In this edition of "Rising High," The Fly conducted an exclusive interview with Liesl Bernard, Chief Executive Officer of CannabizTeam, a vertically integrated executive search and staffing firm focused on sourcing for the cannabis industry. Here are some highlights:
2023 CANNABIS MARKET: CannabizTeam, established in 2016, has placed thousands of dedicated people in all verticals of the cannabis industry, including cultivation, extraction, testing, manufacturing, retail, compliance, and C-suite roles. The company has active clients across 30 states and the ability to access over 200,000 vetted candidates to find the perfect match for any position. As competition continues to increase in the space, Bernard said the biggest predicter of success for cannabis companies in 2023 will be ensuring that the best team is in place.
“A lot of companies are going to establish themselves much stronger in 2023,” she said. “Having the right team in place to be able to respond to the market and expansion, especially to the East Coast, is going to be super important.”
EAST VS. WEST: In its 2023 predictions, CannabizTeam said it expects investment and commercial activity to become more focused on new and growing markets in the Midwest and East Coast as California continues to work through the economic challenges of high debt levels, oversupply and the black market. The company also sees single and multi-state operators shifting towards business in states with lower taxation and more business-friendly regulation.
“There are three states that just legalized for adult-use on the East Coast and Midwest, Maryland, Missouri and Minnesota,” the CEO said. “That is starting 2023 and just in those markets alone there is 18M people that will have access to cannabis.”
She noted she expects very strong adoption of cannabis in those markets as well as strong job creation.
“We’re predicting close to 150,000 jobs being created in these markets within the next five years,” Bernard said. “The industry itself is really poised for a lot of growth, especially the Midwest and East Coast.”
TALENT MIGRATION: CannabizTeam has already been seeing a talent migration from Western states towards Midwest and East Coast markets as better capitalized MSOs and single state operators with expanding footprints East of the Mississippi are hiring more and offering more attractive compensation packages than their West Coast counterparts.
“We’re going to see that trend continuing,” the CEO said. “California and the West Coast markets are struggling with oversupply and competition and with the Midwest and East Coast expanding, we’re seeing a lot of talent being pulled from the West Coast.”
She added people gained cannabis experience on the West Coast over the last few years and talent with experience is in high demand as states legalize and MSOs and local operators broaden their footprint.
MISSOURI, MARYLAND, MINNESOTA: CannabizTeam also pointed to the expansion of the adult-use market by Missouri, Maryland, and Minnesota and noted the states’ vibrant medical markets may enable an easier transition to adult use than other markets such as New York or Illinois. Bernard said the transitions add value for the cannabis industry as populations from all states will have access to products from both a medical and adult-use perspective.
“The market itself is expanding and a lot of MSOs are setting up operations within these states,” she said. “We’re also seeing movement in Florida, New York and New Jersey. Those are big markets, and even though Florida is not legal for adult-use yet, it’s already a big market from a medical perspective. Brands are expanding into those states and getting a stronger market share.”
TEMP UPTICK: The CEO said CannabizTeam is seeing a huge uptick in temporary and consulting staffing in the industry and expects the trend to continue in 2023, with top temp jobs in financial/accounting, human resources, marketing and e-commerce, compliance, testing, packaging, manufacturing and cultivation.
“As expansion happens and the economic market in the U.S. remains slightly volatile right now, a lot of companies are opting to use temp and consulting talent to utilize the flexible staffing aspect of that segment,” she said. “But also because of the ability to access talent really quickly.”
CannabizTeam held calls with a couple big MSOs that are planning to expand into states like Georgia, Alabama, Maryland and Missouri, Bernard said.
“They all prefer to do temp staffing because they can staff up really quickly, have the flexibility around that but also try out talent before they employ them full time,” she said. “It definitely is the biggest expanding market as far as employment is concerned.”
EXPANDED ROLES: With easing of restrictions on federal cannabis research under the medical marijuana research bill, the company said it anticipates more roles created in research, development testing and pharmacology.
“Just the movement on a political level for the cannabis industry is really exciting,” the CEO said. “Even though SAFE Banking hasn’t passed, the movement as far as descheduling and passing the research bill is very promising. With the research bill being approved, we’re going to see a lot of hiring in research and development.”
CannabizTeam also cited the explosion of medical cannabis, especially in the EU, with MSOs picking up the pace of international expansions. The company expects the expansions to lead to a wave of new international hiring for C-suite, legal, compliance, sales, branding and marketing positions.
“A lot of the MSOs and some of the companies that are publicly-traded in Canada have started to penetrate Europe and also Asia,” Bernard said. “We’re seeing a huge uptick in hiring in those countries.”
She noted Thailand recently legalized cannabis and companies are preparing to establish branding in the country.
“Companies are hiring talent from the U.S. to come in, train and set up operations in those countries,” the CEO said. “That’s a huge advantage for U.S. talent. We’ve had the knowledge over the last 10 years in cannabis and that’s highly sought after now in those markets.”
CAREER JUMPS: CannabizTeam also forecast more transitions from management and executives outside of cannabis into cannabis following U.S. employment contraction in 2022. Likely sources of new hires could include the pharma, tech, agriculture, CPG, spirits, food and personal care industries.
“We’ve been pulling talent from other industries for the past six years because obviously there hasn’t been a ton of talent with cannabis-specific experience,” Bernard said. “But as companies expand and they become more sophisticated, they’re pulling from other larger companies with the level of experience they’re looking for.”
She added while cannabis may have lower starting salaries then some of the more traditional businesses, the industry potential plus healthy equity packages are expected to attract new talent.
“As the stigma around cannabis continues to decrease, more and more people view it as an exciting industry to enter where they feel they can make a difference,” the CEO said. “A lot of people also have a personal connection with the industry from a medical perspective and a lot of executives are taking the opportunity right now to jump in.”
SOCIAL EQUITY PROGRAMS: The company also predicted continued progress in ongoing efforts to promote a diverse cannabis industry with several states enacting various social equity policies.
“These policies are giving people who have been incarcerated for cannabis in the past opportunities to come out and have the ability to help grow this industry,” Bernard said. “A lot of companies are focusing on diversity and inclusion and a lot of the license holders, especially on the East Coast, getting the first opportunities are people in communities that have been negatively affected by the war on drugs.”
LEGALIZATION: In the U.S. midterm elections, voters in Maryland and Missouri approved legalization for recreational use, while similar proposals were rejected in Arkansas, North Dakota and South Dakota.
“Some markets are a little more conservative than others,” the CEO said. “I don’t think it’s necessarily a sign of cannabis not being accepted on a national basis I think it’s just a timing issue.”
She added exciting movement has been taking place on the federal level around descheduling and cannabis research.
“SAFE Banking eventually will pass,” Bernard said. “Federal legalization is just a matter of time, but we’re in a negative space right now.”
CHALLENGES: When asked about the largest hurdles facing the cannabis space, the CEO pointed to the illicit market as a big issue for several states.
“A lot of people are concerned about what is happening in New York,” she said. “Maybe New York will be following a very similar path to California in not enforcing the law around non-license holders. New York will have some of the same issues that California faces and that to me right now is the biggest concern.”
Bernard also noted that access to capital in the space creates other hurdles for cannabis operators.
“With the lack of capital and SAFE Banking not passing, it puts a lot of strain on just surviving the tougher economy right now,” she said. “That’s an issue for a lot of companies, but at the same time there are benefits. It’s going to force companies to become more efficient, more effective and focus on branding.”
OPPORTUNITIES: As the cannabis industry develops and matures, the CEO said she sees the biggest opportunities for companies is in focusing on branding and ensuring they have the most dominant brands in their markets.
“Especially as U.S. companies are expanding and international expansion is on the radar,” she said. “This is a really exciting development in the industry and is really becoming a reality on a global basis.”
Bernard added CannabizTeam is also excited about the opportunities from the broadening use of temporary and consulting talent.
“A lot of companies did not know that there was access to temp staffing in the industry,” she said. “As that becomes the norm, we’re going to see a huge uptick of people being able to work on a temporary basis and doing temp-to-hire opportunities.”
CANNABIS/PSYCHEDELIC STOCKS: Publicly-traded companies in the space include Acreage (ACRHF), Akerna (KERN), Aleafia (ALEAF), Atai Life Sciences (ATAI), Audacious (AUSAF), Aurora Cannabis (ACB), Awakn Life Sciences (AWKNF), Avant Brands (AVBTF), Ayr Wellness (AYRWF), Body and Mind (BMMJ), Canopy Growth (CGC), Cannara Biotech (LOVFF), Chicago Atlantic (REFI), Clever Leaves (CLVR), Compass Pathways (CMPS), Columbia Care (CCHWF), CordovaCann (LVRLF), Cresco Labs (CRLBF), Cronos (CRON), Curaleaf (CURLF), CURE Pharmaceutical (CURR), CV Sciences (CVSI), Cybin (CYBN), Delic Holdings (DELCF), Delta 9 (DLTNF), Entourage Health (ETRGF), Fire & Flower (FFLWF), Flora Growth (FLGC), The Flowr Group (FLWPF), General Cannabis (CANN), Greenlane (GNLN), The Green Organic Dutchman (TGODF), Green Thumb (GTBIF), Goodness Growth (GDNSF), GrowGeneration (GRWG), Hemp (HEMP), HEXO (HEXO), High Tide (HITI), India Globalization Capital (IGC), Indiva (NDVAF), Innovative Industrial Properties (IIPR), InterCure (INCR), IM Cannabis (IMCC), Khiron (KHRNF), Wellbeing Digital (KONEF), Lowell Farms (LOWLF), Lotus Ventures (LTTSF), MediPharm Labs (MEDIF), MedMen (MMNFF), Neptune Wellness (NEPT), NewLake Capital (NLCP), Organigram (OGI), Planet 13 (PLNHF), Reunion Neuroscience (REUN), Revitalist (RVLWF), RIV Capital (CNPOF), Relmada (RLMD), RYAH Group (RYAHF), Safe Harbor (SHFS), SLANG Worldwide (SLGWF), Sproutly (SRUTF), Stem Holdings (STMH), Small Pharma (DMTTF), Skye Biosciences (SKYE), SNDL (SNDL), Sunniva (SNNVF), TerrAscend (TRSSF), Tetra Bio-Pharma (TBPMF), Tilray (TLRY), Trulieve (TCNNF), Tryp Therapeutics (TRYPF), The Valens Company (VLNS), Verano Holdings (VRNOF), Village Farms (VFF), Wesana Health (WSNAF), Zynerba (ZYNE) and 4Front Ventures (FFNTF).
Published first on TheFly
See Insiders’ Hot Stocks on TipRanks >>
Read More on CMPS:
