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XGreen Rush: The Sudden Death of Dmitry Bosov and His Dream of a California Cannabis Empire
Tami Abdollah was dot.LA's senior technology reporter. She was previously a national security and cybersecurity reporter for The Associated Press in Washington, D.C. She's been a reporter for the AP in Los Angeles, the Los Angeles Times and for L.A.'s NPR affiliate KPCC. Abdollah spent nearly a year in Iraq as a U.S. government contractor. A native Angeleno, she's traveled the world on $5 a day, taught trad climbing safety classes and is an avid mountaineer. Follow her on Twitter.

Hours before Dmitry Bosov, or "Dima," died alone in a Moscow suburb on May 6, allegedly of suicide or an accident, he chatted with family members over video. Even as his former cannabis company was sold to a new owner and he was overtaken by concerns about the novel coronavirus pandemic in Russia, he still seemed happy to family members, who wrote about his demeanor the night of his death in an online tribute.
The Russian coal magnate had gambled on Genius Fund, an ambitious Culver City-based cannabis startup that had plans to dominate the industry. But after investing roughly $164 million, he appeared to have walked away, at least temporarily, from the dream of a viable U.S. cannabis company.
When his former Genius Fund associates learned of Bosov's death shortly afterward, they were all "shocked," according to former employees interviewed by dot.LA.
Bosov's son called Genius Fund executive Ari Stiegler the next day crying. "It was super sad," Stiegler said.
A string of bad investments, power struggles and lavish spending had nearly brought Genius Fund to its knees. A lawsuit filed against Bosov and his company alleges funds were "commingled," that there was a lack of "any coherent business plan" and that the investor "concealed and misrepresented" his ownership, raising questions about what his investment intentions were.
Editor's Note
The story is pieced together from interviews with more than 40 former employees and business associates, active and retired county officials, as well as federal and county law enforcement; state court records, arbitration, arrest and corporate records in the U.S. and Canada; other public records in six California counties; Genius Fund corporate records and emails. Some former employees and business associates spoke to dot.LA on condition that their names not be mentioned out of fear of reprisals.
This is the fifth and final story in our "Green Rush" series. Read more:
Part 1: Rise and Collapse of LA's Genius Fund | Part 2: Growing Pains in Plumas County | Part 3: A Line of Failed Products | Part 4: What Happened in Adelanto
Bosov, 52, was a father of five who reportedly ice skated with Putin. He was 86th on Forbes' richest Russian billionaires, with an estimated net worth of $1.1 billion in 2020.
Because he died alone, of an apparent gunshot wound to the head, the oligarch's passing resulted in a great amount of speculation in Russian and other media reports that he was murdered. Russian authorities have been investigating his death as a suicide or accident.
One early report was in Kremlin-controlled news outlet Sputnik. It provided few details other than that the billionaire was "found with a gunshot wound to the head" with a gun next to his body.
But Genius Fund executive Ari Stiegler told people he believed it was murder, according to a business associate with whom Stiegler spoke.
Stiegler told him "Putin took one of Dmitry's coal mines" and "that's what happens when a $1 billion oligarch gets in a fight with a $5 billion oligarch."
A representative of the Bosov family told dot.LA they want Russian authorities to investigate whether foul play was involved in Bosov's death.
A screenshot of an online memorial to Dmitry"Dima" Bosov.
Turmoil in Russia
Bosov's last months alive were turbulent. Genius Fund was trying to restructure itself under Bosov's advisor, Gary "Igor" Shinder, and evaluate its financial losses. Bosov was also dealing with drama in Russia.
Bosov was known in Russia as a coal industrialist who more recently sought to build the largest railway infrastructure project for Russian Federation President Vladimir Putin. The eccentric billionaire was a majority owner in multiple Russia-based companies that are involved in the production of coal-linked projects.
He was the chairman of the board of directors and the owner of 86% of Moscow-based Alltech Group, a 27-year-old private investment company that manages oil and gas, coal and anthracite, as well as residential and commercial real estate, according to Genius Fund documents and Alltech'swebsite. The investment group controls Sibanthracite Group, a coal exporter that calls itself Russia's largest producer of metallurgical coal — a crucial component for making steel, Sibanthracite's website states.
Bosov was also co-owner of other coal companies including VostokCoal MC, which manages coal extraction projects, with his longtime business partner Alexander Isaev, according to a Russian media interview on Sibanthracite's website.
Russian media reported that the state's environmental agency fined it roughly $8.4 million for illegal mining. The fine was related to a 2018 case against Bosov and Isaev's VostokCoal subsidiary, which was involved in a project to mine vast coal reserves in the Arctic's Taymyr Peninsula, Russia's largest nature reserve and a haven for wildlife like the muskox.
The Russian Federal Security Service, or FSB, also opened a criminal case against the management of Bosov's company for the illegal mining and sale of that coal, Russian media reported in April 2019. That was the same month Bosov and his wife's visas were rescinded by the U.S., said Genius Fund ex-CEO Francis Racioppi in a whistleblower retaliation lawsuit filed this past April.
A few months into 2020, Russian media reported that the Russian state's nuclear power company created by Putin sought to buy VostokCoal MC.
In early April, weeks before his death, Russian media and Forbes Russia reported that Bosov accused his longtime business partner Isaev of "egregious abuse and theft," and had him removed from his position atop coal company VostokCoal MC and also from the board at Sibanthracite. Isaev has denied the accusation.
It was later reported that less than 24 hours before Bosov's death, a former business partner was arrested in Russia on suspicion of ordering contract killings in the 1990s. Russian media outlets speculated that Bosov was about to be called as a witness.
During this period, the price of coal dropped precipitously in the face of the ongoing COVID-19 pandemic, putting the companies "in a desperate crisis," Anders Åslund, a senior fellow and Russia expert at the Atlantic Council think tank, told dot.LA.
A person familiar with Bosov's state of mind in the months prior to his death told dot.LA that he had talked about increasing turmoil, including theft, at a company.
As the pandemic spread, Bosov reportedly armed himself, believing rampant crime would break out, and yelled at people to "stay home or die."
"It's clear that since the beginning of the year, there had been something going on," said Brian Whitmore, director of the Russia Program for the Washington, D.C.-based Center for European Policy Analysis. "Russian media was reporting that his financial affairs appeared to be in turmoil since the beginning of the year, when he began transferring assets and dismissing employees."
Whitmore said despite much speculation in the Russia media it's hard to know exactly what may have led to Bosov's death. Whitemore said the billionaire was known for "adventurous," high-risk investments.
"We had a saying in Russia: was it suicide or were they suicided?" Whitmore told dot.LA.
In April, as the turmoil at his Russian companies' was unfolding, Genius Fund ex-CEO Francis Racioppi filed a more than $3.5 million whistleblower retaliation lawsuit in Los Angeles federal court against Bosov and Genius Fund. And in June Genius Fund, itself, filed a second arbitration claim alleging their former business associates embezzled and unjustly enriched themselves.
Bosov's manner of financing and lack of strict accounting controls prompted speculation among Genius Fund staff. In particular, as to why he was "repeatedly dumping millions of dollars into the company without requiring any accountability from company management or executives as to how the money was being spent," according to allegations in Racioppi's lawsuit.
"I'm surprised the company didn't get raided by federal authorities only because there's one investor," a former Genius Fund employee told dot.LA. "He's a billionaire oligarch and it looks like a classic play of moving assets to the West."
Bosov's Plans
Just how much Bosov was involved in day-to-day decision-making at Genius Fund remains unclear.
In his whistleblower retaliation lawsuit, Racioppi contends that Bosov was not a passive investor but exerted "complete control" over the business. A Bosov family member told dot.LA this was not true. That person declined to provide details beyond that the family hoped Genius Fund would be "grown as father wished and be a great company."
Racioppi's lawsuit alleges that Bosov ran Genius Fund's day-to-day operations while living in the U.S. from fall of 2018 to the around May 2019, just as the company was getting off the ground.
During that time, Bosov lived in a garish Beverly Hills mansion described as a modern-day tribute to Versailles that he eventually purchased through an entity created a few weeks prior, paying $30 million in cash, according to property and court records.
In his lawsuit, Racioppi alleges Bosov mixed his personal funds with Genius Fund's, blurring the lines between corporate and personal investments.
Attorneys representing the defendants denied the allegations and characterized Racioppi as a disgruntled CEO who was unwilling to take direction from the new owner, and was never terminated.
Amit Sharma, a former U.S. Treasury Department official and a startup owner himself, said it's crucial that there be a firewall between business funds and personal funds. "Commingling is a notable red flag in the money laundering world," he said.
Genius Fund operated more than 50 entities, but had only one main account through which the investor's money came in and from which money was spent, according to corporate documents and former employees.
The Beginnings of the Power Struggle
By fall of 2019, back at Genius Fund's Culver City office, Racioppi said he was communicating with Bosov daily regarding the company's growing debt, according to his lawsuit.
As the year went on, funds wired from Bosov's company, Alltech Group, to Genius Fund became less frequent. Genius Fund's sole investor began requiring more details on profits and losses before sending additional funds, multiple employees said.
"In the past, these two kids, whenever they wanted money, he just sent it," Evan Kagan, an executive in one of Genius Fund's ventures, said of Stiegler and Borden.
Internal company records and former employees show the plan had been that Genius Fund expected to be financially self-sufficient by the fall of 2019. But by that December the company was still not cash flow positive, and it looked unlikely it would be anytime soon, according to company records.
Bosov summoned the team to the Mexican resort town of Cabo San Lucas for a meeting, according to multiple employees and company records. He made Stiegler and Racioppi co-CEOs and made it clear that they should not meddle in the staff's future financial projections, according to multiple former employees. The billionaire introduced his friend, Shinder, who lives in the U.S., as his new consultant on matters related to Genius Fund.
When the executives returned in early December, former staff members realized that many of them had received the same calendar invitation.
They told dot.LA that one by one, they were brought over to talk to a representative of HR and legal and told they were being let go. The casualties included the C-suite of products, the THC team and anyone redundant, three former employees said. Stiegler and Borden stayed away and waited it all out, the three remembered.
The next day, Stiegler went over to the product team and said, "If you're around, congratulations, get ready to work really fucking hard," according to the three former employees.
In a video clip of a Genius Fund meeting reviewed by dot.LA, Stiegler announced at a staff meeting that he and Racioppi are now co-CEOs and said he's in charge of "investment decisions." Stiegler told his employees, "I'm deciding where our money is going."
The mid-January 2020 forecast prepared for Bosov found if Genius Fund wanted to continue operating in the same fashion, he would need to invest tens of millions — on top of the more than $150 million he'd already spent without profit, two former employees said.
"Until it became a problem, they probably never thought they had a financial problem," Kagan said of Stiegler and Borden.
Things were unraveling.
The Incident in Mexico
Stiegler occasionally set aside samples of the company's branded product with the words "this one's for Dima," according to former employees who saw and heard him do this.
Racioppi's lawsuit alleges that "Bosov insisted that a Genius Group employee transport a sample of its commercial cannabis product to him in Italy" despite Racioppi's objections. The suit describes an executive organizing the transport behind Racioppi's back.
In December, on another visit to Mexico, Stiegler stashed some of Genius Fund's marijuana in his backpack for another visit to meet Bosov. But before Stiegler could exit the airport, he was randomly selected for a search, three former employees said.
He was arrested.
"The one thing I can tell you about the Mexico trip," Stiegler told dot.LA. "There was, like it was kind of like some dirty Mexican cops, who obviously saw me as a rich American and they wanted to exploit that. They were, like, trying to extort me and scare me and stuff like what you see in the movies."
Stiegler added he had a "couple joints, literally like three, four joints in a bag" in a side pocket. "They saw it, then they just really scared me."
He said he was in jail for a "pretty short" amount of time.
Firing
As Genius Fund underwent a crisis at its top ranks in February of this year, the company continued to spend on what some within the company said were unrealistic ventures. An employee flew to Rotterdam in order to research automated greenhouses and hold meetings about potentially buying a $92 million project, a former employee said.
Stiegler also tried to develop a new real estate investment trust to operate as a Genius affiliate, spending investor money on research and travel to meet people in those last months, former employees and business associates said.
Racioppi alleges he told Bosov of the "the gravity of the company's dire financial situation" during meetings in Mexico, presenting him with a plan to turn the company profitable with a minimal additional cash infusion. In court filings he said Bosov then directed him to "implement a reorganization plan" with Shinder overseeing that effort.
By the end of February, Racioppi called a staff meeting where he stood up and told everyone, "I don't know if I have money to pay you or not. So you guys can go home. Don't come back. I'm so sorry. You'll get a letter from us," said several former employees.
For the many off-site employees, the conference call piping them into the meeting didn't work -- callers heard a bunch of people talking in the background before the line went dead, two former employees, who were on the phone call, said. They said they learned they had lost their jobs when they could no longer log into their work Gmail accounts. A week or so later, employees said they received a letter telling them they were laid off.
In the final months, ex-employees described efforts by the company to sell whatever it could, including farm equipment, to make payroll. In March, the company's coffee table and couch disappeared from the office, they said.
The layoff letter was dated the same day Racioppi accepted a new position as sole CEO. His contract was to run through 2021 with an annual base salary of $700,000 plus a $300,000 signing bonus, along with $30,000 in moving expenses and a guaranteed bonus of no less than $350,000 a year, according to Racioppi's lawsuit, which alleges he is owed the remainder of his contract.
But according to the lawsuit, shortly after he was promoted, Bosov pulled the funding and sold the company, its entities and assets to Shinder.
In his final written executive order as Genius Fund's board chair, Bosov detailed the murky corporate structure that made him the company's ultimate beneficiary. He said he indirectly owned the company through a majority stake in Cyprus-based Goldhawk Investments Limited, according to the order. But that name had never appeared on monetary wires to Genius Fund, said four former employees. Bosov's other company, Alltech Group, was cited on internal paperwork as the source of funds. The relationship between the private companies is unclear.
After Bosov washed his hands of Genius Fund in March, Shinder made himself the company's president and chairman of the board of directors, according to Racioppi's whistleblower retaliation lawsuit.
By the end of March, Shinder established a new Genius Fund board of directors that included three active members: Shinder as president, as well as his two attorneys, lawyers at the Washington, D.C.-based law firm Freeh Sporkin & Sullivan.
With the transfer of power complete, Shinder worked for weeks with lawyers to get a handle on the company's financial picture.
The new board's first executive order, submitted as part of Racioppi's lawsuit, was to audit Genius Fund and all of its entities, ban distribution of any assets or funds without written approval from Shinder, and to order an independent investigation regarding "possible fraud and negligence" because of apparently "severe deviations" in the fund's financials, structure and management, the document said.
Liquidation
By the end of March, Shinder laid off all existing staff, including management, citing the "substantial business interruption caused by the ongoing COVID-19 outbreak," even though the state and city said cannabis shops were allowed to remain open. Just a month earlier, the company had set records for daily and weekly revenue, Racioppi alleges in his whistleblower retaliation lawsuit.
But Genius Fund's time and financial backing had run out.
Former employees told dot.LA that the sudden dissolution of Genius Fund left them and their colleagues with thousands of dollars in expenses unreimbursed thus far. In a letter dated April 22 reviewed by dot.LA, employees received a "notice of unavailability of COBRA (healthcare) continuation coverage."
Some upset employees sold heavy machinery in the field to a competitor and then split and pocketed the cash, two people familiar with the sale said. Meanwhile, the company notified vendors it was terminating their relationships even though many of them were still owed money, according to recorded liens, Racioppi's lawsuit, and interviews with former employees and vendors.
Today Genius Fund's website is just a landing page with an email address. Slowly assets have been sold or appeared for sale, according to property records and documents submitted as part of Racioppi's lawsuit.
The company grew more than one million pounds of industrial hemp, but none of it ended up in any of Genius Fund's branded products during the company's less than two years of operation, multiple ex-employees said.
In April, property records show that Genius Fund sold its Santa Barbara County land for $5.4 million. The Adelanto site, used to manufacture CBD and THC oils and extract, is for sale, according to an arbitration claim Genius Fund filed in June against its former partners at the site, which alleges they stole, embezzled funds and were grossly negligent.
The arbitration has since been settled, according to Kagan, one of the parties to the claim.
Genius Fund's new owner, Gary Shinder, did not reply to repeated requests for an interview, but said in a letter to dot.LA that after significant examination, "I did not find anything that could support any allegations of embezzlement, theft, or mismanagement by Heli Holdings or its principals." He wrote that he instead found what was likely "the only successful project in the Genius Fund portfolio."
"Everybody's just trying to get what they can out of it," said former Genius employee Jeff Davis in May. Davis lives with Stiegler and is one of the people Racioppi's lawsuit said is helping on a commission basis to distribute remaining assets for what Davis called the now "defunct" company.
In the meantime, the FBI has shown some interest in talking to Stiegler. Federal agents showed up at Stiegler's house, but he wasn't home, Stiegler told dot.LA.
Stiegler said an FBI agent called him afterward and asked if he was OK in light of Bosov's death saying, "we want to make sure you're safe." The agent then proceeded to ask him questions about Bosov, but Stiegler said he didn't want to speak about him.
A spokeswoman for the FBI declined to comment.
'A Case Study in Excess'
Former VP of Cultivation Jason Taylor told dot.LA that the company could have been the largest player in the cannabis industry today, but "they just couldn't get out of their own way. They were too busy on drug fueled binges and parties."
"He gave them everything. The ability to have a private chef at the offices…they bought vehicles, all kinds of stuff," Taylor said of Bosov. "This was a billionaire who stood up and stopped meetings to shake my hand. He was not a monster, he just wanted results."
Borden and Stiegler were also let go in the final round of layoffs, but Shinder subsequently hired them back on a commission basis — along with a skeleton crew of at least six others — to "liquidate" the multi-millions in assets, including 1.7 million pounds of hemp, real estate assets, business entities, vehicles and other equipment, as quickly as possible, Racioppi said in his sworn declaration filed in his whistleblower retaliation lawsuit.
Stiegler said "that's not accurate," and that there were "two or three remaining employees and I'm pretty sure they've all been fired or quit now."
In his letter to dotLA, Shinder wrote: "While the public relishes in the success stories of young brash entrepreneurs in Silicon Valley, they usually don't hear about the colossal failures... To everyone's embarrassment, the prior Genius management can serve as a case study in immaturity, ego, financial irresponsibility, and excess."
He declined to comment further.
One former employee called it a "tragedy" that hundreds of people lost their jobs. So far, no one has accepted responsibility for the company's failings.
Stiegler said since Genius Fund's dissolution he's been working on new investments and new projects, "just kind of on to the next."
He's also hired a public relations and crisis management firm to improve his online image, a former business associate with direct knowledge told dot.LA.
Former employees who spoke to dot.LA say they are still dealing with the sudden job loss.
"It'd be great for some kind of justice to come out of (everything that happened)," said a former employee." There were a lot of good people who were trying to do right."
--
This is the fifth and final story in dot.LA's "Green Rush" series looking at the rise and fall of cannabis-related startup Genius Fund. Read part one, part two, part three, and part fourand sign up for dot.LA's newsletter to be notified about new stories.
Do you have a story that needs to be told? My DMs are open on Twitter @latams. You can also email me at tami(at)dot.la, or ask for my contact on Signal, for more secure and private communications.
Lead art and illustrations by Candice Navi.
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Tami Abdollah was dot.LA's senior technology reporter. She was previously a national security and cybersecurity reporter for The Associated Press in Washington, D.C. She's been a reporter for the AP in Los Angeles, the Los Angeles Times and for L.A.'s NPR affiliate KPCC. Abdollah spent nearly a year in Iraq as a U.S. government contractor. A native Angeleno, she's traveled the world on $5 a day, taught trad climbing safety classes and is an avid mountaineer. Follow her on Twitter.
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Netflix Turns To Asia To Boost Its Stalled Subscriber Growth
Christian Hetrick is dot.LA's Entertainment Tech Reporter. He was formerly a business reporter for the Philadelphia Inquirer and reported on New Jersey politics for the Observer and the Press of Atlantic City.
Netflix will invest more in Asia in a bid to revive its sluggish subscriber growth, betting on the lone region where the company added customers during an otherwise disappointing first quarter.
Bloomberg reported Monday that the streaming giant will grow its investment in Asia despite plans to reign in spending overall across the company. That will include financing the production of local films and series for that market, Tony Zameczkowski, Netflix’s vice president of business development for Asia Pacific, told the news outlet.
The streaming service has lost roughly 70% of its market value this year, due in large part to the company losing customers for the first time in a decade last quarter. Things aren’t expected to improve in the current second quarter, either with Netflix predicting a net loss of 2 million subscribers.
But Asia is the one market where Netflix has made gains this year, adding 1.1 million subscribers during the first quarter. The company will likely try to reproduce the success it found with South Korean hits like “Squid Game”—Netflix’s most-watched show ever—and “Hellbound,” as well as ramp up its Japanese anime portfolio.
Still, the Asia region presents political and profit challenges, such as countries seeking to restrict certain content within its borders and lower revenue per customer compared to North American subscribers, Bloomberg noted.
Facing heightened competition from tech and legacy media giants, Netflix is trying all sorts of things to remain atop the streaming market. It’s planning to crack down on password sharing, introduce advertising and expand into gaming to add or hang onto paying customers.- 'Squid Game' Helps Netflix Add 4.4 Million Subscribers in Q3 - dot.LA ›
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Christian Hetrick is dot.LA's Entertainment Tech Reporter. He was formerly a business reporter for the Philadelphia Inquirer and reported on New Jersey politics for the Observer and the Press of Atlantic City.
Kid Cudi Is Betting Artists—And Fans—Want Live Shows on Their Smartphones
Christian Hetrick is dot.LA's Entertainment Tech Reporter. He was formerly a business reporter for the Philadelphia Inquirer and reported on New Jersey politics for the Observer and the Press of Atlantic City.
Live performance app Encore, co-founded by rapper Kid Cudi, wants to put concerts in people’s pockets.
The Culver City-based company is among a bunch of virtual concert startups to emerge as the pandemic forced musicians to cancel or postpone in-person shows. But unlike competitors that are producing shows for virtual reality headsets or putting pay-per-view concerts on computers, Encore is betting fans will watch their favorite artists on smartphones. Think of it as a higher quality Instagram Live, with artists performing before augmented reality (AR) backgrounds and video chatting with fans.
A screenshot of Encore's Studio app for iPhone.
Photo courtesy of Encore
“What's disruptive about what we're doing is it is mobile live performance,” Encore co-founder and CEO Jonathan Gray told dot.LA. “It's free [for the artist] in your pocket, everywhere you go. And I think that's ultimately the vision of the company.”
Founded in 2020, the startup previously required artists to use both an iPad and iPhone to set up a show, with the more powerful tablets ensuring better production quality. But the iPad requirement proved to be a barrier for artists who couldn’t afford one, Gray said. Encore brings artists to its physical studio to perform on a greenscreen stage, too, but the company wants Encore shows to feel less like formal productions. They’ll ideally be something an artist does casually—and frequently—to engage with fans and make money in a lower stakes environment.
“The vision of the company, and the way we will get scale, is with artists doing stuff on their own,” Gray said. “I think as soon as it's on your phone, as soon as you can be going live in a minute, you're totally changing what it means to go live.”
Admission is cheap, but Gray said fans collectively spend a lot of money during a show. Middle-tier artists who have relatively smaller but engaged fan bases have racked up several thousand dollars during an Encore show—without booking a venue or hiring a production team.
“There's this completely untapped part of the music industry that has tons of engagement, but the engagement is on social [media],” Gray said. “Ultimately, your superfans can only stream on Spotify so many times. And even though you have super fans, how many of them are going to show up to a single city on a single night? Not that many.”
The new Encore Studio App lets artists design AR stages, add custom artwork and incorporate visual effects to turn basic spaces into more visually compelling backdrops. Other features include live polls, “backstage pass” video chats, and “clap goals,” in which artists can, for example, entice fans to spend more to hear new music.
Encore has raised $9 million in seed funding so far from investors like Battery Ventures, 468 Capital and Parade Ventures. The company has 14 employees and has facilitated 200 live shows since its first app went live in February. Roughly 2,000 artists have registered with Encore, which shows performers are interested but haven’t tried it, Gray said. That’s a big reason why the company is removing the iPad obstacle.
“You can actually get from downloading the app to having your own AR world and going live in like two minutes,” Gray said. “Before—it was not two minutes.”
Christian Hetrick is dot.LA's Entertainment Tech Reporter. He was formerly a business reporter for the Philadelphia Inquirer and reported on New Jersey politics for the Observer and the Press of Atlantic City.
Venture Firm Backstage Capital Laid Off Nine Employees, Reducing Its Staff to Just Three
Kristin Snyder is an editorial intern for dot.la. She previously interned with Tiger Oak Media and led the arts section for UCLA's Daily Bruin.
Venture firm Backstage Capital laid off nine employees, reducing its staff to just three.
Managing partner and founder Arlan Hamilton announced the layoffs Sunday on her “Your First Million” podcast. General partners Christie Pitts and Brittany Davis, along with Hamilton, are the only remaining employees, TechCrunch reported. The move comes only three months after the Los Angeles-based firm said it would only fund existing portfolio companies.
“It’s not that I feel like there’s any sort of failure on the fund side, on the firm’s side, on Backstage’s side, it’s that this could have been avoided if…the system we work within were different,” Hamilton said during the podcast.
Hamilton founded Backstage in 2015 to highlight underrepresented founders and launched a crowdfunding campaign last year to draw in everyday investors. The company announced its plan to raise $30 million for a new fund, bringing in $1 million from Comcast. Having invested in 200 companies, Backstage announced in March that it would not be making new investments.
Hamilton said Backstage’s situation is a “purgatory kind of position,” with companies saying the fund was either too developed or not developed enough to invest in. However, in an email sent to stakeholders, she said she is “optimistic about the next 18 months.”
The firm still intends to grow its assets under management to over $100 million as Hamilton looks for backing from to the 26 funds she has invested in for backing. Hamilton said the company does not “have dry powder right now,” which points to the firm’s struggle to grow.
The news comes during a wave of layoffs across Los Angeles, with companies like Voyage SMS, Albert and Bird letting go of employees.
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Kristin Snyder is an editorial intern for dot.la. She previously interned with Tiger Oak Media and led the arts section for UCLA's Daily Bruin.