Snoop Dogg Abruptly Exits FaZe Clan Board as Stock Plunges Into Worthlessness

Snoop Dogg Abruptly Exits FaZe Clan Board as Stock Plunges Into Worthlessness

FaZe Clan’s IPO hasn’t worked out so well for the gaming collective. The stock is down 95% from its IPO height—and Snoop Dogg is exiting through a doggy door.

The gaming collective claimed to be worth $700 million when it went public in 2021. Now just a few short years after that declaration, the stock is essentially a penny stock. So what happened? Why did the interest in FaZe Clan disappear so quickly? In September 2022, FaZe reported $43.9 million cash on hand, with Forbes predicting the company would run out of operating funds before the end of 2023.

FaZe Clan was founded back in 2010 and includes pro eSports teams competing in games like Call of Duty and Super Smash Bros. With interest in eSports at an all-time high during the pandemic, investor interest in a gaming collective boomed in 2020. FaZe Clan’s business model was advertising, believing it could leverage its members’ huge social followings to brands eager to reach Gen Z.

To that end, FaZe Clan formed partnerships with rappers like Snoop Dogg and Pitbull to promote itself. For its SPAC plans, FaZe Clan raised $291 million from the financial firm B. Riley and went public in July 2022. “The company has been exploring a number of ventures beyond video games,” according to The Washington Post interview with FaZe Clan CEO Lee Trink. “Gambling, virtual dining and ghost kitchens, fan clubs, and subscription models” are some potential revenue generators that Trink said FaZe was looking to explore.

During his Super Bowl Halftime Show performance, Snoop Dogg wore a gold FaZe Clan chain to promote the collective. That’s because FaZe offered Snoop Dogg a spot on the company’s board of directors, $1.9 million in stock, and then a further $250,000 in shares to Snoop’s son and “companies controlled by his spouse and manager.”

An SEC filing with the company reveals Snoop Dogg doesn’t want to be on the board of directors of a penny stock. The rapper resigned effective immediately on March 29 according to those SEC documents. The filing notes that the departure was not a result of disagreement with any of FaZe Clan’s leadership.

FaZe Clan claimed a social media reach of 526 million people, but 200 million of that comes from signings like Snoop Dogg.

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