Big Thinker Transforms Farming’s Paradigm

Kristjan Hebert focuses on long-term gain over short-term gains on his Saskatchewan farm

For Kristjan Hebert, farming is an ongoing puzzle of challenges and solutions. Case in point: Put him in a room with a white board and accompanying problem, and watch as the scribbles explode—the issues are defined, previous business protocols are challenged, and big ideas are bulleted.

“I truly believe challenges are simply opportunities in disguise — opportunities to learn and grow,” says Hebert, managing partner of Hebert Grain Ventures in Moosomin, Saskatchewan.

From business growing pains to a consolidating industry to labor pinch points and unsatisfactory risk management, Hebert has transformed obstacles into open doors.

“He is a visionary and when he sees an opportunity, he is willing to take a leadership role in making it happen,” says Danny Klinefelter, professor emeritus and Extension economist at Texas A&M University.

CPA to CEO. Hebert spent five years as a CPA with a large agricultural firm. His first-hand view of other farms showed him how technology and a laser focus on finances could revolutionize farming.

“The number side and the people side of agriculture drew me to it way more than running a combine,” he says. “I knew there was a better way to do things, and I wanted to be a part of changing the agriculture industry.”

In 2009, Hebert and his wife, Theresa, combined their 1,200 acres with 4,500 acres owned by his parents, Louis and Karen.

After the initial father-son combination, the operation began expanding, focused on common goals and black-and-white numbers. Today, the operation includes 22,000 acres of canola, malt barley and wheat. The mix can also include rye, peas and hemp, depending on the year. In addition to the Heberts, the partnership includes farm manager Jeff Warkentin and CFO Evan Shout.
Hebert Grain VenturesThe Hebert family includes, from left, Louis, Karen, Theresa and Kristjan, as well as Kristjan and Theresa’s children, Ivy and Bentley. Photo: Olga McCarthy

Partners are paid a 5% return on equity invested, compensated for labor, and paid rent for land they own. Profits are shared for management and vision. This financed-focused foundation set the stage for growth, professional development of the team and partnerships.
Massive growth doesn’t happen by chance. To sustainably expand, Hebert followed three principles:

People are an investment not an expense.

Technology is an optimizer and enabler.

Working capital and risk management are the engine.

“He’s basically created a perfect storm of people and technology to take the farm from 10,000 acres to 22,000 acres,” says Kim Anderson, the team’s office manager. “We are constantly trying to keep pace with all of his new ideas and figure out how we’re going to implement them.”
Hebert Grain VenturesPhoto: Olga McCarthy

Culture of Growth. Timing and opportunity are the drivers of business growth at Hebert Grain Ventures. “Your future should always be better than your past, otherwise you’re just living life,” Hebert says.

The team sets 12-year, three-year and one-year goals. Those goals are the guide for how they spend their time and money. Back in 2009, the goal was to grow to 8,000 acres, as Hebert’s number crunching shows 8,000-acre pods are efficient from an equipment and people metric.

Hebert is still focused on efficient growth, but you won’t see a written acre goal anymore without the word optimized beside it. “We only want optimized acres, meaning they are highly productive, our profit margin is the same or goes up with the acres and we can build the team and equipment plan to farm them properly,” he says. “If we can’t do those three things then it’s not an optimized acre. That’s just expansion for expansion reasons.”

As farmers around him eyed retirement, Hebert created a merger and acquisition strategy, which includes staggered purchasing plans to help with tax optimization for the retiring party. In addition, the retiring farmer or farm team can contribute machinery and/or labor.

“Every deal is done a little bit differently,” Hebert says. “I just want a win-win strategy. I want to shake the hand at the end of the deal and be excited about what we can do next together.”

Hebert Grain Ventures rents every acre in their portfolio, either from Hebert, his father or other landowners. “I love owning land, but owning land uses a lot of cash. That’s why I also utilize long-term rental agreements with the first right of refusal.”

The team reviews real-time monthly dashboards and financial statements. This level of financial acumen has helped the team realign their goals, and make logical versus emotional decisions.

“Our operating capital is 80% backed through private insurance contracts and a personal guarantee. There’s no land equity or machinery equity tied into our operating note,” Hebert says. “As we want to expand, I only need to come up with 20% of the working capital to do it.”

Kristjan HebertPhoto: Olga McCarthy

Many Hats. In addition to running the farm, Hebert has formed several ancillary businesses. These offshoots provide everything from risk management and finance consulting to insurance products to human resources technology to CFO services.

As the operation has grown in complexity and sophistication, Hebert focuses on putting the right people in the right seats. Today the team includes eight full-time and five-part-time members.

“As our farm got larger, it made the people side easier and more rewarding,” he says. “The bigger you are the more time people can spend doing the things they enjoy. I want 80% of employees’ time to do be doing the tasks they love and only 20% doing what they don’t like.”

The latest management exercise at the farm is implementing an entrepreneurial operating system (EOS). Hebert has seen many benefits, with one being a simple and effective way to evaluate and lead employees. They use the GWC metric, which stands for: Get it, want it and the capacity to do it.

“We do a GWC score for our values on every single person,” he says. “Each person gets a plus or minus for if they understand their job, want to do their job and have the capacity. We see what’s on track or if we need to correct a problem. It can be that simple.”

The EOS system, as well as the operation’s other strategies such as the phantom partnership unit for employees and defined governance structure were stretch goals for Hebert. He’ll quickly admit advisors questioned these moves.

“They told me I was too small to do these things,” he says. “But if we don’t have time to do it right when we are too small to do it, how will I have time to do it when we’re too big? I’m absolutely willing to step over short-term profits to maximize the long-term gain.”

Hebert Grain VenturesPhoto: Olga McCarthy

Deep Roots, Bright Future. That respect for the past and focus on the future guides all decisions at Hebert Grain Ventures, and is encapsulated in the operation’s legacy statement: “To leave the dirt, financial statements, team members, community and industry in a better state than the last generation.”

That next generation includes the Hebert’s children: Bentley, 8, and Ivy, 6. “I want to give my kids the opportunity to go to Harvard but build something cool enough they might come back,” Hebert says.

Snapshot of Hebert Grain Ventures

Hebert Grain VenturesPhoto: Olga McCarthy

Operation: Hebert Grain Ventures is a row-crop operation in Moosomin, Saskatchewan. The operation includes 22,000 acres of malt barley, canola and wheat.

Family and Team: The operation is a partnership between Kristjan and Theresa Hebert, Kristjan’s parents, Louis and Karen Hebert, Jeff Warkentin and Evan Shout. The team also includes eight full-time and five-part-time team members. Kristjan and Theresa have two children: Bentley and Ivy.

Business Ventures: In addition to Hebert Grain Ventures, Hebert’s business umbrella includes finance and risk management consulting, a farmland real estate company, an investment holding company and a human resources technology application company.

Community and Leadership: Kristjan is president of the Moosomin Minor Hockey Board and coaches several leagues. He serves on advisory boards for several international chemical, technology and machinery companies. He is also director of strategic projections for Global Ag Risk Solutions, a private crop insurance provider.

Hebert Grain VenturesPhoto: Olga McCarthy

Kristjan Hebert’s Business and Life Principles

Being decisive is key to being an entrepreneur. Some decisions you have to make without having all the facts.

Most issues, whether good or bad, are tied to a process not a person. Look to systemize the simple so you can humanize the exceptional

Use accrual accounting and know your numbers so your banker and accountant work for you. Then when you are asking for a loan, you’re not really asking. You already know the answer is yes.

Progress is more important than perfection. Sometimes moving forward and then moving in a different direction is OK.

Adopt a win-win mentality. Don’t think you have to win and someone else lose. Win-wins create more opportunities.

Find your way to stay positive. Agriculture is an extremely negative industry, whether that’s the weather or neighbor or prices. Focus on what’s right and what’s going good.
Kristjan HebertPhoto: Olga McCarthy

Kristjan Hebert is the winner of the 2020 Top Producer of the Year Award, which was sponsored by BASF, Case IH and Rabo AgriFinance.

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