Ever look at a business and think, how did that much money just... vanish?
It happens more than you’d think in the venture world, but the story of Ari Stiegler and the Genius Fund is in a league of its own. We’re talking about a $164 million war chest. A Russian oligarch. Massive hemp farms in California. And then, almost as fast as it appeared, it was gone. Total collapse.
If you’re trying to find the Genius Fund today, you won’t find much besides old court documents and a few deep-dive investigative reports. But for a brief window around 2018 and 2019, it was the talk of the Los Angeles tech and cannabis scenes. It was supposed to be the "everything" company for weed. Instead, it became a cautionary tale about what happens when unlimited capital meets a complete lack of operational guardrails.
The Wild Rise of the Genius Fund
The whole thing started with a connection that sounds like something out of a techno-thriller. Ari Stiegler, a young entrepreneur who had already made some noise by co-founding the Lyft Ambassador program and the tutoring platform TutorMe, teamed up with Gabriel Borden. They weren't just looking for a small seed round. They landed a whale.
Dmitry Bosov, a Russian coal magnate with a net worth in the billions, decided to bankroll the duo. He didn't just give them a few million to play with. He committed roughly $164 million to build a vertically integrated cannabis empire.
The goal for the Genius Fund was aggressive. They wanted to own the whole supply chain.
- Cultivation: Buying up thousands of acres of land.
- Manufacturing: Building high-tech processing facilities.
- Brands: Launching CPG lines like Day One (a CBD sparkling water).
- Retail: Opening dispensaries in prime L.A. locations.
At its peak, the company had over 300 employees and dozens of corporate entities under its umbrella. They were hiring top talent from tech and beverage industries. They were building out offices that looked more like social clubs than workspaces.
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Where the Money Actually Went
Honestly, the spending was legendary. And not in a good way.
According to investigative reporting from dot.LA, which spent months digging into the company's carcass, the internal culture was... chaotic. Former employees described five-figure bar tabs and a "lavish" lifestyle that felt disconnected from the reality of the struggling cannabis market.
There were stories of armed security details and massive investments in hemp farming—specifically a $70 million-plus bet on facilities in places like Plumas County—just as the price of CBD started to crater. They bought high and had no way to sell low without bleeding out.
The Russian Connection and the Crash
The Genius Fund wasn't just a business; it was essentially a single-LP fund. When your only source of cash is one billionaire, you are 100% dependent on their whims and their own stability.
In early 2020, things took a dark turn. Dmitry Bosov was found dead in his home outside Moscow. His death was ruled a suicide. Almost immediately, the lifeblood of the Genius Fund—the cash—was cut off. Without Bosov’s capital to bridge the gap between their massive overhead and their lack of revenue, the whole structure folded like a house of cards.
Lawsuits followed. Accusations of mismanagement flew. Former employees filed claims ranging from wrongful termination to more serious allegations about the work environment. Ari Stiegler eventually moved on to other ventures, but the "Genius Fund" name remains synonymous with one of the most expensive "burnt" investments in the history of the Green Rush.
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Why the Genius Fund Strategy Failed
You've got to wonder why a guy like Stiegler, who had seen success with TutorMe (which actually sold to Zovio in 2019), couldn't make this work.
The cannabis industry is notoriously difficult. It's not like SaaS. You have:
- Vast Regulatory Hurdles: Every county has different rules.
- Taxation Issues: Section 280E of the tax code means you can't deduct most business expenses.
- Supply Glut: California produced way more weed than it could legally sell.
The Genius Fund tried to do everything at once. Usually, startups pick a niche—be the best grower or the best brand. Stiegler and his team tried to build the plane while flying it and also trying to own the airport. It was too much, too fast, with too little oversight.
What Ari Stiegler Is Doing Now
If you look for Ari Stiegler in 2026, he’s rebranded himself as a seasoned venture capitalist. He’s currently the Managing Partner at Flux Capital.
He seems to have learned from the "all-in" madness of the cannabis days. Flux Capital focuses on "winner-take-all" markets—think robotics, AI, and space tech. It’s a more traditional VC play. He’s also been vocal about a "contrarian" investing strategy, claiming a high success rate on deals involving companies like Kraken and Triumph.
It’s a classic pivot. From the wreckage of a $164 million cannabis collapse to a $200 million transaction milestone in deep tech. In the world of high-stakes finance, a massive failure is often just seen as a very expensive tuition fee.
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Practical Lessons from the Collapse
If you're an investor or a founder, there are three big takeaways from the Genius Fund saga.
Don't ignore unit economics. You can't just throw $30 million at a hemp facility because CBD is "hot." You need to know what happens if the price drops by 80%. The Genius Fund didn't have a Plan B for market volatility.
Watch your "Key Man" risk. If your entire business relies on one person's checkbook, you don't have a business; you have a project. When Bosov died, the project died. Diversify your funding sources as soon as humanly possible.
Culture matters more than the office. Cool offices and "unlimited" budgets often mask a lack of clear mission. By the time the Genius Fund realized they were in trouble, the toxic culture and frivolous spending had already hollowed out the company's soul.
Next Steps for Researching This Space
If you want to understand the current state of the players involved, here is how you should look:
- Check Public Filings: Look into the ongoing litigation in California and Delaware involving "Genius Fund Group." Many of these cases offer a line-by-line breakdown of where the money went.
- Review Flux Capital's Portfolio: If you're interested in Stiegler's current path, look at Flux Capital’s investments in robotics. It’s a complete 180-degree turn from the cannabis industry.
- Monitor Secondary Markets: Sites like Forge Global sometimes list "Genius" (though usually relating to the sports data company Genius Sports, which is a totally different entity). Make sure you aren't confusing the two—one is a multi-billion dollar public company, the other is a defunct cannabis fund.
The Genius Fund is a reminder that in business, "genius" is often just a label we put on luck until the money runs out. When the tide goes out, you see who's been swimming without a suit. In this case, the tide went out very, very fast.
Actionable Insight: Before investing in any "vertically integrated" startup, demand to see the path to profitability for each individual segment of the business. If the cultivation side can't survive without the retail side being perfect, the business model is a house of cards.