Professionals used to shy away from jobs in the marijuana industry — or at least keep them hush hush. Now, the tables have turned.
Liesl Bernard, chief executive of San Diego-based CannabizTeam, which places both managers and temps at cannabis companies, said she used to have to “beg people to take a chance on cannabis” when she started her business in 2016. Executives were concerned that working with marijuana, which is illegal on the federal level in the U.S., could cause them to lose professional licenses in areas such as accounting or law.
This year, her firm placed TerrAscend Corp.’s new Chief Financial Officer Keith Stauffer, who previously worked at Coty Inc. and Hershey Co. CannabizTeam has doubled its number of placements this year to over 1,000, with 25% to 30% of those at the management and executive level.
“Today, it’s become the sexy industry,” Bernard said. “After it was deemed essential in Covid, people are reaching out to us and saying: ‘How can we get into this industry?’”
If full legalization occurred in all 50 states today, there would be in excess of 1.46 million jobs, which would increase to 1.63 million jobs by 2025. Its appeal has grown as more states move to allow it.
Competition is also on the rise for rank-and-file employees, prompting some companies to get creative. California brand Papa & Barkley recently started five-day “unplugged weekends” where employees aren’t supposed to engage in work correspondence. Parallel, a private multistate producer of cannabis products, offers pet insurance and tuition reimbursement.
Executives from well-known brands are now popping up in the once-shunned industry with greater frequency. Examples include Setti Coscarella, a former lead strategist at Philip Morris International, who’s now CEO of Taat Lifestyle & Wellness Ltd., which makes hemp cigarettes with CBD. Hydrofarm Holdings Group Inc.’s CEO Bill Toler previously had the same role at Twinkies-maker Hostess Brands Inc.
See Also: In Hydrofarm IPO, Investors Seek Pot Growth Without the Pot
Toler told me last week that when he got a call from a recruiter in late 2018, he hardly hesitated. “Over a 40-year career, I’ve seen very few sea changes in our culture that will parallel what will happen in cannabis,” he said.
Top executive salaries are now commensurate with many other industries — from $250,000 to $500,000. But Bernard said finding qualified candidates remains a challenge. Since the sector is so young, there’s no pool of seasoned veterans. And while industries from tobacco and alcohol to pharmaceuticals and cosmetics are supplying good candidates, culture clashes can be an issue.
And then, there’s the most awkward unknown — has the new potential cannabis executive actually tried the still-federally-illegal product?
“We don’t ask to that level of detail,” Bernard said. “We often ask, ‘what is your experience with cannabis?’ And so many people open up, and say cannabis really helped someone in their family overcome cancer or deal with disease.”
NUMBER OF THE WEEK
- 105%: The increase in online purchases of cannabis-related accessories in the first 11 months of 2020 from a year earlier, according to Clearbanc, a venture capital firm that invests in startups. That made cannabis the fourth-fastest growing category after medical supplies, collectibles and electronics.
QUOTE OF THE WEEK
“Think of a $5 tomato versus a $2,000-a-pound plant. You’ve got a longer way to go in vertical farming to make up your return on capital,” said Hydrofarm’s Bill Toler in an interview, to explain why his company is going after the cannabis market before it targets vertical farming operations.
WHAT YOU NEED TO KNOW
- Psychedelics is replacing pot as the new favorite edgy investment for high net-worth individuals and family offices.
- Hydrofarm, the hydroponics equipment maker that started trading last week well above its IPO price, showed how investors can get a piece of the cannabis action — without the actual cannabis.
- Canopy Growth will close some operations in Canada, affecting around 220 employees, as it slashes production to better align its cost structure.
- Ayr Strategies Inc., a multi-state operator, closed an offering of 12.5% senior secured notes.
- The House passed a measure that would ease marijuana research regulations for researchers and manufacturers.
- The Weedmaps e-commerce platform became a public company after merging with blank-check firm Silver Spike Acquisition Corp.
- Hexo reports first-quarter earnings before the market opens and hosts a call at 8:30 a.m. in New York.
- EnWave reports fourth-quarter earnings after the market closes.