No hard feelings, it's just a Doggy Dogg World.
Things are going from bad to worse for FaZe Clan, the esports and lifestyle brand that bellyflopped onto the Nasdaq with a public listing in July last year. Dexerto reports that the company has lost one of its most famous backers: weed evangelist and hip hop artist Snoop Dogg, who resigned from its board of directors on March 29, which was revealed in an SEC filing by the company yesterday.
"On March 29, 2023, Calvin "Snoop Dogg" Broadus, Jr. notified FaZe Holdings Inc. … that he is resigning from the Board of Directors," read the filing, but noted that the resignation "was not the result of any disagreement with the Company or any of its subsidiaries". So at least they're still friends.
Snoop and FaZe only revealed that the rapper would join the company's board in March 2022, meaning his tenure has only lasted about a year.
It's another in a long series of blows for FaZe Clan, whose stock dumped a quarter of its value on the first day of its public listing last year. In a letter to shareholders last week, the company touted Snoop's participation in FaZe as one of its "Talent Highlights" and "2022 + 2023 Year-to-Date Accomplishments". That letter was released the day after Snoop told FaZe he'd be departing its board of directors.
FaZe's SEC filing doesn't detail why Snoop has elected to abandon his seat on the board, but it's not hard to figure out. The company has seen multiple executive resignations in the past year, and its fortunes haven't recovered since its initial public listing. It recorded a loss of $168.5 million in the 2022 financial year, if you include a "one-time accounting charge of $115.3 million". It lost $55.3 million if you don't include that charge, but either way it's worse than the company's net loss of $36.9 million in the 2021 financial year.
Dexerto also reports that FaZe Clan has been served with a "deficiency notice" by Nasdaq, threatening to delist it from the exchange unless it can keep its share price at above $1 for 10 consecutive days in the next half-year.
So it seems pretty likely that Snoop just isn't optimistic about FaZe Clan's future prospects, and is getting out while the getting is, ah, not exactly good, but better than it might be a few months from now. Sportico reports that Snoop was so eager to get out that he may have sacrificed about 214,000 shares to do so, leaving him with around 106,000-or-so shares that are worth far less than their original value when he was awarded them.
Despite all this, FaZe Clan CEO Lee Trink remained determinedly chipper in the letter to shareholders: "We’re taking the right steps to position the business for successful long-term growth," he said, adding that he is "as optimistic as ever about the future of FaZe Clan".
