Despite Shaking Hands With Lakers, $844.4 Million Worth Co. Goes Bankrupt and Fires 180+ Employees

Published 09/14/2023, 3:28 PM EDT

The market is brutal. Forget blue-collar workers, it doesn’t even spare the employees high in the hierarchy. In ESPN’s case, its parent company Disney let go of commentary phenoms like Mark Jackson, Jeff Van Gundy, and Jalen Rose. Despite setting a high bar and building a stellar fanbase, they faced the axe. Now, a Lakers-backed corporation—which was traded in to replace a longtime partner, Gatorade, and recover from a $34-million-worth pandemic loss from 2020 to 2021—has filed for bankruptcy protection.

Although millionaires take the spotlight owing to their popularity, many struggling workers who get fired find it tougher to have a voice in the mainstream. In this wake, the market took its toll on workers of a sports drink company, so much so that approximately 95% workforce will be soon released from their posts.

Affiliation with the Lakers didn’t help the company

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The Los Angeles Lakers are a lucrative franchise. The perennial top-performing player has interests in every nook and corner. The bright lights of LA and a storied NBA team make for a huge customer base. That’s why, in 2021, BioSteel Nutrition opted to become the official drink of the franchise. One can see the presence of the BioSteel brand on the benches, locker room, and many places in the Crypto.com Arena, home of the franchise.

Upon signing the deal, BioSteel’s co-founder Michael Cammalleri expressed, “Fans worldwide know the Lakers as one of the most entertaining and storied franchises in all of sports, and we’re excited they’ve chosen BioSteel as their team’s official sports drink.”

Fast forward to two years and the company is in dire straits. Canopy, which fuels BioSteel’s operations and owns 90% of the equity in BioSteel, has a market cap of $844.61 million but it is done with the BioSteel Nutrition unit. Funding this unit was costing too much. Canopy registered 60% first-quarter losses. That’s why BioSteel Nutrition, which has been facing an uphill battle against Gatorade, BodyArmor, and Powerade, has decided to file for creditor protection and is up for sale, under the supervision of a court.

“BioSteel made the decision to conserve cash and put the business into hibernation to preserve its assets,” a company statement said.

“While BioSteel’s business has shown significant year-over-year revenue growth, and we believe the brand remains an attractive asset, it does not align with Canopy Growth’s cannabis focused asset-light strategy,” David Klein, Canopy Growth CEO, said in a statement.

Amidst all this, it is the employees who are facing the brunt. To cut costs and regain their footing in the stock market, Canopy-fueled Bio Steel decided to lay off 181 employees as mentioned in an SEC filing. Now, just nine out of the 190 employees remain on the scene. And this is hinting at the insecure job market.

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A Massive Meltdown

No big company is shying away from massive layoffs. Whether it be tech giant Google or a nutrition line like BioSteel, the brunt of firing has been massive. These firings have created an environment of insecurity.

If millionaires like Jalen Rose and Mark Jackson aren’t safe, it has transpired into a precarious situation for those who are pushed to live paycheck to paycheck.

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The alarm bells are ringing. The workers are insecure. And things remain at the market’s whim.

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Written by:

Shubham is an NBA Writer at Essentially Sports. He became a fan of the NBA in late 2000s and his interest skyrocketed after Dirk Nowitzki and the Dallas Mavericks upset the Miami Heat in Six Games during 2011 NBA Finals. He loves looking into playing styles of different players and teams while also trying to analyse what circumstances shape a typical NBA game.

Edited by:

Bilal Handoo

Despite Shaking Hands With Lakers, $844.4 Million Worth Co. Goes Bankrupt and Fires 180+ Employees

Affiliation with the Lakers didn’t help the company

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