FaZe Clan receives deficiency notice from NASDAQ

FaZe now has 180 days to regain compliance and keep the stock listed.

FaZe Clan receives deficiency notice from NASDAQ

FaZe Clan is a well-known esports and entertainment organization. Richard “Banks” Bengston founded the eSports organization in 2010. It has become one of the most popular and successful esports organizations in the world, with teams in games like Call of Duty, Fortnite, and CS:GO.

In June 2021, FaZe Clan went public through a merger with a special purpose acquisition company (SPAC) called B. Riley Principal Merger Corp. II. The deal valued FaZe Clan at $1 billion. The organization was also provided with $291 million in cash through this deal. However, since going public, FaZe Clan’s share price has been on a downward trend. This downward trend has led the FaZe stock to stay below $1 for 30 consecutive business days. Following this, the NASDAQ stock exchange has served FaZe Clan with a deficiency notice. This means that the company now has 180 days to regain compliance. The FaZe share price is required to recover to over $1 and remain at that price for 10 consecutive trading days.

Related: FaZe Virus takes an exit from the organization due to a past beef related to his anti-LGBTQ+ comments

Internal and external challenges at FaZe Clan

FaZe

The organization’s current situation with the Nasdaq deficiency notice is not uncommon for companies that go public through a SPAC merger. Such companies often see their share prices rise rapidly in the months following the merger. However, the price ends up experiencing a sharp decline shortly thereafter. This is because the initial valuation of the company may have been based on speculative projections rather than real financial performance.

In addition to the financial challenges faced by FaZe Clan, the organization has also been dealing with internal disputes. In May 2021, several of the organization’s original members went public with allegations of unfair treatment by FaZe Clan management. They claimed that the organization had exploited them and failed to compensate them adequately for their work. FaZe Clan responded by stating that it was working to address these issues and improve its internal culture.

FaZe Clan is facing significant challenges both internally and externally. Despite these challenges, the organization remains a major player in the eSports and entertainment industries. The eSports organization still has the potential to overcome these challenges and continue to grow and innovate.

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