Connecting impact and creativity.

Eve Picker: Hey, everyone, this is Eve Picker, and if you listen to this podcast series, you’re going to learn how to make some change. Thanks so much for joining me today for the latest episode of Impact Real Estate Investing. 

Eve Picker: Hi there.  Thanks so much for joining me today for the latest episode of Impact Real Estate Investing.  My guest today is Laura Callanan, The founding partner of Upstart Co-Labs. Upstart believes that creative people solve problems. It is disrupting how creativity is funded by connecting impact investing to the creative economy.  One way the creative economy drives impact is in communities.

Laura brings a powerful background to Upstart Co-Lab.  Just a few of her many past roles include serving as senior deputy chairman of the National Endowment of the Arts;  consultant with McKinsey & Company’s Social Sector Office and associate director at the Rockefeller Foundation 

Be sure to go to evepicker dot com to find out more about Laura on the shownotes page for this episode. And be sure to sign up for my newsletter so you can access information about impact real estate investing and get the latest news about the exciting projects on my crowdfunding platform, SmallChange.

Eve Picker: Be sure to go to EvePicker.com to find out more about Laura on the Show Notes page for this episode and be sure to sign up for my newsletter so you can access information about impact real estate investing and get the latest news about the exciting projects on my crowdfunding platform, Small Change.

Eve Picker: Hi, Laura. It’s really a pleasure to have you here. Thank you for joining me. I’ve come to know you through your most recent enterprise, Upstart Co-Lab, where you’re a founding partner. I’m wondering if you could just tell us a little bit about Upstart’s mission and goals?

Laura Callanan: So Upstart Co-Lab is a field builder, a catalyst, a connector. We are connecting impact investing to the creative economy. We know that creative people solve problems. Like all entrepreneurs, they need capital to do it. Most creative entrepreneurs are very socially minded. Artists care about the human condition and that extends to the work they do through an enterprise model. So, the capital that fits them best is social capital, impact capital. Upstart Co-Lab is trying to unleash more of that impact investment capital for the creative economy.

Eve Picker: That’s great. How do you propose to accomplish that? I know you have a few different strategies you’ve been working on, but I’d love to hear more.

Laura Callanan: Well, from the beginning, we realized that what we were doing for the creative sector, in a lot of ways, followed on from what leaders had done around gender lens investing, so we went to the mothers of gender lens investing, and we said, “How did you do it? How did you take this idea, and, in a pretty short period of time, it really infused the notion of gender lens throughout the impact investing space?” They said it was a three-part recipe: make the case, build the coalition, and bring investable products to market. So, that’s what we’ve tried to do.

Laura Callanan: We have undertaken research to get facts, and case studies, and examples in hand to be able to really articulate the opportunity for investors and the demand for capital in the creative sector to really represent that case. We have shared what we’ve learned through the research published on our website, through opinion pieces in the Financial Times and other publications, in conference panels and keynote talks. We’ve been trying to get these ideas out into the world. That’s how we’ve done the first step.

Laura Callanan: Building the coalition, we have been working with strategic partners from the very beginning. We’ve taken an approach of being small, nimble, spunky; trying to take our ideas and work with much larger, older, better-established partners to get the idea of the potential for the creative economy to make change and do good, infused into the work of community development – finance institutions, impact platforms, like CapShift, and Small Change, your own platform, and work with partners who can help us make these changes happen quickly. 

Laura Callanan: We’ve also been building relationships on the investor side. Through a number of conversations in small and large meetings, we’ve really started to build this community of impact investors who recognize the power of art, and design, and culture, and heritage, and creativity to drive change. We have recently re-oriented our approach to what we’re calling Upstart 2.0, and we’re really going to focus on building a member community of the ambassadors, the evangelists who – as donor-advised funds, as private foundations, as endowed cultural institutions – want to take these ideas back to their peer group.

Laura Callanan: Then, the third step – bring investable products to market – our greatest example of that to date is work that we did with the Local Initiative Support Corporation (LISC) to launch a New York City Inclusive Creative Economy Fund. This is working with the oldest and largest national community development finance institutions, harnessing the power of their AA rating; harnessing their ability to underwrite and manage loans to real estate projects – in this case, affordable workspace for multi-tenant creative economy businesses.

Laura Callanan: We’ve found this to be really exciting, because we set out to raise $5 million of impact capital for the New York City Inclusive Creative Economy Fund. We closed the fund after about six months, having raised $6.2 million [cross talk] all Foundation that capital is fully deployed. We’re talking with LISC now about what a $100 million National Inclusive Creative Economy Fund could be [cross talk] That’s been our approach: make the case, build the coalition, and bring investable products to market to make it easier for investors to deploy their capital.

Eve Picker: I think you must be a very focused person not to get distracted, because that’s … You make it sound easy, but it’s pretty big. I’m very familiar with LISC; one of our would-be issuers on Small Change actually tried to use that program. She didn’t end up being able to buy the building, but it was that program that would have made it possible for her. That’s pretty great. How do you think that LISC might expand that? Are you talking to them about expansion?

Laura Callanan: As I said, the national fund is in the works, so let’s just wait and see when that’s ready to be announced.

Eve Picker: Okay, very good. I have to backtrack a little bit and say, why is all of this important to you, personally?

Laura Callanan: I majored in theater in college. I started my career working in the arts. My husband, my late husband, was a playwright and a novelist. So, in my personal life, I’ve always had a connection to creative people and the work that they do. I guess, now about eight or nine years ago, I had a lunch with a guy named Jim Howden, a founding artistic director of an off-Broadway theatre company in New York, Signature Theatre Company. And I at that point, I’d known Jim for about 20 years. I had known him from the very first days at the very beginning of his founding Signature Theatre Company.

Laura Callanan: We were having a lunch, and catching up, and he was talking to me about the $70 million Signature Theatre Company had raised in a public-private partnership to create a new three-theatre complex in West 42nd Street in the Times Square area. He was talking about how that new space would allow Signature Theatre to expand their programming. He reiterated the commitment to be sure that every ticket for every play was affordably priced at about $25. He was just describing all of the vision and what was going to happen next.

Laura Callanan: The architect on the project was Frank Gehry. They were designing a 7,500-square-foot open lobby space that would be a community center … A community green in the middle of Hell’s Kitchen was how Jim talked about it. He was just describing all of these plans. I knew where this company had started. The budget for their first year with $30,000. They were in a borrowed space way downtown. Things had not always been smooth and easy. They had made a commitment to equity and access from the early days. I knew that it had not been a smooth trajectory, but here was Jim talking about what was happening next.

Laura Callanan: It was at a moment that I was working at McKinsey & Company in the social sector office. I was in the middle of an engagement with the school foundation, so I was thinking a lot about social entrepreneurship. I heard these words coming out of my mouth. I said, “Jim, you’re what they call a social entrepreneur, but nobody calls you that because you’re working in the arts and you don’t call yourself that because you’re working in the arts. But take it from me. I am a highly paid McKinsey consultant. I know this stuff, and this is what you are.”

Laura Callanan: I left the lunch really scratching my head and thinking, if this guy were not a friend, would I put him in the same group as Muhammad Yunus, Wangari Maathai, Paul Farmer, Wendy Kopp, all of these card-carrying social entrepreneurs? If Jim is objectively a social entrepreneur of that caliber, is he the exception that proves the rule? Is there nobody else in the arts who could be called a social entrepreneur, or is there this whole overlooked cohort of talented, socially oriented, potentially hugely successful leaders who, for some reason, have not benefited from the grants, the networks, the incubators, the accelerators, the impact capital that other social entrepreneurs have access to?

Laura Callanan: I thought about this for a while. A few years later, in my role as the senior deputy chairman of the National Endowment for the Arts, I started to explore what it would take to close this gap for creative people who’ve decided to move beyond the studio, beyond the theatre, beyond the concert hall, and to work in their communities and to work as every bit of a social entrepreneur. That’s the background and how we got started with Upstart Co-Lab. 

Eve Picker: That’s pretty fabulous. So, I suppose the question is – what’s the end goal for Upstart Co-Lab? What does it look like when you’ve succeeded? 

Laura Callanan: When we’ve succeeded, every impact investment advisor on their website, next to talking about how they can help their clients invest in community development, and environmental sustainability, and by using a gender lens, they’ll also have a nice tab, a nice page, that talks about all of the ways that their clients can invest in the creative economy. We want to see this be as much of a theme, as much of a focus for impact investors as all of the other things that are already grabbing attention and investment dollars.

Laura Callanan: Our goal is to integrate this into the thinking of all impact investors and, frankly, to welcome a whole set of potential impact investors who’ve been sitting on the sidelines up to this point. By our calculation, more than $58 billion sits in the endowments of our museums, performing arts centers, libraries, or just endowed foundations, schools like Juilliard and RISD. 

Laura Callanan: These are institutions that are, at the moment, under some pressure for taking small donations from folks connected with opioids, tobacco, fossil fuels, and weapons. There’s been a lot in the headlines in recent months about cultural institutions declining contributions from these tainted sources. But the conversation stopped a bit short, and folks have not yet recognized that these are institutions controlling billions and billions of dollars and, unless they have taken active steps, are likely invested in, and earning returns from tobacco, and fossil fuels, and weapons, and private prisons, and some of these other things. 

Laura Callanan: The future that we hope we’re building through Upstart is one where all impact investors have more access to the great opportunities happening in sustainable food, ethical fashion, social-impact media, and other parts of the creative economy, and that artists, art lovers, arts institutions, who are investing, are able to learn about and are welcomed into a larger conversation about socially responsible investing through the door of the creative economy.

Eve Picker: Be sure to go to EvePicker.com and sign up for my free educational newsletter about impact real estate investing. You’ll be among the first to hear about new projects you can invest in. That’s EvePicker.com. Thanks so much.

Eve Picker: It’s really a shift in thinking, isn’t it? You’re an early pioneer in thinking that the creative arts are social impact, and you really have to wait until that idea takes hold with the masses. That’s a pretty hard road- 

Laura Callanan: Introducing any new idea takes some time, and some patience, and some moral fortitude. We’re trying to bring all of that to our work.

Eve Picker: Yeah, that’s pretty wonderful. That brings us to real estate, which is really my interest and the interest on this show. You talked about investment in creative enterprises. What do those enterprises look like? 

Laura Callanan: Let me describe one where real estate is a really core component. It’s interesting because it’s actually in the social-impact media space. When you hear social-impact media and you think about film and TV, music, video games, things like that, you think about content. That seems to be the furthest thing- as far as away as possible from real estate. But actually, real estate can play a crucial role.

Laura Callanan: I’m speaking to you today from the Hudson Valley of New York. One of my neighbors is the actor-director Mary Stuart Masterson. She is an example of a creative person who is also very much a social entrepreneur. She is launching a film and TV studio here in the Hudson Valley called Upriver Studios. She is doing it, in part, because she would like to be able to work where she lives, when she acts, and directs, and produces. But she also understands that film and TV can be a significant economic driver for a region. 

Laura Callanan: There’s a tax credit in this region of New York state, as in the rest of the state, and other places around the country, that incents producers to bring their projects here. One of the obligations to qualify for the tax credit is that your project needs to spend two days shooting on a certified soundstage in the geography, or the tax credit doesn’t apply to you. 

Laura Callanan: Mary Stuart, and her business partner, Beth Davenport, are launching Upriver Studios, a women-led New York State benefit corporation that will be environmentally friendly. They’re looking at solar power, and a green roof, and some other features like that, as well as environmentally friendly on-set practices.

Laura Callanan: It’s a hoteling model. They will have the state-of-the-art facility, and producers, directors, projects will come in; rent the space. It’s very fit for purpose. It’s a specialized space. There is sound attenuation; there are loading docks. There are high ceilings. There’s shop space. There are all of these things that are very particular to what it takes to film a TV series.

Laura Callanan: The advantage of this, for the community, is a couple-fold. First of all, every TV series generates between 150 and 200 production-crew jobs. We all think about the actors, and the writers, and the directors who are behind some of our favorite programs, but in fact, they’re the minority of people working on the show. There are all of the electricians, and the grips, and the sound folks, and the hair and makeup folks. You look at all those names that run on the credits at the end of a movie or at the end of a TV show [cross talk] 

Eve Picker: -Yeah, pretty long list. 

Laura Callanan: -150 to 200 people. These are quality jobs. Most of them are union jobs. They pay between $75,000, and $250,000 dollars a year. They have excellent health benefits. To bring this sort of work to this region creates a real opportunity for folks to work in those jobs. There’s a sister nonprofit to Upriver Studios, called Stockade Works, that is training the 21st century production crew to be ready to take those jobs.

Laura Callanan: There’s also an economic multiplier benefit. There’s also a tourism benefit. People like to go to the place that they learn about on their favorite TV show. So, the real estate is crucial to all the rest of this working; to the training program paying off; for the graduates of the training program to have a place to work; to attract folks to come, in partnership with the tax credit; provide the access to the sound stages that will make people really want to come to this region. That’s an example of real estate, as I said, connected to a content-focused industry – TV and film.

Eve Picker: So, that’s a pretty sexy use. While you’re speaking, I’m thinking that also, I think, restaurants are creative.

Laura Callanan: Absolutely. We are working right now on a deep dive around sustainable food, as it pertains to the creative economy. Obviously, there’s a big focus, within impact investing, on food and agriculture. We’re not looking at the crop. We’re looking at what it is on your plate. As I was thinking about it earlier today, we’re not focused on the milk, but we are focused on the cheese, right?

Eve Picker: Yes, yeah … 

Laura Callanan: So, the cheese factory is an example. We’re not focused on the groceries as much as we are the recipes. Those recipes get turned into delicious dishes in kitchens … We see a lot of community kitchens and commercial kitchens that can support multiple small-scale entrepreneurs. So, absolutely. Then, the restaurant, as an experience – the setting, the location, the ambiance, the type of building that it’s in – it’s all part of thinking about food and eating as a form of culture and community, not just nutrition.

Eve Picker: So, I’m realizing we’re actually talking to someone who may be a neighbor of yours about a restaurant idea, which is really immersed in the community. They would like to open the door for investment at a very small amount – $250 per investor – because they really want to involve the community. That’s another interesting way to look at it. From what I understand, creative enterprises seep into a lot of different things. I have to remind myself from time to time what a creative enterprise is; probably, Small Change is a creative enterprise, because I’m trained as an architect. Do architects count, Laura? 

Laura Callanan: We see that a lot of creative people are creative in many ways. They get trained as architects, or painters, or actors, and they decide to start different enterprises. We don’t talk about creativity as a skill set or a mindset. We focus on creativity from an industry perspective. We think that’s the way that investors can understand best. We had to do a lot of thinking early on about how we were going to scope our focus, because you’re right, people can be creative in many fields. But in terms of the type of work we’re trying to support and that we’re trying to get impact investors to pay attention to – food, fashion, media, other types of creative businesses, and the sorts of real estate projects that we’re describing here that make it possible for those creative activities to take place.

Eve Picker: That makes a lot of sense. This is a general question I usually ask – do you think socially responsible real estate is necessary in today’s development landscape? I don’t know how much you know or are involved in just real estate development. Do you have thoughts about that?

Laura Callanan: Well, it’s something that people who think about arts and the creative sector can’t overlook, because, as I’m sure you think about often, creative people are pioneers in different ways, not just in terms of the work they do, but where they choose to live and do their work; often looking for affordable places to be to give themselves the flexibility and the capacity to experiment and take risks.

Laura Callanan: Increasingly, we see examples where creative people are in neighborhoods that are ripe for gentrification. There can be confused conversations about the role that the presence of creative people plays in stimulating or contributing to that gentrification. Obviously, I believe that gentrification is a problem that lands on the doorstep of the asset owners and the developers, not the residents and the renters in a neighborhood. The creatives are frequently, like other residents, in a renter capacity. 

Laura Callanan: We spend a lot of time looking at academic research and other reports about how the presence of artists and creatives in a neighborhood is not the precipitating factor for gentrification, but actually occurs after the gentrification has begun. We think a lot about what different paradigms could be that would enable residents in a neighborhood to benefit as the neighborhood strengthens; how they can be rewarded for being good neighbors, for sweeping their stoops, for keeping their sidewalks clean – all that stuff that makes the neighborhood inviting and habitable – and what the system could look like – where the folks who are responsible for growing the value of the real estate assets in a community can actually benefit, even if they’re not the owners, themselves.

Eve Picker: Yeah, I do think that there is also a piece of this that government is responsible for, because if there’s an open free market, then it’s very difficult to control, but there are ways to control gentrification that benefit everyone, if you think about it early enough. I’m wondering, are there any current trends in arts innovation that interest you?

Laura Callanan: We don’t think about arts innovation, specifically. We’re thinking about that larger creative economy; we’re thinking about the role that industry plays [cross talk] 

Eve Picker: -that’s Upstart Co-Lab, but I’m just wondering if there’s anything that fascinates you.

Laura Callanan: Anything that fascinates me … I’m intrigued by our hunger for experience, and this is something where creative people are playing a role. I’m sure that you’re familiar with Meow Wolf, the phenomenon that started in Santa Fe that’s spreading to Denver, and Las Vegas, and Phoenix, and Chicago, and Washington, and on, and on, and on.

Laura Callanan: This is something where artists have come together. They transformed – in the Santa Fe example – an abandoned bowling alley. They turned it into this funhouse; this art gallery; this community space. It’s a place that attracts folks of all ages. All economic, demographic, sociological backgrounds, come, and walk through, and participate in Meow Wolf and find it intriguing.

Laura Callanan: The appetite for these types of immersive experiences, I think, is a reflection of our very isolated, tech-enhanced daily life. I love it that creative people – whether it’s through a food experience, whether it’s through an art experience, a music experience – that they are at the heart of what people choose to do when they leave their laptop.

Eve Picker: Yes. I think probably Starbucks was one of the first companies that realized this and created an experience out of coffee, right?

Laura Callanan: Exactly.

Eve Picker: What should those of us who are not in the creative world be following? What of these trends do you think is most important for the future of our cities? 

Laura Callanan: There’s an important role in the creative future for diversity, equity, and inclusion. Put aside the moral and ethical imperative. There’s just an imperative in terms of what’s going to come out- what’s going to generate the most intriguing content, the most relevant experience, the most interesting food, or fashion.

Laura Callanan: As you know, heterogeneous groups of people have been shown to solve harder problems, better and faster. If you think of both challenges and opportunities as problems to be solved, the more engaged the broader set of actors can be in contributing to imagining what comes next, the better the results will be. From a serious point of view, it’s a more effective solution. From a more lighthearted point of view, it’s that beautiful, delicious, joyful, wonderment experience, right?

Eve Picker: Yes. 

Laura Callanan: That having a variety of perspectives, a variety of experiences, a variety of backgrounds, a variety of skills brought together to imagine what’s next will get us the best result.

Eve Picker: Yeah, I think you’re probably right about that. It’s just very hard getting there, isn’t it?

Laura Callanan: It depends. If you hang out with enough creative people, it can make you ridiculously optimistic, so … 

Eve Picker: That’s what I need to do, then … Because you have a very different point of view than many of the people I’ve talked to, who are developers, or work in the securities world, or are really focused on the built environment. You have sort of a more expanded view, I think. How do you think we need to think about our cities and neighborhoods so that we build better places for everyone? You may have just answered that.

Laura Callanan: Well, we think that the creative people and creative organizations, meaning arts- and design-type organizations, have some lessons that are useful to the rest of the economy. We’ve started to articulate values for an inclusive, creative economy. I can just share them with you because our hope is that we can transform; we can improve; we can strengthen the entire economy by sharing some of these lessons from the creative economy.

Eve Picker: Yeah, that would be great.

Laura Callanan: These are things that we’ve touched on already, but one is an orientation that’s open and experimental. So, openness and experimentation, I think, is crucial. It will help us to keep pace in our rapidly changing world. Continuous improvement, radical new approaches, that’s what we need. Incremental change is insufficient given the dynamism, the complexity of the world that we’re in. Sometimes, small improvements are just simply inadequate, and you need something that’s much more bold. 

Laura Callanan: You get that by being curious and having this learning orientation. Artists, designers, very much are built that way, and I think that’s a general approach that can benefit all types of businesses, all sorts of real estate projects, governments, philanthropy. I think everyone benefits from that approach. That’s the first value that we think the creatives can share with the rest of the economy.

Laura Callanan: The second one – diversity and inclusion – we’ve already talked about; the capacity to solve problems better and faster that comes when you’ve got diverse perspectives on the task. It’s not just that it’s the ethically right thing to do. It’s that there’s business value. There is a strategic advantage to approaching it in this way. Creativity simply can’t be optimized if you don’t have both diversity and inclusion at play.

Laura Callanan: The last idea is one around tradition and innovation and recognizing that communities have both – I’ll call it – knowledge and wisdom. With that, they’re able to learn from the past experience and apply that to what’s coming up next in the future. You know that creative people are always reacting to what came before. They might be building off of it. They might be rejecting it outright and trying to do something very different, but creative work is always in context, and it’s in context with what has preceded it.

Laura Callanan: The long-term thinking, the sense of stewardship that social-sector leaders and impact investors hold, I think, is very compatible with the way creatives do their work. I think creative take it even a step further; having a really deep respect and awareness of prior tradition, but not being restrained by that or being held back by that; using that actually as a launch pad to innovation.

Laura Callanan: Those are the three ideas that we think are crucial. Creatives just know this in their bones to be open and experimenting, to welcome in diverse perspectives and be very inclusive of various voices and to connect to tradition and innovation. We think that those are ideas and lessons that can strengthen the entire economy.

Eve Picker: I’m very honored that you asked to partner with Small Change and that we’re now highlighting creative economy projects on our site. I’m just wondering what you think equity crowdfunding- how you think it can play a role in building these special creative economy projects and communities?

Laura Callanan: I think it’s crucial as a way for projects like Upriver Studios that I mentioned a minute ago, or a Meow Wolf, that started in one community and is now expanding to the next six or so communities around the country. I think it’s important for these organizations, these enterprises, to engage the communities that they’re in, in an active way.

Laura Callanan: This is a way to signal that it’s not just building something for a small group of employees or a small group of investors. If you are a Mary Stuart Masterson and you’re launching something that you hope is going to really boost the economy of the Hudson River Valley, this is a way to say, “And you, my neighbor, can have a stake in this. You can benefit as we grow this thing together,” whether or not your $250 dollars, your $1,000 dollars, whatever the small bite size might be of investment that’s facilitated through Small Change … It’s a really clear communication to local folks that this is for them and that they’re welcome.

Laura Callanan: I think it’s a really strong indicator for larger-scale investors who want to test the morals and the intentions of a real estate developer. It gives them a really strong indication. If the developer is going to take the time and engage with the local community and allow them to participate through a crowdfunding structure, then they’re serious about boosting the local community. If they can’t be bothered, I think that is a real question mark about the intention of the developer.

Eve Picker: That also extends to planning departments and zoning hearings. If you can bring along a crowd of people who are supporting the project, that’s a very strong statement, I think, in many ways-

Laura Callanan: Absolutely.

Eve Picker: Where do you think the future of impact investing lies? I ask this because I’m afraid it’s still just a word that people use. I have yet to really believe that people will take a lesser return because a project is socially responsible. Perhaps that’s coming, but still hard to believe.

Laura Callanan: Well, I would disabuse you or anyone listening to this podcast that impact investing is asking people to take a lesser return. I know that 25 years ago, when I started to get into the impact investing space – when the space was very new and impact investing was not the term it went by – that there were a few early, less sophisticated, less professionally managed investment opportunities, and that might have been the story back in the 1990s.

Laura Callanan: I would say that we have Goldman Sachs, BlackRock, UBS, Morgan Stanley – all these large names, these premier financial institutions, participating in the socially responsible and impact investing sector, not because they and their clients are expecting to make less money. We can have a whole separate conversation about the whys and wherefores for this. We can talk about the risk management component of introducing social, responsible ESG factors into decision-making, but I would hate for anyone to hear this conversation and walk away thinking that they’re going to lose money by engaging in impact [cross talk] 

Eve Picker: I don’t think lose money but let me just pose the question a bit differently in what I see, and that is, in particular, affordable housing. As a real estate developer, when you work in an underserved neighborhood, it is very hard to get projects to pencil out; very, very difficult. That’s why there are so many subsidies around affordable housing projects, and that’s why it’s slow to build them fast enough.

Eve Picker: If you want to keep a project- an asset like that affordable for the next 15 or 30 years, it’s not an asset that will increase in value. It’s a difficult thing to invest in. Absolutely, investors in those types of projects will have to take a lesser return than if they invested in a more traditional real estate project. There’s a real differentiation there, and I would love to have this conversation with you- 

Laura Callanan: No, that suggests that each investment’s looked at in isolation, and an investor is looking at their total portfolio. There should be some things that are lower risk and commensurate return, and here are some things that are going to be higher risk and commensurate return.

Laura Callanan: When we were talking with investors about the New York City, the LISC New York City Inclusive Creative Economy Fund, we were talking to them about an eight-year note with full recourse to a AA-rated issuer that was paying 2.75 percent annual interest. As I talk to you today, in September of 2019, and we sit with an inverted yield curve, the 2.75 interest on a seven-, eight-year investment from a AA-rated issuer is looking awfully good. So, a lower-risk commensurate-return opportunity, which has a place in everybody’s portfolio.

Eve Picker: I see it- I’m not seeing it yet in my world, but I hope to see it. I think there’s still a lot of people who don’t think that way … Maybe we can convince them. There’s just some sign-off questions that I’d like to ask.

Laura Callanan: Sure. 

Eve Picker: What would be the key factor that makes a real estate project impactful to you?

Laura Callanan: Well, the community orientation, clearly, is something that we would probably both agree on. I see that- it’s not a surprise to me that a lot of the creative economy real estate projects that I’m aware of are deeply focused on their role in their community, whether it’s Meow Wolf, Upriver Studios … We haven’t yet talked about Greenbelt Hospitality, which is launching out of Phoenix. These are examples where the entrepreneurs behind the projects all are really thoughtful about their community, and real estate is core to what these businesses are all about. The businesses can’t succeed if the community is not engaged. I think that that’s fundamental.

Eve Picker: Yeah, I agree. If you’re looking at the real estate landscape in the U.S., which you see every day, if there were one thing that you could change to make it better, what would that be?

Laura Callanan: Well, I think there’s got to be a regulatory solution to the gentrification question. Obviously, improving communities is a good thing. The only reason that we have a term like gentrification that conjures up something that’s really, really bad is because when the community improves, there are winners and losers. I think there needs to be a regulatory fact or a solution that comes into play to close that gap, because the notion of keeping communities where they are already and not allowing them to strengthen is not an alternative. It’s not a solution to the issue.

Eve Picker: Yeah, I totally agree with you. Thank you very, very much. Thanks for spending the time with us. I really enjoyed the conversation, and I’m going to continue having conversations with you off the air, okay? 

Laura Callanan: My pleasure. Thanks, Eve.

Eve Picker: Thank you. Bye-bye. That was Laura Callanan of Upstart Co-Lab. She shared some powerful concepts with me. First, that strategy and focus are key to accomplish big goals, like the goals that Upstart Co-Lab has. Second, that creative endeavors can bring every bit as much to the economy as any other enterprise. Third, that artists, by nature, are suited to community development. Art is built on tradition, whether it embraces it or not. Expect to hear more about creative economy investment opportunities in the next few years, because that is what Laura is determined to do.

Eve Picker: You can find out more about impact real estate investing and access the show notes for today’s episode at my website, EvePicker.com. While you’re there, sign up for my newsletter to find out more about how to make money in real estate while building better cities. Thank you so much for spending your time with me today, and thank you, Laura, for sharing your thoughts with me. We’ll talk again soon, but for now, this is Eve Picker signing off to go make some change.