Beau Wrigley’s ambitions seem to include becoming a weed millionaire. A decade after selling the family-owned empire, he invested in a medical marijuana company and took charge of it. He had big plans, developing sleep aids and a particular type of THC from sativa cannabis seeds.
However, the path forward proved to be messy for Wrigley’s Parallel. The deal to go public fell apart in 2021, and he stepped down shortly after. Now there are lawsuits from investors alleging fraud and debt concealment. Is the game over for the billionaire?
Let’s review Wrigley’s weed venture and see what the future holds.
The rise of the Wrigley Company
William Wrigley Jr. II (‘Beau’) is a member of an American business dynasty.
His great-grandfather started the Wrigley Company in 1891. The business was first a soap producer but soon transitioned to chewing gum, earning considerable profit.
The firm remained in the family until recently, and Beau took it over in 1998 at 35. He ran it until 2008 and then sold it to Mars in a whopping $23 billion deal. This event marked the beginning of Wrigley’s independent financial activity.
Transition to investing
Who owns Wrigley gum? The company remained in the family for 115 years. After Beau sold it to Mars, Incorporated, he was free to pursue other business ventures. So he went into investing.
Wrigley’s first interest was healthcare, but he soon decided to diversify. Entering the marijuana industry surprised the public, as the billionaire has no history of consumption or advocacy. Still, his open mind paved the road to a potentially profitable enterprise.
How does cannabis fit the bill?
Attitudes towards weed were largely negative in Bo Wrigley’s childhood. The mainstream media mostly demonized the plant, so he avoided it. Only after getting approached by his managing director did he check his beliefs for bias.
Later, Wrigley would start seeing legal cannabis as a burgeoning field, albeit one hampered by politics. He also took notice of consumer behavior.
Over 60% of Americans favor legalization, and many state laws are beginning to reflect this fact. Marijuana is now a large, valuable, and untapped market. It also seems to have applications in healthcare, another of the billionaire’s interests.
As a result, Wrigley and his managing director soon started looking at prospective deals.
A medical marijuana company from Florida called Surterra Wellness attracted their attention. They moved to invest $65 billion in the business in 2018, and Wrigley took over as CEO the following year. Rebranding swiftly followed, and the name got changed to Parallel.
Since Wrigley disliked smoking as a consumption method, his company focused on alternatives. It released products catered to all generations, selling drops, tablets, edibles, vaporizers, and balms.
By 2021, Parallel operated in Texas, Nevada, Pennsylvania, and Massachusetts and had two lofty goals. One was developing THCV, a novel cannabinoid to induce a psychoactive high without the desire to eat. The other was a line of over-the-counter cannabis-based sleep aids.
Wrigley’s business announced a deal with Ceres Acquisition Corp. in February 2021. The purchase would allow Parallel to go national and get additional funding, and the CEO had big hopes. He expected his revenue to surpass $600 million by 2022.
This big announcement was also the start of legal and financial turbulence for Parallel.
Parallel’s financial crisis
Seven months after the February announcement, the acquisition deal was canceled; Parallel wasn’t among 2021 IPOs. Its administration blames the weed market’s unpredictable nature and the consequences of the COVID-19 pandemic.
Another two months later, the would-be weed millionaire stepped down as CEO.
A pair of lawsuits soon followed. Investors alleged that Parallel concealed debt, issued false financial projections, and participated in self-dealing. The company’s founding CEO joined the legal tide; more lawsuits are in the pipeline.
Parallel’s leadership is yet to comment on most allegations. The suits are still in the early stages, so it’s hard to say what will come from them.
Going public could’ve been a way out for Parallel. So the collapse of their deal left Wrigley scrambling to pay off debts. He also had to make the company look attractive. However, his projections were fanciful at best and patently false at worst.
According to cannabis attorney experts, this issue is endemic to new weed companies. The plant is still federally illegal, so firms face massive expenses while setting up operations. Many startups resort to overpromising to get funding; Parallel proves that giants face the same pitfalls.
The current consensus is that Wrigley likely hasn’t purposely schemed. His behaviours suggest that market fluctuations led to his failure. The trials could go either way, but given their nature, they’re likely to take years and end in a settlement.
What’s in the future?
Beau Wrigley’s ambitions of becoming a cannabis millionaire may not be over. His company failed to become a national player, but it’s a significant asset in Florida. Come legislative changes, and he might get a second chance if the fraud allegations prove false.