Episode 191 - From Y Combinator to 3D Printing, Investing in Housing Innovation with Brett Hagler of New Story
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Meet Brett Hagler, who transformed from a tech entrepreneur to pioneering market-based solutions for the global housing crisis through New Story. As one of the first nonprofits accepted into Y Combinator, New Story is revolutionizing how we think about affordable housing by combining philanthropy, technology, and investment capital to create sustainable homeownership opportunities in Latin America. Learn how New Story achieved a 100% repayment rate on their housing projects while delivering both strong financial returns and life-changing social impact for thousands of families.
Please note that the views expressed by the hosts and guests are their own and do not necessarily represent the opinions of Faith Driven Investor.
All opinions expressed on this podcast, including the team and guests, are solely their opinions. Host and guests may maintain positions in the companies and securities discussed. This podcast is for informational purposes only and should not be relied upon as specific investment advice for any individual or organization.
Episode Transcript
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.
Richard Cunningham You're listening to Faith Driven Investor, a podcast that highlights voices from a growing movement of Christ -following investors who believe that God owns it all and cares deeply about the heart posture behind our stewardship. Thanks for listening.
Speaker 3 Hey, everyone. All opinions expressed on this podcast, including the team and guests, are solely their opinions. Hosts and guests may maintain positions in the companies and securities discussed. This podcast is for informational purposes only and should not be relied upon as specific investment advice for any individual or organization. Thanks for listening.
Richard Cunningham Welcome back, everyone, to another episode of the Faith Driven Investor podcast. Great to have you with us. What is our pod for the end of February? We're joined by a really special guest today, Brett Hagler, who will be joining Luke and I in the FDI podcast studio. Brett's the CEO and co -founder of New Story. Luke, Brett, great to have you guys in here. Brett, pumped to hear about some of your work with New Story and what you guys are doing to help thousands of families get homes and properties in Latin America. This will be a really fun episode and I think a fun kind of angle for Faith Driven Investors to look at the problem of homelessness and all of that. But before we dive in, Brett, and get some of who you are and what you've been working on, how are you guys doing?
Brett Hagler Doing great. I'm excited to be on with you guys. Love the pod. So it's an honor to be here.
Luke Roush It's not often, Richard, that we get to focus on problems that affect two billion people, billion with a B. And so the scope and scale of what we're going to talk about today has me excited as well, and nobody's been more on the front lines than what Brett's doing here. So this is an exciting day.
Richard Cunningham It is. So Brett, Goldman Sachs called you one of the top 100 most intriguing entrepreneurs. We got to hear about that in and of itself. The word intriguing, which I just love. And you're also a founder of a nonprofit. And I know it's got for -profit angles, which we'll get into here in a little bit with this being the FDI pod specifically. But man, maybe just start us with a little bit of your kind of story and who you are, way God kind of rescued you in an awesome way post -college and just how that led into new story.
Brett Hagler Sure. Yeah, I'll just give everybody context. We'll give some background, but this is definitely about investment. So we'll talk more about how we believe and I've learned after 10 years of doing this, that investment and market -based solutions is, in my opinion, the best way to help the most people. So we'll get there and I'll kind of talk the back story. So yeah, I, from a faith perspective, didn't grow up a strong believer at all, kind of lost my way in high school. It was a stereotypical jock in high school. I had a very rare form of cancer my senior year in high school. And that changed a lot of my plans. I was going to try to play basketball, college, blah, blah. And, you know, during that time, it was, I was definitely praying. I was definitely hoping God would save me because it was serious cancer. And he did. And instead of me kind of turning to him and, you know, making my life surrendered to God, I kind of went the opposite way. And so I went off to college at Florida State and yeah, lived a life that if you would have asked somebody what I'm doing today, then this would probably be the last thing that they would have said and just wasn't following the Lord was using a lot of maybe skills is the wrong word, but using characteristics that God gave me for a lot of the wrong things. And that led to just all types of pursuits. You know, I call it, someone told me it was the three G's, which is gratitude and generosity and God. It was a girl's gold and glory. And I'm sure, you know, a lot of people, of course, have kind of gone through that phase and obviously learned that it's empty. There's really nothing there. And thankfully about a year and a half after college, the Holy Spirit met me. And I loved entrepreneurship. I love startups. I loved business in college. I was, you know, reading a book a week about all the biographies that many people listening probably read. I was obsessed, but I wasn't a believer. And I was lost pursuing, you know, the things that don't matter. And I did a first startup right out of college and it was a for -profit company and how God met me was actually through a venture capitalist and it just kind of goes to show for those listening. I had no idea he was a believer, but I was very attracted to what he had done, what he accomplished, how he held himself. And he was a role model from afar. And I was lucky enough to get a chance to sit down with him for lunch. I was a young 23 year old kid. I kind of begged to get on his calendar, blah, blah, blah. And I get there and I asked him about leadership and maybe if he wants to invest and long story short, in a very natural way, he starts talking about Jesus and I kind of asked him a question of how he thinks about leadership and he told me about servant leadership and I'm like, what's that? And that was kind of a softball for him to talk about Jesus and leadership. And from that point on, Luke and Richard, that was kind of the spark that God used to get my attention. I mean, to kind of reframe what I thought living a life, surrendered to Jesus looks like. And it was done through a venture capitalist investor was kind of the spark that caught my attention. And after that, I kind of make a total 180, go all in, get baptized. Really nobody else, none of my friends were doing this. It was all, you know, kind of by myself with the Holy Spirit. Shortly after that, two things happened. My best friend, which many people probably have heard of or know is a guy named Mike Arrieta, we grew up in middle school together and he kind of shortly after me started following the Lord and so the two of us together in our early twenties started just running after Jesus and that ended up taking myself and Mike on a missions trip to Haiti and that was back in 2014 and on that trip is when the kind of an original spark for news story was created and that was just seeing, you know, the devastating, devastating reality of what it looks like to not have life's most basic human needs. And that was kind of the spark of it all.
Luke Roush How did you think about, so I've been on trips like that, where you kind of have a spark and your heart breaks for something that you see, you realize like, wait a second, there's gotta be a better way. Coming out of that trip. How did you contextualize, like, what was the on -ramp into actually getting in the game the way you'd got in the game following that experience?
Brett Hagler Yeah. I mean, from my perspective, I was, I was pretty young. You know, I was 24 years old. I loved entrepreneurship. You know, my faith was on fire. And so I had a lot of energy and I had a lot of passion. I would say, you know, people talk about ignorance is bliss. And if you know then you wouldn't have got started of all the problems, et cetera. And, you know, as cliche as it sounds, I just tried to start small. You know, I think if I would've tried to say, how do we create systematic change in multiple countries and get into disrupting the financing system and redefine what it looks like for property rights, like, I didn't know enough, you know, I didn't know enough, but I got started. I got started very small. I said, you know, how can we try to literally help a few families get access to life -changing housing? And then through that action, God introduced me to two other co -founders in Matthew and Alexandria, and we were trying to come at this problem back then just in a different way with a unique angle, and back then we used even more technology and we applied to Y Combinator. My background again, was not doing things in the developing world. I didn't have this kind of a nonprofit background. I loved the stuff Y Combinator was preaching and teaching. And so we applied and we actually became one of the first nonprofits to ever go through Y Combinator. And so to answer your question, Luke, that was God putting a lot of things together in a short period of time, and we kind of got started pretty fast.
Luke Roush So wait a second, how many nonprofits, I mean, you said it was one of the first ones, I mean, it had to be maybe the first one.
Brett Hagler It was the second one.
Unidentified Yeah
Luke Roush Okay. So what did that look like? I mean, you show up at that time, they were still doing all their cohorts in Silicon Valley. Is that right?
Brett Hagler Yes.
Luke Roush So you still have to tell people, Hey, this is kind of what I'm fired up about. Like how did that go? I mean, need to hear more.
Richard Cunningham Yeah. So we moved out to San Francisco. I ended up living there for almost five years and we went through the summer of 2015 was our Y Combinator batch and I freaking loved it. It was incredible. I mean, I felt at the beginning and during most of it, like the highest level imposter syndrome that you could imagine because it was so hard to get into, I didn't have any prestigious accolades or fancy schools or, you know, and so it just felt like, wow, God really wanted me and us there. And of this organization that's trying to help vulnerable families in Haiti and El Salvador that don't have basic housing, like what are we doing here? And honestly, we just made the most of it. We were on fire. We were so passionate. It was definitely a season that I do not regret how much we worked and how much energy we had because it truly felt like a once in a lifetime opportunity that God created. And so it also really shaped the DNA of how we think about building new story. And even though what we're doing today is entirely different strategy wise than we were doing 10 years ago, the DNA of how to think, how to imagine, how to get started, all the things that the best startups kind of learn and go through. We were so lucky to be taught that at a young age. And it really shaped my thinking, our DNA. And I'm just so grateful for that experience.
Richard Cunningham That's cool. All right. So selfishly, I kind of have to like recap the story here from my own brain, not as fast as you guys, but there's a lot of fun synergies and overlap too that I'm loving. So you got young jock, Luke and I resonate deeply with that. Just like the sports world, Luke more than me. And then you go off the Florida state, John Coleman, our other FDI podcast host will love that. He's a Tallahassee native. We'll love the Florida state roots. The Haiti kind of awakening moment and the kind of birthing of new story alongside our buddy, Mike Arietta, another kind of fun synergy. Ironically, Luke is where Suzanne Daniel, one of our FDI podcast guests a few weeks back, who also just spoke on the FDI conference is where she kind of came alive for the Pilgrim Foundation and Suzanne Daniel story. So a lot of just like fun threads here, but anyways, young founder, a powerful experience in Haiti goes to YC with a nonprofit has this like amazing kind of business building experience. And I've got friends here in town, Brett, who are great admirers. I'm here in Austin, Texas, Chandler Bolton, particular, another young founder who just like loves watching you run a nonprofit, such a missional organization, like he runs his for -profit venture. And I'm sure that was kind of bred into you in that YC background and some of the reading you did and just the passion you naturally have. So help me understand kind of like the original theory of change of new story, what you brought into YC, why they accepted you in the first place. And then you mentioned the mission and kind of the way you're attacking the mission, if you will, has changed in present day, kind of bring us from that journey that started in 2014 to kind of where we are now.
Brett Hagler Totally. Yeah. So our mission today is to empower families to transform their lives through land and home ownership. And so that goes back to what Luke mentioned. Unfortunately, there's almost 2 billion people today that live in inadequate housing. That does not mean 2 billion people on the street, but it's 2 billion people that are living in conditions that are completely inadequate, that you would not want anybody, you know, to live in. You probably wouldn't want your dog to live in. And, you know, the size of that is so big. It can be overwhelming, right? And so we are doing our best to help those families have access to life -changing land and home ownership. So that hasn't changed or why hasn't changed. Our big North star hasn't changed, but how we go about accomplishing that has completely changed. And I, you know, tell my team all the time that you learn by doing and action produces information, right? And so in the beginning, our first like five years, and we're 10 years old now, we love innovation. We love technology. We still will have that's in us. But in the first five years, I think we over index on building technology and trying a lot of like ways to cut down the cost of a house with technology or more novel approaches, which is important, but we weren't seeing the full picture. So with housing, there are so many pieces to the puzzle. And when you think about first principles with housing and land, in my opinion, it's not about how do you reduce the cost to build the actual unit by 20 percent. It's the whole value chain. So you have to think of, well, where's the land? How do you buy the land? What about the infrastructure that comes in, the sewage, the plumbing, the roads, the electricity? How do you work with municipalities to get permitting and fast track everything? How do you help a family build a credit profile? How do you then help that family have access to legally titled land that can be recognized by a bank so they can unlock a mortgage? These are all things that we weren't thinking about our first five years because we were just trying to focus on like the end product of the house. And so now, like 80 percent of organization is focused on all those beginning steps, the first principles approach to catalyze. Then you're able to bring in whether it's normal construction or a novel technology after you have the foundation set. So that was kind of the biggest learning. And when we realized that we had to completely evolve really our strategy and our strategy started to evolve more towards how do you think about investment, how do you think about helping families to be at a place where you could underwrite them for a mortgage? And that means it's the basics of capitalism. It's like, OK, they need to have a credit profile. They need to have legal property title that has to have market value and able to unlock bigger financing. So that was kind of the big learning.
Luke Roush Well, you know, here in the US, right, we talked about systems being broken and they are. But my family lived in Indonesia for a handful of years. And you start to realize in a lot of these countries that are home for these two billion folks, there are a lot of systemic things, whether it's just basic property ownership rights, title, this idea of like title insurance that we get in the US that is largely a dumb expense. But it does kind of help to reassure everyone that you own what you think you own. You know, this concept in most of the countries, probably where you've operated, Brett, is somewhat foreign. And so until you kind of get after some of these systemic things and you realize just a multifaceted nature of the problem, you can focus on the end goal at the expense of like these process steps that need to be in place to be able to ensure that if you get the end goal done, it actually sticks and it's generationally changing the trajectory of your family. So maybe talk a little bit about like how you discovered what else is required to be able to address issues that you're ultimately addressing really successfully.
Brett Hagler Yeah, I'm going to walk you guys kind of through one project example. I think that'll help. And so this project, it's all market based. The unit economics of it are positive. It's not subsidized on purpose, and we can come back to that. And it also brings in investment. So what we've learned is that, like, if you think about an underserved family that is around the poverty line or is a low income family, they don't have a few main things that they need for long term homeownership. Right. So they usually don't have a trustworthy credit profile. That's a problem. You usually can't trust or validate the land that they own. So if you can't trust the land property title and if you don't really know who owns what land. And then thirdly, if you don't know the value of that land, how are you ever going to then go and try to get a loan and use collateral when you don't have it. Right. And so what we've done is we've said, hey, why don't we start first with land ownership as kind of the pathway to homeownership? And so we've created this model that we think is definitely effective, but it's simple. And it's this it's we go in, we buy land with investment. And let's say we buy enough land for 500 housing lots. We'll then work with 500 families to make payments, to buy their land first before the house. And so families will go on a monthly payment program to pay for their land. And then we also are using investment to bring in infrastructure, life changing infrastructure so that they can have clean water and electricity and plumbing, Wi -Fi, telecom, et cetera. And so they're paying for that while our investment is putting all the infrastructure in. And then once they're done paying, well, they've now paid, which is about 12 to 24 months. So they have a credit profile that they didn't have before. They now own a valuable asset, which is a land plot that has appreciated in value because the infrastructure is now installed. And that can be appraised and has a market value. And now they're in a totally different place once they own that valuable piece of land to then go get a home loan, because you can actually underwrite it. It's the basics, the beauty of capitalism. Or if they want, they could build their own house. But for us, we've learned, ah, the catalyzing thing is like to be obsessed with land ownership in the beginning, because that's the gateway to make everything else happen. And so that's what we've really focused on. It's been quite successful. The last project we just did was about 400 lots. We ended up having a 100 percent payment rate for the portfolio. We exceeded returns and would have, by any measure, good market returns for that project. And now families are in the phase of starting to build homes or get a home loan. So I kind of that's a way to think about it.
Richard Cunningham Yeah, that's helpful. So you've got operations in Mexico, El Salvador, Bolivia and Haiti. You kind of explained what one project can look like there. But putting yourself in the shoes of a faith driven investor listening to this podcast, there's a number of quote unquote risks to mitigate. Like there's a very catalytic opportunity here, but it's international work in Latin America. I'm curious about the mechanics of the investment and how you kind of think about returns from kind of this new story capital side of the operation. You mentioned 100 percent repayment rate, which is really powerful. So I'd love to hear you double click on that a little bit more. But I'm a faith driven investor, someone who's motivated by this solution. I'm thinking about it. And I'm like, am I really willing to put market rate capital on the line here? Or is this a more patient concessionary play or something people you find more doing from a philanthropic angle? Because I think how how you thought about this is really powerful.
Brett Hagler Yeah, so those are super important questions, you know, from the highest level. My belief is for this to really scale, which for us, I feel like God has called us to truly try to impact millions of people with this model. I believe you have to get market returns. That doesn't mean that we're trying to have the top one percent returns of all time. But I believe you need to have good returns. That's like a double scoop of one good returns. And then two truly 10 out of 10 life changing impact. Right. I think we've all kind of gotten different views in the last couple of years on ESG, impact investing, like all that. So much of that. You can't draw the direct correlation to the life changing impact. Right. And so with this, you get both. And it's just my belief that you're not going to get to big scale if you don't have the good returns, because you're not going to be incentivizing other lenders, other investors to do this. Right. And so what we want to do from an impact perspective is we want to demonstrate what this looks like. We want to say, hey, there is a massive underserved market. It is deeply undersupplied. But there is demand. And we've proven this out. And we believe that you have to have a fair profit with a good return. And if that then you can really grow it. And it's somewhat, I want to say, unlimited, but it has so much more potential for scale. So that's our belief. Now, getting there, obviously, it's challenging. And so I'd say the main thing is we have a team that is obsessed with this problem. Right. And we are building a team around that. We're building our case studies around that. And we're trying to be the best in the world at this particular niche, which turns out to be a pretty large market. And we'll go into all the details of like how we hedge the risk and all of that. But we try our best to have it as risk -migrated as possible, knowing that there's a whole waterfall of how we do that. But we can dive into that if you want, Richard.
Luke Roush One of the things that I'm struck by, you know, so we talked about the enormity of the problem and one of the things that you were just pointing towards is the importance of market -based solutions. And so the statistic, I think, is, you know, only 10 percent of the current housing need would be solved if all of global philanthropy and government housing subsidies were put in play. So like back to how do you activate market -based solutions at scale so that this isn't just kind of a bandaid. It's not just, you know, one out of 10 communities, it's 10 out of 10 communities that can be reached. Yeah, maybe just talk a little bit about that journey. I mean, you know, my perspective, again, in like sort of emerging markets, if you can have less than a 5 percent non -performing loan and PL rate, you're doing really great. And so for you to be at 100 percent payment rate, really remarkable. Maybe just talk about peel that back a little bit. Why is it so successful?
Brett Hagler Yeah. So let me go through two parts there. First, on the you mentioned some of the math, you know, that was a big learning that we had five years ago. Jim Collins talks about the brutal facts. Find out the brutal facts. And that was a big one where we were like, OK, if we're just going to raise philanthropy, we're going to be the best in the world at raising philanthropy. And we got all the government subsidies. How big of a dent could we put in this problem? And it was very depressing to know that it's literally less than 10 percent. Right. That's just the enormity of the cost of the housing crisis. And so we're like, OK, we have to shift so that families can participate in the pool of capital, which is capital markets and lending that actually is big enough to make a significant debt. So that was like the big idea, the big learning. And then so the 100 percent payment portfolio. Let me walk you through that real quick. So in our model, if we do, let's say, a thousand lot projects, right? We have a thousand families that in the very beginning of that project, we already have signed up as customers that are going to pay for their land plots. Once we have that and once we have the permits for the municipality, then we bring in an investment and then we buy the land and we start doing the infrastructure. Families are making monthly payments on their plan. But because we are taking a risk on them. Right. What we say is, hey, we want to have kind of like a little insurance as well. And we set up what's called a waitlist group that we created. And so if there's a thousand families making payments for their land, that's kind of the main group. We have this waitlist group that's about 20 percent of the total. And they're making payments into an interest bearing savings account. So we've created a way for them to save, be on a waitlist, know that they're probably not going to be part of this batch or project. But there's such a mismatch in supply and demand that they want to do it. So if anybody from the main group has to drop out, maybe a kid gets sick or they have to move, they get their money back. And we don't have a hit to cash flow because we can backfill it with somebody from the waitlist. It's simple. Right. But it's a way of, you know, taking a simple, great idea and taking it seriously. And it's just like this mismatch in supply and demand. And how can we use some of New Story's skills around marketing and sales and setting things up so that we're de -risking, working with a vulnerable demographic?
Speaker 3 That's cool.
Richard Cunningham Brett, maybe put some of like the names and stories to faces on both sides of the aisle here that you're bridging together. So you've got some of these families you're talking about. Maybe help us understand kind of the demographic of that family in Latin America and then also those who are partnering with you on the New Story capital side to be the investors who are kind of willing to blaze this trail. And so, yeah, this is a project that I think is worthwhile. I want to journey with New Story.
Brett Hagler Yeah, sure. Yeah. I mean, the families we work with are families that it's funny when you work in the kind of developing world markets, when you ask families their dream, not all the time, but very, very for the most common answer you're going to get is a home. Right. And people typically think because it is true just by the data, the status quo is that's going to take them 15, maybe 20 years. That is the status quo that has been that's just reality, because when you don't have other interventions, that's how long it takes. And so people will say a family, a mother and a father with three kids, you know, they'll say one day I'm going to save up enough and I'm going to, you know, try to buy land. And I'm going to slowly build my house over 10 to 15 years. That's the status quo. And so we're able to go into that family who has, you know, kids of all different ages and say, hey, that could actually take two years. That's what we've done. It is a totally different calculus to think about this dream of home ownership and land ownership. So they have a place for generations to build their family, to build their church community, build all these things can happen in two years.
Richard Cunningham And real quick, double click on that, though, is where do they find a new story and how do you guys find them? Because I think that's a key piece of the puzzle as well. Sorry to cut you off, because I don't want to take it too far down this rabbit trail.
Brett Hagler Yeah. So we find them by, you know, it looks more like a real estate kind of analysis of where are areas that have need. That's kind of the unfortunately the easiest one. And then how do we work with a municipality that wants to do permitting, rezoning, et cetera. We can buy land at the price. It's going to be affordable and can deliver a return. And then we have a really good marketing and kind of brand, you know, opportunity where we go out into the community, showcase studies, show that this is possible. And we have a whole like content kind of it's called the home journey is the program that we've created. And that's what families are seeing and learning. And then the main thing, Richard, is the best example is when it's been done close by and so they know people and word of mouth spreads just like anything that, hey, this is like this is actually not too good to be true. This is possible. And I want the opportunity to own land. And so if I have anything saved or if I get remittances, like this is the opportunity because it's actually affordable and it's not a gift. You know, they don't want it for free. They want the dignified process to just afford something. So that's kind of how we how we do it. And, you know, these are as so many of the listeners know, I mean, these are incredible, hardworking people that have dreams, that have potential, that have creativity. And when you don't have the basic, basic, basic human needs of safety, of shelter, of a bathroom, of a shower, you know, many families is the first time that they've ever had their own bathroom and shower because the infrastructure has been created and it's in their home. So it just truly unlocks potential when you're not in an overcrowded, you know, tiny room with a family of five and you're trying to study or you're trying to improve your work. Yes, that's why we're so passionate about it.
Richard Cunningham That's cool. And so then the other side of the coin is that investor component. And so those folks that are willing to kind of partner with you guys to go into these places and buy the land and kind of infuse the investment capital. So what do those conversations look like and who are those folks? And obviously no specifics, but just what is the profile of that person look like getting involved?
Brett Hagler Yeah, today and the next by two years, it's primarily been high net worth families and family offices with our current fund that we have right now. A lot of it's faith driven investors, not all, but it's the majority is faith driven investors, which has been incredible to have the support of this network. I think with time, because, you know, what we're doing is it's just so expensive and it's such a big problem. We definitely want to blend high net worth family offices, faith driven network and institutions, pension funds that we're going to work with local institutions in country that have, you know, big pools of capital that can be deployed. And right now, these next couple of years from an impact perspective, coming in and really demonstrating this, you know, proving that this is a massive, massive opportunity because of how underserved it is. That's the kind of opportunity for investors right now. You know, one analogy that I would say is one of my favorite examples of entrepreneurship, and we've actually got to know some of the leaders at this company at Walmart and, you know, Walmart. Sam Walton has been somebody that I love his book, Made in America. And, you know, in the very beginning, when he was running around trying to create these stores in small town America or in more rural areas, you know, all big players at the time were like, why are you wasting your time going out into these small town, you know, areas with this concept? It's never going to work there. It's not a big enough market, et cetera, et cetera, et cetera. And obviously, you know, it's been one of the best entrepreneurial stories there is. And I think for future investors, there is a lot of other opportunities out there that can look similar, not to that exact example. But like, you know, for us, just as an example, what we're betting on is there is so much opportunity in these locations that we're working that are not like super dense. They're not super rural. You know, they have probably a population of on the low end, 50 ,000 people on the high end, maybe a couple hundred thousand people. There is so much opportunity to buy land, do infrastructure, help families become land and homeowners. And sure, big developers aren't doing it right now because they see opportunity costs, they see all these other things. But that is what we want to be best in the world at. And I think there's so many other things for investors to think about of social problems, of how that same, you know, kind of philosophy can be applied.
Luke Roush Maybe speak a little bit about just for all the faith driven investors that are listening and thinking about, hey, maybe this is something that I should be waiting into. How do you position it? Thinking about debt versus equity, current income versus, you know, OK, it's going to accrue and then be paid in maturity, you know, liquidity profile, maybe just get into the tactics of that so that folks can then say, all right, hey, maybe this is for me.
Brett Hagler Yeah, totally. Let me back up for a second. So it's a little funky because it's a hybrid. So we have a news story. Kind of think about philanthropy. And just for context, that's its own entity. And what is funding that is philanthropy. And that's just going for R &D and then hiring extra staff, right? So extra staff that a management fee wouldn't cover, right? And we're so lucky to have incredible, committed people that fund that. And then we have news story capital and news story. Capital is the investment arm. It's what's doing all the hard costs. It's buying land. It's doing infrastructure. It's all the investments. And so investing into news story capital looks like a for profit investment like you would as an LP. And the current structure would be an equity investment. It's about a five year term. And we basically have two options, two classes where one, you could get paid back an annual interest rate and then at the end, you know, get the returns. And then we have another class that's a little higher on the return, but it's kind of all at the end of five years. And then the other thing that's cool about that is you get to see. And with the current fund we have right now, we're aiming to reach about 15000 families with this product. And it's so clear to see it. It's project related. And so you get a lot of updates along the way with the impact.
Richard Cunningham Man, that's powerful. You know, Brett, we just had the I guess just is not the right word is back on February 7th. But it's been a couple of weeks now. The global faith driven investor kind of annual conference, 100 and something plus watch parties, thousands of attendees around the globe. And we talk a lot about in the kind of FDI world, this language when it comes to solving massive problems like this, a two billion person problem, the concept of building, giving or investing. And I love that your journey kind of encapsulates all three of those. Like you saw the problem when you went to Haiti. New story was born. You've invited charitable, well -intentioned, amazing people to join you on that journey. And I love that now you're also saying, wait, I recognize that this problem could be tackled with a far larger pool of capital that it can also drive almost a kind of capitalistic like mindset to create sustainability in these economies and power people. It doesn't just turn into a handout type model. And so I love that you kind of encapsulate your ministry now, for -profit investment arm encapsulates kind of all three of those angles. So I want to hand you the floor for kind of just like any final closing comments on like where new story is headed next, some of the things you're most pumped about. And then we're going to ask you our kind of go to main question that we ask at the end of every FDI pod. But I want to kind of finish there real quickly.
Brett Hagler Yeah, I mean, we kind of have been starting 2025. We are coming out of almost two or three years of trying to get this model right, having case studies, getting pilots and thank God those have gone really well. And that has given me now the confidence to go forth, to raise more capital, to hire a more senior team, et cetera. So honestly, I'm just truly so excited about this year and this chapter that God has us in. It was not easy getting here and not easy transforming the organization to be more market based solutions. That was a very difficult couple of years, if you could probably imagine internally, externally was a really big evolution. And we're on the other side of that now. And so I'm very excited. You know, we'll be raising capital over the next couple of years. And I think, you know, to your point, Richard, about combining kind of philanthropy, investing, business, doing this for a decade now, working in areas where there's, you know, there's real poverty, there is real need. I think using philanthropy is really great when you can put it towards R &D and trying to demonstrate something and de -risk something. Right. So the philanthropy right now is it's used to de -risk the model. Right. So we are able to go in to riskier places, try things, because I'm not putting investment towards that. Right. This isn't a venture capital fund. This is we're thinking like investors. And so combining those two things has been, you know, a hybrid for us. But I think where God has had us and it's going to lead to, hopefully, what I believe is more people impacted, a more sustainable model and something that I think, you know, hopefully, a new story in the faith driven investor world. There's many other examples like this. So we're definitely not the only ones. But the belief of bringing market based solutions and investment to some of the world's biggest problems that the status quo would say, oh, we need to bring charity to that or we need to bring government aid to that. But how do we think more like a business mindset and think like investors? In my opinion, that's how you're actually going to reach the most people in need. So that's what I'm really excited about. We'll be hiring more people and raising more capital for it.
Luke Roush Before we go to what God's taught you recently, Brett, and how he's spoken to you through his word, just a comment. I think it's a great way of just framing up. What is the role of philanthropic capital versus maybe concessionary capital, where you think you have a business model, but you're still proving it out, you're going to take some currency risk, whatever. And then real kind of at market risk adjusted return investing. And there's a bunch of shades of gray in there. But I think it's a great way of really answering the question that Richard asked around builders, givers and investors. How do all three groups collectively collaborate to get after big problems like housing and security? And that's what is just awesome to see play out, as he said, all three forms woven into the context of news stories. So really cool. Absolutely.
Richard Cunningham All right, Brett. Well, root us in some truth to take us home here, man. This is the question we like to ask at the end of every pod. And that's just what's been God teaching you in and through his word lately.
Brett Hagler Yeah. I knew you guys were going to ask this because I listened to the pod. So I'm reading Proverbs right now with a couple of buddies. And we do this thing every day that I'm sure some listeners do something similar, but it's been really life changing in my last year. So I just want to share it. So it's me and a couple of friends and we read the same scripture. And then we just send back to each other what God wants us to know, how he wants us to be and what he wants us to do. And that's been one of just the best, best, best new habits of not just doing it with myself and God, but bringing in a few close friends. And so we've been doing that and going through Proverbs. And just the two main words that stand out are trust and humility that I've been just seeing and reading in Proverbs. And I think both of those are such a powerful combination just to live into God's will and not our will. And I think they're also two of the most challenging things to do is to trust and to have the humility because the enemy wants to do the opposite of those things. Right. He wants us to have fear, not to trust, to try to have control over our plans, et cetera. But if we can trust God, which is all in Proverbs and then have the humility that to me feels like the main thing that God is trying to talk to me about right now.
Richard Cunningham I love that no be do and then trust and humility. That's a good word. Well, Brett Hagler, new story. I mean, thank you for the work you're doing while you're blazing a trail. This gets me fired up. I'm pumped about what is in front of you. And Luke and I both kind of see that the work you're doing and the angle about what you're going at it, and I think deeply resonate with your work. So, man, prayers up for what's ahead and folks for Luke Roush. This is Richard Cunningham. Thanks for joining us for another episode of the FDI pod. We will catch you next time.
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