How JAY-Z Avoided a $575 Million Loss in the Cannabis Industry

JAY-Z quietly jumped ship from a cannabis company he invested in before it reported a $575 million loss. The Roc Nation mogul, known for his sharp business acumen, appears to have outmaneuvered financial disaster by distancing himself from The Parent Company (TPCO), the cannabis conglomerate that once housed the premium cannabis brand Monogram.

As TPCO’s shocking $575 million loss in 2022 comes to light, sources close to the situation claim JAY-Z stepped away well before the collapse.

A source told TMZ Hip Hop, “Jay-Z stepped away years ago, and it just went up in a mess,” adding that his official separation occurred in December 2022. While TPCO has since merged with Gold Flora, Monogram is now under the control of another LLC, leaving JAY-Z unscathed as the fallout continues.

Launched in 2020, Monogram was marketed as a luxury cannabis brand with an aggressive campaign that boasted features in GQ, Vogue and Vanity Fair. However, the ambitious venture struggled in California’s fiercely competitive market.

Seth Yakatan, a cannabis industry expert, explained to SFGATE that the upscale campaigns opened the door to disaster for the brand. Yakatan says those campaigns cost The Parent Company mind-boggling amounts of money and claims Monogram’s $50 joints were a tough sell in a state flooded with affordable alternatives.

Despite its glamorous debut, insiders suggest Monogram may have played a significant role in TPCO’s financial collapse. The brand, positioned as ultra-premium, faced criticism for underwhelming consumers. A GQ review even pointed out that Monogram’s $50 hand-rolls failed to stay lit—a basic expectation for cannabis enthusiasts.

“Monogram was supposed to be an ultra-premium product, and I don’t know anyone who tried it and thought it was anything more than mid-tier,” Yakatan said.

He also noted that TPCO burned through $575 million in cash, primarily due to overvalued acquisitions, unmet sales projections, and stiff competition.

As TPCO hemorrhaged funds, JAY-Z’s involvement as the brand’s chief visionary officer may have added to the company’s bloated spending. The rapper-turned-mogul’s influence and celebrity cachet drove up the costs of marketing campaigns, which recruited the likes of famed director Hype Williams, yet failed to translate into sales. But by the time TPCO reported its staggering loss and merged with Gold Flora in 2023, JAY-Z had already separated from the cannabis operation.

Meanwhile, Gold Flora, now grappling with over $56 million in losses and lawsuits over unpaid bills, struggles to keep its footing in the industry. With debts far exceeding its assets, industry analysts are already speculating whether the company will face bankruptcy.

For JAY-Z, the cannabis debacle is merely a blip on his otherwise stellar business record. With a $2.5 billion net worth, he has pivoted back to his more successful ventures, including Armand de Brignac champagne, D’Usse cognac and Roc Nation. As Yakatan aptly put it, “The hype hasn’t met the reality” in cannabis ventures tied to rappers—a lesson JAY-Z seems to have learned before the ship sank.

See the post below for the previous ads that came from Monogram while HOV was still attached.