoots Inc. (OTCMKTS: MSRT) the cannabis community’s first social media platform is working diligently to become cash positive after some serious missteps in the last year.
On Thursday, MassRoots CEO Isaac Dietrich reported that the company managed to raise $4.75 million and fully repay their capital debt. The announcement came on a phone call with investors. He also informed them that the company had reduced its employee size to five and that its burn rate is currently at $200,000 per month.
Fired and Rehired CEO
In October, Dietrich, the company’s founder and CEO, was fired abruptly by the MassRoots board after announcing a deal to purchase CannaRegs.
CannaRegs is a subscription-based company that provides its users with access to up to date local, state, and federal cannabis regulations and laws. MassRoots agreed to acquire CannaRegs in a stock deal for $12 million. Board members including Scott Kveton thought that the price tag on the deal was too high which many believe set in motion Dietrich’s firing.
In October, Kveton assumed the role of CEO of MassRoots. His installation came with criticism, especially from women in the industry because of past allegations of sexual misconduct. Kveton’s tenure was short-lived. He resigned after being in the role for only two months.
Dietrich reassumed the role of CEO and had to immediately deal with pressing issues.
In December, the company was evicted from its offices in Denver after failing to come up with the $39,742 in back rent. MassRoots employees are currently working from a WeWork space.
News of the $4.75 million is the first step in putting the company back on track for success. According to the Green Market Report, Dietrich is also focused on growth to meet his goal of being "cashflow positive this year".
He plans to increase his overall dispensary business.
MassRoots has “several hundred dispensaries that pay a couple hundred of dollars a month for services.” Dietrich is looking to grow the services to $500 per month and expand the number of dispensaries who utilize services to 1000.
The company has made some major moves under Dietrich’s second tenure as CEO.
In December, the company announced that they formed MassRoots Blockchain Technologies a subsidiary of MassRoots. This new technology signals Dietrich’s focus on shifting the company away from its social media roots to a cannabis tech brand.
According to the Green Market Report, the new block technology will “be useful in improving seed-to-sale traceability and will explore that with its new point-of-sale system called MassRoots Retail”.
The technology is also expected to “enable advertisers to better target consumers, reduce the risk of security breaches, and enable the development of solutions”.
The company has highlighted some of its investments as part of its strategy for success. For example, it is still very excited about the investment it made last February in High Times. Also, CannaRegs is still very much a part of MassRoots picture.
Although there was much controversy surrounding the acquisition of CannaRegs, Dietrich believes the $300,000 investment it made last quarter is valuable to the company.
MassRoots is also exploring the burgeoning Canadian stock market, especially after the investment that Aphria Inc. (TSX: APH) (USOTCQB: APHQF) made in the company over the past year and a half.