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We got the inside story of the downfall of Civilized, a cannabis media startup that raised $7 million, then had to shut down after a takeover offer fell through

On September 20, 2018, Derek Riedle, then the CEO of Civilized Worldwide, a cannabis media startup, was set to embark on a tour.

He had just boarded a jet with the comedian Chelsea Handler at Van Nuys Airport in Los Angeles, a popular spot for celebrities and wealthy executives.

The pair were heading to Calgary, Alberta, the first stop on a tour of seven Canadian cities where Riedle and Handler held town-hall-style events with thousands of people. Canada had just legalized cannabis, and the excitement was palpable.

The excitement helped the company pull in $7 million from prominent investors like Canopy Rivers, the venture arm of the biggest cannabis company, and celebrities like Handler. By spring 2018, former employees said the company had even taken steps to go public and touted its ability to reach over 2 million people per month.

But a little more than a year after the Riedles toured Canada with Handler, they were closing up shop at Civilized.

By December 2, Civilized had laid off all of its employees and suspended operations after the startup ran out of runway. A deal to sell the company and resume publishing was beginning to unravel too.

While the layoffs have been made public, Business Insider is the first to report on the collapse of Civilized’s deal with New Frontier Data, as well as its negotiations to restructure its debt. This story is based on conversations with five former employees and four freelancers, as well as email threads and internal memos obtained by Business Insider.

Former employees say they all talk about the cannabis media startup in the past tense.

Saint John-based cannabis magazine lays off staff ahead of purchase by U.S. firm

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Civilized Worldwide Inc. publishes the online magazine Civilized Life

The Saint John-based publishers of a cannabis lifestyle magazine have laid off all their employees ahead of being bought out by a Washington, D.C.-based analytics company.

Civilized Worldwide Inc., which included the online magazine Civilized Life, will be acquired by New Frontier Data.

A statement from New Frontier Data said all Civilized staff have been laid off “temporarily.” The statement did not say how many employees were affected.

As of Dec. 3, the magazine’s website is still online, featuring articles on hiding the smell of cannabis, the easiest edibles to make at home, and surviving Thanksgiving dinner with cannabis.

New Frontier Data told CBC News no one was available for an interview.

CBC also tried to reach Derek Riedle, founder and publisher of Civilized, but did not receive a reply.

Launched before legalization

The magazine, which was launched in 2015, was touted as a sophisticated magazine for the cannabis enthusiast.

When the magazine launched, founder Derek Riedle described the magazine as “Cigar aficionado meets Huffington Post meets cannabis.”

When Civilized started, cannabis laws were in a much different place.

It would be three years before Canada would legalize recreational use of the drug. At the time of the magazine launch, only four jurisdictions in North America had legalized recreational use of the drug: Alaska, Colorado, Oregon and Washington.

At the time of its launch, it employed 14 people in Saint John. The company later opened an office in Los Angeles.

Civilized began marketing itself to the greater world, sponsoring the World Cannabis Congress, which brought in Martha Stewart as a speaker.

The magazine has also been a sponsor of the Moonlight Bazaar in Saint John’s uptown and was the host of the event last year.

Public money

Civilized was the beneficiary of more than $200,000 from New Brunswick taxpayers over three years.

Public Accounts documents shows Civilized Worldwide Inc. received $25,385 from the provincial government in 2018, $67,787 in 2017 and $108,461 in 2016.

The public documents don’t show what the money was for or which department it was coming from.

Opportunities New Brunswick has previously touted a partnership with Civilized but did not specify how much money went into the company.

The Saint John-based publishers of a cannabis lifestyle magazine have laid off all their employees ahead of being bought out by a Washington, D.C.-based analytics company.