Derrick Knudsen, Meta Talent Group

[00:00:00] Sanjay Parekh: Welcome to the Side Hustle to Small Business Podcast, powered by Hiscox. I’m your host, Sanjay Parekh. Throughout my career I’ve had side hustles, some of which turned into real businesses, but first and foremost: I’m a serial technology entrepreneur.

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Derrick Knudsen was working at a Fortune 500 recruitment firm in Denver, Colorado when he recognized a gap in the industry. Traditional firms were hesitant to help fill open positions at cannabis companies. In response, Derrick created a boutique recruitment firm, Meta Talent Group, which helps fill roles at cannabis, hemp, and psychedelic-focused companies.

On today’s episode, Derrick and I talk about finding the right talent, founding a company with family members, and overcoming the stigma of an emerging industry. Derrick, so excited to have you on the podcast. Thanks for joining us.

[00:01:27] Derrick Knudsen: Thanks for your time today, Sanjay. I'm excited to be here.

[00:01:29] Sanjay Parekh: Okay. Let's start out. Tell me a little bit about yourself. Tell me your background, like where you're from, where did you grow up? Like all those things.

[00:01:37] Derrick Knudsen: I'm originally from New York. Grew up the youngest of six and graduated from Syracuse University. Moved out to Denver, Colorado just about six, seven years ago, and that was really to break into the cannabis industry.

I've been out here for a number of years, really kind of building up Meta Talent, my boutique cannabis and alternative health recruitment firm, as well as working on the nonprofit side with some folks here in Denver.

[00:02:12] Sanjay Parekh: Yeah. Okay. So before starting these companies, did you do anything entrepreneurial? Did you just have jobs? Where'd you go to school? Like where's your base?

[00:02:22] Derrick Knudsen: Yes, so my degree was environmental biology. I was a summer camp director both in New York and in Colorado when I first got out here and really thought that outdoor ecological science education was going to be my future.

In the non-profit world at that time, I felt like there was just a ton of red tape and some barriers, and so wanted the opportunity to step into the for-profit entrepreneurial space to try to build some personal wealth and then hopefully open a nonprofit, which ended up coming a little bit sooner than I thought.

[00:02:59] Sanjay Parekh: So, let's talk about the nonprofit for a second. So you saw the issues that we were having with COVID. What was your thought process of “Hey, I could, I should do something to support here?" How did that come about?

[00:03:13] Derrick Knudsen: Yeah, you know, I feel like so much has happened the past year or two and I think everyone at some point has said, what can I do to help? There have been folks struggling. And so I had a good friend here approach me back in May, June of 2020, and really just pitched this idea of supporting small business owners and doing it in a way that helps bring them to the current digital age in terms of websites and online ordering platforms, etc., etc. And we sat down for our first meeting and I was immediately interested in basically said, where do we start? Where do we go from here? And so, we've been building that for the last two years and supporting small business owners here in Denver. And we started specifically in food and beverage, just because of how bad food and beverage and hospitality, in general, were hit through the pandemic. So, we want it to support the folks that needed a little bit of that additional support.

[00:04:16] Sanjay Parekh: So alongside that, you started up Meta. And Meta, the goal is the cannabis and psychedelic industry, like helping with recruiting there. Why do you think that's a place to work for you? Like what's the challenge? What was the issue that you were seeing and why has somebody else not filled that gap?

[00:04:41] Derrick Knudsen: Yeah, I think you look at it now there, there's definitely a number of recruitment firms in the space. For myself, I was working for a Fortune 500 executive recruitment firm in downtown Denver. It was very large and risk-averse, and so when cannabis and hemp companies were approaching us for help, there wasn't an ability to work with them under that umbrella. Back in New York, I had tried some side hustle businesses in terms of tutoring companies and different things of that nature.

But that was the first time I thought that I had an idea that I could go in full force and then turning a side hustle into an entrepreneurial venture. And yeah, did that in 2018 and have been building up towards that since then.

[00:05:23] Sanjay Parekh: What I'm hearing is, you decided to be an entrepreneur and, as difficult as that is, you also decided to go into an industry where it's already difficult because not all the stuff is there.

So you basically took it as a double whammy of: I'm just going to make this as hard as possible on myself to be successful. Is that what we're talking about?

[00:05:41] Derrick Knudsen: I think so. I think also doing it also at the height of the pandemic and kicking things off, yeah.

[00:05:49] Sanjay Parekh: Let's just add a third one out there, like a pandemic, and let's see what else we can pile on to make it harder for you to be successful.

[00:05:56] Derrick Knudsen: But if you can make it when the roads are hardest, you're going to be super successful as the roads get easier. Yeah, that's the mentality. And more than just our services, we're passionate about the industry. Coming from New York and seeing the opioid crisis firsthand, wanting there to be alternative options.

Even when you look at CBD and what it's done for children with epilepsy. There's just a lot of research and development, a lot that can come out and that's, I think, what all of us want to push forward. Sure, there's a recreational component. But the research and development around what this could do physically and mentally for us, especially as we dive into the psychedelic world. So it's an exciting space, and one that we're in full support of, and want to see it grow with the right people in place. And bringing our corporate and professional backgrounds into these nascent industries to help them grow the right way is what we set out to do in starting Meta Talent.

[00:07:01] Sanjay Parekh: Okay, so let's talk about you getting started with this, right? So, you left the corporate gig, corporate recruiting. You put out your shingle, how'd you go out and get your first client and your first placement, how did you get that all? Because this is almost a chicken and egg problem, right?

[00:07:25] Derrick Knudsen: Yeah, full desk recruiting is always a bit of the chicken and the egg. You're always trying to build a pipeline and relationships with great candidates that are already in this space or interested to get into it and, and transition their skill sets.

And then you're always looking for great partners to work with. I think for us, we're highly focused on finding sustainable partners — B corporations, ESG corps, and companies that are thinking about sustainable growth from a people, planet, and profitability perspective. And so, finding the first client wasn't easy.

But I think when you're in this space, you quickly learn that relationships and referrals go a very long way. And so, our first business came through a referral. A candidate that we spoke to that had a mentor and they were working as a consultant in the space and needed to hire for a VP of Operations and we stepped in and filled that role.

[00:08:23] Sanjay Parekh: Okay so you really had the benefit of having been in the industry, even if it wasn't this industry, in the industry for a while and having built up those relationships. That's really the kind of secret sauce, the key to kicking this off.

[00:08:36] Derrick Knudsen: I think being in a legacy market Colorado, just being one of the first. So, doing it in Denver made it a bit easier. My brother, my partner are in San Francisco, California, another legacy market. So, in that first year, a lot of our business was Colorado and California. Yeah, we've come a long way since 2018.

[00:08:56] Sanjay Parekh: So, okay you alluded to this, and let’s talk about this for a little bit.

Your co-founder in this business is your brother, which is not unusual. There are a lot of people that do start companies with family, but it definitely adds a different wrinkle to all of this. If things aren't going well, you're still going to see them for Thanksgiving dinner or whatever. So how do you manage that?

[00:09:19] Derrick Knudsen: Yeah, it was a fair bit of vetting, a lot of conversations back and forth. We've always got along very well, but obviously starting a venture, a business together is very different then playing on the same basketball team. And yeah, I think through those conversations, I had approached him and brought up the idea, this is what I want to do, looking for capital and trying to find interested parties. Would this be something you're interested in?

And then you know, I think a little bit of luck came through. A couple of months after that, he had been lucky enough to win a big fantasy football tournament. And so that was actually the capital that got us started. And then from there, it was like, hey, let's do this, let's put it together. And we've been riding that since the last four or five years in building this together. Yeah, it was kind of serendipitous to a point. I wouldn't take back any of it and he's been a great partner all along.

[00:10:24] Sanjay Parekh: I was not expecting a fantasy football windfall to be what you said about how this all got started.

[00:10:31] Derrick Knudsen: Just a gritty family, hungry family from New York, like I said, one of six and didn't have a lot growing up. And that was the golden egg that really kicked off all of his ventures. And one of them being with myself here with Meta.

[00:10:50] Sanjay Parekh: Yeah, so, okay. Let's switch back to the recruiting side of it and the industry you're in. Are you looking for something different in people that you're recruiting for this industry and for your clients than you did when you were kind of a regular corporate recruiter?

Is there a skill set? Is there a mentality? What is different about the people you're looking to recruit and bring into cannabis?

[00:11:16] Derrick Knudsen: Definitely. I think as an individual I've always approached it from a culture-first mentality. And so really talking with our partners and understanding what the office environment is like, and the culture that they're looking to build.

But I think when you look specifically at cannabis, you're trying to find some of that passion. And if it's not passion for the plant and the industry, it's a passion for startups and exciting environments that are growing and changing every day. And I think between those two avenues that’s a great way to filter it out. Yeah. And looking for passionate folks who either really enjoy wearing many hats and stepping into a startup environment that is still forming and still developing. Or the passion for the plant, alternative health care, alternative medicine, and what that can do for folks.

[00:12:09] Sanjay Parekh: Yeah. So, starting a new company, starting a startup, even though you had experience in this industry before, recruiting that is, is always difficult. There's always challenges. So, what are the challenges that you've faced?

And, and I know you're still early on, right? It's only been a few years that you've been doing this, but there's all these challenges and a lot of times people will over overblow those kinds of challenges and be the reason why they think that they can't start a company like you've done. So, what, tell us some about some of those challenges that you faced and how did you deal with them and how did you get over them?

[00:12:47] Derrick Knudsen: Yeah, I think number one is probably stigma, right? Ten years ago, we wouldn't even be sitting here having this conversation, right? It just wouldn't be happening.

So, I think number one, you know, even for myself. Four or five of my family members back in New York are cops and just come from that kind of legal side and that law enforcement side of the house. And when I said that I was starting a company in cannabis, almost immediately, I became the black sheep. And I think that stigma is number one. Even in terms of looking for candidates on LinkedIn and people being nervous to even talk about being interested in these areas. And so using Boolean search and keywords, that really does inhibit the pool of candidates that you can get in touch with because they're nervous to put that information out there. So often early on in '18 and '19, even for corporate professionals that were very passionate again about the space said, I've heard if I get in, I'm not going to be accepted back into the corporate world. Because now I've got cannabis on my resume, and I just don't know how favorable that's going to look to other employers that are in more traditional and corporate industries. And I think a lot of it was just breaking through that stigma. And I think we're facing the same things with the psychedelic health industries now, right? I mean, I think people are becoming a bit more open just to talking about mental health, PTSD and trauma, and anxiety and depression, especially with everything that's happened the last year or two. But it's really working through the stigmas. That's most difficult.

[00:14:29] Adam Walker: Support for this podcast comes from Hiscox, committed to helping small businesses protect their dreams since 1901. Quotes and information on customized insurance for specific risks are available at hiscox.com. Hiscox, the business insurance experts.

[00:14:49] Sanjay Parekh: Okay. So let's talk about like the nuts and bolts of actually running a company like this. There's a lot to do when you start, right? And a lot of people don't understand this because we just see the very nice stories that happen at the end, and they don't write the stories about what happens between the beginning and the fancy ending.

What are some things that you're using? Tools, techniques, things like that, to help you run the business and make it so that you're able to manage all of the stuff that's going on. What do you have for us?

[00:15:23] Derrick Knudsen: So, I mean, a couple of key tools that we use as recruiters and in this space.

You have to have a great CRM ATS, an applicant tracking system. So, we use Bullhorn – top of the line. We went back and forth with some smaller, more affordable platforms and at the end of the day, just thought in terms of scaling and really growing the business we want to set ourselves up right from the beginning. ZoomInfo, a great business-to-business contact tool, so just reaching out to executives in the space and getting them some of the resources that we put out there in terms of salary guides and in our national internship program for the space. And then of course LinkedIn. LinkedIn Recruiter, any executive recruiter is going to be on LinkedIn Recruiter and have the ability to use thousands of different search filters to really narrow down the right fit for that particular role in that particular company. So, I think those three are really big. But again, like I said, with it being such a nascent space, referrals and relationships &Mdash; that does go a long way. But yeah, those are three of the big ones for us.

[00:16:38] Sanjay Parekh: Okay, and let's give some advice to listeners that potentially might want to get into the industry. What would you tell them that they should do? Like they're not in any of these industries right now, but they want to move in. And we talked about it a little bit before, worrying about the stigma, and what should they say and should not say on a LinkedIn or whatever. Like what advice would you have for them to be able to be seen and known in the industry? Other than they could reach out to you and raise their hand and say, hey, I'm interested, but what else could they do?

[00:17:11] Derrick Knudsen: Yeah. I think there's, there's a lot of things you can do. And obviously switching industries, and changing jobs, that's a big step for anyone. So, when you talk about it in industries like these it's even that more pronounced. And I think reading up and doing your due diligence just on companies. And I think it starts with the why. Why do you want to be in this space? And so that's the first question you ask yourself and you really understand your motives for being in the space.

Like I said, it could be a passion for the planet, could be passion just for startup environments and hyper-growth industries. And there are a couple of different ways you can take it. But the first question is why. And then I think that inevitably if that answer is yes and, and it's confident, then you're moving to how, and a lot of that can be connecting with an executive recruiter, recruitment firm, like ours. And even just having a conversation to understand the landscape, before looking at a particular position. Like we said earlier, how do you overcome the stigma? It's just having conversations and just continuing to be open and transparent about what you're looking for. And I think a lot of it just comes down to the motivation to want to learn about the space, what's happening there, and how they can be a puzzle piece in the bigger system.

[00:18:35] Sanjay Parekh: Yeah, so what's interesting in what you said there is, making a bunch of money was not one of the good reasons as to why you want to move into this. And I think that's true for most jobs. That shouldn't be your motivation in terms of your perspective, I take it.

[00:18:49] Derrick Knudsen: I Yeah, it's part of it. I'd be lying if it wasn't, right? We work people, planet, and profitability, and we want all three of those to grow equally. And so, profitability, making money, leads to increased job availability. And so there are a lot of great things that come from this. We're not afraid of making money, but we're not going to let that outweigh our core principles and why we entered this space. Yeah, it's an equal component, but it doesn't outweigh the other pieces of what we're trying to do here.

[00:19:22] Sanjay Parekh: So, the successful recruit, somebody that wants to work in this industry, that's not their main motivation. Obviously, look, we all have to get paid. We have bills and we’ve got to live life. But from your perspective, that's not the main thing that drives a successful candidate getting placed into these companies. Is that true?

[00:19:40] Derrick Knudsen: No. I don't think so. Although there's not too many industries that offer up as much equity as you'll see in this area. Just because, again, it's so new, right? So there is upside and a light at the end of the tunnel, but that's also not going to be realized in your first couple of years.

And I think it's just a balance, like most things. Knowing that because the industry is growing so quickly and when it does go federally legal there's going to be more capital availability, more profitability, and so it'll get there. And I think the right folks understand that it's not today, but it'll get there. As long as you continue to stay in the space.

[00:20:19] Sanjay Parekh: Yeah, okay. So I got one last one for you, Derrick. Listeners that might be teetering on the edge of either starting a side hustle or going all in and starting a business. What would your one piece of advice be to them and maybe a piece of advice of something that they should do and maybe a piece of advice if something that they shouldn't do and make sure they avoid. What would you say?

[00:20:43] Derrick Knudsen: Yeah. Something that they definitely should do is think about it for quite some time. It's not easy, you know that, I know that. You're doing everything, right? And so when you're expected to keep your inbox clean on top of sending out paychecks and invoices, and collecting, and doing the day-to-day recruitment of a position.

When you're first starting out, if it is a side hustle to a business and you're really shoe-stringing it, it's going to be a struggle. It's a bit of a roller coaster, right? You're going to have great days and you're going to have not-so-great days. And so I think a lot of it is just understanding where you are in your life. Who depends on you. For me, just being a single person, I feel like that made it easier, just not having dependents and a family. And yeah, there are a lot of ups and downs, just know your footing, your foundation, and why you want to do it.

In terms of what you shouldn't do, you know, friends and family are tough. It's worked for us and, and my brother and I, we've made it work. But that's, it's something to take into consideration. And when you're starting a business, your first one or two hires are just so important, right? I mean, the cost of a bad hire is already two and a half to three times the salary. But when you're talking about it, when you're starting a two-person company and you're making hires three and four. You almost need those to be successful, and so really taking your time and vetting out your first couple of hires is super critical.

[00:22:32] Sanjay Parekh: Awesome. Awesome. Derrick, thanks so much for being on the podcast, this is fascinating. I learned a lot. And I look forward to seeing how you and Meta grow over time.

[00:22:42] Derrick Knudsen: Thank you Sanjay. I appreciate your time today.

[00:34:15] Sanjay Parekh: Thank you for listening to this week’s episode of the Side Hustle to Small Business Podcast, powered by Hiscox. To learn more about how Hiscox can help protect your small business through intelligent insurance solutions, visit hiscox.com.

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I’m your host, Sanjay Parekh. You can find me on Twitter at @sanjay or on my website at sanjayparekh.com.