Farhaj Mayan of OKO Sees Hiring and Training as the Biggest Problem to Tackle in the Cannabis Industry

Cannabis
June 10, 2021
Alexander Lipnik

After working at several startups and having a failed venture of his own, the legal cannabis industry came calling. There was plenty of opportunity.

AeroPay is the leading digital payments platform for the cannabis industry. This is the latest edition of “Grow Operation” - a series where we tell the stories of entrepreneurs and executives from the companies shaping the future of the legal cannabis industry.

Aha Moment

At the beginning of his career, Farhaj Mayan — now the Co-Founder & CEO of Oko, a next generation trade school and people ops platform — worked at multiple startups as an early employee. Everything from VR to drones to experiential marketing. 

He eventually decided it was time to transition into the journey as a founder himself. So he started FADE, a mobile platform that helps men find the best local barbers for their hair type. He grew it to early revenue and even secured seed financing from institutional venture capitalists after pitching close to 300 investors.

Ultimately, however, he ended up winding the company down.

As he was going through his existential crisis as a founder, Mayan learned that his friend started a legal cannabis operation in Oklahoma. He was surprised by two things. First, that his friend had a legal cannabis business. The second surprise was that cannabis was legal in Oklahoma.

When his friend needed help trimming cannabis and had no other options to turn to (the friend had even recently ‘fired’ his grandma for being a really bad trimmer), Mayan drove to a little town in Oklahoma of about 400 people, with a single Dairy Queen and a gas station, to help out his friend.

In typical founder fashion, he spent much of the time when he first arrived pitching FADE, the company he had just decided to call it quits on. That conversation ended quickly when he realized everyone he was speaking to frequented Supercuts or the like. They weren’t the ideal audience to sell on the concept.

It wasn’t all bad though. Those same people asked Mayan his thoughts on building an application that could be used to seamlessly hire trained and vetted cannabis workers. This was a huge problem they needed to solve, as they saw 6 out of 10 hires turnover every few months despite being paid nearly double the wage of other available opportunities.

That’s when he had his aha moment and his entrepreneurial spirit kicked in. They needed a standardized training, vetting, and credentialing process to better match workers.

So he went from building technology to help people find someone to trim their hair to building technology to help people find someone to trim their cannabis (and more, of course). Oko was born.

Early Days

One of the biggest problems Mayan noticed when his team started building Oko was the net retention of contractors who were being sent to farms. Many of the workers weren’t getting requested back.

After speaking to the farms, it was immediately evident that the reasoning was because people weren't trained to actually go and do a good job at the farm. 

So, the Oko team gathered expert cultivators, growers, and dispensary owners to draft up a curriculum. They began holding in-person training sessions onsite and started to see that compared to an average staffing agency, their fulfillment rate and net retention was skyrocketing.

The education part was crucial.

To validate this, Mayan went into Undercover Boss mode. He immersed himself in the course and got out into the field, estimating that he worked 80 to 85 shifts. This gave him the ability to talk to employers, be alongside the workers, and truly understand how the operations work.

He realized starting with the context of what a flower is, how to trim, what to look for, and other components they were teaching beforehand made a huge difference. It allowed workers to start with a core understanding, so they could spend the rest of the time improving their throughput. 

Growing Pains

But Mayan learned pretty fast that the cannabis industry came with some hurdles. For as much tax revenue as it brings in to both the fed and individual states, it’s extremely over-regulated and very underserved. Companies can be bringing in millions of dollars per year and employ hundreds, if not thousands, of people and still not have access to simple tools such as digital payroll benefits or consolidated insurance.

Banking and payments are other major pain points he noticed for cannabis businesses as they grow and expand.

Mayan saw this for himself as he was starting his own company in cannabis. With $150,000 in money committed over term sheets, he had no bank account to put it in. He was rejected by banks over 30 times when applying as an MRB Tier III service.

He grew frustrated as his company was simply a software provider that didn't even touch the plant. He assumed the issue came from being cannabis adjacent. But as he started diving deeper, he realized the original name for his company, Kanna, was getting flagged pretty aggressively during the Anti-Money Laundering (AML) and Know Your Customer (KYC) process. 

Even when he finally got a bank, problems still persisted. When following up on some of the initial invoices he sent out for billing, he needed to visit each individual customer to pick up a check or cash. He then had to mail it to his bank in Arkansas to have it put into his account.

These weren’t small check sizes either. He had customers signing relatively large contracts. This became a slow, tedious, and unreliable process for a company trying to build a scalable technology platform.

Eventually, he was able to accept B2B payments through AeroPay. He received their first entirely compliant digital ACH payment from a customer for a $12,000 contract shortly thereafter. This was a huge relief for him.

Going Digital

With banking and payments figured out and a basic premise outlined for their program, Mayan and his team decided it was time to scale up. They grabbed a camera and tripod, and recorded their head trainer talking about different aspects of cannabis. It started as four modules. 

They launched it to see what the appetite would look like and promptly got 1,000 applicants. Better yet, 750 of them actually completed the course, which Mayan acknowledges is an insane rate for a direct to consumer education platform.

There was a really big opportunity to offer access to easily affordable education. In turn, they could drum up a supply side of workers who meet employer’s expectations and fit really well into their culture, systems, and operations. 

After a number of iterations on the topics and material they covered, the effort finally culminated in the launch of Cannabis Retail 101, Oko’s flagship budtending course. The instructional design and teaching for the course is done by Emma Chasen, leaning on her knowledge and methods developed over her time in the industry as an accomplished consultant, Portland's 2016 Budtender of the Year, and Farma GM. Other contributors to the project include the former Chief Cannabis Advisor at Eaze and a prominent Los Angeles-based Director, Cinematographer, and Executive Producer.

The Future

Despite some of the challenges the cannabis industry has presented, Mayan remains bullish about the opportunity ahead of him. 

He’s excited to launch the next wave of courses. Those courses include subjects such as cannabis trimming, cannabis harvesting, cannabis plant maintenance, cannabis propagation, and cannabis manufacturing.

Mayan hopes to democratize access to trade-specific information, helping workers find affordable education to up-skill and even transition into full-time roles. To see people print their certificates, frame them, and put them up on the wall would be the ultimate satisfaction for him.

For employers, the vision is to help them find qualified talent by taking a different approach. He refers to Oko as the anti-staffing staffing agency or the peopleOS (operating system).

He believes that cannabis has this unique opportunity to set a new standard for what kind of work people can find and what kind of compensation people can offer as long as workers have a way to become educated on the relevant information.

Beyond the hiring and training piece of the puzzle for cannabis businesses, Mayan is confident there's really good opportunities to optimize other silos of their business. He mentions banking and payments specifically, difficulties he knows all too well.

His goal is to be able to make introductions to banks for currently unbanked customers and implement payments - for B2B billing on the employer side and digitally accessible payouts for workers - into their platform. 

In time, this will give Oko customers the freedom to transition their business away from a reliance on cash.

The future is certainly bright.

Stay tuned as we share other stories of the incredible individuals building the business of cannabis.

Story as described on The Grow Operation Podcast.

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