Eaze winding down cannabis delivery operations as new owners ponder future

(This story was updated on Oct. 8 with information about potential layoffs.)

The CEO of California’s largest cannabis delivery service, Eaze Technologies, said its parent company is winding down operations and new ownership will determine if the business continues.

“Stache LLC will be winding down operations, with the full closure expected to take place on or around December 31, 2024,” Eaze CEO Cory Azzalino told employees last week in an internal memo he posted on his LinkedIn feed Sunday.

Eaze will provide employees an update on or before Nov. 15, he added.

The California-based marijuana delivery company came under new ownership in August after a public auction of its corporate assets.

A bundle of Eaze assets was purchased for $56 million by FoundersJT, a firm owned by Netscape co-founder James Henry Clark.

The acquisition by Clark, a tech billionaire and the largest investor in Eaze, follows his May foreclosure on the delivery service after it defaulted on a loan.

Union expects layoffs

In the internal memo, Azzalino said the asset transfer is expected to take months and Eaze has contacted employee union reps at local chapters of the United Food and Commercial Workers (UFCW).

MJBizDaily reported in April that 500 of Eaze’s delivery and depot employees in Los Angeles, Orange County, San Diego and Northern California were ready to walk off the job after negotiations broke down in late March to secure the first labor contract between staffers and the San Francisco-based delivery company.

However, a settlement was reached to avert a work stoppage across California on April 20, the biggest retail day of the year for the marijuana industry.

Those workers now face the prospect of layoffs, a UFCW leader told SFGate.

Jim Araby, a UFCW vice president, told the San Francisco-based news outlet that the company said an undetermined number of employees could be rehired next year.

“We were told by the company that they are assessing which depots will reopen under new ownership and which will close permanently. We don’t have answers on that,” Araby told SFGate.

Florida election could impact decision

Meanwhile, Azzalino told MJBizDaily it appears the new ownership group will decide Eaze’s fate after seeing the results of Florida’s November ballot initiative seeking to legalize adult-use retail sales.

“The new ownership group is awaiting the election results (Florida Amendment 3 results specifically) to make final determinations on go forward plans,” Azzalino told MJBizDaily in a Monday email.

Azzalino also told MJBizDaily his future with the company is unclear.

In the internal memo, Azzalino thanked employees for their “hard work, dedication and loyalty.”

San Francisco TV station KRON first reported the prospect Eaze might be closing its doors.

Chris Casacchia can be reached at ch*************@mj********.com.