March 27, 2019 – Investors poured $10 billion into cannabis in North America in 2018, twice what was invested in the last three years combined. The North American market is expected to reach more than $16 billion in 2019.
While talent deficits are a problem in every industry, the marijuana field is exceptionally short on senior-level leaders who can come in and cross-pollinate their functional and industry skills-sets. It is only natural that recruitment firms are focusing on bringing talent to this booming sector.
Not everyone, however, embraces the idea of legalized pot, and that may pose some challenges for executive search firms as they establish their footing. Many do believe that as awareness spreads and the medical benefits, in particular, become better known, acceptance will increase.
Right now, what the cannabis industry needs most is time to mature, say recruiting specialists in the field. On one hand, there is a public perception connecting marijuana with the well-worn stoner image. Recruiters therefore believe it is going to take a bit of doing to build the perception of cannabis as a true stand-alone industry and not the realm of the counterculture.
So, what kind of talent do companies in the marijuana field need to fuel their aggressive growth plans? A recent report by executive search and talent acquisition company Y Scouts offered three reasons why cannabis companies need purpose-driven leaders. Weighing in on the report’s finding are executive search consultants who recruit for the sector.
1. It is a Social Movement
We have seen some of the most successful brands such as Zappos, Southwest Airlines, Warby Parker and Netflix built on seemingly nondescript products and services. All of these companies took somewhat commoditized products or services, or both, and transformed them with a unique culture. “If these companies can create great cultures from seemingly vanilla products and services, I cannot wait to see the types of company cultures the cannabis industry will turn up,” said the Y Scouts report.
“The cannabis industry is more naturally set up for companies to leverage meaningful work in their culture than almost anything we have ever seen,” said Max Hansen, CEO of Y Scouts and the report’s author. “I think almost everyone has a personal story about someone that is close to them who has been positively affected by the medicinal uses of cannabis, whether it be a child who has experienced seizures or a cancer patient dealing with chronic pain.”
Mr. Hansen said one of his best friends and business colleagues recently started treating his son’s ADHD with CBD oil, and it has been life-changing. “Before trying CBD oil, doctors worked every drug on the market known for treating ADHD with no success. It was a long and challenging process for the child and his family that was ultimately cured by just plain old CBD oil,” he said.
Protis Global Strengthens Capabilities to Serve Cannabis Sector
Protis Global recently added Wall Street veteran Samantha Ford to its executive search and advisory firm as senior vice president of business development to head a third location which will be in the Bay Area and entirely focused on recruitment within the cannabis industry.
“We have already seen a large number of leaders in the cannabis space whose purpose was created by a positive personal experience with cannabis as a medicine,” the Y Scouts report said. “We firmly believe this is just the beginning of a purposeful movement that will create opportunities for companies and leaders. Purpose-driven and performance-proven leaders are now flocking to the industry to impact the stakeholder ecosystem positively.”
Bert Miller, president and CEO of Protis Global, an executive search firm which recently created a cannabis talent division, said that the social aspects of cannabis inclusive of CBD and the wellness that the plant can provide are significant. “As companies look to build, people get charged up around an industry that does meaningful and important work and this industry is ripe with that opportunity,” he said.
“Companies have to vet whether someone is interested due to the sexy nature and momentum of the sector or whether a person has interest to do important work and that might mean rolling up your sleeves due to minimal resources of an emerging company,” Mr. Miller said.
2. It is a High-Growth / Fast-Growth Industry
Fast-growth companies need purposeful leaders to build great sustainable cultures, said the Y Scouts report. The global legal marijuana market is expected to reach $146.4 billion by the end of 2025. “It’s safe to say the cannabis industry is experiencing some of the fastest growth we have seen in any industry in our lifetime,” Mr. Hansen said in the report. “From what we know about rapid growth companies, the strength of the culture is one of the most critical variables to drive positive impact, successful business outcomes, and ultimately enterprise value.”
“The only other high-growth industry to compare is technology,” he said. “It’s tough for me to think of a successful high-growth technology company that doesn’t have a good company culture—one that is led by conscious and purposeful leaders.”
“After having the opportunity to hire leaders in many purpose-driven companies, it’s easy to see the ROI of creating a culture with defined purpose and values,” he said. “Purposeful cultures mobilize people in a way that pursuing profits alone never will. Purpose-driven and performance-proven leaders are an absolute must-have for any fast-growing cannabis company.”
The pace of growth is unlike anything he has seen, said Mr. Miller. “It is incumbent that companies find leaders with purpose, vision, cultural leadership and probably most important, endurance,” he said.
Jay Czarkowski, co-founder of H2 Talent in Boulder, CO, the latest recruiting entrant to serve cannabis companies looking for senior talent, said that the sector “continues to grow at a rapid pace, and there is a great need to pull in expertise from outside the cannabis industry, and there are opportunities to pull experienced people out of existing positions within the industry. The industry has matured enough that companies need to get serious about their senior and executive talent to move to the next level.”
H2 Talent Launches to Serve Marijuana Industry
In Colorado, arguably ground zero for the cannabis industry, a new search firm is focused on building leadership teams that will take businesses to new highs. H2 Talent was recently launched to specifically to provide C-suite and executive recruiting services to the cannabis industry.
John Comeau, co-founder of H2 Talent said that as the “cannabis industry continues to grow and mature, leading companies in the sector need to hire many of the same key positions as leading companies in any other industry: C-level executives, professionals with marketing expertise and business development expertise, experts in logistics, manufacturing, distribution and bio sciences. The list goes on and on.”
3. These are Newly Created Cultures in a Complex and Developing Industry
“In the grand scheme of the things, the cannabis industry is still in its infancy,” the Y Scouts report said. “Most of the big players have four to five years under their belt. Previously, many regulations directly restricted people from entering the market. A large number of people stayed away because of the legal implications — which have not been entirely lifted but eased enough to entice a large percentage of the population to recognize cannabis as a legitimate industry.”
Thirty-two states have legalized marijuana for medicinal use and 10 have authorized it for recreational use. In an industry that was, in a sense, born overnight it is more critical than ever to have leaders who have built significant, sustainable cultures in other sectors.
“The simple fact is that the industry is too new to have deep-rooted cultures that have been carefully created,” Mr. Hansen said in the report. “Cannabis will be an industry where only the strong will survive due to the complexities and development that is still to come.”
The rules of engagement are changing faster than ever. “The first-mover advantages will be slowly diminished in short order,” said Mr. Hansen. “Just as we have seen history play out, the companies who hire the best leaders – those who effectively drive sustainable purpose and meaning – will ultimately win the game.”
Mr. Miller said that it is critical for businesses to follow best practices in building the cannabis industry. “It is a very young industry and it is an arms race to build companies for future acquisition,” he said. “So, companies need to ensure they are building an employment brand, a vibrant culture and hiring the best. It also means being responsible in hiring by consistent communication, staying on process and ensuring the candidates have a great experience interviewing and getting to know your company.”
Contributed by Scott A. Scanlon, Editor-in-Chief; Dale M. Zupsansky, Managing Editor; Stephen Sawicki, Managing Editor; and Andrew W. Mitchell, Managing Editor – Hunt Scanlon Media