TILT Holdings cut ties with social equity brands Her Highness, Highsman and Black Buddah without warning and announced it is stepping away from its partnership with the New York Shinnecock Nation during its Q2 earnings call on August 14, 2023. TILT’s Q2 earnings report showed an operating loss of $13.951 million during the quarter, a considerably higher amount than the $7.622 million operating loss the company reported for Q1 2023.
“Though these were difficult decisions to make given the impact on our team members, the reductions were necessary to get ourselves back on the path to sustained profitability,” TILT interim CEO Tim Conder said during the earnings call.
The sudden decision brought ire from many across the industry, questioning the company’s sincerity when championing diversity only months prior to the cuts. Some also questioned why it is retaining partnerships with Old Pal Cannabis and Toast.
During the call, Conder cited the challenges created by the delayed rollout of the adult-use cannabis program in New York, unlicensed operators selling cannabis on Shinnecock land and the inability to bring in or sell cannabis products across sovereign and New York state lines as the reasons why the company is stepping away from the partnership with the tribe.
“Due to these challenges, we are undergoing a deep analysis on the economic viability of this partnership,” Conder said. “During this analysis, construction has been put on hold. We are grateful to our partners for their cooperation and understanding through this evaluation period to ultimately bring the Shinnecock and Little Beach Harvest to the next phase of their journey.”
In the December 2022 cover story of Marijuana Venture announcing the partnership with Shinnecock Nation, then-CEO Gary Santo said working in conjunction with minority-owned brands was part of what made TILT different than other cannabis companies.
“This is an opportunity to show that not all corporate cannabis is bad,” he said.
Meanwhile, Chenae Bullock, managing partner of Little Beach Harvest, said it took a lot of trust to go into a partnership with TILT because of bad experiences in the past.
“We’ve been burned by so many different partnerships over the years,” Bullock told Marijuana Venture. “It’s left a bad taste in the mouths of a lot of people when it comes to joint partnerships, but this just seemed like the perfect match.”
TILT Holdings also announced a shift to focus on its inhalable products, particularly its Jupiter vape business, which has also seen declining sales that interim chief financial officer Brad Hoch attributed to supply constraints.
— Patrick Wagner