MassRoots, known for their marijuana friendly social media platform, has acquired CannaRegs Inc. for a $12 million. CannaRegs is known for supplying software that tracks changes in marijuana law and helps businesses stay in compliance.
CannaRegs, formed by in 2014 by former Federal Reserve regulator and attorney Amanda Ostrowitz, has enjoyed consistent success in the cannabis industry. The company is debt free and generates $450,000 in annual revenue.
CannaRegs’ solid financial standing likely made it appealing to MassRoots. Last September, MassRoots made news last September when they were unable to make payments to their creditors. Ultimately, they were able to stay afloat after layoffs and a reduction in operating costs.
The company’s outlook seems to be looking much brighter these days.
“This acquisition expands MassRoots’ compliance offerings, consolidating the most important operations for cannabis businesses into one central platform,” said MassRoots CEO Isaac Dietrich according to Forbes. “We expect with MassRoots’ resources and relationships, we can grow the number of businesses utilizing CannaRegs and significantly increase MassRoots’ contractually-obligated monthly recurring revenue.”
The timing may be perfect for MassRoots. The expectation is that many businesses will turn to CannaRegs for assistance as California starts recreational marijuana sales.
Ostrowitz is very excited about what the future holds for her and CannaRegs.
“These are very exciting times for us all and we are excited for what the future holds. We are thrilled to help MassRoots continue its transition into a business-2-business company. By combining CannaRegs scrappy nature and robust regulatory platform with MassRoots’ brand, marketing, and technology resources we are confident that CannaRegs sales will continue to accelerate rapidly, driving strong core fundamentals for our shareholders,”Ostrowitz told mg. ”
“We are also thrilled to integrate with MassRoots’ existing offerings to provide businesses with a comprehensive solution for their operations that will be compliance driven.”