HIGHFIELD

This is a Part 1 in a three-part series that will demonstrate lessons learned over four years in the cannabis industry and 16 years in executive search. The series will provide insight for Founders, Candidates and Managers in Start-ups and Scale-ups

Part 1 – Founders:

In 2017, I was recruited to a cannabis start-up as VP of Talent. The cannabis industry was exploding, and I was there to help recruit the talent needed to keep pace with the change and growth that was happening with our company across Canada. A month later, I decided to launch an external-facing business to help companies in this industry attract and acquire talent.

That firm was since acquired by a larger company, but I was far from done helping organizations find the right people for the unique talent needs of start-ups and scale-ups. In March 2021, I launched HIGHFIELD Human Capital – not only to be a positive force of change in the marketplace, but also to share lessons learned from the cannabis sector and my years of experience running a thriving Consumer Packaged Goods (CPG) practice at a national search firm.

Here are my six hiring lessons for start-up founders:

1) You need entrepreneurs to launch the vision, but you need seasoned leaders to manage the company

The energy of founders is unparalleled, and true visionaries are exciting and electric, but a successful start-up needs experienced leadership to move the mission forward. Think of it this way: If founders are the soul of the business, professional managers are the heart.  When hiring for leadership positions, look for people who can complement your skills and style, have experience launching a business or division, know how to make quick decisions with limited information and resources, and have a solid track record success.

2) It takes a unique type of person to work at a start-up

Start-up life isn’t for everyone. Team members need to be bold, fearless and have a strong understanding of the risks involved (after all, 68% of start-ups fail within their first three years – candidates should know this stat going in). Here are a few questions to ask potential employees to assess their fit and readiness:

a/ Assessing Comfort with Risk

- We are a start-up: Are you comfortable with the risks that come with working at a start-up? Can you walk me through a time – either personally or professionally – where you took on risk? What was the end result? (This question is imperative, especially if hiring an executive and even more so if that executive comes from a Tier 1 company)

b/ Assessing innovation

- We are a scale-up: Can you walk me through something you built? Stage-Gate examples are important to assess, especially if hiring Marketers or VPs of Innovation.

c/ Assessing Budget or Financial Acumen

- We work on zero based or limited budgets. How would you drive results if you only had $10,000 in marketing spend?  

- How do you assess Capex or Op-x Spend?

d/ Assessing Leadership

- Walk me through your biggest win – how would you do that here?  

- What would your last manager say about you?

- What would your direct reports say about you?

- Can you bootstrap a sales force?  

- Are you prepared to sell directly to accounts during your first year?

3) Plan, review, repeat… and pivot

For your business to succeed, you need vision, a plan that carries out that vision and the right leadership that can execute the plan. The ability to review and revisit the plan regularly, and the agility to pivot when necessary are essential to meeting client needs, responding to market conditions and staying relevant during periods of fast-pace change.

As the adage goes, ‘the best laid plans of mice and men often go awry.’ You must know when to pivot, be agile and be prepared to change direction as markets evolve.  The pivot can be small – for example, you may determine that you will not develop all your connectivity tools in house and will instead buy off the shelf CRM software.  On a larger scale, you may decide that you will no longer sell CBD and will only focus on THC extracts for the beverage category – a change that may save you tens of thousands of dollars for your company.

I recently ran into one of the top growing consultants in the industry who commented that, with the growth of cannabis consultants in North America, he was pivoting his consulting practice to include Agri growers of flowers, fruits, and vegetables.  If global CPG juggernaut Procter & Gamble can pivot and get out of food, you can make small adjustments to your business.

4) Don’t over-hire in your first three years

Remember the stat that 68% of businesses fail in the first three years? Many start-ups don’t make it because they run out of cash – and people represent a big chunk of your expenses. Hire for mission-critical positions first and work with consultants until revenue and EBITDA are positive.

5) Don’t be an absentee landlord

While not every founder is meant to lead, you don’t want to disappear completely. Knowing when to step back and let an experienced leader steer the ship is indeed important, but that doesn’t mean walking away. Two thirds of new hires join a start-up because of the visionary leader – they leave after one year when they never hear from that leader.

6) Why You?  

Every founder and entrepreneur I have encountered in 16 years of search believed that people would flock to their business. But when asked “why?” no one had an answer. While some may say “that’s why we hire recruiters,” the reality is you need an answer. Are you leading in innovation? Is your product unique in the market? Do you have an exceptional culture?

Whatever that reason for someone to join your company, it is up to you, the founder to be part of answer – if not the answer itself. Just think about what Steve Jobs said to John Scully in 1983 when John was still undecided about joining Apple: "Do you want to sell sugared water for the rest of your life? Or do you want to come with me and change the world?"

Bottom Line

It takes the right mix of people to equip a start-up or scale-up with the resources to succeed. Bringing in experienced leaders to steer the ship – while keeping the vision, mission and culture of innovation front and centre – will enable you to operate efficiently, attract the right staff and keep your best people engaged, inspired and working hard towards your goals.

Up Next: Part 2 – Tips for Managers working in a Start-up

Part 3 – 5 things candidates should know before joining a start-up

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