subscribe to the podcast

How do you remove corruption from a society? How do you create lasting, sustainable prosperity in developing nations? 

Neither of these questions has an easy or obvious answer, but today’s guest is a leading thinker in how we can make positive investments in developing countries. Efosa Ojomo is co-author of Prosperity Paradox, and he’s here to help us think about how to create prosperity. 

He was such a great podcast guest that we asked him to speak at the FDI event in a few weeks, so you’ll want to tune in today and then at the conference to hear everything he has to share.

Episode Transcript

Some listeners have found it helpful to have a transcription of the podcast. Transcription is done by an AI software. While technology is an incredible tool to automate this process, there will be misspellings and typos that might accompany it. Please keep that in mind as you work through it. The FDI movement is a volunteer-led movement, and if you’d like to contribute by editing future transcripts, please email us.

.

Henry Kaestner: Welcome back to the failure of an investor podcast. I’m here with William, my co-host. William, how are you?

William Norvell: I’m doing fantastic. Gets a little hot out here in California, which is rare for an Alabama guy to say, but we’re hanging in there.

Henry Kaestner: Well, I know that you’re in a house that doesn’t have air conditioning and you’d ordinarily open the windows. But we’ve got wildfires and that’s thrown a little bit of a wrench into things.

William Norvell: You’ve got you’ve got ash raining down end times, ash over there. Right.

Henry Kaestner: It’s crazy. It really is crazy. So today we’ve got an amazing guest. And this is a big deal for me. For those who you know a little bit about my background coming out of bandwidth as we start up Sovereign’s capital, we wanted to focus on Southeast Asia. We had some good relationships in Indonesia and Singapore. And through the grace of God, we’ve made about a dozen investments have gone really, really well in investing in Faith driven entrepreneurs in Indonesia and Singapore. But increasingly, God has put Africa on my heart. And I went with my family this month. Last year I’m recording this right now in August 20, 20, August to 2019. I went back to East Africa for the first time since 1984. I’ve been in South Africa a number of times in that time. But I went back to East Africa for the first time and obviously a long, long time, you know, so incredibly impressed by the amount of advancement and just how the marketplace was just thriving. And I guess anywhere around the world, there isn’t a lot of change over the course of 35 or 40 years. But definitely in East Africa. And as we have had this ministry of Faith Driven Entrepreneur, which preceded Fater of an investor, I thought, gosh, was it look like to bring together faith driven entrepreneurs and faith driven investors to understand what’s going on the marketplace? So we had a couple of Faith Driven Entrepreneur events. One was just this kind of impromptu meet up where we had 200 faith driven entrepreneurs getting together. Nairobi went back in February to try to understand where were investors, local Kenyan Christians investing and just met? No, really just motivating great godly people in government and in industry and then again in church and then among the entrepreneurial class and just felt completely drawn into their stories, just really encouraged and just really encouraged by the way that these astronauts were able to minister to me about how they had this heartfelt mission about loving on their communities in a way that was just it was just awesome. So I’m on an Africa kick and I’ve been on one. I don’t think I’m ever going to get off it. And I came across a book, I guess it just bought in the airport. And I’m reading through this new book called The Prosperity Paradox by Clayton Christensen, and Efosa Ojomo. And I’m reading through it and just amazed by it. And it’s making the case for investing in Africa. And as I’m reading it, I knew a little bit about Clayton Christensen’s faith background. And it comes from a Mormon faith and just very vocal about how faith influences the way that he thinks about his work and unfortunate and also known that he had just passed away. And I’m reading this and seeing the contributions from his coauthor, Efosa Ojomo. I wonder if Efosa has a faith foundation as well. Wouldn’t it be incredible if he has also committed Christ Fowler and that informed his work? And so then I’m like, OK, I’m going to look for this guy. I’m going to find this author because I wonder if he is. And if he is, he might help us unlock as a group of faith driven investors, how to go about investing. And so we track him down. And as it turns out, he is a committed Christ father. He did coauthor the book. And he is also on today’s episode of Faith Driven Investor. You can’t make this stuff up. Efosa, welcome to the program.

Efosa Ojomo: Thank you. Thank you so much, Henry and William. It’s really an honor to be here. Wow. Thank you.

Henry Kaestner: Super cool to have you. So we start every episode by, we’re going to get into the book, but we get to the things that guy has taught you in your life and the hopes that you’ve got for Africa. And together, mostly you. To be clear, that burns mostly on you. We’re gonna make this case for investing in Africa that you can actually do well, that you can help involved in lifting a continent out. And there’s some big deals to be done and there’s some really compelling opportunities. But before we do that, we’d like to interview each one of our guests and understand a little bit of their background. Who are you? Where do you come from?

Efosa Ojomo: Yeah. Thank you. So I’m originally from Nigeria and I was born and raised there till I was 16, where I moved to the States for college. I was born into a really loving family. I’ve got three siblings. We’re all thankfully Christ followers. There was one of those things where at an early age can’t really describe it. But I just had this awareness of God’s love for me and for all of us.

And so, you know, I would say my parents were what you would call a good people. They were nice people. They taught us to be kind, humble, caring, generous.

But, you know, they didn’t quite introduce the gospel to us, like we weren’t going to attend a Sunday school, that kind of thing. But I was nine years old and went to boarding school. Somehow I just was aware that there was a God that loved me, and that was when I decided to commit my life to him.

Now, since then, it’s been a journey, as any Christ follow would tell you. Ups and downs. But I would say that’s when the journey started for me. And so, yeah, I mean, I think that sort of explains my background upbringing. The connection to the US, though, is quite interesting because it also connects to the work I do today. When I was 16, I was fortunate to get a scholarship to come to college in the U.S. I bought a one way ticket. No intentions of ever going back to Nigeria. Sort of typical immigrant story. You know, you’re gonna come to America, embraced the American dream, and life was going to be good. And I got to tell you, I was there. I mean, I got a job as an engineer. I was working and bought a house, bought a car, even bought an SUV, you know, big gas guzzling SUV. And I was I was all about America. But then my life changed after I began reading about poverty, development and economics. And we can go into details as we talk.

Henry Kaestner: Yeah. Yeah. So Nigeria’s this country. And maybe I’ll just talk about the elephant in the room. Many of our listeners have been in contact with people from Nigeria before that have invited them to participate in different things. And your family, too was brought into some of the challenges that are part of Nigerian. We’re going to be clear. This is episode about talking about the very good things going on in Nigeria and Africa. And yet many of us have this experience of interacting with people in Nigeria and there’s some amount of corruption. And that impacted your family, I think, with your sister.

Efosa Ojomo: Yeah, yeah. Yeah, absolutely. So the thing about, you know, growing up in Nigeria and Nigeria, especially perhaps, I mean, other emerging economies, but Nigeria is this idea of poverty, which is connected to corruption, very connected to corruption, becomes normalized. All right. And that’s a big difference between, say, growing up in Nigeria and the US, you know, poverty and corruption and normalized. And so the experience you’re talking about is one that I talked about in my TED talk where my sister got her office broken into. Someone stole some stuff. She went to the police station and they essentially the folks at a police station essentially asking her for a bribe to pay a little something for them to be able to do their jobs. And for her, she was just confused, like I just got robbed. You are the police. You’re supposed to help and you’re asking me to commit another crime. And it just didn’t make sense. But that is not an anomaly. Right. That’s just one example of how corruption shows itself in the country. The problem is that gets normalized. And the idea that we can never develop until we fix everything was really ingrained in me. It was ingrained in my sister, in many people in Africa, which I think is one of the biggest issues in terms of thinking about how the country and the continent can develop.

Henry Kaestner: OK, so let’s tackle that corruption a little bit, just even at the outset. Let’s get right into it. How do you remove corruption from a society? How do you deal normalize that as a way of life? What’s that look like?

Efosa Ojomo: Yeah. So, I mean, there are a couple of ways to tackle this, right? One is we tackle this as a moral cultural problem. Right. So corruption is bad. We all know it’s bad. You need to stop it. If you don’t stop it, nothing can happen. And that, I think, is the dominant way. Corruption is often discussed and it’s often handled. You know, we have the Transparency International Corruption Perceptions Index. We have ease of doing business indices. We have, you know, world governance indices. These are, you know, these indices that show us how does a country rank in governance and corruption and so on. Right. That’s one way to handle it. If you country moves up, you know, the idea is you can get some extra investment. But then the other approach, which is the approach we take in our research, which is the approach that has worked for many prosperous countries today, is to handle it more scientifically and to do that. What we have to do is to lean into this idea of corruption and ask the question, why are people engaged in corruption? Right. Why do people engage in corruption, seem to engage in corruption in this country? Maybe not so much in this other country. Did people in rich countries today ever engage in corruption at a similar scale or level? What types of corruption are there? Right.

Are all corruption or forms of corruption created equal? And when you lean into those questions with some humility, with the understanding that you know. Maybe the folks engaging in this kind of corruption are not just all evil and terrible and there’s no hope. Maybe I need to understand the circumstance better. You begin to uncover some truly amazing insights. And that’s the approach we’ve taken. And in doing that, what we find is the vast majority of people who engage in corruption are doing that to solve a problem.

They’re doing that to typically increase incomes so they can afford a place to live so they can pay for health care so they can get justice. Like my sister. Imagine if she paid that bribe. She didn’t. Just to be clear. But if she did, it wasn’t like she wanted to choke up on whatever day she was robbed and said, I want to pay this. I want to just go be corrupt.

You know, it would be that she had to engage in it so she could get justice. And when we begin to unpack why people engage in it and the different forms, we begin to see the role, the critical role, innovation, entrepreneurship and increase in investment can actually play in helping people and communities mitigate incidences of corruption.

Henry Kaestner: So if I’m following you’re talking about the concept that development and wealth creation has this inverse relationship with corruption. So as an economy gets stronger and there’s more innovation, it feels a little bit like a chicken and egg thing. Right? Some people say, well, but I get that. But I’m I can invest any money until I see corruption go down. Are you asking people in are their stories of success in investing in places like Nigeria where investors have gone in and said, you know what? I know there’s corruption. And yet I still see opportunities and that type of investment and development has paid off for the investor while decreasing corruption? Or do I have it backwards?

Efosa Ojomo: Yeah, no, you’re absolutely right. It is this notion of chicken and egg. In fact, one of the things that I said in the TED talk I gave was societies don’t develop because they’ve reduced corruption. They’re able to reduce corruption because they’ve developed. And then when you just think about how we fight, corruption requires a lot of resources and many low and middle income countries don’t have the mechanisms, the money to actually fight corruption. But to your question about other opportunities and so on. Absolutely. There are so many opportunities. The minute we begin to see things differently. Right. So one quick example is, is one that we highlight. I highlight this. A lot of my research in our book and even in the TED talk is the story of Mo Ibrahim. You know, so about 20 years ago, 22, to be more precise. He looks at the continent of Africa. No joke. And he says, I want to go and build mobile telecommunications infrastructure on the continent and get cell phones to the average African. Now, for many of your listeners who know when they hear the word Africa, the continent, I mean, what comes to mind? Poverty, corruption, malaria, destitution. I mean, it’s often bad words that are associated with the continent. Twenty two years ago, it was a lot worse. And that was you know, The Economist wrote an article, The Dark Continent essentially is saying where Africa is a hopeless continent. And the idea of mobile phones was still new. It was still new even in rich countries. So it wasn’t like it was widespread and every single person had it. Right. But he looks and says, I think I can create value if we give the average person access to this phone. Talk to a lot of his colleagues at the time, they thought he was crazy. There’s no way this continent would absorb this technology. There’s no way that people can’t eat. How could they possibly afford this? Well, it turns out that he sets up cell tell mobile telecommunications company in the midst of an Africa that poor, you know, corrupt and so on. And he is able to, in the span of seven years, create a market for mobile telecommunication services. Right. Inexpensive cell phones, mobile minutes for more than five million customers generates revenues of more than half a billion dollars a year, net income of a little over one hundred million a year and sells his company right, sells his company in seven years, 1998 to 2000 and five, four three point four billion dollars. Now, Mo Ibrahim is sitting on the list of one of the world’s richest men today. But, you know, the question is, how did he mitigate corruption? How did he fight this? Well, you have to have a strategy to deal with whatever obstacles come your way when you decide to invest somewhere. And so for him, he said we’re going to have a zero tolerance policy on corruption. And so when they went into a country, they made sure they began building relationships with top. Level government officials that were not corrupt. I mean, there’s this idea that every single person on the continent is corrupt. That’s really not the case. So he built relationships there. Then he set policies within his organization that if you’re going to cut a check for anything over thirty thousand dollars, you have to get board approval. We have to make sure we understand why we’re cutting the check and so on. Now, at the onset, this is inefficient. This is no way to run a business. But it’s important to understand some of these policies will not last forever. Right. These are ways that you can mitigate some of the issues and obstacles in doing business in emerging economies. Once he was able to do this and built a business model that made the cell phone affordable and accessible.

I mean, millions of people flooded into the markets. And today what we have is a continent with close to a billion mobile phone subscriptions, over 100 telecommunications companies all across the continent generating taxes of 15 to 20 billion dollars a year for African governments. So that, again, they can improve their governance, build infrastructure and so on. And that industry is now worth close to 200 billion dollars on the continent. If he waited for Africa to root out corruption and build out its infrastructure. Have a governance structure similar to, you know, richer countries. He’d still be waiting today. But it’s this beautiful evolutionary process of the role of innovation and how it helps develop society that we really want to share in the work we do.

William Norvell: Efosa, William here. Thank you for going into that. I might get to the book. Next, I want to ask one question, though, while you’re going down this path of corruption. So it sounds like they put a very tolerant policy. But as a Christ follower, I remember a conversation business go around this. And I was all high and mighty saying how great I was and how morally superior I was to people. And one of my friends from the Middle East in a really winsome way said, you know, if you want to do business like that is what it is. And that’s just the way the economy works. And he said, hey, if you call it a facilitating payment, maybe you’ll sleep better at night. And he had a really, like, core thesis that, you know, this is just part of bottom line net income. And this is the way you get a building permit. And it is what it is. And to be fair, I have another experience in life where I built a building in Chicago where I noticed some line items missing. And I asked a senior executive and he said some version of the same thing is that if you’re going to build a building in Chicago, you’re gonna have a line item there. I don’t know if you want to know what’s in it or not. And he was dead serious. And so my question is, as a Christ-follower, how do you think about that? Are there places where, you know, corruption is a big word? Facilitating payments a smaller word, bribe is a bigger word, means some version of the same thing. Is that business? I mean, do you think he really and I’m not saying he didn’t build a three point four billion dollar company without ever paying anything that was not, you know, right down the middle of the fairway. And how have you seen that play out in other investments there?

Efosa Ojomo: Yeah. Yeah. So I don’t know I don’t know the answer to that question. I believe him when he says, look, this is how we built this and I haven’t heard otherwise. Right. And if you’re going to build something that big. I think people would say, oh, you’re a hypocrite. Look at what you did. Look what you did. The question, though, is critical. So one of the things that I think Christ following investors. Right. Investors who just are not about I want to make as much money as I can, but really want to be a force for good and a force for God in the world. Should understand is this notion that C.S. Lewis talks about in his book where he says, Christ, little Christians all over the place should be like good infection. It’s like we should go to a place. And because of the way we are, we should infect the place as sort of like little Christ’s running around. And over time, we’ll see how that place changes. One of the best ways you can do this is through business. Now, what this means is we need to lean into places that seem overtly corrupt and figure out how to do business there. But in terms of how you navigate around it, I would recommend another book, which, by the way, everyone I am. She’s a professor out of University of Michigan. The name of the book is called China’s Gilded Age The Paradox of Economic Boom. And I think it’s vast corruption. And what she describes is this idea that not all corruption is created equal. This notion that there are really four types of corruption. Right. That’s petty theft. So the stuff that my sister was experiencing and as grand theft and embezzlement. Right. So when you hear Senator has embezzled 10 million dollars or Westminister, that’s grand theft. And then there’s. Access, money and access. Money is a lot of times and no different from, you know, what we lobbying. Right now, we might have good justification for it and say, I want to help the lawmakers write the law. I know more about the issues. But, you know, typically access money. It’s sort of, you know, lobbying. We just call it lobbying. And it’s not corruption. It’s transparent and so on. And the last one is speed. Money, right. So you want a new driver’s license. So you want something new permit or something. And then you pay money and it speed things up when you begin to categorize corruption that way. What you find is we have all seen them falling short of the glory of God. Right. And so it’s really hard for me to think of a society where there isn’t one or more forms of this corruption going on. It doesn’t condone it. And I think as Christ followers, we have to lead lives of utmost integrity and then we have to also make decisions on where we go. So Mo Ibrahim, for instance. Right. He did not set up shop in Nigeria.

I mean, most populous country in Africa that would have given him a lot of, you know, economic prosperity. Now, I don’t know why he didn’t, but my guess is he tried and he’s like, I can’t play ball the way these guys want me to play ball. And so he didn’t set up shop there, set up shop in Sierra Leone, Liberia, Uganda, much smaller economies still did really well. And so I think as a Christ follower, we will be convicted in one way or another and we will have to make decisions on where we go, how we invest. But sort of the high level broad. Oh, I can’t go here because there’s corruption and I’m a Christian. I’m not even gonna lean into it. I don’t think that’s the way we should think about it.

William Norvell: Oh, it’s fantastic. Thank you for taking us down the detour. I love that for framework of kind of thinking through it. And I think that’s super helpful. OK. We’re gonna shift back to this ownership back of the book Prosperity Paradox. We talked about a little bit. I want to give you a chance. Give us the core thesis of the book and what you’re really trying to draw out and writing it.

Efosa Ojomo: Yeah. Quick, quick story on that. In 2008, I read a book about poverty and economic development. The author of the book, William Easterly a professor out of NYU. He dedicated the book to a 10 year old Ethiopian girl who had to wake up every morning at three a.m., fetch firewood, walk miles and sell so she could take care of a family. Right. I’m in my room. February Wisconsin crying. I’m crying uncontrollably. I’m not really a big crier, but I couldn’t help myself because I thought there are hundreds of millions of people, young children in the world that are struggling like this. And I could not connect, sort of reconcile my faith, the story I was reading and how I was lead in my life. I remember earlier I talked about I embrace the American dream wholeheartedly and I just wanted a lot of nice things. There’s nothing wrong with that. But I think I was just really convicted. And that year I started going back home to Nigeria every year to do some poverty alleviation work. Now, in the process, I started an organization called Poverty Stops Here. We built a bunch of wells in different communities and virtually all the wells broke down and hit me that something is wrong with this process. Right? Because what we did was we looked at poverty as a lack of resource problem. And the solution, therefore, is you provide the resource. You go to a community, you don’t have water, schools, wells, hospitals, you provide the resource and you fix the problem. Unfortunately, that way of solving the problem is not sustainable. So that’s a big lesson that I learned. And that’s the paradigm shift we want to happen for people that read the book. The core thesis is you don’t fix poverty by trying to fix poverty. Instead, you fix poverty by trying to create prosperity. Right. And when you try to create prosperity, you realize that you can’t do it without focusing on entrepreneurship, innovation, and more specifically, what we describe as market creating innovations. And these are innovations like the one more Ibraheem built where you make a product that’s really expensive, complicated, you make it simple and affordable. So many more people can afford it. And when you do that, what ultimately happens is you generate a lot of wealth. So Mo Ibrahim and a lot of wealth, you create a lot of jobs that can help people earn much more income. You generate tax revenues, like I described earlier, about the mobile telecommunications industry and the tax revenues that they’re now generating. And perhaps the most important thing is you begin to foster a culture of innovation and entrepreneurship so other people see this new market you’re creating. They want to take part in it. Investors come in, entrepreneur. Nurse come in and you begin to innovate and develop newer and newer products. And that’s what we realized and that’s the core thesis in the book. The more market creating innovations we develop, the more societies can prosper.

William Norvell: Efosa, we’ve talked a little bit and I think this is common. You end up talking a little bit, unfortunately, when you talk about an investing in Africa, some of the negative connotations that come along with it. But obviously, there are just incredible assets that are unique and only to Africa. And even that Sennett’s I’m one of those people that, you know, when you say Africa, I can’t even name all the countries. Right. And I know they’re there. But in my mind, it’s like one big place and I can’t get out of it just to confess that and ask for forgiveness that I have not done my research. But so tell me and our listeners a little more about the uniqueness of investing in that continent.

Efosa Ojomo: Yeah. So, I mean, I could talk for an hour. I will focus on three things here. Number one, it’s the youngest continent. And when we talk about that in economic development talk, we talk about this idea of a demographic dividend. Right. It’s essentially when the people working outnumber people in retirement. And so this a nation or a region has this demographic dividend. Many other parts of the world are growing much older. Africa is very young and the median age is about 18 or 19 years old. Now, what that does or what that means is if an investor can create a market on the continent, you’re going to have customers for a very, very long time. Right. So that’s one thing that’s unique to the continent. The second thing is, at this stage, the continent, not only is it young, but it’s very susceptible to technology. Right. So when you look at the proliferation of technology on the continent, what you find is the continent can actually leapfrog a lot of traditional technologies. And so just look at the way mobile telephony spread all across the continent. Internet and data is next. And that also is going to spread. And so begin to think about new business models and how to attract this growing customer base. So that’s the second thing. The third, which is often seen as a negative, is actually a positive. It’s this idea that there is vast nonconsumption on the continent. And, you know, we define nonconsumption in our book, in our writing. It’s essentially when a vast majority of people in a region cannot access a product or service that would benefit them. And so when you look at Africa, just vast nonconsumption of many of the most basic things. I mean, from housing to even food to health care to education. It’s just vast right now. You can look at that and say that there’s no opportunity there. These folks are too poor. If Mo Ibrahim did that 22 years ago, he wouldn’t have created this vast market. But when you look at nonconsumption and say, oh, my gosh, if I go into this market, to this region, create a market, I will not have a lot of competition because right now people are not consuming. You can actually turn that around and see there’s a ton of opportunity. I think the challenge is many entrepreneurs and investors look at Africa and compare it to wealthier countries. From the governance side and even from the market side, you see the continent is in what I call the market creation phase, which means when you go to Africa to create a new market, we’ll stick with Mo Ibrahim example. He talked about how if you wanted to do a mobile telecommunications company in London or the U.S., he would have just signed papers in a conference room.

And the deal would have been done on the continent in the several countries he started. He had to build the cell towers here to educate a workforce. He had to build some clinics in some communities where his workers would live. He had to engage in community development projects. That’s not an anomaly in the market creation phase as long as an investor knows. These are the things that have to do. Then the returns that are waiting for them are going to be significant. When we look at what Henry Ford did when he was building the US, when we look at what Kodak did, Eastman Kodak, you go to Rochester, New York and see all the stuff that’s there named after him. Amadio, Giannini, Bank of America. We see similar activities. Right. And so what we really want to share with investors is this is not an anomaly when you have to build some of these things. But if you do it in a theory driven way, in a predictable way, you can actually reap a lot of rewards and help communities develop.

Henry Kaestner: So I’m fascinated by this concept to nonconsumption. I get the sense and maybe it’s accurate, maybe it’s not, that there are opportunities that are akin to what we saw in the United States, maybe back at the turn of. Last century, when Vanderbilt and Rockefeller and Stanford and all these people were going ahead and investing in places that things didn’t exist and they were able to shape culture, create culture by investing in the marketplace in profound ways. And I think that what strikes me is I listened to you talk is that there are similar opportunities here. What a compelling not only is there a market to be developed, but as you said, as a young content, you know, average age 18, 19 years. You’ve got consumers for life. That’s really profound. I’m also influenced and impacted by the fact that turning back again to go back in history about how committed Christ followers developed schools and hospitals that are all throughout Africa. And had that very focused in terms of bringing Christ and the gospel to an entire continent. They did that by investing early when other people wouldn’t have done that might take away from this is that there’s a sense for us to do that again and that we can invest in culture, in the marketplace in a way that points to God. And maybe it’s going to be easier to influence an economy for God than it might be for a more developed nation when things are more entrenched. I’d love for you to riff on that. Am I going down the right path on that? Is this that opportunity for us to go in instead of the schools and hospitals as we did one hundred years ago? Now’s the time for us to invest in a marketplace.

Efosa Ojomo: I mean, I think so. I mean, when you think about what work means for a lot of people, I know Tim Keller was on this show. I did a talk. And, you know, his book, Every Good Endeavor, talks about the importance of work in the life of a Christ-follower. When you think about the importance of work, just the average person, Crossville or not, we spend a majority of our waking life at work. So when you talk about influence, how do you influence a society? What better way to influence a society for good and for God than figuring out ways to create businesses and organizations where you have integrity, honesty, truth, goodness as core principles and core values? What better way to do that, especially when that organization is in a system where that’s really not the norm? Right. And so, in a way, I see it as a huge opportunity if more faith driven investors go to Africa, invest in a certain way. Right. We have to figure out how to shape culture, not the other way around, but invest in a certain way. I think that’s going to give us so much more bang for our buck than maybe going into a poor community, you know, donating a school or some T-shirts. I mean, I think investing is what we should be thinking more about.

Henry Kaestner: Yeah. I want to be careful that you don’t harsh on T-shirts. That’s how I get my entrepreneurial start selling T-shirts.

Efosa Ojomo: Yeah, I heard that podcast, too. And that’s why I talked about T-shirts, because I know I’m kidding. I did.

Henry Kaestner: I love the fact you pander to your host. Thank you for that. I love you for it. It’s awesome. Okay. So if you’re a listener out there, this is where we’re going to do a little bit of crowd participation. We at faith driven investor in Faith Driven Entrepreneur had been super encouraged by the development of two different things. And I want to ask you first, if he knows of other things, we might be missing out. But one is this focus on investing in the ecosystem of Faith Driven Entrepreneur ownership. And I think about organizations like Hope International. I think about a Gorai in Snapp’s and TBN and others that are creating this kind of following Christ driven enterprise in the marketplace by doing training and many MBA A’s in matching up mentors with entrepreneurs, et cetera. So there’s a philanthropic opportunity that’s there. And yet, as investors, there are also a whole bunch of new funds to develop over the last 12 or 15 months that we’re tracking. I think about Sard and Tree of Life in South Africa and talent in and Sierra v.C and NovaStar. Can you go kinfolk in others? And I’m just really encouraged by the advent of professional management, both on their capacity building side, but then also in the fund management side, because otherwise it’s hard for the average listener to say, what do I get started? I mean, do I go online and just kind of go on Angeles or we fund? But there’s some other ways, and I’m loving the way that the market for faith driven investor is developing. Anything I’m missing there?

Efosa Ojomo: No, I mean, I think you’ve hit the nail on the head. It’s one of the things that we have to begin thinking about, creating a better infrastructure that enables people who get this message and want to get involved to be able to get involved. There’s a fund called Future Africa, a young Christ follower who is figuring out ways to get people to essentially crowd fund investments. That’s why he calls it golden palm. Investment is another one. Good friend of mine went to Harvard Law School Business School, and he’s investing in key sectors in the economy, health care, technology, Verrat, Capital Management and other HBF alarm seem to be biased to the HBF alarms reason?

William Norvell: No, not at all. I don’t hear that at all.

Efosa Ojomo: Yes, health capital is another one focused on agriculture, really figuring out how Africa can become a breadbasket for the world. And so what’s interesting is you don’t have to go too far to find faith driven investors on the continent. Everybody I’ve mentioned is a faith driven investor, which to me was fascinating because I thought, oh, who’s doing this in Africa? Not necessarily who’s a Christian doing this in Africa? And I was like, oh, wow. Faith, faith, faith, faith, faith, you know.

Henry Kaestner: So I tell you, though, you know, HBS definitely has it up on the Stanford Graduate School of Business. William, how do you respond?

William Norvell: No comment.

Henry Kaestner: All right. Well, thank you for not shifting it back to how the University of Delaware alumni base is doing in investing and faith driven opportunities in Africa. And that’s the crowd participation part. As you hear, as you, the listener, understand new players that are in the capacity building space or in the investment space. Share it with us. Superimportant that we as a community can understand more ways that we can get involved in Africa. William brings to close, please.

William Norvell: Yeah, I will. And the only thing I’ll say before that is as you were listing of names and if you listen to this podcast you may hear me say this a bunch of my favorite quotes, but African investing in Africa just totally reminds me of that famous Bill Gates quote that most people overestimate what they can do in a year and underestimate what they can do in 10. And when you list all those names, my mind just went to this like, what is this conversation going to be in 10 years? It’s going to be so much more. And it’s hard to see that and to start investing in those people now. For our audience to start learning now to listen to those names, obviously email us if you want to learn more. We’re not hard to find. I just had this vision of this conversation in 10 years. And you say. And who knew? Well, it could have happened when we actually had this conversation. And only God knows. Right. And my other favorite quote I’ve heard from God is, you know, now tell you what I was up to, but you wouldn’t believe me even if I told you. And that’s our God if we are faithful and walk with him. And on that note, we are running close to time. So we love to figure out where our guests are in God’s word and where he may be pushing them. So if you have a moment, maybe just share with us where you might be, where he might be taking you today or the season. And let our audience into your life and your walk with God’s word.

Henry Kaestner: And I’ll interject here for folks who need time and think I love the fact he’s got this chalkboard behind him and he’s got the great quote from Jeremiah, 29, that’s up there. It’s written down. That’s true. I don’t know if that was in preparation for today’s call. I don’t know if his next calls with the World Bank. Tell us about that.

Efosa Ojomo: Well, that’s just called my wife and I have up here to encourage us. You know, any Christ follower will tell you the journey is not linear. It’s not straightforward. And so we need reminders that we are on God’s team. He is here for us. He loves us. And that’s just one of the ways we remind ourselves that he has good plans for us, plans for welfare and not for evil. And so, anyways, I think, you know, to your question, William, where my wife and I are now in our faith, we just celebrated our one year anniversary. Is this Matthew six, 33 to 34. Those two verses. Right. You first. A Kingdom of God and his righteousness and all these things will be given to you as well. And then the verse 34 says, therefore, do not worry about tomorrow for tomorrow, worry about itself. Each day has enough trouble of its own. It’s just this idea of putting God first. It sounds really simple, but we’ve been asking ourselves, what does it mean to put God first? To be proactive about our faith, to anchor our lives on our faith. And then everything else flows from there.

And so every year we’ve decided now that we would figure out an issue that we know God cares about and we would lean into that issue, that issue of injustice. That issue of poverty, whatever the issue is, would lean into that issue. And then whatever extra time we have, whatever extra money, whatever extra whatever goes to everything else. But first God issue and then everything else. And so that’s where we are right now. And we’re we’re pretty excited about that.

Henry Kaestner: It should be. That’s awesome. We are, too. Thank you very much for your life’s work. Thank you for your time. And just excited about our partnership and your faithfulness and where God’s got you.

Efosa Ojomo: Thank you. Thank you.

subscribe to the podcast

Today, we’re talking coffee, co-working, and Chick-fil-a cows. That’s right. 

You’ve heard a lot about the ups and downs of WeWork, but now we’re going to look at a panel of faith-driven experts who are leading the way in co-working and how it can provide economically and spiritually for those participating in it. 

Tune in to hear Trevor Hightower, Peyton Day, and David Salyers share their stories and what the intersection of their Christian faith and co-working looks like.

Useful Links:

Craftwork Coffee and Co-Working

The Roam Story

People Provide the Ultimate Competitive Framework

Episode Transcript

Some listeners have found it helpful to have a transcription of the podcast. Transcription is done by an AI software. While technology is an incredible tool to automate this process, there will be misspellings and typos that might accompany it. Please keep that in mind as you work through it. The FDI movement is a volunteer-led movement, and if you’d like to contribute by editing future transcripts, please email us.

.

Henry Kaestner: Welcome back to the failure of an investor podcast. I’m here with William. William, good morning.

William Norvell: Good morning.

And we’ve got a special edition today. We’ve got three guests on to help us unpack what I think is a super important topic with regards to faith driven investments with real estate in particular coworking. So today we’ve got Trevor Hightower, Peyton Day and David Salyers on the show. So glad to have you all with us. Thank you. What we want to do is at the beginning, we want to give you each a chance to share your story, provide some background, and then women can ask the questions that we want to get everybody’s input on as we explore this idea of getting out there and investing in coworking on the for profit side. What makes it a great investment and then what makes it a great ministry opportunity is people come in as they form their businesses, get together, have meetings, have fellowship and community. So, Trevor, I want to start off with you at the beginning. Tell us about your personal journey and then tell us about what craft coffee is in your strategy.

Trevor Hightower: Well, thank you. Henry and William would love to. Let me first say I’m a regular listener of the three faith driven podcast. So much so that my daughter Grace asked me what Bible verse I would be sharing today at the end of this podcast.

Henry Kaestner: That is awesome. That is my love language. Thank you for listening.

Trevor Hightower: Maybe that’s not a good thing because that means I’m listening to podcasts instead of being present with her. So it could be more there. But I am deeply indebted to the great work that you guys are doing and listen to your guests and want to emulate their lives. And as I’ll try to share in my story. It was ideas and content like yours that God used to help shape the redemptive vision for my work. So thank you for your great work. So Jesus rescued me when I was 27 on a wood trip trail in Hermosa Beach, and I had transitioned from being an Air Force officer to working in commercial real estate. So the gospel of grace completely reordered my loves and desires. And I grew up knowing Jesus. So I thought this meant I needed to go into ministry. And thankfully, I had a mentor who graciously said to me he was actually in the ministries that God has agents of reconciliation and restoration in every domain in society. And Trevor, he might have you and real estate for a reason. And I remember thinking to myself, I have no idea what he just said, but that is awesome. Whatever he said. I am all in for a lot of the framework, the rhythm, the framework really helped birth in me, a passion for the reality that there’s no sacred secular divide. And so I was fortunate that my career in real estate started during the Great Recession, which allowed me the opportunity to be gritty and find places to add value and grow. And I worked for a publicly-traded in the office space and then worked for CBRE in leadership as a managing director in the Houston office about the time I was working for CBRE in Houston.

A mutual friend of ours, Dave Blanchard from Praxis, gave a talk that I listened to where he said something to the effect of, you know, if every entrepreneur. But I inserted to real estate developer could see a trend line and get in front of that trend line and create market value. How much more of a responsibility and advantage do we have as Christ followers that know that the ultimate trend line is heading towards new heavens? And they were? How much more of a opportunity do we have to get in front of that trend line and whatever? Now, in my case, real estate. And so that was in 2016 and I was already starting to see a major shift in how our corporate users were utilizing their space. The trend lines of shorter lease terms and more flexibility. The growing gig economy had already convinced me that shared office space coworking, that would be a huge part of the future of the office asset class.

But what really excited me about the operators I saw that really did it well and differentiated their offering was their emphasis on connection and community. And so with Dave’s prompting in the Lawrence prompting, I created a coworking space that the vision of it was to create that higher vision of connection and community. Accidentally, it happened to be in a multi-family building. So we reimagined the front entrance way of a multi-family lobby in an amenity area and found out that those uses really traded a lot of synergies when they worked together, especially if you’re operating it with intention to create connection and community. I met my now partner, Riley, who is had another great concept of a specialty coffee and coworking space combined, and saw really great synergies there. And we met in a really God ordained way and decided to. Merge those concepts together, where especially coffee and coworking, that would go into multi-family building and reimagine amenity spaces and lobby areas to really bring connection community in those multi-family buildings. So that is craftwork and what we get to work on today.

Henry Kaestner: So more revenue throughput in underutilized space, bringing in some community fellowship, adding some value to the property owners as they provide another amenity and some great business in ministry correspondence. OK. That’s awesome. Craftwork. David, I want to move over to you, David. You’ve got a great background, a very interesting background, one that some people can have some familiarity with. What am I talking about? And what’s your background?

David Salyers: Well, interestingly, Henry, my career started four hours after college graduation. I graduated on a Saturday morning. I started at a little company called Chick-fil-a four hours later. I had met Truett Cathy during my college career when I was a junior in college, and we’d kind of both pursued it. But what was fascinating is Chick fil A was not a startup at the time, but it was close. The headquarters was in a converted airfreight warehouse and they had run out of room in the warehouse. So they cut a hole through the wall, pulled up a mobile home. And my first office was in a mobile home attached to that warehouse. And I had no idea what I just signed up for, but it turned out to be much greater than anything I could have imagined. I think true could have imagined then kind of being a chicken salesman. Now for most of my life. But here’s the main thing I want to tell you as a 21 year old kid. If you had asked me what would be the most remarkable career possible, I would have told you get out of school, make as much money as I could, as fast as I could, and retire as early as I could. That’s kind of the paradigm that I had. I thought life couldn’t get better than that.

Instead, go to work for Chick fil A and Truett Cathy. I found something a hundred times better than that, something I could not have imagined as a 21 year old kid even exist. In fact, some I wouldn’t believe existed had I not seen it play out before my very eyes and really role model by Truett and the Chick-fil-a organization. Instead of finding the job, I could retire from early. I found the job I wouldn’t want to retire from, and that thought had never crossed my mind that there could be a job you wouldn’t want to retire from because my whole world is a 21 year old was all around money and true, its whole world was around mission. And if you find a job that’s in alignment with a mission, it is the job you wouldn’t want to retire from. And, you know, it’s fascinating. I remember going into true its office when he was in his late 80s. Say true it man, your four one K fully funded. What are you still doing here? He would tell me why would I stop doing something I love this much. He said, if you love what you do, you’ll never work another day in your life. And so kind of a message for me when you go back to the Bible and you ask, where does God first mention the word work? You know where it is. Oh, where Genesis one, where God had everything exactly the way he wanted it work was part of that equation. When life was paradise, work was part of that equation. So what that tells me is that work, ideally, if done right, is designed to be a source of satisfaction, fulfillment, enjoyment, contentment. All of that is the way work should be. But for most people, that’s not the experience that they’re having.

Henry Kaestner: So along the way, you talk about mission. I want to get back to this where you find a mission and purpose in it because you’re bringing into the present day. But less we go over some Chiclet story. Part of your mission is to save the lives of millions of cows. Tell us what that means.

That certainly got added along the way. Well, we want people to eat more chicken. Save those lives. But you’re right. I mean, in a sense, it’s kind of a comical look at what Chick-fil-a is all about. In fact, the corporate purpose of Chick fil A is to glorify God by being a faithful steward of all that’s entrusted to us. And a positive influence on all who come in contact with Chick fil A. Notice, it mentions nothing about chicken. It mentions nothing. It’s being a faithful steward and a positive influence. And that’s the way that we’re going to glorify God through work and by doing work that way. What we’ve done is created jobs that people don’t want to retire from, jobs that are fulfilling, rewarding, exciting, engaging. In fact, if you can believe this, in an industry known for turnover, we’ve got a 97 percent retention rate at Chick fil A, 97 percent retention rate for the corporate staff and for our Chick fil A operators, the independent contractors that run each location, 97 percent retention rate.

David Salyers: David, tell us about how you think about real estate. How do you think about faith driven investments and what you’re doing right now?

Yes, so let me segue from a Chick fil A background, I took early retirement from Chick fil A two years ago. And the main reason I did that is I feel like to those whom much is given, much is required. And the easy thing for me to do would have been to stay at chick fillet, enjoy all the rewards of a long career there and all the fruits that are now being enjoyed by that corporation. But I felt like because so much of being given to me, what’s required of me is to go out and help recreate the things that I was able to enjoy at Chick fil A. And so what we’re doing at Rome, which is Peyton and I’s concept here, we’re trying to recreate the environment of chick fillet, but make it available to entrepreneurs, to major corporations, to nonprofits, etc.. And so Rome is a coworking facility built on culture, built on hospitality, built on all the principles that I saw make Chick fil A what it was. And what we want to do is create, first of all, for our own employees that kind of job opportunities that I enjoyed it chick fillet. But more importantly, we want a role model to all those who come here, what that looks like. And we think it’s contagious. We think people see what Chick fil A has to offer. I notice when people come on tours when people would partner with and say, wow, this is so amazing, I want to go recreate it. So what Rome is all about for me is recreating and helping others recreate the incredible culture and the incredible results that I was able to enjoy for so many years at Chick fil A. But making those more publicly available, because right now, as great as Chick fil A is, there’s a limit to the number of people who can be employed by Chick fil A. So how can we take that and scale it? So for us, for me and I want to speak for Peyton, but for me, what Roehm is, is an exercise in scaling culture, hospitality and creating a world where we reinvent. In fact, our mission at Rome is to renew and inspire the way the world does business as partners in the story of accomplished dreams. So we want to use Rome as a platform to renew and inspire the way the world does business, i.e. what I got to experience the job I wouldn’t want to retire from instead of the job. I can’t wait to retire. How do we create a culture and an atmosphere where that is common, that you’ve got people that love what they do and so they never work another day in their life? And then how do we partner with others to help them do that? So we want to create that for ourselves and we want to partner with others. And we do it for everything from individual entrepreneurs to growing organizations to non-profits to even major corporations that use us as an offsite facility for meetings, et cetera. But our goal is to use the real estate as a platform to do something far more important than the real estate. It’s not about chairs and tables and meeting spaces. It’s about culture and renewing and inspiring. The way people think about work and the way they execute work and the way they try and use work is an opportunity not to extract value from others, but create value for others.

Henry Kaestner: Peyton, I want to move back over to you as David talks about roam and its mission as suspected. Listening to this podcast understands the impact and the importance that David sees in being able to articulate your mission and be able to reflect back on it and come back and make sure that all of your initiatives flow from that. I think that must come from some of the Chick fil A legacy that you’ve got. Peyton, you come from a family that’s focused on hospitality. Tell us about that and tell us about the idea for the formation of Roam.

Peyton Day: Well, thank you, Henry. And my story is different than David’s and my first job out of college. Honestly, I was working for a leader I didn’t believe in. In a culture, I really didn’t want to be a part of pursuing a cause and I could care nothing about. And needless to say, I wasn’t successful in that culture because in my life I had seen a father. My dad was my mentor, Cecil Day, and he developed a hotel chain. And of course, Chick Fillet was also just true. Kathy and the influence he had a chick fillet was certainly someone I wanted to emulate my life, a young Asian. As it turns out, my father and Kathy were good friends. You know, it’s never been stuck with homes back in the late 50s. And so it’s just an interesting twist to see God’s hand and how David now we bought each other.

But nonetheless, I was part of this what I’ll call a toxic culture. And I saw that there was a better way because I’d seen this from my dad at a young age. And people like to Kathy. My father was all about integrating faith and work.

And he did that in his own way. One way he did that was for every hotel guest that stayed in our hotels, for every single location. We had a chaplain on call. This is back in the early 70s for all 200 locations. You know, David. The United States. And so what was interesting to me. This is a nine year old boy just watching that and saying that’s really neat to see that he’s having a positive influence on guests that are staying in a hotel that really spoke to me. Because when you think about it. Hotels are a place where a lot of people go to contemplate suicide or divorce or lots of other things that are not good. And yet he used that as an opportunity to reach out to people in the most desperate of times. And so I saw that modeled at a young age, and it was attracted to me as a young person coming along. I said to myself all or be like my dad one day and do more than be like people like Truett Cathy of Chick fil A.

And so for us at Roam, when we came across from David and I did not come up with the original idea for Roa,. These were for IBM ers that were sent home because these big companies were trying to save on the cost of fixed office space. So they were IBM was ever sent home to work. And when they went home, they found it difficult to get work done because the baby’s crying. The U.P.S. man is ringing the doorbell. The blower’s for the landscaping is loud outside all types of distractions. And so these guys said there must be a better way. So instead of working from the home, they started going to coffee shops. And this is back in 2008. And so it was from there, they tried to go to coffee shops. And we all know that Starbucks or coffee shops can be a difficult place to have a meeting. So they said there must be a better way. So their original concept was a coffee bar with meeting rooms around a small meeting rooms. And so and Dave and I got involved in 2010. I knew I was interested. My background was with Marriott. I had the opportunity develop Marriott Hilton Hotels. And I knew that this was a very interesting platform for impact because first of all, it had all my passions, real estate, hospitality, entrepreneurship and non-profits ability to get back.

And I walked in and just basically cold call. These guys got so intrigued by it that they invited me to do some hospitality consulting. And as fate would have, it is God’s providence would have it. David walked in nine months later and he fell in love with it. And we were able to be in a position to body ownership. Then from there, we started expanding the footprint to offices to meeting space, to catering and larger meetings and so forth. And so that’s how we got involved. That’s why we got involved. It is a very unique platform for impact, because whether you’re Republican or Democrat, it really doesn’t matter where you are on the political spectrum. What I love about wrong is it’s good for the ozone. It’s good for controlling emissions. You’re creating jobs. You can do a lot of good things. And as Gaited said, our vision is to renew. It’s part of the world, does business as partners and the story of others dreams. Well, everyone that walks in a room has a green. As a nonprofit, as an entrepreneur, as a large company, and it’s our goal, the role that we play is we want to partner with them on that journey.

And we’re an advocate for them. We look at ourselves as an extension of their brand. And so we are servant leaders that are other people centered in order to carry out that vision. So that’s how I got involved and why we got involved. And it’s a very, very interesting platform for impact. And it was until I was forty nine years old that I was able to intersect that passion, purpose and talent. I believe when we talk about three concentric circles and the intersection of those circles, that’s the best role for us. Well, this is a very unique role for me and ideal. And so David and I, we endeavor to be leaders that others believe that I’m creating cultures that people want to be a part of pursuing a cause that people can get excited about. And I believe and I learned this from David. Businesses don’t succeed or fail. People do. I got that from David. I think David got it from Truett Cathy. And I’m pretty confident that Truett Cathy got it from God because it’s such a powerful concept that if you take care of the people, if you set them up for success, give them those are excited about your passion, about on purpose. Then you have something really, really special. And so that’s what we’re trying to do it wrong. And it’s been a real honor to be able to do this with David.

William Norvell: Amen. This is William here. Thanks so much for sharing that story and is someone who’s been to a couple of your own locations. It really is a unique experience. And a part of this podcast is really thinking uniquely about real estate and some of these assets. But another guy, John Marsh, on the Faith Driven Entrepreneur podcast about a year ago that really talked about how to revive a community through real estate. And so I want to dig into that a little bit more. And for those that don’t have seen Rome yet, you have your traditional freestanding building, which is really interesting to walk into. And it kind of feels about like I would expect. But the one I remember most was one of your locations. Sort of in more of a shopping mall area. I don’t know how to say it. You may say it better, but the transportation that I experience walking into that, I’ll be honest, I’m a little skeptical of. Oh, man. They put one in a shopping center. That’s a little interesting. Didn’t expect that. When I type this into the Google Maps, I kind of thought it was going to be a beautiful building somewhere. But what you did with the culture and what you did with the location, once you walk and you really are transported and you forget where you are and that’s amazing. And that really took some thought and some innovation, in my opinion, to really take a step back into how could we look at a space in a different way. So we’re going to dig into that a little bit on the swing. Back over to Trever for a second. And you mentioned how you’re working with multi-family units. And I want to dig into a little bit of the spiritual integration side of things. We heard a little bit of what you’re doing and what it looks like. How do you think about integrating faith and work through that? You mentioned Dave Blanchard, a frequent guest here, who I think has inspired many to think about things a different way. How do you see it? Craftwork today?

Trevor Hightower: Well, yeah, thank you. William and I also have visited Peyton and his team in Roam and can attest to their culture and their people is what really brings the space to life. And as beautiful as design and esthetics are, it’s the way that you feel cared for by the people. And that’s one thing that we really have focus on craft work. So we’re a B to B to C company. Our B2B side is we partner with multi-family owners. So high rise, mid rise owners and the way that a typical real estate owner thinks about their multi-family development as well. We need to compete to attract a similar demographic by creating bigger, more expensive amenities. And we try to come onside them and say, you don’t want to be in the menotti’s arms race. You want to be and a connection arms race. You want to be an experienced arms race. And we really believe in this flows from our spiritual intent that you can bring to life. This what typically goes way underutilized, if utilized at all, kind of lobby and amenity area. You can bring it to life with a hospitality focused, human centered operation. And so what we essentially do is reimagine the lobby and amenity area into a specialty coffee and Corrigan’s space. But our missional intent is we have people on the front lines who are our mission is to generously see all the people and the spaces that we operate. So our team is diverse. We have many believers. We have nonbelievers who are on that front line. But all of them are really passionate about our mission to draw people out of isolation and into community. And, you know, no one does this better than Chick fil A and Rome, but we really try to emulate the best practices around training and hiring and equipping our teams so that when a coffee. Customer or a member comes into contact with a craftwork teammate. They experience something very different, which is they feel genuinely connected.

William Norvell: Absolutely. That’s great. I want to swing it back over to Peyton to talk about, you know, the special integration yours. And I’d be remiss not to mention one story has this funny image of the people. I was in one and then peyton was generous to give me a tour. And you meet some of the people and they do strike up a conversation. One of the coolest Faith Driven Entrepreneur moments that I’ve experienced. And there were then the investor podcast here. But the faith driven family was talking to the host at room, Mary London. She’s mentioned that she used to work in Kenya and some other places. And at the time, Henry was actually doing a Faith Driven Entrepreneur event that night in Kenya. And I said, well, you know, randomly, we have an event that night and she e-mailed out a bunch people they were able to come. Amazing to see what God does. And I just mentioned that story to say Roam feels like that kind of place that you can just be alert to what the Holy Spirit is doing at any moment. Some craft workers as well just it’s an amazing opportunity place for the spirit to work. And so I’d love for you to probably tell more stories than I campaign about how you go about that and how you built that culture intentionally and how it continues to thrive today.

Peyton Day: Well, I think it goes back to the saying, you know, people don’t care what you know, they’re more concerned about how much you care, make you care less about what you know. And I think for us, you know, we do our best to hire, again, people who love serving other people and who take great joy in that. And that starts with leadership in ensuring that we’re hiring people who are committed to serving others. That’s where it starts. And then from there, we really try to point them to this vision of this bigger vision of renewing, inspiring how the world does business. And they live that out in their own way. And we give them a lot of freedom. We’re big believers in giving people autonomy to make decisions. And without autonomy comes responsibility. And we think about this ratio of autonomy divided by responsibility equals one. And that means that oftentimes I think we as leaders, we can be too heavy handed, too much of a micromanager. And so for us, we try to push decisions down through all levels of the organization such that they can address those problems. And oftentimes, I think people are concerned about giving people the autonomy to make decisions. But that’s not the problem. The problem is, in some cases, they’re either not trained for how to address the problem or in other cases you may have the wrong person. So what we try to do is hire leaders again, give them the vision, give them a lot of freedom and latitude within those guardrails to make those decisions. And then we turn them loose to do what they do and use their destinies to do that. And so day in and day out, that’s what happens at Ron. So stories like you just shared with you. You know, David, I had the honor of hearing every day we have one lady whose mother was passing away. And it’s just a heartwarming story. It’s actually on our website. But somehow that same Mary London that you’re talking about got wind of that and found out that her mother was dying. And she wrote the most beautiful handwritten note that to this day. This lady talks about and she just talks about how that was what she needed at that moment. So every day, you know, we have the opportunity to be a positive impact on those we come in touch with. And as I mentioned to you earlier, this is a unique platform for doing just that, because at a Chick fil A drive through, Davis mentioned this before, you had to maybe a 30 second encounter with someone at a Chick fil A drive through.

Well, in many cases, David and I and Trever have the opportunity to impact people over entire day or over an entire week, much longer extended period time. So from a ministry standpoint, we get a lot of touches with people. And because of that, we’re able to forge deeper relationships. And that’s one of the things I love about this model. It is a very unique platform for positively impacting those. We come in touch with.

William Norvell: Amen and jump back over to. David would be equally remiss not to ask you, you know, why you love cowls and dislike chickens. But that’s a conversation for another time. But we would love to know a little bit about your banking experience there. Oh, Henry?

Henry Kaestner: No, no, no, no. I’m right with you. I just want to make sure you and pass over that. I mean, it’s one of the greatest marketing campaigns of all time. We’ve got a guy guests on the show that had served at Chick-fil-a in the marketing department during the birth of the whole chicken cow thing. I want to hear about it.

William Norvell: Yes. So that’s where we’re going. That’s the end of the question. I have long lead ends, as you can tell. But Henry is better again to the point. And so we’d love to hear about that as well.

David Salyers: All right. We’ll talk about that is interesting. The first 20 years at Chick fil A was all mall locations. And we used to talk about marketing at a. All as a captive audience marketing strategy, in other words, it wasn’t our job to bring people the mall, but once they showed up, it was our job to get them to eat while we were there, and about 70 percent of molesting was impulsivity. But once we got out in what we call freestanding locations out on the street, we now had to become destination marketers. You know, in other words, we had to get some I get up off their sofa. Get in their car and drive to us. And it’s completely different situation. So as free standards started to become the largest portion of the offering that we had, we realized we had to revamp our marketing and we began a national search. And we started with one hundred and twenty agencies that we looked at and we were able to narrow it down to 20 that I personally went and visited. And from those 20 visits, we narrowed it down to three. And what you’ll appreciate about this is the three that we narrowed it down to, all three of them. We’re really good at their craft. But what we’re really looking for is a cultural fit at that point. And we felt like the cultural fit. We weren’t have a long term relationship with an agency which in and of itself is very different. Most agencies is high turnover. What have you done for me lately? It’s, you know, come in and pitch your business at your expense. And we weren’t in a completely different relationship. And where I can go into lots of details, but we did something that all three of those agencies had never seen before, which a lot of what chick fillet does is counterintuitive. It’s the opposite of the way most everyone else is doing it. So we decided to pay each of those three agencies to do a project for us so that we could simulate what it would be like to work with them. And we spent a couple of months working with each agency to get a sense of what it would be like to work with. Contrast that the way a normal agency would work is you come at your expense. And usually they’d spend six figures pitching your business and you don’t give them any information. You know, it’s almost hands off and come impress us. We said we want to do just the opposite. We want to dig in with you. We want to give you everything you need to be successful. And let’s see where it would be like to work together. And so out of all that, we ended up selecting the Richards Group out of Dallas, Texas. And the Richards Group was similar to Ticketfly. In a sense. It was a privately held business. One guy owned the whole thing and they were much more concerned about doing great work than how big a check your writing. And that’s exactly what we wanted. When I first met with Stan Richards and went out to Dallas at that time, we were at a big disadvantage because relatively speaking, we would have been like on a list of the top hundred fast food chains. At the time we signed up with the Richards Group, we would’ve been much closer to 100 than never once. We weren’t a very desirable client is basically because we’re really small. We had a really small budget. So to overcome that, we went in and we said I said, Stan, we may never be your biggest client. We want to be your best client. Tell me what that looks like. And he went on for about 20 minutes telling me what it would look like to be his best man. And you could tell he had a gleam in his eye. And that was a very attractive question for him, because it wasn’t about the size of our account. It was about the quality of the work they could do. And for a guy like Stan, almost like what Payton was talking about a minute ago, we wanted somebody who was very missional in their approach and he was very excited about doing great advertising and great work, getting great results. And it wasn’t about the size of the check that you would write. So net net is a cow campaign was not the original campaign they came up with. It was several iterations later that they came up and actually was a combination of three different billboard ideas that they had done. And that was another thing all of our competitors were doing. Lots of television advertising, radio advertising. We said, let’s pick a medium that we could dominate that no one else is using. And the one medium that no one else was using really in the fast food business at the time was billboards. They would use them as directional as what we’d call, you know, next exit go. Right. But no one was using as a brand building opportunity. And we got inspired by billboards we saw out in L.A., in Orlando, these 3D billboards. So we basically told Stan we want to do a 3-D billboard campaign as a brand building campaign. And that intrigued him because his background was graphic arts. And so this was a graphic art opportunity. Long story short, they did a number of billboards, three different billboards, kind of came in to focus. If you want to do another, I could actually bring and show you the three billboards. But pieces of those other three billboards kind of came together in the mind of one of their creatives, a guy named David Ring, and they came up with the eat more chicken idea and we were thrilled with it. But the problem was it was totally off strategy. It was a great idea. That didn’t align with the strategy that we had. And we said, well, you know what? Sometimes if the idea is big enough, you got to throw out the strategy. So we tried it and we tried it in Atlanta, Georgia, right before the Olympics because we were looking for a great billboard because the world was coming to Atlanta and that one billboard was between the Atlanta airport and downtown. Got more recall than all the other billboards we had done put together to that tab in the research that we did afterwards. So I think the big aha moment was going from a billboard to a campaign idea. And that was the big leap, was how do we take it from a billboard and take it into the stores and make it a long term campaign. And they came up with some great ideas and we worked together. But it’s really a story of culture and teamwork and not focusing on the size of the check, but focusing on the size, the opportunity and what stand would tell you. To this day, if we were to get him on the podcast here, he would say, you know what? Chick fil A’s to this day is not my biggest client, but he’s a billion dollar ad agency now world’s biggest privately held ad agency. He said Chiclet to this day and write me the biggest check. But he said, almost every client I’ve gotten since the Cal campaign has come as a result of the Cal campaign. So you were their best customer? Yeah. Exactly. All these other customers, he said the first thing they want to know when they said our stand is tell me about the Cal campaign and create a cow campaign for us. So even though we were saying that the work led to him getting all the other checks, you know, and a lot of ways since that time.

Henry Kaestner: Well, I’ll tell you, it’s another billboard that really got me hooked on Chick fil A. And it wasn’t the more chicken. It was a billboard that McDonald’s had up in Durham, North Carolina, when it just said open Sundays. I thought, oh, my goodness. How did they do that? And so I have not eaten in a McDonald’s since. And I love chick flick. OK, so if people tune in in this podcast right now. No, we’re not talking about retail marketing. We’re talking about faith driven investments. And so I want to talk, of course, about the big elephant in the room, and that is that you all have found yourselves in an industry that has been probably a little bit more higher profile over the course of last nine or 12 months with the challenges that we work has experienced. We’ve got an audience of investors. Can you make money in coworking? Trevor, we’ll start with you.

Trevor Hightower: That’s an easy question. Thanks, Henry. So what we see with Covid 19 these past 10 weeks is a lot of the trend lines that we were following are massively accelerated. So you can look at remote work, for instance, remote work was already a trend line that was heading in a certain direction. And then we had a mass adoption overnight of remote work. And so I think at least for us at craftwork, what becomes important to the model is something that other Kirchen operators have adopted as well. It’s more of a management agreement, partnership model where you are sharing and the upside and also sharing and the downside. The least model is difficult when you encounter a little bit more of a challenging market like we’ve been in. But I think one pivot that we’ve really focused on as a service provider to come alongside our multi-family partners is to create more of an agile, less capital intensive model that essentially craftwork can go into the existing lobby and replace a lobby with a hospitality experience and then operate the existing amenity space as a corrick in space. And what this does for the owner is it allows them to differentiate their building in a increasingly competitive environment through creating a layer of service that’s focused on connection and community and hospitality. And so we think in the new normal post-covid home is going to become increasingly important as some level of remote work is going to increase for all workers. And where people work is going to be important so that amenity space within their multifamily building does become important. It’s not highly utilized now, but if it was really curated and really layered with service, with the type of hospitality that’s groups like Rhome or Rappard could provide, then I think it becomes very differentiated, differentiates one asset to another. But I think the key is that partnership approach with the landlord.

Henry Kaestner: Got it. David Payton talked to us about roam. Talk to us about your model. Tell us about where you’ve been in terms of capitalizing what you’re doing and what your prospects are, what you see as you think about expanding. Can an investor that might invest in a room or a craft worker that has a co-working idea, can they not only see that as a great opportunity, provide amenities and fellowship and community where ministry can happen, but can they make money and invest in it as well?

David Salyers: Peyton, why don’t you start and I’ll finish?

Peyton Day: Well, first of all, I would agree with Trevor said the answer. Yes, I do believe remote work is going to be accelerated for all the reasons that Trevor mentioned. I would also add that at some point we sincerely believe that meetings will come back. They may look a little different in my mind. If you believe that the Masters is coming back or NBA basketball or the NFL, you have to believe that meetings also will come back. They may be smaller. People may need to social distance more. Without a doubt, people may need more elbow room. Certainly, cleanliness has become a much bigger issue. And so for us, our model is based on diverse constraints. And that’s what’s so interesting about this. Even when you think you’re bulletproof, you’re not right. You think you’ve got it all figured out.

We’ve got all these revenue streams. And then, wham! Here comes covid 19. And so the next opportunity, virtual platforms, member services. We’ve got to find ways to create value for our membership. And by definition, value is what you get over what you pay. So every day we wake up thinking, what can we do to add more, more value to the membership? Even on a post covid environment. Now, I believe that a vaccine changes a lot. But I do believe while the last 10 years we’ve seen densification in real estate think we work one personally, 50 square feet. The office that I wanted to be a part of when I was growing up was a 200 square foot glass office. That’s what we wanted. But the last 10 years, we’ve without a doubt moved to densification, more people and smaller places. I don’t think there’s any question that we’re gonna have a period of detoxification. The question is, how long will I go? I think the vaccine will change a lot. Getting kids back to school are going to change a lot. But ultimately, I believe that this model is what people are looking for. As Trevor mentioned earlier, it’s flexibility. It’s giving people the ability to work from home, giving people options of different work environments in which they want to be productive outside of their home or a traditional office. People want to create. They want to collaborate. People need to be together. And we believe that the coworking platform is certainly an answer. And it’s on friends. And we don’t think it’s going away.

David Salyers: And what I would add to that, Henry, is prior to the Corona virus, all of our locations were profitable, several highly profitable. Obviously, during the Corona virus, we’ve had to shut down certain revenue. The meetings, part of it, that kind of thing. But I do feel like the new trends coming out of it. Trevor, I would totally agree with you. I think what this is doing is making everyone rethink the way they do business and the way they have approached business historically. So I think it can be an accelerant for coworking in that I think we could be much more on trend with what people want. I think they don’t necessarily want to have to go to an officer today, but they also don’t want to have to work from home every day. I think we’re a nice in between. And I do think historically, a lot of businesses have thought in terms of centralization of the workforce. Everyone comes to one office to work out of one place. And now we’ve experienced massive decentralization. And there are certain things people really like about that decentralization of office. But I think now they’re going to desire more of that. But I don’t think they want total decentralization. I don’t think they want total centralization. I think what a lot of people are going to want coming out of this is some combination of the two. And I think that’s where the opportunity is. Anytime you have a major world event like this, it kind of takes everyone back to zero. And the scrappy entrepreneurs are the ones that succeed. And we’ve got a whole team full of scrappy entrepreneurs and they’re already coming up with new ideas to Payton’s point about how do we create value, add new ways for people. Yeah. So I’m cautiously optimistic that we’ve got a lot of exciting things in the future and certainly ripe for cover. To answer your original question, can it be profitable? 100 percent of our locations were before growing matters.

Trevor Hightower: Yeah, I’ll just add to what I hear David and Payton saying is that the benefit that coworking industry has relative to traditional office space is a maniacal focus on the end user. It really is what Payton was saying, this combination of hospitality and office space. And so what I just heard Payton and David describe is the ability of a good coworking operator to really Kivett is to the end user to attract what we anticipate. Being a larger supply is a benefit relative to a traditional office user. Really, they’re going to probably have a challenging time in a recessionary environment with a little bit less demand for traditional office space. So the key is to really focus on end user experience. And I think that what we all really on this call is that it’s not mutually exclusive, that end user experience and really creating something that is spiritually beneficial for people, which is training places of connection and community.

William Norvell: That’s really good. That’s interesting. I’m fascinated to watch how this industry shakes out. I mean, I agree with everything you guys have said. I also think there’s going to be new customers, as you mentioned. There’s going to be more work from home. There’s going to be a reimagining at some level, maybe not for every company, but for many companies. I would imagine what work looks like and what teams look like and what office spaces look like. And I could see coworking. Being a big part of the solution there, it’s probably easier would be my guess to set up a social distancing policy when you have disparate companies in a space already, you know, and you can kind of set up offices and things like that. And that’s really fascinating to watch. And I thank you guys for walking us through that time and for sharing with us, because it’s really going to be a hot topic. I think just the future of work in general is a hot topic right now. And I think many of us also believe or my wife’s in medicine, you know, coronaviruses is something that will likely happen in some way, shape or form again. Peyton, you mentioned cleanliness and and all the things. It really is a future defining event, in my opinion. And I think coworking has a great place to play in the middle of that. And so as we do turn to an end here, Trevor, you already foreshadowed the event here, so you’d better be ready. It’s coming to you first. We would love to know. We always love just seeing how God bridges our listeners and our guests and how his word is always continually alive. And we would just love to know where God has you. Today could be this morning, something you read on the way to wherever you may be working from could be a passage or story that God has had you in for a season of today or years, even sometimes our guests have said they’ve been meditating on something for a long time. So if you would bring our our listeners into your world a little bit, they’d be great. And then we’ll go to David and Peyton.

Trevor Hightower: Thank you, William. Yeah. I am fortunate that I had my daughter Grace prompt me, and I always loved this part of the podcast. It’s a joy to share what the Lord has been counting on in my heart. This is something that has been ongoing for me and it’s really rooted. And I get into the beginning part of my story, but grew up in a very chaotic environment and at an early age, probably not similar to a lot of entrepreneurs and investors listening performance. It’s always been an idol of mine and performing for others. And when the Gospel invaded my heart, it was such a release of freedom and peace that I had just obviously I described it as know warm water poured over a very restless soul. And so I’ve noticed that the best growth in my spiritual life is it really comes in reminding myself of that gospel. It’s the gospel not only saved me and reminded me of who I am and Christ, but it’s also what propels me and gives me motivation to change. And so the verse that I literally read every day is Corinthians five. Twenty one for our sake, he made him to be sent here and, you know, sent so that in him we might become the righteousness of God. And that verse and Romans eight one. I have to remind myself every day of the Gospel not only that Jesus took my sin, but then it is something incredible. He gave me his righteousness. And for a performer like me and I’m sure a lot of those listening, that is just the best news ever, that it’s not my work, it’s his work and that it’s already finished. But what I’ve noticed is that if I really let that sink from just the words on the page from my head into my heart, then all of my relationships, from my wife to my children, to the people I get to work alongside and serve here at craft, where those relationships are all dramatically improved because I’m no longer thinking about myself. Ideally, I’m truly beyond grateful for like good God has given me. So it’s been the best business tool ever that I’ve had is to remind myself of the gospel. And that’s one of the verses that I literally read every morning.

David Salyers: You know, it’s interesting. I go to North Point Community Church with Andy Stanley and he did a sermon series a few weeks ago that really posed a challenging question that I’ve been pondering this whole crowing about. He said, you know, one day this is one of those times in life and in history that all of us will look back on and have a story about, you know, it’s a little bit like 9/11 or, you know, other times, you know, where everyone is focused on something said ten years from now, what story will we tell about this time? And I thought a lot about that, William, about will I be proud of the story I tell, you know? Well, I’ve just spent time in the basement hunkering down and or will I have seized the opportunity because, you know, the greatest value we can create many times during people’s most challenging moments. And I’ve noticed that God seems to do his greatest work during our personal, most challenging moments. And I’ve seen a lot of that going on where a lot of the scrappy entrepreneurs out there are taking advantage of a time when there’s a lot of despair and a lot of hurting people. And that’s our opportunity to do some of our greatest work. So the question on my mind has been, will I be proud of the story I tell 10 years from now about what Payton and I and Roam did during the Corona virus? And we use that to help shape our whole culture. And what we’ve done during this time and. Seize the moment, carpe IDM, you know, seize the moment and then combine that with the fact that Chick fil A, we always used to talk about that every life is a story. And we used to say, how can we use our business as an opportunity to improve the story of those we do business with. So we’ve been trying to figure out how can we use this opportunity to improve the story of not only our own employees, but those we serve. And finally, true, it lived his whole life. His favorite verse was Proverbs 20 to one. A good name is rather to be chosen then great riches. So we try to use all of those thoughts to shape our decision make because all of us have had to make a lot of decisions during this time, some tough decisions. But I want to make sure we look back on the decisions that we made during this time and we’re proud of those decisions. And those decisions helped improve the stories of those we do business with. Those decisions helped improve the stories of our employees, etc.. And how do we make sure that we maintain our good name during a time when it’s not easy sometimes? You know, we all have difficult decisions to make during this time. How do we balance that with a good name? And that’s what we’ve tried to do. I think that’s what we’ve done, Peyton. And, you know, we’ve had to make a lot of hard decisions, but I think we’ll look back 10 years from now and be proud of the decisions that we made during this time to do the right thing for the right reasons. Even when it hurts.

William Norvell: Amen. Peyton, do you have something that God’s telling you today to pass along?

Peyton Day: Well, yeah, I have actually two things, and I’ll make it really brief. First of all, it’s something that David was talking about earlier in his talk. And this idea around, you know, the work is broken and going back to Genesis two. And when you really think about it, I think it’s incumbent upon all of us as leaders to provide environments where people can thrive. And if we’re going to ask employees to spend one hundred thousand hours of their life working, it only makes sense that we would provide an environment that is fun, meaningful and purposeful. And we you look at the numbers, 70 percent disengagement in the workplace. Imagine what it would look like if 100 percent of the people were fully engaged to what they do. And so it’s just a constant reminder. You know, I think David and I share this and I know a lot of your listeners share this and I know Trevor does. It’s just feeling some burden that we have. You know, as leaders in the workplace, not necessarily a burden, but an opportunity, a blessing to be able to provide environments where people can thrive. So my heart goes there quite often. And then the second thing is I go to something I heard recently from Tim Keller where he did a talk on Psalm 11 And it’s this idea around when the foundations of the world tremble. Sometimes it seems like God is out of control, but he is not. And while we’re all going through uncertain times today, guys are in control. He is the author of Our Lives. He knows what you and I are facing. And he will be our daily bread. And by definition, because he is our daily bread. He’ll be our weekly bread, our yearly bread and our life bread. And he’s going to give each of us whatever we need to face the challenges that we’re facing today. And on the other side of this, we’re going to come out better because God has done a great work in these days. And I truly believe that’s what’s going to happen in each of our lives.

William Norvell: Amen, great work. Well, thank you all for joining us. This has been a fun roundtable event to talk through a really hot topic right now. And then we went around a lot of things. And David, also appreciate you with the Chick fil A cup. You know, can’t see that. Not everybody has video, but he’s he’s live in his marketing roots there.

David Salyers: I’ve got my shirt with the roam logo.

William Norvell: Staying On brand. This has been this super fun. I hope to have y’all back at some point in here how things have changed and how God has shown up, I hope and look forward to that day and four, five, six months, whatever that may be, where we can come back and say this is what God did in response to all of those things that we were praying for and looking for and trying our best to love and serve as he would have us. And so thank you.

subscribe to the podcast

What does it mean to be a Christian financial advisor? There are lots of possible answers to this question, but today we look at two experts in the field, Eric Chetwood and Rachel McDonough, to hear what they think. 

When it comes to integrating your faith as a financial advisor, these two are living it out in the real world. Their insights will be helpful for anyone who is a financial advisor, or for anyone who is looking for one.

Useful Links:

10 Tangible Ways to Integrate Your Faith as an Advisor

Investing as Ambassadors

Episode Transcript

Some listeners have found it helpful to have a transcription of the podcast. Transcription is done by an AI software. While technology is an incredible tool to automate this process, there will be misspellings and typos that might accompany it. Please keep that in mind as you work through it. The FDI movement is a volunteer-led movement, and if you’d like to contribute by editing future transcripts, please email us.

.

Henry Kaestner: Welcome back to the faith driven investor podcast. We’ve got an edition today that is probably a little bit overdue, and that is that we’re going to talk to some folks that are in the businesses professionals helping customers from retail through an institutional understand how to process the world of faith driven investments. A good number of our audience, of course, are direct investors and are in in the process of figure out how did they do angel investments, how do they pick out funds? And I think that we can all realize pretty quickly, that’s pretty intimidating stuff. There’s a lot there’s incredible amount of complexity. There’s incredible amount of selection. And through the grace guy, that selection is just increasing. And so the question then is where do I go to get some good counsel or how do I talk to somebody about my own particular needs rather than just reading an article about where I might invest in the latest trends or listening, of course, to a podcasts like this. How does that really impact me in my own financial situation? So faith driven advisors that are in the investment world are incredibly valuable and they view what they do as a mission and a ministry. And we’ve got two of the very best with us today. And I’ve been looking for this episode. Eric and Rachel, thank you for joining.

Rachel McDonough: Thanks for having us.

Henry Kaestner: Tell us a little bit as we get started just a little bit about each of you. Where are you calling from today, what your background is? We’re going to start back in my hometown of Durham, North Carolina, to Eric, who is a friend and neighbor in. And then we want to move to Wisconsin and hear from Rachel about what she’s doing. But, Eric, tell us about what got you to this spot where you are full time ministry in the financial marketplace.

Eric Chetwood: Yeah, yeah. Well, first of all, Henry, I think I speak for Rachel when I say I feel really grateful for you and your team because you guys have really let out in the faith and work discussion, at least for folks in my circle of influence. And many of the guests that you have had are heroes of mine. So I feel really humbled to be speaking with you all today.

Henry Kaestner: Well, before you go on. Thank you for that. That just helps me feel that much better about having had you on the show. That was awesome. Thank you. It’s awesome to serve.

Eric Chetwood: It is really a humbling experience. But for me, I would say that my story after college at USC, I spent a gap year doing a Bible program in Denton, Texas, right outside of Dallas. And that year was really one of the most amazing investments of time that I could think of. And I give thanks to it for this day. But I knew that at the conclusion of that program, I wanted to come back to North Carolina and specifically play out my life in Durham, North Carolina, because I joined the church here during college and I wanted to come back and be a part of what God was doing through the summit church. And so after coming back home to join an advisory team in 2004 with an amazing mentor and boss who later became my business partner, who taught me what it looks like to love Jesus in this industry and how to care for clients holistically. So, you know, I got certified from a planner designation in 2007. And really the only other significant data point in my story would be that our team left our wire house in 2005 and started an independent registered investment advisory firm, which has given us a lot of the freedom to implement some of the initiatives that we’ll talk about today.

Henry Kaestner: Rachel, tell us a little bit about the same on your side to your background, how you found yourself, where you are today.

Rachel McDonough: Sure, I am an unlikely candidate. If you look just at the data from my background, I guess unlikely candidate to be a financial adviser. I was raised as a missionary kid in Kenya, East Africa. My parents as missionaries did not have a lot of wealth in this world. Maybe they stored up some treasures in heaven, but the balance sheet was looking a little lean. I remember we would come back on furlough to the United States and have a free lunch, get government assistance to get a free lunch at school, and then we would go back to Kenya. And I was obviously the rich kid in Kenya. So I’d go this back and forth from rich kid to poor kid in Kenya. I would have other children and come up to me in Nairobi and ask me for money. And I always had at least a little bit of spending money in my pocket. So it really made an impression on me at an early age about what it means to have wealth and what it means to be wealthy. I learned a lot about some of those intangible lessons of internal wealth and external wealth and what it takes to, I guess, transition from having money to being in a place of abundance, of being able to use that money to create something good in the world. So I was taken with that idea very early on in my career. As you know, how do we actually use the money that God’s entrusted to us to make a difference in the lives of the people around us? So fast forward a bit. After college, I took a job as a receptionist at Merrill Lynch in downtown Minneapolis, and I got bored with that after about the first 20 minutes. And so I started studying for some licensing exams. Much to my surprise, I passed them all quickly and I marched into the director’s office one day and said, I want you to hire me as a financial adviser. And here’s my 20 arguments of why you should do that. And to my surprise, he didn’t need any of my arguments. He just said, yeah, OK, you can have a shot. So there I was with no family money to start with and no book of business to inherit or purchase. And somehow, by the grace of God, there was always enough provision. I would always bring in just enough clients to meet all my hurdles. And shortly thereafter, a much like Eric the Lord released me from that warehouse and I went to the independent channel at Raymond James and then from there followed the Lord again to make a change to Ameriprise Financial, where I served today.

Henry Kaestner: You’ve had some leadership positions at Ameriprise, correct? You’ve gotten together with other groups of faith driven advisers there.

Rachel McDonough: Yes, I currently serve on the leadership team as a vice president of the CFAN Network. That’s a Christian franchise advisory network. There are eleven hundred of us at Ameriprise Financial Advisors have raised their hand and said, yes, I’m a Christian. I want to figure out how to bring my faith to work and live at the intersection of faith and finance and be well equipped to serve Christian clients who come into our practice and celibacy found that work has really become a group of friends and had the honor and the privilege to help train them and equip them to take values based investing or faith based investing and apply it and implemented in their practices through quarterly webinars and newsletters and some one on one coaching.

Henry Kaestner: Eric, you talked to at the beginning about your relationship with his friend and mentor, now partner, Rick Adams. What was it that he taught you about integrating your faith with the vocation you’ve got?

Eric Chetwood: Yeah, I think one of the things was just that how we care for clients comprehensively and that can for clients comprehensively is a lot more than just rates of return and standard deviation that it is speaking in to really all of the way that money impacts people, which money impacts people relationally, it impacts people emotionally, especially during this current pandemic. So being able to care for clients in every way that money impacts them is one of the ways that we can really reflect and represent our savior.

Henry Kaestner: Well, both of you have been a great encouragement to me and your involvement in the larger movement of faith driven investing. And Rachel, you’ve served really well and with great leadership in some of our working groups. And Eric, you’ve written an article for FDI. I am talking about how you see God calling us to live fully integrated lives. Talk to us a little bit about what you mean by that, about fully integrated lives within the context of finance, or maybe not just within the context of finance, but just what do you mean?

Eric Chetwood: Yeah. So one of the things that I have really loved about listening to you guys in this podcast is that you all examine integrating faith and work from so many different angles and living a life that doesn’t segregate the sacred and the secular. And I would say that that’s a topic that I really enjoy talking about just because I used to have a very disintegrated, compartmentalized life where I saw my relationship with God and personal ministry over here and then work over here. And that worldview caused me to buy into a lie. Early in my career. And that why is this? That work is something that I endure. So I can make a paycheck in order to fund the activities that I’m actually passionate about. And I think that lie is very prevalent in our culture. And I think financial advisers are really complicit in that, even in how we frame the retirement discussion. You know, Mr. Card, do what you have to do so that you can retire and then do what you want to do. So whenever I hear that logic, it’s usually a sign that someone doesn’t understand the integrated purpose that God has for them. And it will be very difficult for them to experience the abundant life that he promised. So for me, I didn’t understand the theology of work, and because of that, I didn’t really grasp God’s full purpose for me. I didn’t see all of the redemptive opportunities in my job as a wealth manager, and they were right in front of me because I was looking for them. And that led me to kind of a crisis of confidence and work, feeling very meaningless and empty. And so over the course of some time, I learned something that just dramatically impacted my life and career. And I learned that all of us, you and me and Rachel and everyone joining us, regardless of their profession. If you’re a follower of Jesus, you’re in full time ministry. And, you know, where do I get that? Ephesians for specifically eleven and twelve, says that the primary function of a posture or a minister is to equip the Saints for the work of the ministry. They are to equip the Saints for the work of the ministry. And that statement just has massive implications. It means that our pastors should not be the only ones doing ministry. It means that our pastor should need to be the primary ones doing ministry. It means that we, the Saints, get to the ministry. And that means that everyone listening to this is both empowered and expected to be primary agents of gospel, ministry and reconciliation. And Henry. And till we understand that until I understood that this democratization, until we see ourselves as the aroma of Christ in real estate or a kingdom of priests and wealth management or as ambassadors of price and private. We miss out on. Part of the great adventure, we miss out on the joy of knowing that we’re fulfilling our integrated purpose in life. So the first application for us is financial advisors is to recognize that our relationships with clients are, by nature. One of the most intimate professional relationships that they have and that no one may be other than their doctor is allowed in to their hopes and dreams or abilities. The way that we are. So God could potentially use us as financial advisors to make a bigger impact in a client’s life than any pastor or priest.

Henry Kaestner: That’s an awesome thing to lean into. Rachel, I know you well enough to know that that’s something you absolutely subscribe to, too. How do you see that actually working out with your clients? What does it mean when the rubber meets the road? Client comes in, you’re having that meeting. How is it that you even just approach this concept of a more integrated life and the meaning of purpose? And is Eric just said, you know, you’re invited into this special relationship to understand their hopes, their dreams, their fears and their anxieties. How do you see that mission’s been part of the Saints being equipped to do the work of the church?

Rachel McDonough: Yes, I agree with Eric and Eric. I love your passion and enthusiasm. I share it. I think that our role is a very pastoral role and it’s a role of coaching as a role of helping clients to hear God for themselves. So as the word of God tells us, we don’t actually need a human teacher per say. We have the Holy Spirit and he promises to lead us and guide us into all truth. And we have the word of God, which is sufficient for instruction in every area of life. But what an adviser can do is come alongside a client or a couple and really help them to lean in and listen. Right. I remember some of the greatest memories that I have as an advisor are times when I’ve just been able to almost be outside of the conversation, just facilitate a setup for a husband and wife to come together before God in prayer and discover his plan and his purpose for their life. One of those examples was there was a couple. The husband was a civil engineer and the wife was a CPA. And they had some extra money that they talked about potentially investing in public securities. And as they talked further. The wife really said, you know, more than anything else, I have faith and confidence that God has given my husband tremendous capacity for creating wealth and creating jobs through his business and his company. And I would rather see us reinvest this money back into his work that I believe God’s call them to and bless them to. And she must not have said that to him out loud before because, I mean, he was almost moved to tears. And that was just the result of us, not me having some kind of tremendous insider wisdom, but me just saying, come on, Dad, we need you to show up and do what only you can do to be the shepherd of your sheep. And the word of God is very clear, says my sheep. Hear my voice, my sheep know my voice and the voice of a stranger they won’t follow. So we should, as believers, come to God’s word and come to our decision making in real life with the expectation that we can anticipate the shepherd’s voice being present to lead us in a personal and relevant way in day to day decision making.

Henry Kaestner: Hear, hear. That’s awesome. Eric, I want to ask you, Rachel brought up this illustration about a husband or wife working together. Are there times that you’re invited into people’s lives that you feel like you’re a little bit of a marriage counselor first?

Eric Chetwood: Sure. You know, it’s amazing that the husband has his own risk tolerance and his own financial goals and aspirations, and the wife has her own risk tolerance. And surprisingly, in the humor, you know, God’s creation, he normally allows people who are diametrically opposed to marry each other. And so a lot of times you yeah, you are dropping financial grenades, so to speak. You’re asking questions and then maybe even ducking a little bit. And that is, you know, an area where so many times I tell people that our role a lot of people think that this industry is all about financial analysis and it is to some degree. But I feel especially in the last few weeks during the Kovik crisis, I have felt more like a therapist than I have a financial counselor. And so, so many times people will come to us in the last questions that really aren’t necessarily financial. They’re just about life wisdom. And that’s why it’s so intimate. And that’s why it’s so far to get to walk through different chapters of life with books.

Henry Kaestner: Rachel, as you do this and you walk through different chapters with different people and it’s had hundreds and hundreds of conversations with individuals and with couples and with families. How has it impacted the way that you yourself think about me? You talked about, of course, your upbringing and being rich and poor at the same time. But as you’ve gone ahead and just heard the collective responses about financial planning and how to think about generosity and investments from your clients, has that changed the way that you think about money, too?

Rachel McDonough: I would say the biggest influence on the way that I think about money has been, you know, hopefully the word of God. Right. That’s the right answer. But also, Kingdom Advisors has been a tremendous blessing to me and the wisdom of Ron Blue and Rob West and some of the other leaders thought leaders there.

Henry Kaestner: For those of us who don’t know, who are listening, who don’t know what Kingdome Advisors is, what is Kingdom Advisors?

Rachel McDonough: Kingdom Advisors is a fantastic organization for financial professionals. And they created a core curriculum. I know, Eric, you’ve gone through it and I have as well. This CKA certified kingdom advisor curriculum, is kind of like the biblical version of the CFP, I guess. And that allows us to really take a deep dove into God’s word to develop personal convictions on several different topic areas, to read the scriptures and then pause and listen for the high spirits voice to make decisions on different areas of life, such as giving, managing debt, spending choices, investing choices and so on, has been a tremendous resource. They’ve created lots of things that can be shared with clients as long as you’re if you’re a financial advisor. Of course, you need to check that with compliance, but they’ve been great tools and great resources for our clients and that’s really had a huge impact on me. The client conversations themselves. I would say have just given me a tremendous amount of depth and understanding and appreciation for the level of each person is at a different place. You know, it’s really a journey. This is a financial journey. And our job, my job and Eric’s job should be to meet that person on their journey, whatever stage of the journey they’re at. Not with condemnation or judgment or you should do this and you shouldn’t do that. But help me understand how you thought here. Helped me understand where you’d like to go. And then let me come alongside you and help you and assist you to complete that journey.

Henry Kaestner: Eric, what do you think is the biggest mistake you see a lot of your clients make in the way? Just that they think about money and planning?

Eric Chetwood: Yeah, I would say a lot of times having a short term mentality and allowing the headlines of the day to determine their investment decisions. I know that that’s something that you guys have talked about a lot. That’s why one of the things that we say to clients is that outperforming the market is not a financial goal. It’s not a financial plan that their behavior is going to have probably more to do with their investment outcomes. Specifically, the discipline to hold tight to a quantifiably data driven financial plan. Their ability to adhere to that plan is going to have more to do with their long term financial success than any market timing or stocks.

Henry Kaestner: Do you ever find out that you work with clients that don’t yet have a faith and you get an opportunity to share within the reason for the hope that you’ve got?

Eric Chetwood: Yeah, absolutely. So our book is probably maybe 50 percent of our people are believers and 50 percent of them are not believers, some staunchly opposed to faith in the gospel. And so one of the things that we talk about a lot as a team is that even if our clients don’t yet love Jesus, that doesn’t change the fact that Jesus loves every single one of our clients and that we can be if we are the aroma of Christ. You know, that means when clients interact with us and the way that we care for them, we do everything for them as if we were doing it out to the Lord. And as they interact with their sets, they smell us, if you will. They ought to be able to smell love and joy and peace patients, kindness, goodness, faithfulness, gentleness, self-control. And because we’re able to speak into so many areas of their life, not just their finances, then we’re able to be that aroma or we strive to be that aroma and reflect well on our king.

Henry Kaestner: So I want to ask you both something that’s obviously it’s top of mind for all of us on this podcast, which is this concept that we might be able to invest guides, resources for his glory, participate in the work that he’s doing in his kingdom, and not just necessarily being of the mindset that, gosh, I want to make as much money over here and then give it all away here. But that very process of stirring the wealth and investments might provide investment capital to different enterprises that are being used to transform culture. So any thoughts what you guys are seeing in terms of trends? Is this something is becoming more mainstream or more clients talking about it? Just want you both riff on that a bit.

Rachel McDonough: I have a couple of statistics to share on that. So there is currently about 51 trillion dollars held by Christians who have specifically expressed an interest in aligning their investments with their values. And as we know, money, especially in the financial services industry, really has a voice of its own. Money talks. What would happen? I just want to think hypothetically, what would happen if we saw 51 trillion dollars exit a particular industry like pornography or abortion. And it’s not all about what you’re against instead of what you’re for. I understand the importance of embracing positive investments. But what would it do? I mean, that’s an easy thing. The exclusionary screening, the ability to screen out certain types of industries or certain companies from our portfolio is becoming increasingly easy and accessible to investors of all sizes. So what kind of a message could we say with our cumulative voice and then with the shareholder advocacy that’s been going on as well with certain fund companies just actively behind the scenes? Even if we don’t personally engage with those companies ourselves, we know that we can easily hire a mutual fund company who’s going to engage on our behalf and express our values, the values that are portrayed in the Bible. And if we have the ability to do that. Why not? You know, I think we should not ask ourselves why should I engage in this activity of using investment vehicles that have a values alignment? But why wouldn’t I? Especially as far more products are being created that have better and better performance. And the fees have come down substantially. There is just such an opportunity for us to give our clients the gift of not only having a relationship with their investments that’s based on returns, but also a relationship with their investing activity that’s based on their values and a way to live out who they are and have a greater sense of wholeness in their investing.

Eric Chetwood: Yeah, I mean, I’ll just add to that for us. This is something that we’re growing in and we’ve grown in very recently because I think a few years ago, as we were looking at the investment arena, faith driven funds and ETF and things like that, it was pretty slim. And there wasn’t a lot of track record or at least that I saw there wasn’t a strong track record. And so we have revisited that because this is absolutely that we want something that we want to at least provide to our clients and make sure that they are living in integrity, that their investments are congruent with their belief system. And it’s something that we’re growing in for sure. And I’ve been very encouraged. I think Rachel probably knows more about this space than I do. But I’ve been very perche saying that the universe of available investment options or fund options that are specifically focused on redemptive investing is growing. And the track records are getting better and better and the internal expenses are decreasing. So I think that’s a positive for financial advisors who are listening to this, who are open to the possibility that they might incorporate those into their portfolios. And one of the things I think Rachel made a great point on is that in the event that you’re not in a position where you’re managing a portfolio where that’s outsourced, you know, to the advisory team within a bigger warehouse or something like that, you can absolutely be an advocate for some of the fund companies, Henry, that you guys have had on this podcast. You know, even tired and thrive, Praxis and Timothee and Inspire and Nabay, Maria and others, God Stone to be an advocate for them to have access on those trading platforms, I think is really important that all of us can be a partner.

Henry Kaestner: I think that a lot of strides that have been made in a lot of the warehouses, in a lot of the larger platforms for financial advisors to incorporate more faith friendly, faith driven investment vehicles. And yet, because of compliance, anybody’s on a platform like that will never be able to have complete carte blanche on the things they do. Believing that angel investing and finding faith driven entrepreneurs in your own community is a great place to be able to put your shoulder to the power folks, to be able to mentor, to be able to get actively involved. By really having skin in the game, be strapped to the mass. I got to be careful about mixing metaphors here. But are there ever times where you see that you need to encourage your clients to investigate other ways that they might be able investigate according their faith that are beyond your own abilities as financial advisors on a specific platform?

Eric Chetwood: Yes. So I think one thing for us that I was very encouraged to see was just the opportunity to within donor advised funds, specifically a partner that we’ve used in the past, National Christian Foundation. Being able to have exposure to some private equity vehicles within those donor platforms. And I think that is really encouraging. And there’s always going to be a conflict of interest whenever you have an advisor who is compensated as a percentage of the assets that they manage. There’s going to be a conflict of interest there to redirect some of those funds elsewhere. But as long as that is acknowledged and. You know, walking through that with the client to say, hey, I do think that their private placement, real estate investment, that I was having redemptive component to that. I think that absolutely has a place in your portfolio. I do think that that private equity component that has a redemptive quality to it has a place in your portfolio, because when we as advisors only focus on, oh, I don’t want to lose assets, then we’re giving in to a scarcity mentality and we are doing what is right for the client in building those allocations in a way that is truly diversified, then I absolutely believe that God will replenish that in order that I just add to this isn’t about private investment, but one of the things that I’ve been seeing that clients have really appreciated has been understanding what’s inside the fund wrapper.

Rachel McDonough: So, so many of the investments that advisors use with their clients are not individual stocks for other their ETF or their mutual funds. And that’s a great idea. If you don’t have time to be tracking individual stocks all the time. Right. So by using a fund, though, we kind of remove investors one more step away from the companies that they are owners of as being shareholders. And so I think it’s important. I’ve been including in the quarterly agenda with my clients quarterly review agenda. I’ve just been adding in a little segment at the bottom of each meeting agenda that says know what you own and reintroducing clients to the companies that they own, not X, Y and Z Fund, but the individual companies inside of the fund and telling the story of the companies to the clients. So one that I put on an agenda recently revealed a medical technology advancement that had happened through one of the companies that was inside of a mutual fund that a client owned. And as I sat across the table from her, she got really quiet. Now, all of a sudden, she just said, well, you know, if I could do that with my money, I don’t even care if it makes money or loses money. And it’s not that we’re advocating that you should see your investment dollars as charitable giving dollars. But what a value and a blessing for clients to be able to have a positive impact even with their investment dollars. For most of us are giving dollars are a smaller bucket than the dollars that we need to invest and save for the future. And so if we can have a positive Kingdome impacts, not just with the charitable dollars, but with the investment dollars to start to understand what’s inside the wrapper and understand that those are businesses and that as shareholders we are business owners. It’s really been a powerful and positive experience for clients.

Henry Kaestner: I think that’s a great illustration. You touched on something there about the difference between investments and giving. And I want to delve into that a little bit. I know each of you both enough to know that where you stand in terms of storage versus ownership and that kind of concept, and you’re both familiar with Randy Alcorn and his work and things like that. What are some of the tools that you use to work with clients as they wrestle with things like structure versus ownership, may wrestle with things like this? Should I tie? Is the tie enough? How do I think about generosity? And just how do you wear some of the different techniques and tools that you’ve used when you find an opening with some of your clients? To be clear, I understand, because I’ve heard from both of you attorneys, attorneys, yes. You need to listen first. You need to hear what they’re saying. And yet there must be times over the engagement with a client, the relationship with a client. Do you get an opportunity to encourage them towards generosity or maybe even challenge them if you’ve worked with them for a very long time? How does that work out? And are there tools are there different things that you use to bring that topic to bear?

Rachel McDonough: Well, Henry, I think that the financial plan is the perfect tool and the perfect platform to do that. When you set out a financial plan with a client and you’re saying, OK, here we are here your retirement goals, here’s what you’ve saved, here’s what you need to live on. It’s just a really easy and natural way to have the conversation about what else would you like to do besides survive? It’s a great time to talk about those charitable goals, the desire for a kingdom impact. Clients have passions. They have passions that God’s place on their hearts. And when you give them the freedom and understanding that actually they have capacity to do more. I have not found that clients are tight fisted. I have found that they primarily need to understand that they’re being responsible, but that they already have an inherent desire to be more generous.

Eric Chetwood: That’s good. I think the only thing that I would add to that is that because our relationships with clients are so intimate. One of the things that I found really helpful for myself and for clients is to share with them how I’ve grown in my understanding of generosity. And I’ll give you a personal example. You know, a couple of years ago, I read the book, God and Money by Gregory Barber and John Cortinas, and it absolutely wrecked me. I mean, wrecked me in a good way and how that changed my view of stewardship and generosity and how that changed my view of really releasing my business to be God’s business was very helpful for me.

And to share my journey with clients was helpful. And so we provide them resources like God and money. That’s actually one of the KPI that we track. How many copies of that did we give away today? How many copies of Every Good Endeavor by Tim Keller? Have we given away how many copies of How to be Rich? By this day we have given away. And that’s one of our KPI is one of the other resources is that we have a chaplain for our clients. A lot of companies have chaplains for their employees. Henry, I know that you’re a big advocate of that. We have chaplains for our clients because we do work for many different chapters of life with clients. And when we see that a client gets a cancer diagnosis or they lose a spouse, they don’t care. They don’t want to talk about the internal rate of return or the standard deviation of their portfolio. They want to talk about bigger things. And so when they share that with us, you know, we hurt with them. We pray with them if they’ll allow us to. And then we say, I want you to know that we have a chaplain on staff who is trained to help you process this. And they want to come and sit next to you and process this with you in a non-threatening way. But that is another resource that we can use and leverage to guide our clients to a Shulem relationship with money.

Henry Kaestner: That’s awesome. Rachel, I don’t know that I ever appreciate the fact that you grew up in Kenya and that you had that type of background and that experience. And now that you’ve been more more exposed to faith driven investing. What are your hopes for what the development of investment vehicles might look like for the kind of guy that you grew up in?

Rachel McDonough: I think Africa will always be on my heart and my mind. It has a way of getting under your skin. I was really excited. There was a culvert, 19 bond that was invested in by one of the mutual funds that we’ve used. I was excited to see that I would even be more excited to see, you know, some type of for profit endeavor to bring clean drinking water and increased amount of economy to the continent of Africa. Well, I grew up in Kenya. I did spend a few weeks in the country of Ghana. And we really see that business and developing economy is the way that there will be a sustainable ramp out of poverty and for Africa. And so we did a fish farm project to try to create some jobs and kind of create some. Bonhomie in one of Africa’s least developing nations and just being there for that few weeks. With the focus on incorporating business and the gospel was a tremendous impact on me.

Just to see, you know, what would it mean to give real people their dignity back by allowing them to produce income and produce revenue for their families? You know, I’d love to see some mutual funds dedicate a small percentage of their overall a, um, to economic development in the continent of Africa. I’d also be really excited to see some things happening in the private sector that, you know, people could invest and expect a return, but also, you know, really see Africa lifted out of poverty.

Henry Kaestner: Guys, you’ve been around this ecosystem long enough to know that. We ask every one of our podcast guests things that they’re hearing from God in his word, maybe today, maybe yesterday, maybe this week, but some way that you feel that he’s speaking to you through the Bible. And I’d love to hear what that’s been looking like for each of you.

Eric Chetwood: Yeah. So one of the things that I’m learning right now is that I have a tendency to needlessly complicate what God asks of me. I realize that I have a big to want to do things for God rather than just enjoying being with God. And so one of the things that I’ve been meditating on is what Jesus says to the disciples. You know, one day when right before the ascension, he says two things. He says you will receive power and you will be my witnesses. And so I’ve been thinking about you and on what it means to be an effective witness. And one of the comforting things for me is that you don’t really have to be particularly smart or articulate or even talented or rich. The only thing that you need to do to be a witness is you have to be willing to relay what you’ve seen and heard. And that’s it, because the power he said in the previous verse, the power has already been taken care of. And so I think that manifests itself in a variety of different ways. Day to day. But being willing to be a witness and being the aroma of Christ again. You know, I think about, yo, my wife smells great and she has this perfume that sometimes at the morgue, I give her a hug and then I’ll come to the office and sometimes I will smell her perfume at various times throughout the day. Sometimes other people will smell her perfume on me. And in the same way, in the same vein, I cannot be the aroma of Christ if I’m not communing with Jesus. And all the things that we talked about earlier were the fruit of the spirit comes out of that daily communion with you.

Rachel McDonough: I love that. It just sounds exactly like what that’s been laying on my heart and a lot of ways. I’ve been reading this book, The Secrets of the Secret Place, by Bob Sorgi. If anyone needs a little Kickstarter to their quiet time, I think it’s a fantastic usually one or two or three pages to just give you some keys to ignite your personal time with God. And we know that it is out of the abundance of our intimacy with him and only through our abundance of intimacy with him, that we can really have something valuable to give to clients. But I would say, like if I just looked at the scripture, that’s been kind of a guiding scripture for me over the past 10 years. I would say First Corinthians, chapter three verses ten through fifteen. So by the grace God has given me, I laid a foundation as an expert builder.

This is Paul writing and someone else is building on it. But each one must be careful how he built for no one can lay a foundation other than the one already laid, which is Jesus Christ. If anyone builds on this foundation using gold, silver, precious stones, wood, hay or straw, his workmanship will be evident because the day will bring it to light. It will be revealed the fire in the fire will prove the quality of each man’s work. If what he is built survives, he will receive a reward. If his burned up people suffer a loss, he himself will be saved, but only as if through the flames. That verse is just so powerful and so haunting and so inspiring at the same time. I love the concept of gold. You know, before building with gold. You think of a goldsmith. They don’t build quickly. They build with quality. And so sometimes, especially in our culture, we tend to be busy, busy, busy and not so much in Kenya. Kenya, there’s a more laid back culture and a less hurried pace. But here in the United States, we just tend to go, go, go 100 miles an hour all the time. I think what that does is it distracts us from the important things, the things that will last, the things that will have eternal fruit. And yet Jesus told us in June 15. It is to my father’s glory that you bear much fruit, the fruit that will remain. So we know that our goal as believers should be out of our intimacy and our abiding relationship with Jesus. There should come through our. Lives an eternal fruit and eternal quality to our work that will last even far after our lives on this earth are done. And what an awesome challenge and one awesome ability to just call labor of a thought in our lives.

Henry Kaestner: Guys, it’s been great having you on the show. I’m encouraged by your partnership, by your friendship, by your faithfulness. By the way that you’re getting out there and you’re really leading. Rachel, I think about eleven hundred people on a platform that you get a chance to minister in addition to administering your young basin. Eric, I love the way that you’ve been thoughtful about integrating your life in the thoughtfulness that you have with Rick about promoting and encouraging generosity and through different resources and just the way that you do life on people. This has been encouraging for me. I’m grateful for both of you and your time.

Eric Chetwood: Thank you. This has been a joy.

Rachel McDonough: Thanks. You too. Eric.

subscribe to the podcast

Finny Kuruvilla, CIO at Eventide Funds, challenges faith-driven investors to consider the impact of their investment decisions.

Hear him remind us that there is an ethical responsibility on the part of the investor to know the impact of their funds. He explores examples of how investors have used their influence to inspire significant world change and encourages modern-day faith-driven investors to do the same.

Episode Transcript

Some listeners have found it helpful to have a transcription of the podcast. Transcription is done by an AI software. While technology is an incredible tool to automate this process, there will be misspellings and typos that might accompany it. Please keep that in mind as you work through it. The FDI movement is a volunteer-led movement, and if you’d like to contribute by editing future transcripts, please email us.

.

Rusty Rueff: Welcome back everyone, to the Faith Driven Investor podcast. If you were able to attend the FDI conference this year, we’re so glad to have you join us because today’s podcast is going to feel familiar, but we think you’ll probably want to hear it again and again. Finny Kuruvilla shared how capital creates influence and what it looks like for faith driven investors to steward that responsibility. Well. It’s a poignant reminder for all of us, and we’re grateful to him and the whole team at Eventide for thinking through this topic. Listen in. Enjoy. And let us know what you think.

Finny Kuruvilla: How do you change the world? I’m not looking for platitudes or nice sentiments. I’m looking for tangible, practical strategy rooted in sound principles. Our world is changing rapidly and not always for the best. Thus, for good reason. There’s a lot of talk today about how to change the world for the good. There’s a lot of young people who hope to use their lives to change the world. And there’s a lot of older people who want to use their influence to change the world. So how do you actually do it? Let’s first dispel two common myths of world change strategies. First, the power to change the world is not found in politics. Politicians make lots of promises they rarely keep. They’ve got to make lots of deals and concessions to get them elected, which in turn makes them beholden to other constituencies. And then on top of that, politicians have their fingers up to figure out which way the wind is blowing so that they get reelected. But what makes that wind blow? Politicians in general are much more reactive than transformational. The second myth is that world change happens because of autonomous individuals, especially in America, where we tend to lift up rugged individualism. It’s easy to fall for this myth. In his book To Change the World. Sociologist James Davis at Hunter makes a compelling argument that the real power to change the world lies with institutions. Certain institutions have concentrated power to shape hearts, attitudes and beliefs. Think of school systems, churches, Hollywood, social media or the news. Certain institutions have concentrated power to affect how you spend your time. Think of professional sports leagues, for example. By the way, these leagues are for profit businesses and how many millions of hours that people spend watching those activities, or how many young people dream of being like Michael Jordan or LeBron James? Renaldo. Serena Williams. There’s other institutions that have concentrated power to shape spending. Think of the people who make commercials. Think of all the online businesses like Amazon or brick and mortar places like shopping malls. It’s difficult to overstate all of these forces. In fact, we’re a little bit like fish that swim in water, but we can’t tell you what water is because it’s our only experience. In the book of Colossians. Paul talks about Dominion’s principalities and powers that are both visible and invisible. These forces define and shape our existence. And if you can change these forces, you can change the world. I’m going to be focusing mostly on business here, but I want to illustrate world change with two historic examples. Let’s start with the very famous voyage of Christopher Columbus. Most of us know he wanted to get to India, but this enterprise of trans oceanic sailing was risky and expensive. You needed investors to supply the capital for such an endeavor. So Columbus traveled all around Europe looking for investors. He unsuccessfully went to France and England to procure these investors after failing there. He eventually got support from Spanish investors. Make no mistake about it, this was very much a business proposition. Columbus took their capital and in exchange for his labor, he arranged a contract where he personally would get 10 percent of future revenues from such expeditions. And he also got the option to invest in one eigth, a future commercial businesses that came from his explorations. Now, the rest of his voyage is history. But I want us to think for a moment about an alternative narrative. What if Columbus secured French investors? Central and South America today would be French speaking and have a very different culture. What if Columbus secured British investors? Central and South America would be English speaking and Protestant, not Catholic? Think of the hundreds of millions of people affected by this small group of investors and explorers. These investors that backed Columbus changed the world. As a second example, consider the British East India Company that was formed in sixteen hundred. Many people consider this to be the first modern corporation financed with a complex mixture of stocks and bonds, and they even had an exchange through the influence of this company. India would go on to become a colony of England that has affected the culture, the language and the politics of India. And you may not know that India has the second largest English speaking population on the Earth. Billions of people have been changed by the geopolitical power of these corporations. Now let’s jump to the future. Consider the modern multinational corporation. How much has Google, Facebook and Nike changed our habits, our desires and even our vocabulary? Companies were funded by venture investors as well as public investors. These investors changed the world through these companies. Want to change gears a little bit and talk a bit more about some of the ethics. The thesis that I’m going to lay out is very simple. By willfully becoming an owner of a company or an owner of a business, which is what investing is, you are sanctioning and benefiting from the company’s activities and practices. This ownership confers an ethical responsibility to the investor for the activities and practices of the company. Investing has long been, however, divorced from this original and basic purpose, which is supplying capital to support businesses. Instead, most investors today are trying to profit from the market itself rather than any productive and intrinsic value of the underlying companies. Basically, investing today has become about making money. The mantra is low cost, low fee products like ETF and investing has become commodities and depersonalized. Frankly, most people don’t even know what companies they own. Investors have forfeited the power to change the world using their hard earned capital to convince you of a more modern example of the positive power investing. I want to share one last example of what can happen if we work together. Let’s go to the year 1971. In 1971, Christians were having a growing concern for apartheid. If you don’t know what apartheid is, it’s an Afrikaans word. That means separation. It literally means a part hood. It’s basically institutionalized racial segregation. Apartheid was practice, of course, in South Africa. And the government had already ignored U.N. sanctions and embargoes. But a group of Episcopal shareholders filed a shareholder resolution with General Motors, a well-known car company. Many people believe this to be the first example of modern shareholder Abigail. They enrolled the help of a Baptist minister whose name was Leon Sullivan. He was an anti-apartheid activist. And Sullivan proposed specific resolutions for the General Motors board that they ended up adopting because of this Episcopal shareholder resolution after GM adopted these resolutions. Then Ford and Goodyear followed suit. Thus, one of the key instruments in the fall apartheid was coordinated investor pressure from Christians think of the many, many problems that we face today, lack of access to clean water, polluted air, difficult jobs, diseases like cancer, Alzheimer’s infections like coronavirus, educational systems that can warp students minds, misinformation and confusion in the media. Every one of these problems could be fixed through institutions, specifically virtuous businesses and a strong church. These are the sleeping giants that we can enable through our investing and participation. Right now, we need all of us to deploy our capital in positive ways to shape the world for the good. Using biblical principles that promote human flourishing. So let’s use investing as a tool to positively change the world.

subscribe to the podcast

Welcome to Opportunity Zones 101. Today, we’re talking with Jeff Shafer, Co-Founder and CEO of CommonGood Capital and Jerome Garciano on Opportunity Zones—what they are, why they matter, and how Faith Driven Investors can approach these unique ventures as a way to integrate their faith and investing. 

If you’re familiar with Opportunity Zones, or if this is literally the first time you’ve ever heard that phrase, today’s episode is a chance to get acquainted with something that can provide value to you, the investor, and to local cities across the U.S.

Episode Transcript

Some listeners have found it helpful to have a transcription of the podcast. Transcription is done by an AI software. While technology is an incredible tool to automate this process, there will be misspellings and typos that might accompany it. Please keep that in mind as you work through it. The FDI movement is a volunteer-led movement, and if you’d like to contribute by editing future transcripts, please email us.

.

Henry Kaestner: Welcome back to the faith driven investor podcast. This is a special edition. I guess I said that for other guests, and yet that’s true every time and that we’re taking some new ground and looking at an area of investing and putting a faith driven investment lens on it. And so today we’re going to learn and together we’re gonna learn because I don’t know a lot about opportunity zones and investing, but we’re going to learn from some experts and some guys with some really interesting backgrounds have gotten to know a bit over time that have brought them into the opportunity zone space. And so we’ve got two guests. Jerome Garciano and then we also have Jeff Shafer on the line with us. Guys, thank you very much for being on the program.

Jeff Shafer: It’s great to be here.

Jerome Garciano: Yeah. Thanks for having us.

Want to start with each your backgrounds. And Jeff, we’ll start with you. Tell us a bit about how you’ve come to this space maybe weave in just a bit of your faith journey, but then most specifically, common good capital and in opportunity zones. And of course, Jerome, we’re going to do the same with you.

Jeff Shafer: Yeah, great. Well, let me take you back just a little bit and I’ll try to get through this quickly, because this is a story that could go on for a long time. But as you mentioned, I was an executive at a company called CNL, which we were leading alternative investment manager. Today, that company’s been around give or take, you know, 45, 46 years. I’m not sure. I left roughly five, six years ago. But the quick story was I was an executive there. I was a workaholic. And when I was 40s, this is almost seven years ago now. God literally and figuratively brought me to my knees through a number of circumstances. But really, it was a combination of back surgery. And so it’s a great analogy of probably where I was at. I was trying to carry too much of the weight on my own and was brought to my knees. Out of that time period, though, my wife and I started to ask the question of what does it mean to be a steward of our time, town and treasuries? And I’m sure we’ve all asked questions at different times. This one just felt like a much deeper questioning across every aspect of our life. And in that time period, a friend of mine actually came to me and from an investment opportunities here in the Orlando area, they were doing some investing in affordable housing. And I remember I was recovering from back surgery on my couch and was watching the little DVD of the video. And yes, there the investment thesis, which was very compelling. In fact, the returns were extremely compelling. But really what hit me was what that did to the residents and the communities, what that capital did without intentionality did to those communities. It lifted them up. And the residents talked about and I can still hear it in my head today. They brought me dignity. I’m excited to have people come over to my house. And so that’s what a light bulb went on for me. I’d been in traditional finance at the time for about 20 years. And we really then started to look at this whole idea of how do you align your values? How do you on your faith with your capital? Now, typically in the faith based world, at least my growing up. That’s a question I’d ask. But it always been on the giving side. And I never had really thought about it. I’m an investor capital side. So that’s really what spawned me. And then also my brother to start Amen good capital is. How do you essentially take the traditional financial world? How do you marry together with our values and our faith? And how do you make an impact? And not only in the lives of the individuals who this capital is going towards or investing in. And that’s typically what most people talk about. The part that intrigues me, even maybe not more, but equally so, is when you invest this way. What it does to the heart and psyche of the investor. So we start a common good capital with that very vision that there is these massive trends and movements that are happening. And so we essentially source due diligence. Different asset managers who do impact investing. And then we create a platform and we bring that to financial advisors so that their investors are able to access different deals. In that vein is how we came into opportunity zones well before they were out. And well before they were popular. It wasn’t that we were ahead of the curve because we had some great insight. It was the opportunity zone legislation, which I’m sure will touch on, was created for this very thing to go into now and make competitive returns, but equally important, to lift up, increase human flourishing among the community of individuals in these opportunity zones.

Henry Kaestner: OK. Thank you. Great overview. Jerome, I want to do the same with you, especially because you not only are interested in opportunity zones, but you’re just more generally interested in Christ centered community development as well. So bring us through your background, how you got here as well. And then what we’ll do is I’ll ask you each to define what are opportunity zones and help us to understand what in the world we’re talking about.

Jerome Garciano: Sure. Thank you, Henry and Justin. So, you know, I was born in Southern California. My parents are immigrants from the Philippines. It wasn’t really, you know, until college when thinking about. Career and kind of purpose, and you know how the gospel really impacts my life is where I think I you know, my faith really kind of grew. And I think a critical component of it is by calling and vocation. And I think, you know, a lot of people interested in FDI talk about all the time reflect upon that all the time.

But I feel like where God calls us to is a place where we are flourishing in the skills and the gifts that he’s given to each of us individually and as organizations and a calling to serve others and a reflection of thankfulness for the gospel and for what God has done for us and to pour that thankfulness into concrete action. So I think for me it’s a lot about creativity and bringing together skills and experiences that might not necessarily be considered critical ministries. So, for example, I am an attorney in Boston. My firm is called Robinson and Cole. I started off my legal career in doing a lot of tax work. And currently I’m doing a lot of more finance and real estate and have done almost 20 years worth of transactional work in affordable housing. And so I’ve done a lot of work in tax credits and you markets, tax credits, community development efforts generally for for profit profit making companies and developers and investors. So my whole journey has been, you know, how can those opportunities and skills and experiences be leverage for the kingdom, be leveraged for the care of the most needy? And I’ve been very blessed in terms of I mean, I do affordable housing every day. You know, that’s that’s what I do every day and have worked for a really developer that focus on that. We’re for investors that are very sophisticated and creative in terms of, you know, trying to use capital for that type of purpose. As you mentioned, I’m also involved in a group called Christian Community Development Association. So it’s a faith based network of churches and nonprofit ministries that are really trying to, you know, seek God and his kingdom in the city among the least of these among those who Jesus calls us to and very inspiring group. And I’m very privileged to be on the board of that. And so it’s talking with groups like them about programs like tax credits and opportunity zones and different types of impact investing and social enterprise to really be creative and to engage people of faith churches, you know, in all these aspects that might not necessarily come to mind as ministry, but really, in fact, I think could be more creative tools in that space.

Henry Kaestner: OK, good. Thank you. So we’ll stay with you. What is the definition of an opportunity zone, as you understand it, and help us help a lay person to get that?

Jerome Garciano: All right. So first of all, it’s a program it’s a federal program that was enacted in 2017. It’s part of the tax reform legislation. So a zone is obviously a geographic region and it’s broken by census tracts. So if you’re talking about opportunity zone, so that’s a place and it’s designated as a U.S. Census tract and that there are certain definitions around poverty and other types of demographic information about that census tract. There was also a period when the program began where certain governors and other leaders can designate which low income census tracts could be opportunity zones. And then after a few months, the Treasury actually officially selected those zones. So the zone is a place. And in order to benefit from this program, an investor has to make an investment through a qualified opportunity zone fund into that opportunity zone. So those are the basics.

Henry Kaestner: Jeff, build on that a bit for us. And also maybe give us some illustrations of some of the opportunity zones that you’ve worked in.

Jeff Shafer: Yeah. Let me just take one quick step back. I think it’s important, in addition to information, you’ve just heard the rationale for why opportunity zones were created. I think it’s helpful here that a white paper that was written in 2015 by a group called EIG, the Economic Innovation Group, and they point out three things. One is they analyzed the recovery of communities after the global financial crisis. And what they found is there’s huge dispersion in the recovery, economic coercion. Secondly, they recognize was with the markets going up. At the time and there’s been a huge stockpile of capital gains. And then the third thing they looked at is they said, hey, there, that other programs and fact, some of the programs are just what we just heard. They’re tried to help these communities out. And some had been successful, some had not been successful, but they essentially kind of put that into a blender, so to speak, and out popped this legislation. So I think it’s important to note that the whole idea was to create human flourishing and then to attract capital to those areas. They created some tax incentives for investors really accessing private capital. To me, the starting point for as you look at opportunity sounds. I think it’s important that if you want to be congruent with the rationale for why these were created, you could simply attack it just as a tax benefit, which I wouldn’t personally. I don’t give a wrong with that. But that’s not how I view it. I look at it go. How do you create human flourishing inside of these zones? And how do you also get a tax benefit from it? And by doing that, you’re creating a win win. And actually, I think there are reasons besides, you know, moral reasons or even ethical reasons why you’d want to do this. I think as soon as you start investing in upcoming zones that maybe don’t have a meaningful impact to the communities, you set yourself up for scrutiny. And you saw that early on in the program. But practically, just give some examples. And I didn’t realize we both were going to have expertize in affordable housing. That is a natural asset class that fits with inside these opportunity zones. So we personally are involved with a group that does affordable housing all across the United States. I think one thing important to note is affordable housing is just a huge need anyways. And then a lot of these developers have been developing in these opportunity zones already. They just haven’t had this extra benefit. And so I think one of the things that we looked at early on is we want to find a model that could capitalize on this capital gain structure or relief. And I can explain that here in a second. But it wasn’t just a new business model that a company goes into. And so the natural spot for us is affordable housing. It’s just there’s a fundamental need that we get in some of the stats and reasons why. I will tell you, the group that we work with has done one here in Orlando in my backyard, and I’ve actually done that with the major bank. One other thing I should note is as an investor, you need to view this as an investment and then you need to look at the tax benefit kind of as gravy. And then obviously you need to think about the impact that you want to have. There’s really two things to look at from a tax consideration standpoint. This program allows for an investor who has a capital gains for simplicity. I’m going to say it’s pretty liberal in what type of capital gain it can be. There are some nuances, but whether it’s a stock, whether it’s the sale of a house, whether it’s a business. So there are taxes. If you’d sold that asset that you don’t pay taxes, that the government is basically said if you take that capital, that whole capital gains, then have all that. But you take that capital gains and you roll it into a fund that is investing into these geographic areas, then you don’t have to pay capital gains tax on that that you normally would have until the end of 2026 and you get a step up in basis in this case. Today, it’s about a 10 percent step up in basis. So you get to defer it. And presumably of tax rates stay the same. You actually will pay less as well in 2026. That’s one component. And the second component is the money that you invest inside of the qualified opportunity zone to fund those assets. If they’re held for 10 years, which you’d want all the Putin years when those assets are sold. Then you do not pay capital gains on those assets as well. And so to extent, we want to we can go into examples of that and you’ll hear, you know, how much kind of return that should add to the investments. It is real dollars in your pocket when you do the math, assuming you buy a good investment, assuming you buy good investment.

Henry Kaestner: So talk to us about what’s the most good investments are. Jerome, illustrate an example and maybe will stay in affordable housing. Something you know of. Talk to us about specific zone specific investment and maybe one that was done in a fund, maybe one that was just done outside of one. But what were the mechanics of it?

Jerome Garciano: Yeah, so our fund that I’m a part of has been involved in a couple of transactions. They were last year. One was affordable housing in New York. So in that instance, there was an investor who had a capital gain. It was a financial institution, and they worked with what they call net farm housing interest, syndicator of essentially of a broker or intermediary that matches up investors with projects, you know. And so in that case, you know, there was the typical tax benefits for an investor that would be driven by the credits. Obviously, they would still need to underwrite the project in terms of the rental income would qualify both for the housing program as well as an operating expense needs and debt service for the project. So, you know, it’s typical underwriting the tax benefit, again, was calculated really at the fund level. So it was a part of the benefit, but it was separate over and above kind of what the real estate economics were about. So certainly that was one example. The other example that we had wasn’t actually an operating business to keep in mind. Opportunities on is not just about real estate, it’s actually about operating businesses as well. And so so that was an M&A transaction. I wasn’t. Directly involved with, but my colleagues were. And so they were working with, you know, a private equity firm that acquired some assets and. And those happened to be an asylum so that they were able to get work with kind of underwriting and evaluation of the business. And then, you know, kind of a key component of that was there is a requirement that assets need to be either new assets being purchased by a qualified opportunities on business or that those assets need to be substantially improved. So, you know, there are definitely some structuring and some programmatic things that need to be laid out and everybody needs to be on the same page on that. So that was an exercise of making sure that there was in this acquisition of a business, that new assets would be placed in service, there would be substantial improvement on the property that that business had. So those are a couple examples.

Henry Kaestner: Jerome I want to stay with you. Both of you are very motivated by your faith. I’ve come to know and appreciate and love that, both of you. But, Jerome, you come out of this from the CCDA perspective, the Christian community development. What is the particular faith lens on this? Presumably at some level, of course, we’re investing in human flourishing and we’re investing in some really challenged neighborhoods. But is there a way to bring the church in? Is there a way to bring word ministry in? Is that too contrived? Talk us through that.

Jerome Garciano: I mean, I think you come at it from a couple different angles. I mean, certainly because, you know, the ease of kind of connection between real estate in place, making an opportunity zone. I mean, I think churches are already good at that. They’re good at kind of creating places and experiences that, you know, point to God and they can point to, you know, our faith. But I think it does take some creativity. I think it takes some new almost like, you know, because this concept of new wineskin for a new time and in kind of a new place of ministry and serving others, you know, for such a time as this as, you know, what we’re experiencing now.

So I feel like investing in people and relationships are at the core of everything. And one of the core tenets of the Christian community development ethos is really being with the poor and being in solidarity with kind of the struggles and the challenges and often the injustices that face those on the margins. And so I think that expresses, you know, theologically this idea of, you know, guy coming down to man and really experiencing kind of what the challenges are. And I think that reflects on even those of us who aren’t, you know, in that economic situation, like what that means and how that reminds us of kind of our need for God and hopefully thankfulness for kind of what he did for us on the cross. And so I think very deep past theological. I mean, I think there’s also, you know, very strong kind of biblical references to what it means to be just and to be equitable and to give everybody an equal opportunity. And so I think that discussion is raised in the context of kind of our Christian community development groups that, you know, kind of focus on that. I think there’s also a sense tragedy of we’re not just meeting physical needs, we’re not just meeting kind of financial needs, but we’re bringing in the gospel and what that means and how God has made us whole through Christ life, death and resurrection. And so, you know, a lot of it is also, you know, people aren’t going to hear the message until maybe you show them that you’re more interested or you’re equally as interested in kind of their practical situations and challenges that they’re facing. So I think there are a few different ways to think about it.

Henry Kaestner: Jeff, would you pile on to that?

Jeff Shafer: Yeah. So let me give you some tangible examples of where I have seen integration. It’s not necessarily an opportunity zone structure, although these assets are in opportunity zones. So we’ve come across managers in specifically affordable housing who they have a nonprofit organization that sets out the properties. And there is so management company that manage the day to day operations of it. But they almost are a dorm parent, so to speak, for the communities. And, you know, part of their ministry is fixing flat tires and being a counselor there, you know, 2:00 in the morning. And when somebody gets sick in English as a second language and then obviously embedded in that is their faith component. And so I’ve seen that model in several different ways. They other think that I’ve started to think about is from a biblical perspective. If you think about this emotional ministry, you know, are we called to be more. I don’t think it’s right or wrong. Are you called to be more evangelistic in the way that you invest? And I think that would be obviously more directly kind of faith based, at least in my mind, than you have. Is it more of a discipleship model or are you cycling coming alongside of people of faith and continuing to build their faith or even the other type of ministry that, you know, through a faith perspective we talk about? Is it more of a mercy ministry where you’re doing it in the name of the Lord, but you’re feeding the poor or whatever it is? And so I think you can use those models as framework. When you look across different types of assets and their faith integration and, you know, we not only work on the real estate side, but we also do. Private credit and private equity, and there isn’t a cookie cutter, a way to integrate it, which is part of the excitement of it, because it’s yet to use your creativity and ingenuity in each scenario and figure out how to meet whatever need that you’re trying to meet. And obviously, spiritual is a huge part of it.

Henry Kaestner: I’m intrigued by that. I love the framework that you just gave. And I think that we all, as Christ followers, need to be thinking through the different models. And we should never be prescriptive. We should never be over the top. We should definitely not force a ministry impact in this. Something that doesn’t feel genuine isn’t done with gentleness and respect. And yet it sounds like these are different investment projects that are going on in different zones where there might be a partnership with either a parish church ministry. I think that’s Jeff, what you’re talking about, but then also potentially with the local church as well. We’ve done episodes in the past where we’ve talked about what it might look like for a local church to adopt multi-family real estate and get involved there. Drome, are you seeing people within the church that are leaders of denominations or individual churches that are seen? This is something that they can get alongside and partner with?

Jerome Garciano: Yeah, definitely. I mean, you know, even before kind of the shutdown and the things that we’ve gone through now, I mean, you know, underutilized church property. Right. I think it depends on the different type of church or denomination. But there are opportunities to use building assets, you know, in ways that are beyond have the traditional Sunday service. And I think there were a lot of creative thinking around, you know, how do we engage the community? How do we serve and meet the needs of a community through these facilities, whether it be something that’s related to something like a community center or something that’s related to, you know, working with the children and after school programs. And so, you know, multi-family and affordable housing is definitely on the forefront. You know, I know a lot of churches that are looking to incorporate on their actual church campus or property housing. And, you know, I think even more so in the future. And let’s see, you know, how this plays out. But I feel like there’ll be a lot of opportunities to kind of rethink and reimagine kind of how these assets are used. So, you know, one group in California, in major cities that have homeless crisis, they’re looking into do some tiny home development, like on church property, you know, and the idea would be to lease some of the land to the developer so that a local church can get a little bit of income and then they would provide these homes that would be able to be, you know, occupied by people who need the affordable housing. You know, there’s certainly other partnerships in terms of, you know, parking lots that have been sold and, you know, developed into housing tax rental projects. So, you know, depends on obviously the sophistication of a local church and kind of what the development team looks like and what their overall goals are. But there are plenty of examples and opportunities to partner in that way.

Henry Kaestner: Okay. I think I’m following I think a lot of our audience is following now about the origination 2017 of this opportunity zone legislation, some of the financial benefits to investors. I want to talk next about how to get involved. If you’re listening to this either as an investor or as a service provider, maybe we’ll start as an investor. We’ll start with you, Jeff. Some listeners podcasts. I might get us this great. I can love on the poor and these challenging neighborhoods and put my investment capital to work there with flourishing. Maybe there’s an opportunity partnering with the church, but definitely motivated by my faith to see a disadvantaged neighborhood get back on par. What do I do now? Are there funds that do this? Are there individual deals? Is there a marketplace? Is there a funder? What do I do?

Jeff Shafer: Yeah. Funny as you’re asking the question, I’m like, what do you do? So a couple of things. And let me start with this and Be very practical for you. I myself have invested in an opportunity zone fund as well. And I think these are three questions that every potential investor needs to ask themselves. And depending if you can answer. Yes. And I think it makes sense to continue the dialog. You know, where do you find opportunity zones? And then really, you’ve got to also think through, do I want to go into a fund? Do I want to do a single asset deal? Do you want somebody else to manage or do you want to manage it yourself? But here are the three questions that I think are foundational. And there’s more than that. But if I just was to give you three questions you need to ask is in this order. So you have a game. You go. Do I pay tax on this gain or do I take some mosquito and roll it into an opportunity zone on? The first question is, you know, what kind of return can you generate? I think you have to view this fundamentally as an investment, because if it doesn’t perform as an investment, then ultimately you’d be better off just paying your capital gains and going elsewhere. Now, obviously, you can try to find different assets to perform at different levels and a different level of risk. But I think you need to start from. This is fundamentally an investment. That’s number one. Number two is can you hold this for 10 years? The way the rules are written to maximize all the tax benefits, you need to hold it for 10 years. It doesn’t mean that they’re. Ways and there may be some reasons why you wouldn’t hold the 10, but the blanket statement, that’s pretty solid. If you can’t hold the investment for 10 years, then you shouldn’t consider it. And the last thing is, can you get comfortable with some incremental risk that needs to be followed so that you actually get the tax benefit that you can? And if you can answer yes to those three questions, then it probably makes sense to go. All right. I want to look at this. One of the things, too, that’s unique. If you’re familiar with the 10 30 one investment, some people compare these and their similarities and differences.

But one of things I want to point out is if I had a half a million dollar gain as an example, I do not have to roll my whole half a million dollars into an opportunity zone. And at ten, thirty one, you really do. And so then you need to figure out how much you’d want to put in there. The other things you want to consider is do you go into a fund that has multiple assets in it? Or do you try to find a one off deal? You can find both out there. Some Web sites that I would at least looked at would be a Web site called AIG dot org. Another one is Noboa Graddick. There really is no great centralized place. I mean, there are some typically you are going to talk to your advisor, attorney, local real estate developers. This whole marketplaces developing in. One of the big questions is, does it continue to develop long term? And I think part of that is dependent on the regulations. And if they continue this program, which is, you know, we’ll find out. I do think they’ll given the Koban 19 and what’s happened there clearly is a renewed interest in that why opportunity zones were created. So not to predict what the government’s going to do. But man two the statement said earlier, for such a time as this, this structure could be extremely powerful tool to help rebuild America at a time when we’re going to need it. The short answer is we can help you find opportunity zones and we can get some places where you can go to Henry Antin and you can check out some Web sites as well.

Henry Kaestner: Jerome, maybe supplement that. But I also want to focus on the service provider aspect of it. Say I’m a church Amen ministry, not for profit in an opportunity zone. I can think of creative uses. Maybe it’s unused property on a church, maybe it’s unused facilities within a church building. Where do I go to take next steps and learn more so that I can get actively involved? Or maybe it’s just I’m a church and I just want to partner and just love on people through some of these new investments are coming in. What do I do?

Jerome Garciano: Sure. I saw, you know, through the CCD network, there was a group of us that started the Jubilee Impact Fund. And so Jubilee Impact Fund is trying to use the Opportunity Zone program to gather faith driven investors, other types of denominational connected investors to opportunity zones, and also trying to bring in on the debt side groups what they’re calling the community development financial institutions. Essentially, you know, lenders and banks that are focused on lower income is providing capital. So we are trying to launch this and we’re trying to partner with local churches. And so we have, you know, dozens of organizations around the country doing ministry already. And, you know, typically inner city areas and we’re having a discussion with them is how can you, you know, look at the existing initiatives and projects, incorporate things like affordable housing and things like a business incubators that could, you know, provide venture capital and other technical assistance and support to Minority and Low-Income Entrepreneurs. How can you engage the neighborhood with, you know, other types of services that could be funded through opportunities on equity? So the niche that we’re trying to make is a connection between the kind of faith driven investors, the people of faith who would be interested in opportunity zones and these initiatives on the grounds where these churches are already serving. I mean, I think that’s thing. I think the churches are already serving in these neighborhoods that are designated opportunity zones. It’s really just trying to make the connection and create, you know, the fund structure and kind of a consistent approach to capitalizing these projects. And I agree with what’s been said before. I mean, it has to make financial sense. I have to pencil out. But the idea would be, how do we creatively do that while maintaining the ministry impact as well as having the positive benefit for the community? Because I think was alluded to earlier, this program is fairly open. I mean, there are not a lot of rules and regulations, which is, you know, in some sense a nice thing, a beautiful thing, a flexible thing. But in other cases, there are no restrictions in terms of challenges like gentrification or displacement of, you know, the existing populations of the zones which actually harm these neighborhoods. So. You know, given the very flexible nature of it, there is creativity. But I think we need to be intentional in terms of what types of products we invest in and how we do that and how we engage the community for true stakeholder engagement to be able to do a successful opportunities on investment.

Henry Kaestner: Fascinating. I’m intrigued by this. I’m grateful for both of you being on the program. If you’ve turned in before, you know, one of the things that we want to make sure that we close out every one of our episodes with is asking our guest what they’re hearing from God about in his word. And it doesn’t need to be necessarily this morning through your quiet time, but maybe sometime last week or sometime recently about some way that you feel that God is speaking to you through time in the Bible. Jeff, we’ll start with you and then Jerome, close out with you.

Jeff Shafer: Yeah, well, if we want to get really personal, what God is challenging me on this question of, and it’s funny, I wasn’t planning on talking about this, but I started to write just for myself. I wrote a question and the question was, can you trust God in the midst of human suffering? And I just wanted to know obviously have Russell before, but I really want to get this on paper for my own self. And really, what is the question ultimately key and personal senses? Do I trust God? Is God a good God in the midst of all this, in the midst of just human suffering?

And I tell you, I’ve got a senior and a junior in high school, and obviously my wife and I and we have been chatting about this very question the last two or three days. And really where I want to go is is intellectually I want to have an answer. But more importantly, I want to know that my heart’s in alignment. And then the key is, am I actually living in that truth? And I got to be honest, I think intellectually I’m probably there. I think my heart is there at times. But really, what’s been challenged in me is, is am I living that out intentionally? Day to day. So now to be where I’m at this very moment.

Henry Kaestner: I think a lot of us are at that very moment. And I love the fact that you lean into that with your kids. Jerome.

Jerome Garciano: Yeah. I guess for me, you know, this almost hopefulness about kind of what is to come, because I feel like God is doing something. And obviously in the midst of very difficult times, there is always hope and we need, as Christians need to carry that and amplify that and share that with those who might not have any right now. So this idea of kind of the new wineskin and you kind of creative models and theories and programs. I feel like people are ready to be creative. And that is very refreshing. And I feel like there is such an opportunity there. So, yeah, I mean, this idea of new wine scans and how can we prepare and be humble and be creative in a time when in a lot of ways were challenging kind of the existing way we do things right. And so how does that balance in terms of, you know, a lot of ways, morning, maybe what we’ve lost and maybe things that we’ve lost permanently in terms of kind of how we gather and kind of how we worship and how we express our faith, but then also embracing kind of a new. And so for me, that definitely still attention and praying about that every day. But I also am very hopeful because I think there’s things that our God will show us and we can just live into and just be thankful for drove.

Henry Kaestner: Thank you, Jeff. Thank you. This has been great. Really appreciate you taking the time. I hope that people will look into the Jubilee Impact Fund, common good capital websites, Jeff, that you shared and put up some show notes to this as well and just appreciate the opportunity to talk to y’all about what does it look like for Chrysler to be intentional about their investment deployment and how to be wise as a serpent, innocent as a dove, be able to take advantage of tax code opportunities, to be able to take advantage of of the passion that we all have to love our neighbor and to take care of the least of these. And lots of those are in our midst and some is opportunity zones that are not very far away from us. So thank you for taking the time and for your leadership in the movement.