Akerna the parents of the dreaded MJ Freeway recently purchased Canadian company Ample Organics a cannabis compliance outfit.
To start us off let’s remember a few Akerna / MJ Freeway stories we’ve reported over the past few years to provide some context
Plenty more stories of a similar ilk at CLR
Click to lean more about Ample Organics
Reading their About Us page it looks like they sold to a company who don’t really have the same outlook about integrity, community etc as is bourne out by a piece today in MJ Biz that reports..
Denver-based Akerna, a marijuana compliance software company, parted ways with John Prentice, the founder of Canadian firm Ample Organics, only months after a $45 million acquisition deal closed.
An Akerna spokesperson released a statement to Marijuana Business Daily confirming the acquisition led to layoffs at the company.
“As a company,” Akerna said in the statement, “we prioritize our people first and foremost, but sometimes it is unfortunately necessary to reduce staff.
“This is never a decision taken lightly and one that is avoided at all costs. Our recent changes reflect our commitment to positive growth in a responsible and efficient manner.”
Prentice’s departure was first reported by New Cannabis Ventures.
In a post on his personal website announcing his resignation, Prentice said Akerna’s executive leadership was “incapable” of creating the “preeminent global (cannabis) technology platform” and leading the “cannabis industry’s evolution.”
Here is his post in its entirety
I am immensely disappointed today to announce my resignation from Ample Organics. For each of you who were part of this wonderful and life-changing journey over the past six years, please accept my most sincere thanks. I appreciate you more than you know.
We sold Ample to Akerna last year because we fell for the same promise Akerna made to stockholders when announcing the acquisition. CEO Jessica Billingsley promised that they had a “vision to create the preeminent global (cannabis) technology platform, addressing the entire supply chain and its regulatory bodies through accountability and transparency.”
As all too often happens with companies like Akerna, it never had the vision or executive leadership to deliver on this promise, or many others. After deep reflection on the cannabis industry’s evolution, and the type of commitment to planning and execution required to lead that evolution, I came to believe that Akerna’s executive leadership is incapable of taking us there successfully.
I will have more to say in coming days and months, but suffice to say that I believe Akerna’s current leadership is unlikely to make it a preeminent leader of anything. Except, possibly, serial layoffs, customer and revenue churn and dilutive deals that are bad for investors — all of which are currently happening there.
Software-as-a-Service (SaaS) companies enjoy an exalted spot in our economy because of their business model simplicity and the value of their recurring revenue streams. When you have successfully acquired a significant customer base, as Akerna has, your job is to faithfully safeguard your investors’ money and make it grow by continuing to deliver products and services customers want, engaging those customers, delighting them, and repeating. But when you call yourself a SaaS company to get that elevated valuation then turn around and disappoint customers, fail to capture acquisition synergies, or even to manage the company like a SaaS company, it is wrong. You can see for yourselves. I challenge anyone to look at Akerna’s quarterly or annual reports and find even one instance where they explain to investors that they understand, manage or report on generally-accepted SaaS metrics like churn, LTV, CAC, CAC:LTV ratio and the like. You won’t find it because they don’t do it.
Failures like this begin at the top. Akerna has some great employees, it has awesome customers, and, with the right leadership, has massive potential. Unfortunately, I do not believe its current executive leadership has any likelihood of nurturing those employees, effectively serving those customers or capturing much of that potential.
After our transaction, each time I raised these issues internally I was rebuffed, and as a part of my final conversation with Jessica Billingsley, I politely requested that she do the right thing and resign her position as CEO. I asked that a rigorous search be started to find a candidate with the requisite experience and skills to lead this company forward and to correct a decade of bad decisions. She declined to do so.
While I may have resigned, I have not given up on my belief in Ample Organics and the potential of Akerna, and I intend to use every resource available to me to make sure that potential is realized.
John X. Prentice
Her at CLR with a number of years reporting on MJ Freeway and their subsequent purchase by Akerna.. we only have one thing to say. A leopard never changes its spots.
MJ Biz Continue
The Akerna statement noted that the company’s leadership understands that personalities, and even technologies, do not always mesh:
“As disappointing as the resignation of John Prentice is, we only want what is best for all parties involved.
“We look forward to the continued growth and success of the Akerna portfolio, of which Ample Organics and its technology and team hold a significant level of importance. We remain committed to our clients and more importantly, our team.”
Ample Organics, a seed-to-sale software business, said last December when its acquisition by Akerna was announced that the company served more than 70% of Canadian cannabis license holders.
The big question will be ..will Canadian customers get the same or an improved level of service from the Akerna owned Ample Organics or will quiet cuts and ridding of staff who don’t fit the Akerna corporate outlook slowly wear down the brand, its tech and customer service so that in 6 to 8 months time we see the type of headlines that MJ Freeway regularly generates as they have outages and reduced service levels.
As always time will tell.
Acquisition by cannabis tech platform Akerna spurs layoffs, leadership split