MJBizMag October 2021 - 94

UNDERSTAND YOUR INVESTOR
FAMILY OFFICE
MULTISKILLED
MANAGEMENT
Single-family office likes leaders who surround
themselves with talent and experience
By Omar Sacirbey
Kevin McGovern
Chair and CEO, McGovern Capital
New York City
C
annabis requires the same
fundamentals as other
investments, according to
Kevin McGovern, whose single-family
office specializes in making early stage
investments in consumer technologies
and brands. But it's also " a little
different, " he added, " because it requires
a multitalented management team,
probably more than any other area that
we've been investors in. "
According to McGovern, cannabis
companies-especially those that
are vertically integrated or partially
vertically integrated-need executives
with expertise in cultivation, regulatory
matters and accounting, because all three
of those skills are especially complicated
in the cannabis realm.
" Cannabis, more than any other
industry that we've experienced, is highly
complicated from an accounting standpoint.
Particularly for public companies,
you need a multitasking, highly sophisticated
and multiskilled management
team, " said McGovern, whose firm has
92 MJBizMagazine | October 2021
invested in more than 30 plant-touching
and ancillary cannabis companies in the
United States and abroad.
He added that he likes leaders who
recognize the value in stepping down.
" Good leaders are not necessarily
good managers; good managers are not
necessarily good leaders. We like leaders
who build a team culture and, to some
extent, are replaceable, " McGovern said.
In addition, " Every company also
needs a 'chief passion officer,' a crazy
person who advocates for the company
24/7. They are like missionaries, "
McGovern said.
A BENEFICIAL BOARD
In addition to smart leadership,
McGovern looks for companies where
the leaders " complement " themselves
with experienced deputies and a board.
Those deputies and board members
are needed to provide guidance to
founder-executives, especially young
entrepreneurs who might not have faced
certain business situations.
" Get a sophisticated board and put
them to work. And make sure that they
have skin in the game, " McGovern said,
adding that a board member's investment
can be writing a check or making a
commitment to perform tasks for the
company. " Make sure your board is
vested not just in stock but in the success
of your company. "
FOUNDATION FOR SCALING
Scaling also ranks high on McGovern's
list of desirable company traits. He
cited good infrastructure such as solid
standard operating procedures and
redundancies that minimize risk as solid
foundations for scaling.
" That's the first important ingredient
for scaling. When you scale on a faulty
foundation, you crumble, " he said.

MJBizMag October 2021

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