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3 Deep Questions with Merida 04 : Karson Humiston of Vangst

3 Deep Questions with Merida 04 : Karson Humiston of Vangst

this is Mitch Berkowitz the managing
partner of Merida Capital Partners our taglin’es responsible investing in the
emerging cannabis industry and I think that describes our next guest Carson Humiston I hope I pronounced that right. – you did, well, its Humiston
– of Vangst thanks for having me
hey errors it’s good we’re just rolling rolling matter so you are the CEO of
Vangst yeah which you are a founder as well and obviously very entrepreneurial
and it’s a it’s a one of the largest platforms it’s not the largest for
recruitment of staffing employment support etc so I guess you know just
leading off you know this is called three deep questions with Merida
Capital so we’re trying to try to really dig into some of the story and give people who
don’t often get a chance to really see the undercurrents of the cannabis
industry you know we want to give them a sense of everything so you know my first
question for you and it’s it’s sort of a series of I guess of thoughts and I’d
love to hear is you know you’re on the front lines you’re in Colorado so your
business started there which is obviously the front lines the most
mature industry in the country but you you you’re watching people evolve their
businesses in a really personal way right the cannabis industry at least in
our and I’d love to hear your opinion my perspective is people very passionate
they’re very prideful they’ve risked illegalities so they have a lot of a lot
of pride wrapped up and and they come to you for help and so give us a sense of
like what those first initial discussions are like what’s it like to
sell your service to people who think they’re probably doing a wonderful job
already but they want your help but they’re probably also resistant to
outside right influence sometimes so you know give us a sense like what are those
discussions like yeah you know I think the dynamic has definitely shifted from
2015 when we started to today so in 2015 evolved you know I think in 2015 people
were pretty happy with the friends and family operation and as the industry has
become more competitive and companies have scaled from a 10 person company to
a 100 person companies their needs change the company of 10 people with the
small operation is much different than a company of 250 people and companies
realize wow we need a director of cultivation someone who has scaled a
large scale commercial compliant cultivation facility and
isn’t my you know my brother so while there’s a place for my brother it’s not
this role and I need to go and recruit from large scale big commercial AG
because if I want to survive and scale my business to the place where it can be
I need to bring in outside talent from other industries who is who have done
this in the past and can bring their expertise to the space and so while some
people want to stay small you see in Colorado the people that wanted to stay
small have have pretty much gone out of business or have been bought right
there’s so much consolidation happening Colorado there was more dispensaries
than Starbucks and the people with the most you know sophisticated technology
sophisticated staff and frankly the most capital won! well and that actually needs
to lead to a natural question which so as people will see in these interviews
it’s not just three deep questions it’s a series of hundred questions but three central
themes that we think people would really ought to hear about and you know let me
ask you it not just the evolution of how people are looking different have you
seen expectations change for the type of services so you know I myself had an
experience in when I was looking for vape cartridges in in my first licensee
in Connecticut and you know calling around or search on the internet
yeah and accepting terms that were in any other industry I found crazy but it
was part you needed it and there were very few people who could provide it
which is one of the reasons why I invest in a company like Kush so it’s driven my
expectations have changed so what what have you seen in terms of expectations
changing and and you know why people would use events are they are their
expectations of the type of professionalism the fact that they want
to interview more people they want to see more you know they want more choices
rather than just going to their brother who might have once grown a you know a
geranium at home right you know so tell me are expectations changing as well? yeah I mean
I think just a level of competition has increased in companies with you know the
the best staff right if you walk into a dispensary you want you know you’re
gonna be if you have a terrible experience at the dispensary you can go
to a different dispensary if you have a terrible experience for the product you
can buy a different product and so yeah it’s becoming the expectations are
increasing the bar is you know rising and because of that companies need the
best staff I mean I’m gonna go to the dispensary where I can have a consistent
experience with a budtender who can answer all the questions I have
and not be looking on their phone or stumbling over their selves or unable to answer my questions.
-also speed is, look attentiveness is a big deal because the because of the
regulatory requirements that don’t exist in other places the transaction for the
typical cannabis transaction is not fast yeah it’s a somewhat you know laborious
process so you need some sophisticated even you know at this point the
evolution of the sophisticated budtender yeah and on the thought of fast right
companies are growing rapidly and they frankly don’t have time to interview
hundreds of candidates call all the candidates references do the candidates
background checks and so they in where do you where do they go if they post
their job on a traditional job board it’s often taken down because they’re
associated with -right- a federally illegal industry mainstream -another friction point
people don’t even recognize in the outside world – yeah another friction point that people don’t realize there’s really outside of
us very limited firms that solely focus on this industry with recruiters who
understand the questions to ask cultivators people in extraction
chemists people on the you know in the retail side ancillary service businesses
you know with a huge database of candidates so speaking of you know speed
you need to hire people and you need to hire them yesterday so you can post your
job have it taken down not know the questions to ask and probably hire the
wrong person and then have that person waste your time and money and be back to
where you started or you can use us right so that’s actually my wife is in
was was in HR and and so I’m curious just before we get into your second deep
question do you uh people she became an expert at spotting resume inflation
mm-hm anything funny around that have you seen
some yeah I mean I there’s a statistic out there that 83% of people exaggerate
on the resumes which is the truth you know the numbers – cannabis is kind of tough though yeah
I mean – smaller ecosystem- yeah I think the number one place people tend to forge
the truth is on their longevity at the company and so right that’s an area that
it’s our job to dive into if someone says that they were with your firm from
the beginning of 20 you know may 2017 until August 2018 it’s our job to call
and and verify that and you know nine times out of ten there’s there’s some
type of something’s a little off there and so then we have to dive into what
were you actually doing between August and December
because now remember it’s now November right so something that’s come up
repeatedly is the the interpersonal tension that can occur when people are
fighting for market share and obviously in Colorado the most mature market by a
mile California probably being another very mature market and so there’s a lot
of cannibalism and there’s a lot of everyone’s the best you know 95% of the
cannabis people are above average somehow which which is referred to as a
Dunning Kruger effect right it’s a scientific study that says people
who are less sophisticated have a hard time identifying that they’re not as
good whereas really sophisticated people tend to think other people are going to
be up to their level because they’re respectful of that so you know you you
you come across people are leaving somewhere to go to somewhere else you
know tell me like what your experience has been when with intake and I know
it’s not just you you have a huge team at this point you’re growing very
quickly congratulation that by the way and just give us a sense of what your
experience is when you’re in taking new potential candidates and you know
anything funny you know anything for us to give us a sense of what that’s like
on a daily basis yeah I mean for for us obviously we don’t is we don’t recruit
from our current clients so a lot of what we do is actually recruiting from
outside of the space right when you have you know 700 of the leading companies
there’s you know it’s we’re limited from so people will come to us from one
client and looking to go to another and you know until they actually quit on
their own we won’t talk to them but you know I think that again on the point of
competitiveness the industry is becoming much more competitive and so you’re
seeing the companies saying we are gonna pay a little bit more to have the you
know the absolute best talent and so you’re getting into a place where we are
going from an industry that was you know underpaying
talent to now overpaying talent because there’s a finite amount of great talent
that has industry experience if he will pay a premium for sure you know one
thing we see a lot of is we’ll have clients in a new market like Maryland
and they want someone with three to five years of large-scale commercial legal
compliant cannabis cultivation experience so a limited amount of people
out there with that exact experience and so right if that if the cultivators
making 90 thousand dollars in Colorado it may take them 150 to get up and move
across the country to – I’ve hired a few of those right to Maryland – I scaled in the medic the
medical markets are different I mean it and you know that an interesting point
because we often tell people it there are several industries that are you know
sort of segregated naturally because the idiosyncratic rules that are every state
and so you know just do you guys when you when you see those now that you seen
the medical markets sort of the merger of the industry is starting to become a
little bit more national is that a challenge to jurisdictionally cross
I know we discussed it once so it’s kind of like a revisit of that so is that
something you’re seeing is it is it accelerating or decelerating the same I
mean I know it’s crazy in general – I think its I would say it’s accelerating I mean – is that cuz the
East Coast markets are opening up so quick? – yeah the East Coast markets are opening up very
quickly everybody needed him you know these employees yesterday – and they’re spending a lot of money- and they don’t care they won this
license and it was extremely hard for them to win the license and so it’s like
you get the license and now now what do we do? staff! – you sound like me in 2014 when I won my first license – yeah I mean that’s it’s no one’s ever done it before – right and so you have
to move you know you have to move now I mean I think we’re living in an age
where you need it everything is done on your phone everything is now now now you
know our Gig assuming mobile is a big place I mean our Gigs our Gigs platform where
temporary needs is a huge piece of this industry right you have a harvest and
you suddenly need 20 or 30 trimmers and you only need them for two weeks and so
you post your gig on Vangst Gigs we have thousands of approved for that state
ready to go gig workers that apply to the gig you as the employer can say oh
this this gig worker has worked you know 700 hours they have this many five stars
I’ll take this person boom they show up they clock in they work you pay them on
to the next I mean this the world is moving so fast everything is done on a
phone and this industry is moving even faster maybe you should hang around
later we’re gonna have Vic Neufeld from Aphria or Aphria I don’t know he’s no
the article but they lost a fairly large harvest because their inability to staff
it to staff the the harvest or for some reason I you know I didn’t get a chance
to read the article in full because MJBiz is a little bit crazy you know
we’re doing this from MJBizCon obviously so my third question and it’s kind of like
I’m gonna ask you should talk to them because we could probably save them a couple million dollars
exactly well you know hang around it there you go I think it was a million
dollar harvest but either way I just made your sales pitch for you see the
connectivity it’s it’s all happening it’s all happening so I’m gonna ask you
to speculate and you know and you can decide how far out on the
waves you want to get sure so January 1st 2021 rolls around
what employment type data what what are people using that you’re providing or
anyone or that you’re using or what is important in the employment side that’s
really driving the next level of optimization you know what what do
people what is the the employment staffing look like two years from now? – sure you know I
think one thing we’ll con- we’ve done and will continue doing as we come out
with two time of year a job report and a salary guide and so you know in our last
one we had more standardizations amazed yes we had more than 1500 participants
from you know leading companies whether it be GTI Cresco labs acreage Holdings
native roots right and to really see what the industry averages are for each
of the positions and what companies are offering in terms of benefits I think
that you know benefits we’ve saw a massive increase in benefits from 2017
2018 and 2017 actually less than 30 percent of cannabis businesses offered
any type of benefits in this year more than 76 percent of cannabis businesses
offered some form of benefits you know we love that’s yeah I mean so there’s
you know when we look at the increase in salary salaries and you know from our
report salaries increased more than forty two percent and you think that’s
just you know it’s actually a phenomenal point that I was trying to make up to
see but you made it so articulately which is you know data and information
is improving the space right right you know when people often ask like what
merit is that it score or what what do we do and we’re consumers of information
and you know people like you who are actually developing the information are
really on the front edge yeah yeah I mean I think well you know you’re
helping people standardize ur two years from now we’ll be you know we’ll be
sitting here and we’ll look at the gigs platform and we’ll be able to say here’s
how many temp workers clocked it in Maryland today here’s how many temp
workers walked walked in and Colorado today and you know when when gig you
know oftentimes when gig workers are needed it’s because a huge harvest is
happening or this company is having a big sale so they need on demand bud tenders
and so you know we we have it locked in in Colorado and you know we have a very
good sense of what’s happening at businesses because right you know there
suddenly need you know 15 additional bud tenders for the week right or they
suddenly need to hire three new retail store managers or they need a new COO or
we’re seeing trends in real time because people needs drive that so I mean this
was first well I think was incredible I don’t think people
realize how quickly the staffing is evolving and you know the fact you would
spend some time with us educating people and just communicating with the world
and I just I’m very thank you thank you for having us it was great to- it was my pleasure so Karson Vangst
great thanks I’m sorry Karsten Hyumiston from Vangst – Karson Humiston of Vangst
thanks I can’t get it right I’ve got it wrong twice okay -its all good – it’s just good TV Thank you so much for coming -but you are Mitch? Baruchowitz. everyone gets mine right – never

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