The ScaleUp Summit offered a perfect platform for innovators, entrepreneurs, corporates and non-profits to connect with one another. We loved meeting so many sharp individuals, collaborating over ideas, business models, and sustainability. We were united in our bias for action and growing our impact together. Academic spaces often face criticism for not thinking outside of the box enough or being relevant enough for greater society, but the Smith School of Business’ initiative of inviting the larger business community to their event was certainly a step in the right direction towards breaking the mould, silos or inequities between “needle-in-the-haystack” entrepreneurs and the proverbial “Bay Street Bros”.
The opening keynote panel discussed cannabis. Their general goal was to dismantle consumer confusion, and innovate with strategies to differentiate their products and brands in a market that’s saturated with so many microbrands — all as new as the other, in a legalized world. Leaders from Materia Ventures (and their High12 brands), Responsible Cannabis Use (RCU – who challenged us to define what a nanogram was in understanding THC use-limits while driving) and 48North presented their views on the current state of legal cannabis in Canada, US and globally. They shared their dreams and visions for the future including – “May everyone be buying it, and every corner street be home to its own favourite retail outlet,” to “may there be more outdoor grows that lavish the landscape with unending acreage of cannabis farms” to “may there be more accurate and varied consumer data collection techniques that actually reflect every cannabis consumer” and a wish for more consumer education and advocacy. The gaps in consumer knowledge with cannabis is a disadvantage when compared to categories like alcohol where for example, consumers know the difference between wine, tequila and beer — to cite a very basic example. The panelists were all focussed on educating their consumers and advocating for them with the RCU aiming to collect 100,000 consumer data points by the end of this year.
The lack of a “Coke” or “Pepsi” in cannabis was viewed as both a challenge and opportunity across the panel, as it signalled changing times where power was actually back in the hands of the consumer. There were superstar brands by market cap, if you logged on to The Green Fund, or followed the pot-stocks daily, but no superstar brands from a consumer-standpoint. Breaking the “stoner stereotype” and cannabis-use stigma remain the ongoing challenge for most cannabis marketers especially in the coming six months as Canada navigates Legalization 2.0. The best way to cut through the brand clutter in such a mixed-response environment is in rallying to your consumers’ habits, desires, occasions, rituals, communities and knowledge levels, according to the panel.
Another interesting point brought up by 48North’s CEO was the running cliche that put all cannabis products into sophisticated lifestyle brands! Cannabis even with its grungy toned-down appeal can attract the veteran or regular user who prefers the low-key (even utilitarian) style of consumption, she offered. Across the panel, it was agreed that cannabis was different from other CPG products because it was simply not classifiable as high quality, medium quality and low quality; its effects varied so vastly across individuals that those categories failed to apply.
The major metrics cannabis investors should look for in cannabis companies they’re looking to fund should be a) topline revenue b) gross margin EBITDA and cash flow portfolio and c) the management patterns (founding team, etc.). A major challenge that was cited not just in this session but also in others, was the lack of marketing and sales professionals in Canada, and the resulting lack of marketing and sales culture in products and services, when compared to our neighbours in the south. Global products were marketed way before they were ready in other markets when compared to Canada where people were focussed on building a perfect product first. Most cannabis brands are looking to grow their marketing and sales divisions with the right hires, they concluded.
Artificial Intelligence Talks
Hiring practices have often come under fire for relying on bad AI. We are still in the early stages of AI, so don’t try to implement AI just “to be cool” or to “get ahead of the curve”. If your problem demands an AI solution then let it be organic and not because you were actively looking to incorporate an AI strategy, advised the panel. We learned about three different companies two of which used AI in different stages of the hiring process (stage 1 for mass screening of applications and stage 2 for screening applicants on soft skills), and the third dealt in wider enterprise commercial AI solutions. Our mind wandered back to BiasCorrect, an AI enabled Slack plug-in used by organizations like Scotiabank to improve workplace inclusivity by flagging objectionable language / framing to Slack users in the workplace.
Often AI was being used to solve large scale transactional problems that were iterative and boring, so don’t harbour any illusions about the glamour of AI without its glitchy-ness in early stage AI and/or iterative nature in bulk operations, warned the panelists. Look for predictive validity, and be motivated by the problem not the solution. The proliferation of AI was spread differently across markets, with certain types of AI disruptors flourishing in less regulated markets than others, noted some. The need for ongoing discussion on training better quality AI (without the human biases) was emphasized as a way forward in developing solutions that are innovative yet ethical.
Read John Paul de Silva’s (of Hopeful Inc.) take on how to apply AI for non-profits here.
The diversity on the Venture Panel was exciting, with firms representing investments for every stage or category of idea. ScaleUP Ventures, DreamMaker Ventures, Funding Portal and Georgian Partners presented a fulfilling discussion on how to go about seeking funding from the right source while acknowledging that solopreneuring was often a state of trying to “fly a plane while fixing it”. Important themes like equity, social innovation and private sector funding emerged and led to stronger discussions with the audience.
The toothbrush test is a good way to determine if your idea / project holds much water – “Is this a product we can legitimately use two times a day?”
Closing Keynote with Ecobee’s CEO and Founder
Stuart Lombard, CEO and Founder of Ecobee, a thermostat company offered a riveting closing keynote. Irreverent, funny, and full of useful non-advice and musings about innovation, entrepreneurship and every other buzzword that challenges business models today, Lombard encouraged everyone to foster a culture of ongoing self-education. He talked about the importance of starting young, but also the power of iteration, and how timing and luck played a key role in product-market fit. Lombard spoke about his journey, praised the effectiveness/simplicity of Costco’s business model, told us to capitalize our core strengths and to stop trying to better your competitors instead of bettering yourself (there’s no time to waste in regretting what we don’t have). He ended with his optimism about the world’s biggest problem today: climate change. He attributed his optimism to three main reasons: growing urbanization (causing us to consume less energy), decarbonization (as renewable energy and clean power becomes cheaper and more affordable, our reliance on it grows), and the electrification of transportation (particularly in North America).
He made good fun of VCs too, while sharing that the future was bright for everyone.
Networking with Innovators
The audience was brimming with questions and ideas in break-out sessions. Sustainability and innovation are hot topics in business today, but every discussion at the summit was focussed on specific and actionable change too. Nadiah Nida, Risk Manager at Metrolinx, brought up the importance of outlining your assumptions when presenting the findings from any dataset you’re working with. She contextualized this with her observation of the tendency among certain professionals to omit the stories they can’t understand or deal with in the data they have access to. This reminded us of the following quote:
Statistics are only an artifact of the power to shape questions we think are worth asking. They are meaningful only in relation to how we interpret them in light of the public policies we seek to enact. In today’s Information Age, the power of numbers is unprecedented in its ability to shape our understanding of the world we live in, the people we dwell among, and the scope of the challenges we face collectively. Microprocessors, terabyte servers, and Wi-Fi allow us to collect, quantify, analyze and distribute data with a speed and scale that even George Lucas could not have imagined a generation ago, let alone Dubois. But the basic problem remains the same. Data are not produced in a vacuum… Data are always a reflection of a set of economic, social, political, and yes, racial choices. The fact of their existence, collection, compilation, and dissemination is a consequence of resource allocation, of choices made by individuals and institutions on what to measure and why.Khalil Gibran Muhammad, “Numbers Never Speak for Themselves”, Black Stats: African Americans by the Numbers in the Twenty First Century, by Monique W. Morris (The New Press, 2014).
Other innovators talked about raising the bar of cultural diversity by questioning what inclusivity really meant to them as personal values.
Lin (above) and Jia (below) are both on a change journey as they transition to life in Canada and we were glad to catch up over their experiences and insights for our readers.
Top Takeaways Recap:
Cannabis is growing very fast and the level of consumer-obsession (with all categories of non-users, users, potential users, lovers, skeptics or haters) brands are able to bring to this category across all touch-points is what will define their success in the coming months. Partnerships with advocacy boards, educational groups and media outlets will boost brands’ chances of success. Career-seekers or start-ups will benefit from looking at ways they can use their business acumen and creativity to add value to the marketing and sales teams in cannabis companies.
Artificial Intelligence is a lot of hype and is still in its early stages in even advanced economies. It probably sees higher success in less regulated markets where disruptors including fintech companies thrive more (India, China, Africa) – also shared by Bernice Cheung, at an Environics Research Fintech Conference the same week. Enterprise AI is the farthest thing from glamourous and used most effectively when dealing with volumes of transactional data. Be motivated by the problem not the AI solution; soon AI will age and no more be “novel”.
Funds exist for every stage of idea, even if they often come at a cost. Aggregation skills will help, and you only learn and grow from trial and iteration.
Entrepreneurship is here to stay, and driven largely by innovation-and-necessity driven, resilient and ambitious immigrant professionals who tap into their experiences and communities to intersect worlds and match problems to solutions globally. Change, is a part of this process (for everyone, and especially the incumbents whether they are big banks or native-born citizens); and we will always be fuelling each others’ discussions about values, growth and impact, so long as democracy is alive.
Thank you to the Smith School of Business at Queen’s University for facilitating such important discussions and connections in the heart of Toronto’s business district and to the Analytics By Design Team for bringing this event to our attention.