Rethink Real Estate. For Good.

Finance

Turnkey goes online.

The internet is bringing a fundamental transformation to the real estate industry. It’s a digital revolution, democratizing and streamlining activities that were once quite complicated and time-consuming, putting them out of the reach of most people. Many investors have wanted the stability of a real estate investment, but do not have the time or wherewithal to purchase, redevelop or manage a property. Or they might be interested in investing in a market that is geographically out of their reach. The internet is providing solutions for many of these problems.

Turnkey properties remain a popular first-time real estate investment. A turnkey property is one where no work is required – you can literally turn the key in the door and it’s liveable. The advantages of turnkey properties are attractive to new investors and to those who have busy lives. There’s no heavy lifting to get the finished product, and the property produces income from day one. Acquiring debt on an already renovated property is also much easier for investors – the banker can see the finished product and is more likely to make a loan.

Many investors use turnkey providers. Turnkey providers buy properties that need renovation, invest their own money into renovating, install a property manager and a quality tenant and then sell to an investor. The provider has a vested interest in finding good tenants who pay rent on time and take care of the property because they want to offer quality properties and tenants to investor clients and make a reasonable profit as well. For the investor the quality of renovations, the location of the property and the quality of tenant are all important factors.

Andrew Luong has taken the model of turnkey provider one step further. He, and partner Justin, founded Doorvest, an online turnkey property service, in March 2020, right at the beginning of the pandemic. They have not only made the process of small-scale real estate investment accessible to everyone, but their track record allows them to purchase and renovate properties in affordable markets, in neighborhoods that bankers don’t traditionally like. Doorvest is just a startup but they are confident that they will be successful. They want to level the playing field for wealth building so that everyone can participate in America’s number one source of wealth within a matter of clicks.

Image by Eve Picker

Permanently affordable.

Kimberly Driggins is executive director of the newly created Washington Housing Conservancy. The nonprofit’s mission is aimed at ensuring that moderate to low-income residents are not priced out of their homes. DC is a city where rents are running rampant and this only promises to get worse once Amazon’s HQ2 opens. The Housing Conservancy plans to acquire and own 3,000 units of affordable housing helping to stabilize rents, prevent displacement, create communities and promote opportunity and wealth building.

For Kimberly, this is a challenge worth taking on. She has had a remarkable career in urban planning and public policy, working on and in the cities she loves. And now she is turning her passion and energy to the challenging crisis that is touching so many people – housing. While she has only just begun to craft a fresh approach to this overwhelming problem, it’s clear that she plans to be spectacularly successful. Just two years into the job and Kimberly is making strong progress with her sights on some big milestones.

Kimberly was a Loeb Fellow at the Harvard GSD, a White House Fellow, and a recipient of Woodrow Wilson National Fellowship in Public Policy and International Affairs. Her early career as an analyst played out at Enterprise Community Partners, International Economic Development Council, and Ernst and Young. This was followed by roles in city government and as associate director in DC’s office of planning. She also worked for D.C. Public Schools facilitating public-private funding partnerships. Before joining the Housing Conservancy Kimberly worked for the City of Detroit as their director of strategic planning for arts and culture, while also serving as chair of the Gehl Institute’s board of directors (based in NYC).

Insights and Inspirations

  • The Housing Conservancy is working to purchase 3,000 units in high-impact neighborhoods, which are relatively affordable today but in the path of redevelopment.
  • Their goal is $150 million of flexible private capital to preserve apartments with affordable rents. With investor returns capped at 7%.
  • The Housing Conservancy is not just about affordable housing. It’s about community building as well.
  • Kimberly got into being a DJ, Kool Like Dat, in Detroit. She has impressed people with her seamless performances and her ability to read the room.
Read the podcast transcript here

Eve Picker: [00:00:12] Hi there. Thanks for joining me on Re-Think Real Estate for good. I’m Eve Picker and I’m on a mission to make real estate work for everyone I love real estate. Real estate makes places good or bad. Rich or poor. Beautiful or not. In this show, I’m interviewing the disruptors, those creative thinkers and doers that are shrugging off the status quo in order to build better for everyone. If you haven’t already, check out all of my podcasts at our website Rethinkrealestateforgood.Co or you can find them at your favorite podcast station. You’ll find lots worth listening to, I’m sure.

Eve: [00:01:05] Today, I’m talking with Kimberly Driggins. She’s Executive Director of the newly created Washington Housing Conservancy, tackling the affordable housing crisis with a fresh model. This one is aimed at ensuring that middle income teachers and firefighters are not priced out of their homes. D.C. is a city where rents are running rampant, and this only promises to get worse once Amazon’s HQ2 opens. For Kimberly, this is a challenge worth taking on. And just two years into the job and she’s making strong progress, she has her sights set on some big milestones. If you’d like to join me in my quest to rethink real estate, there are two simple things you can do. Share this podcast and go to rethinkrealestateforgood.co, where you can subscribe to be the first to hear about my podcasts, blog posts and other goodies.

Eve: [00:02:13] Hello, Kimberly. I’m really honored to have you with me today and excited to hear about your work.

Kimberly Driggins: [00:02:20] Thank you for having me, Eve. It’s a pleasure to be here today.

Eve: [00:02:24] So you head up a fairly new organization in Washington D.C., the Washington Housing Conservancy. Can you tell us a little bit about it? Why was it formed and how does it work?

Kimberly: [00:02:39] Sure, yes. The Washington Housing Conservancy, we are relatively new, not for profit organization 501c3. And we were created in 2018. And we were created because we saw a gap in the market really refocus on the market rate affordable, also known as NOAH, Naturally Occurring Affordable Housing. We’re focused on preventing residential displacement, stabilizing rents and promoting opportunity for moderate to low-income Washington area residents. Really, the focus of our work, we really work to mitigate displacement and to promote economic mobility. That’s really what we do. And we really felt that in our hot real estate market like D.C., where affordable housing is becoming a scarce resource, thinking about how we can preserve what we already have. This housing stock is the housing stock that is being lost to the market, no matter where you are in the country at the greatest rate. And for, you know, and it’s not the easiest to preserve, but it’s always easier to preserve existing housing as opposed to creating new housing. You need both. We certainly think that you need everything at your disposal, but we’re really focused on this, this product, multifamily housing.

Eve: [00:04:21] Yeah, I think you have, there’s an organization in San Francisco that does something a little bit similar if I’m remembering correctly.

Kimberly: [00:04:30] It’s quite possible, I mean, in hot markets like San Francisco, New York, Boston, I mean, we’ve been fighting this for several years, decades, I would say. I think a lot of listeners that are outside of the DMV don’t really understand how expensive D.C. has gotten over the last 20 – 25 years. And we really are. When you look outside of New York and California and possibly Boston, we’re really in the top five, maybe top three in terms of most expensive markets to live in, especially in the rental market. We’re very much akin to Manhattan, parts of Brooklyn and Brooklyn, New York and the Bay Area in terms of our housing costs. We’re not as high, but we’re trying to really solve a problem before it becomes out of control. With respect to mixed income communities. In those areas that I just named you in Manhattan, you really have a situation where you have unless you’re in a subsidized unit, it’s really the very wealthy, very affluent or low to no income. Because you have the housing subsidy or government subsidized housing, you don’t have a lot of this market rate affordable. I think probably none in the Bay Area, San Francisco specifically. So that’s what we are focused on, and we’re really focused on workforce housing, which is a term that I don’t love. It’s an industry term, but it’s really, it’s people who are, you know, working such as your first responders, your teachers, your lab technicians, hospitality workers, folks that make a “decent living.” You can be making 60 – 75,000. Yet you are extremely rent burdened. That’s not enough to be not rent burdened here in the D.C. area.

Eve: [00:06:42] Just talking about rent burden, so the typical calculation that you do with a tenant is one third of your income should go to rent and utilities, right? So, if you earn $60,000, then you shouldn’t really spend more than $20,000 on rent and utilities. How is that playing out in Washington? Where can someone find rent at $20,000 for a year? At the moment?

Kimberly: [00:07:08] It’s increasingly hard to do, Eve. I mean, that’s the reality. You know, on average and I’m trying to find some statistics, but you know, this is a region where you know, people are severely rent burdened. A cost for, you know, a two-bedroom apartment is well north of 2,000 maybe 2,500 dollars. And I think about 35 percent or so of folks are rent burdened. And you know, I can get you the specifics.

Eve: [00:07:43] I read some really high numbers. Something like 40 percent are paying half their income in rent, some really large number like that.

Kimberly: [00:07:51] It’s actually, yeah, I’m pulling up some of the stats. It’s 50 percent of households are spending more than 30 percent of their earnings on housing in the D.C. region.

Eve: [00:08:00] Wow!

Kimberly: [00:08:02] That’s a lot, that’s half the population.

Eve: [00:08:05] So these are everyday people who really can’t afford to live in the places they’re living in. What happens when Amazon’s HQ2 headquarters opens? Does that get worse?

Kimberly: [00:08:17] Well, you know, I do. I think that it’s known when you have tech companies and organizations like Amazon, when they move into town, the impact. It can be great for the economy, but it definitely creates housing pressure. And you know, to Amazon’s credit, I think that they have looked at what happened in Seattle. Looking at what’s happened in California with Google and Apple and all the others, and really try to do things differently here in the DMV and Nashville. I think that was a main motivation for their housing equity fund, which we were one of their first marquee investments. So, I think overall, the tech sector has actually responded in a way that I wish other corporations and employers would. I think that they’re recognizing their impact on place. Mainly because of what has happened in California and what has happened in Seattle. And so they all have initiatives around housing, affordable housing, housing affordability. You don’t see that. D.C., you know, there’s a lot of other employers and hospitals and universities are your largest employers in D.C. You also have a lot of defense contractors that are based in D.C. So, we don’t actually, tech doesn’t drive industry here. But I hope that the other sectors are listening and thinking and looking at what Amazon and Microsoft and others are doing because we really need the corporate sector to do their part around thinking about solving for the challenges of housing affordability. Because I think it’s everyone’s issue and I think it becomes a workforce issue for many of these companies. If we don’t do something collectively. It can’t just be government. Can’t just be the not-for-profit sector. We all have to be rowing in the same direction. And I haven’t seen that, and I’m hoping that Amazon and Google and others can inspire other corporations to do similar type of investments.

Eve: [00:10:33] So then that brings me to the Washington Housing Initiative. How does that tie into what you’re doing? Why was it formed? What does it do?

Kimberly: [00:10:44] Washington Housing Conservancy, we sit in a larger, broader initiative called the Washington Housing Initiative. Think of it as a three-legged stool. So, the Washington Housing Initiative has three main components. The Washington Housing Conservancy, or WHC, which is what I run. I’m the Executive Director and we are the not-for-profit owner and operator of the real estate that we acquire. In addition to WHC, we have an impact pool. That impact pool provides mezzanine or second debt financing. It’s a social impact investing arm and that’s managed by JBG Smith. And then we have a stakeholder council that we’re establishing this year and that really is looking at policy and advocacy in this NOAH space. There are very few tools in the toolkit to preserve this type of housing stock, and we are really hoping to change the system and really create more mechanisms to allow this to occur. We are disrupting the real estate market. We’re trying to do something that doesn’t want to happen. And we’ve realized that. We compete with the for-profit sector with these properties. In the NOAH space, by and large, the majority of these properties go to value-add investors or developers that are looking to make double digit returns on their investment, as well as add to displacement. They often acquire these properties. There’s a lot of up-side. The rents are low, but the growth trajectory is high, and they often know that, and they will either make substantial improvements that raise rents or just raise rents gradually because there are no affordability covenants on these properties. And so that’s what we’re doing that’s so different is that we’re buying the property. We’re putting affordability covenants, sometimes up to 99 years. Our first project with the Amazon money, it’s a 99-year deal. But more realistic of our typical profile is 20 – 25 years. Sometimes it’s 30 or beyond. It really depends on where we are in the financing terms, but we’re putting affordability covenants on properties that currently don’t have it and maintaining the asset for the long term. We’re not interested in reselling. We refinanced the property. That’s how our investors get paid in the impact pool, not through sell.

Eve: [00:13:28] Mm hmm.

Kimberly: [00:13:29] So did I answer your question there, Eve?

Eve: [00:13:31] Yeah, yeah. So, I think, you know, probably most of us are thinking, you know, to keep something affordable is very difficult with the way finances are structured these days. The capital stack and you’re a nonprofit, which makes it possible for you. But how about that impact pool that you talked about? How does that work? I mean, where does the money come from and what sort of return and how big is that going to grow?

Kimberly: [00:13:58] Sure. So, the impact pool, again, that’s it provides mezzanine financing. I’ll talk about who invests in that in a second, but to give you an example of our capital stack. So, our typical capital stack, it’s a first mortgage from a GSE like a Fannie Freddie. That’s 70 percent. On average, these are averages. The impact pool comes in to provide the mezz debt, and that’s up to 20 percent. And then the conservancy, WHC, what I run, the organization that I run. We provide up to 10 percent equity, so we have real skin in the game. We put money into our deals that’s separate and apart from the mezz debt, from the impact pool. And I think that that’s something that most people don’t really know or fully understand. But what makes us competitive is that mezz debt, because it is below market rate debt. That debt is so the investors, we have, it’s 115 million for the first round for the pool. The fund has closed. We raised that money over the last two years. We started deploying that money early or late last year. And that impact pool, the investors are primarily banks. And banks know, this is impact investing. So, it’s a single digit return to investors. It’s a total of nine percent. It’s seven percent to the investors. There’s a two percent fee that goes to the administrators of the pool. In this case, it’s JBG Smith, so it’s nine percent money.

Eve: [00:15:40] Not bad. It’s not bad.

Kimberly: [00:15:42] It’s not bad. You know, when we structured the fund several years ago, that was what it needed to be. I think if we do a second round, it could be lower in terms of the return. It’s not bad. I know in the social impact world you’re looking typically around five six percent return, so it’s above average for social impact investing and we recognize that. And so again, banks are primarily the investor in that fund, and they have many reasons to invest. Mainly, it fulfills their CRA credits, and it advances the mission around affordable housing. All of them have affordable housing, social impact, economic mobility goals. And you know, the biggies are all in. Bank of America, Wells Fargo, you know, you name it, Trust, which used to be SunTrust, BB&T. So, they are national banks, local banks. We have high net worth individuals that are also in the fund now, you know, as opposed to our money WHC, you know, ours are philanthropic dollars. So, you know, that’s the difference. Banks are rarely donating to us. If they are, it’s really a very small amount, typically. But our biggest donors, we have donors, we have some foundations locally, Marriott, Shatner Foundation, others that are based here. We’re looking to grow. We have a $30 million fundraising goal, the Conservancy does. And we’ve raised over half of what we need to date. We have raised 18.5. So, we’re looking to close that gap in the next 12 to 18 months to be… We feel like that is the number it’ll take to get us to scale and to get us towards self-sufficiency. That’s another key aspect of our model, Eve, is that we are designed to be self-sustaining. We will not always be in a fundraising mode once we get critical mass in terms of the number of units, which is 3,000 for us. You know, our properties do generate some revenue that goes back to the Conservancy to help with our operations. Not a lot, but some because we have market rate units in the portfolio. I mean, that’s part of our criteria selection.

Eve: [00:18:18] Interesting. So you, to sort of break even, 8,000 units…

Kimberly: [00:18:23] 3,000 units

Eve: [00:18:25] 3,000. Okay. That’s a lot.

Kimberly: [00:18:28] Yes, it is.

Eve: [00:18:29] What is scale mean to you then? What sort of the big, hairy, audacious goal?

Kimberly: [00:18:37] I mean. For me, you know, that’s a great question, I don’t think I’ve ever been asked that. You know, we want to go as far as we can. I mean, you know, we’re proving the model. We’ve had a breakthrough year this year. I mean, you know, I’ve been on the job two years and this year we’ve acquired our first properties. We have two more that we’re closing on and we have a strong pipeline. And I think that we’ve moved from this is a nice idea and it sounds cool to knowing that it can work. So, we’re past proof of concept, but we’re pre scale. And for me, you know, 3,000 is a starting place. It’s not the endgame. I mean, I definitely think we want to do more. I don’t know what that means, but I do know that we want to keep going. And I also think that as we prove the model, if we can do more in the low-income space, I get this question all the time. You guys are focused on workforce. What about low income? There’s pressure there and it’s the hardest housing to create because of the amount of subsidy that it requires. That’s really true. I mean, I would hope that, you know, if we’re successful beyond my wildest imagination, that we are able to do more at the 30 percent or less AMI. I mean, that’s where the challenges, I mean, are really, really great.

Eve: [00:20:03] Yeah.

Kimberly: [00:20:03] But there’s also a lot of government resources that work to produce housing at that level. Of course, it’s never enough. But you know, we, as I said earlier, all need to all sectors need to step up to solve this crisis, and we are one solution. We’re not the only solution. And I think that if we can make a dent and workforce, we chose this because no one is really, not as many people are paying attention to this demographic. And there’s actually no resources for folks. I mean, and this is personal. I mean, this was me, you know, I chose to live in Washington because it was affordable over 20 years ago. If I was just starting out in my career, I’m not sure if I could afford Washington. I went in, I started my career in the not-for-profit space. I wasn’t making a lot of money and I didn’t have a lot of debt from college and graduate school. So, I was able to follow and work on what I’m passionate about and live in a city that was affordable, and I want more people to be able to do what I was able to do. And you know, right now, it’s really tough in D.C. to be able to do that. You have two and three roommates, or you have two or three jobs to be able to come out of school.

Eve: [00:21:33] Right, right. So where do you find your tenants then? Are they typically the buildings are full, and you keep tenants in place?

Kimberly: [00:21:41] Yes, absolutely. I mean, you know, the great thing about our model is when we buy a building, it’s about keeping residents there. We want residents to stay. We don’t need people to move. The mix is what we need for our model to work. The one exception is the Amazon project and Crystal House. Crystal House is a market rate luxury building, right? It wasn’t mixed income, you know, typically, our building profile is Class B Class C buildings that are in very good shape. They don’t require substantial rehab, but they’ve got great bones. They’ve been well cared for. There’s not a lot of deferred maintenance, but it’s just not the, you know, the buildings. And you know, that’s most of the NOAH housing stock is what I’m describing. And so that’s typically our building profile with the Crystal House. That’s market rate luxury. We’re transitioning that building to 75 percent affordable over the next five years. So it’s 20 percent a year and we’re doing that through natural attrition. We don’t need to displace current residents. We want residents to stay. Many of the residents that live in Crystal House qualify for the workforce program, so when their leases are up, we’re asking them if they want to participate. Now, participation in the workforce program, having your rent reduced, you have to we have to income certify. So, this deal was written to LIHTC standards and so we income certify at all of our properties to make sure that you’re qualifying for the workforce units. There’s about 20 percent of those units are 50 percent or less of AMI, but it’s 75 percent. So let me do the math. 825 units, that’s 619 units that will be made affordable for moderate to low-income workers and residents at Crystal House over the next five years. And we were keeping that affordable for 99 years. There’s a 99-year affordability covenant. It’s quite possibly one of the largest NOAH projects in the country, so we’ve been told by some of our national advisors.

Eve: [00:24:05] So, you know, when I listen to this, you know, I also interviewed an architect, who I think is amazing in Australia, who’s tackling this in a completely different way, but exactly the same demographic. The firefighters and teachers who could no longer afford to live in the city. And he found a piece of land next to a railway station with a bike trail that goes all the way into the central business district and built this building, just chipping away at all the cost to make it affordable for that group of people without any marketing. He has a waiting list of 8,000 people.

Kimberly: [00:24:42] Wow.

Eve: [00:24:42] So there’s a part of me that thinks like, this is a global problem, and we’re just like scratching at the surface of it. What is it really going to take to correct this housing crisis that we’re in? Are we ever going to be able to correct it?

Kimberly: [00:25:00] Yeah, that’s the million-dollar question, Eve. I do think it’s a global phenomenon. I have some experience in Europe and Denmark. Copenhagen specifically, I sat on a board there. Europe tends to have social housing, which, you know, they have a larger sort of definition that I think includes sort of this workforce. But I’ve gotten some interest outside of the country. I know that Canada, Toronto. You know, again, another hot market real estate market. And you know, the project that you discussed in Australia. Jennifer Keesmaat, the former Planning Director, she’s now head of a company called Markee Developments. They’re doing exactly the same thing, but they’re doing new construction. And, you know, we talk often. I recommend her. If she hasn’t been on your podcast, she probably has.

Eve: [00:25:54] I love that. I would love that. No.

Kimberly: [00:25:56] I think that what we’re doing is so similar. But her scale is actually larger than mine because it is new construction that they’re doing. But the goal around creating and or preserving workforce housing is is exactly the same and also the ambition around. We have a dual mission. It’s preserving rents and service of promoting economic mobility, and we haven’t even scratched the surface on what that looks like. So we are a mission driven, not for profit. We focus on, you know, how can we promote economic mobility for our residents? And we have a full strategy that we developed last year that we are implementing with all the properties that we acquire. And it’s really exciting. I think that that piece is part of the solution to the question that you raised. Because it’s it’s not just about rents, but it’s also how do you ensure that people have enough income? How do you raise people’s incomes? That’s really the equalizer. And, you know, you know, minimum wage, I mean, it’s going up to 15 hours and I mean, $15 an hour. It was stagnant for I don’t know how many years in the U.S.

Eve: [00:27:19] Yeah.

Kimberly: [00:27:19] So you know, there’s definitely like an income stagnation issue in the U.S. and how do you promote economic mobility, whether that’s, you know, for our residents thinking about what are the resources that our residents need to help them build wealth? Is it, you know, financial literacy? Is it thinking about how do you mitigate the second highest expense, which is daycare in the DMV? Is it thinking about how do we promote entrepreneurship if that’s something that you’re interested in? Is it thinking about workforce development? So, we really have a focus on human capacity and wealth building, and we’re partnering with best-in-class service providers for that. We were very clear about what we do and what we don’t do, but we are very collaborative. We will make the partnerships that we need to, to advance our mission.

Eve: [00:28:20] So you’ve had a really big background, including pretty significant honors like the Loeb Fellowship at Harvard and White House Fellow. And I wonder how you ended up here. You’re clearly very passionate about this. What led you, kind of down this path to equitable housing for everyone?

Kimberly: [00:28:42] You know, it’s something I’ve thought a lot about. You know, I’ve had an amazing career and, you know, I’ve been in urban planning and development my entire career. I started out working at Enterprise. Enterprise Community Partners now, but it was Enterprise Foundation in the mid 90s. And so, this is a bit of a full circle moment for me. I’ve always been someone who was interested in cities. I grew up in the suburbs, so it was very much, you know, I was attracted to cities. But I grew up in the 80s and I saw, you know, cities weren’t the hot places to be that they are now. And there’s a lot of homelessness. There’s a lot of violence, gang violence. There was a lot of drugs. I saw a lot of that when I would go into to New York. When I go into to Philadelphia, when I go down to D.C. And I always wondered why, and I saw it disproportionately impact people of color, African Americans in particular. And I was living a very different life. You know, my parents were first generation. They moved from the city to the suburbs to give my sisters and I a better life. You know, this is really, you know, zip code matters. Where you grow up is a strong determinant of your life outcomes. This is Raj Chetty. But even before he came along, this was the case and my parents understood this and they moved us out. You know, my mom grew up in the toughest part of Baltimore. My dad grew up in Chester, Pennsylvania, in the poorest area. And so, you know, they were, you know, they defied expectations and, you know, they instilled in us, you know, the will to give back. Like, you know, do whatever you are passionate about. But make sure that whether it’s in your career or in your personal life, around service, around this world is bigger than you. And too much is given, much is required. And that ethos has driven me and my entire life. My love of cities. I love everything about cities. I love the density. I love the diversity. I love the messiness actually of cities. Cities are complicated and it’s something as an adult, I’ve always chosen to live in a city. I went to graduate school in Chicago, and I’ve made my career in Washington, and I worked in Detroit for three years. So, I like big, messy challenges and problems. But I also look at the entire ecosystem. So, I would say that I’m an urbanist and I’m a city builder. Right now, I’m focused on the challenge of housing and creating equitable housing. But, you know, throughout my career, I’ve gone deep. I’ve thought about how arts and culture, you know, it can be a catalyst for neighborhood change that informs my view on placemaking and making sure residents feel a deep sense of belonging. So, you know, the route, you know, it’s not a dotted line per say, but there is a through line in my career and this it all comes together in this job. And there’s a sense of urgency. I mean, I love working on issues that are of the moment, and there’s nothing more urgent right now in the DMV than really trying to figure this out. And I like innovation. You know, I worked for government for 15 years. I loved local government. I served with honor and duty with local government. But they’re not out of the box.

Eve: [00:32:34] No, no.

Kimberly: [00:32:35] We did some. We did some innovative things. You know, I tried my best. But that’s also what draws me to this job and this role is that we’re not quite sure that it works. We are proving out the model and I think that we are going to be successful. But there is a level of risk and I think that innovation requires risk taking. You really do have to push the envelope. You have to be uncomfortable. You have to move out of your comfort zone. And these are things that I live my life by. I certainly, my career has been defined by taking some level of risk because I think that that’s when you really learn, and I think that you have to fail. I think, you know, innovation part of innovation is failing, but you want to make sure that you course correct, that you’re constantly willing to look at what you’re doing to evaluate, is this working and be able to innovate and move as you go?

Eve: [00:33:47] I love every word you said. So, you have a start-up, it’s pretty, that’s pretty fabulous. That’s a pretty great way to live your life.

Kimberly: [00:33:59] You know, for me, you know, it is, you know, I, you know, I get really excited, I love being the first person to do something. Even when I was in government. Many of the jobs that I had I was the first person to have it. I like startup culture. I like building something from the ground up. You know, it’s deeply rewarding. And I also think I have the personality to think about the next steps. What’s needed, the unknown. You know, this is not work that if you need to know what you’re doing every day, and you need a roadmap, this is not for you. You know, I’m interviewing now to bring on staff and you know, I’m looking for personality traits as well as skills. But this entrepreneurial, out-of-the-box thinker, you know, that’s where I live, and I try to surround myself around people who have that as well, because you need that in startup culture.

Eve: [00:35:06] Yes, you do. Well, thank you so much. I’ve really enjoyed this, and I hope I get to talk more to you some other time because there’s a lot of energy there, and that’s pretty wonderful.

Kimberly: [00:35:18] Well, thank you, Eve. I really appreciate you inviting me on to your podcast, and I would love to come back because I feel like I didn’t do justice talking about the social impact work that we’re doing. And I think that your viewers, as well as you would be really interested to kind of get into the details of that work. And I would love to share it with you. You know, at an appropriate time.

Eve: [00:35:43] Awesome. Thank you. That was Kimberly Driggins. Kimberly is a woman of great passion and generosity. She’s had a remarkable career in urban planning and public policy, working on and in the cities she loves. And now she’s turning her passion and energy to the challenging crisis that is touching so many people. Housing. While Kimberly has only just begun to craft a fresh approach to this overwhelming problem, it’s clear that she plans to be spectacularly successful and we’re sure she will be.

Eve: [00:36:44] You can find out more about this episode or others you might have missed on the show notes page at our website, Rethinkrealestateforgood.co. There’s lots to listen to there. A special thanks to David Allardice for his excellent editing of this podcast and original music, and thanks to you for spending your time with me today. We’ll talk again soon, but for now, this is Eve Picker signing off to go make some change.

Image courtesy of Kimberly Driggins and Washington Housing Conservancy

Jamison loves real estate crowdfunding.

Jamison Manwaring is the co-founder and CEO of Neighborhood Ventures, a remarkable Arizona-based real estate crowdfunding company, focused on value-add multi-family properties.

It’s a real estate company, for sure – they buy, hold and sell property. But the capital plan is innovative, with a growing pool of state residents who are permitted to invest through Arizona intrastate securities law. Nine successful projects later, Jamison is now taking his plan to the national stage with their latest project, a short-stay hotel he wants to repurpose into affordable housing. And he’s raising funds on my crowdfunding platform, SmallChange.co.

Jamison attended business school at the University of Utah where he graduated with a BS in Finance. He was always interested in finance. He loved it enough to become president of the finance club. Even at a young age Jamison’s determination shone through. He wanted to work in New York, at a top finance firm. But those companies have their pick of Ivy league school graduates, which he was not. So every Thursday night he flew the red eye to New York to network. You’ll have to listen in to hear the rest of the story.

Insights and Inspirations

  • Jamison’s determination and stick-to-itness has taken him to Wall Street, and on to con-founding his own successful real estate company.
  • His mission? To let everyone invest in real estate opportunities.
  • Value add real estate projects, with less construction time than ground up, generally mean distributions to investors can start more quickly.
Read the podcast transcript here

Eve Picker: [00:00:05] Hi there. Thanks for joining me on Re-Think Real Estate. For Good. I’m Eve Picker and I’m on a mission to make real estate work for everyone. I love real estate. Real estate makes places good or bad, rich or poor, beautiful or not. In this show, I’m interviewing the disruptors, those creative thinkers and doers that are shrugging off the status quo in order to build better for everyone. If you haven’t already, check out all of my podcasts on our website at rethinkrealestateforgood.co or you can find them at your favorite podcast station. You’ll find lots worth listening to.

Eve: [00:00:56] Today, I’m talking with Jamison Manwaring. Jamison is enjoying success as the Co-founder and CEO of Neighborhood Ventures, an Arizona based real estate crowdfunding company focused on value-add multi-family properties. Always interested in finance, Jamison went to business school and studied finance. He loved it enough to become President of the Finance Club. Even at a young age, Jamison’s determination shone through. He wanted to work in New York at a top finance firm, but those companies have their pick of Ivy League school graduates, which he was not. So, every Thursday night, he flew the Red Eye to New York to network. But wait, if I tell you what happened next, I’d be a spoiler, so you’ll have to listen in to hear the rest of the story. If you’d like to join me in my quest to rethink real estate, there are two simple things you can do. Share this podcast and go to rethinkrealestateforgood.co., where you can subscribe to be the first to hear about my podcasts, blog posts and other goodies.

Eve: [00:02:14] Hi, Jamison, thanks so much for joining me today.

Jamison Manwaring: [00:02:17] Hey, thanks for having me, I’m happy to be on your podcast straight out of Pittsburgh. I’m here in Phoenix, still in the nineties here and…

Eve: [00:02:27] Oh wow.

Jamison: [00:02:29] Happy we have the technology we can be talking and doing this remotely.

Eve: [00:02:32] Well, I’m in the snow belt, at the moment. It’s in the low 60s here, so that’s a pretty big differential. So, your background is solidly in finance, all the way back to college when you majored in finance. And I want to know what led you to, you know, your early career was with Goldman Sachs and places like that. And I want to know what led you to launch Neighborhood Ventures and your focus on real estate.

Jamison: [00:03:02] Yeah, yeah. Great. Well, you know, I was always an entrepreneur type of person as a kid and did, I had several businesses. My most successful one was either dog walking or picking up, hauling off people’s Christmas trees into the field where the city wanted them to go for for a couple of bucks. That was a big business. And I ended up doing a bunch of telemarketing when I was in high school because you don’t have to have any experience there if you can produce results quickly. So, I started doing telemarketing and by my senior year I had 10 of my friends from school working for me and we were calling doing lead generation for mortgage company, insurance company and and I was just always pulled into business in general and in specifically real estate. My brother was in the mortgage business. My dad’s a real estate broker and has been for a long time. I always loved real estate, especially seeing a project go from what it was right now, but having a vision around what it could be and then seeing that vision come to fruition is really gratifying. And I started a real estate business right out of when I was in my early 20s before I went to college, and it was a for sale by owner business service. People want to sell their homes on their own. And we would help them with that and then charge them a flat fee. And that worked OK for a little while. But I also realized I was I had a lot of limitations when it came to my understanding of business, and even though I thought I knew everything, I clearly didn’t. And when the financial crisis happened and I was living in Phoenix at the time, you know, it really slowed things way down here. And when with real estate and with building and with the real estate market in general. And I hadn’t gone to college university and at that point decided, boy, right now is probably a good time to go to school because there’s not a lot happening economically. So I started in 2008 and I did a year at Arizona State, and then I transferred and finished at University of Utah in Salt Lake City. And when I was there, I realized finance is kind of what what helps you understand what is going on with the business. If you understand the financials, you understand the lifeblood, you’re kind of like the doctor of a company. You can really look at it, see where the problems are, see where the the great things are. See where areas that need focus. And if you can really understand how to give how to analyze a business or a real estate project financially, then then you have a really key skill set. And so that’s why I decided to study finance.

Eve: [00:06:19] Yeah. So you’ve had a kind of a you always had a background in real estate, but still it’s a pretty big leap to go from that to launching a crowdfunding platform. And tell me about that and what made you take that leap?

Jamison: [00:06:34] When I was studying at the University of Utah, I had a lot of friends who had done, a few friends who had done some internships with some investment banks. And as I talked to them, I realized and came to conclude that that would be a great option for me to try to get the experience of working in an investment bank. Most of them are were either going to be in San Francisco for us because we’re more. I was in Utah and then some people even made it all the way to New York. That was a little bit further than than most of us get to and um, I decided to go for that, not just to work on Wall Street, for the the brand or, you know, the status. I was more wanting to really go because I heard how how much they learned about companies, public companies and the markets. And so my junior year of school at University of Utah, I started going out to New York on a redeye flight, JetBlue flight on a Thursday night. I would leave at 11:30 p.m. and I’d arrive in New York at about 5:30 a.m. And then I would go out to the investment banks and try to network with with folks. And because the investment banks, they recruited their core schools, which tend to be the Ivy League schools, they are not recruiting at University of Utah, so we have to go to them. And I did that.

Eve: [00:08:06] That’s pretty intense.

Jamison: [00:08:10] Yeah, it’s, you know, I’d get on that flight and get there at six a.m., grab a little breakfast and then just try to have the most productive Friday that I could. And that usually meant meeting two or three folks face to face. And I would just, I got some some email addresses from some professors who have friends working on Wall Street, former students. Uh, from University of Utah, who maybe later went on and got an MBA at Wharton or Chicago or one of the the schools where a lot of them end up on Wall Street. And I ended up meeting probably half a dozen people, maybe 15 people who would have a 15 20 minute meeting with me. And I just said, Hey, I just want to learn about your business. I’d ask them a few questions about what they do. And it gave an opportunity for for them to get to know me and ask me questions, too. And I was hoping that something would happen, but I didn’t know exactly what would happen, and I made probably half a dozen or eight trips there. I’d stay in a hostel with eight other people snoring. You know that Friday night it was it was miserable. But I was in New York and it was fun. I had never I had never experienced New York, so I would stay there until usually Sunday night and fly back Sunday night and really grew a love for, for all things, New York. And luckily, one of the people who I met he was at Barclays, which bought Lehman Brothers after the financial crash. Barclays is a UK based bank. They came in kind of bailed out Lehman and they were one of the biggest investment banks in the world, and he was there and he helped me get an internship. And he actually he helped me get an interview, and they flew me out from Utah for the interview, for a super day and ended up getting an internship, full time summer internship, the junior year to my senior year. And that’s really what kind of got me into finance in Wall Street.

Eve: [00:10:22] It also certainly shows your determination, which you really need for a startup business.

Jamison: [00:10:28] Yes. Yeah, there’s there’s no giving up. It’s just it hasn’t happened yet. I’ve just got to keep going. As you know.

Eve: [00:10:37] I know that feeling really well. Not giving up.

Jamison: [00:10:42] Yeah. One of the things I found is a lot of times right when you’re at your worst and you’re about ready to give up that a lot of times means you’re almost there. So it’s kind of like…

Eve: [00:10:55] Oh, that’s awful.

Jamison: [00:10:56] I feel that so many times. And I was paying for this out of pocket. And luckily, JetBlue had a special, I think it was $129 round trip on that flight. And so I spent about $1,000 in the travel and stayed as cheap as I could. But, you know, had a great experience. And I ended up at Goldman Sachs after college.

Eve: [00:11:19] That’s a testament to your stick-to-itness.

Jamison: [00:11:23] You know, some folks, they might go to Ivy League and go right into a company like that, and those companies are out recruiting them, trying to get them to work there. For me, it was a little different. I had to come in the side door, not the front door, but I was in the door. And then once you’re in there, you know, you’re all equal. It’s it’s a meritocracy. It’s about what can you do? What ideas do you have? And I love that. I love the, you know, it’s kind of a low drama atmosphere. It’s just about what do you do and what can you produce. At that point, once you get the job, it’s not who you know. And I love the fact that I could be from Idaho, you know, going to school in Utah and I’m here on a level playing field and it really motivated me and I was I felt like I was with some of the smartest people I’d ever been around, for sure.

Eve: [00:12:15] That’s a great story.

Jamison: [00:12:18] Yeah, thank you. One of the companies that went public that I worked on their IPO was LifeLock in 2012, and they were based in Arizona. And I had some family in Arizona and I had lived in Arizona for a little while. And when they went public, I was always a little drawn to them because they were one of the few companies in Arizona that’s kind of like a tech company. And long story short, in 2015, they offered me a job to run their investor relations. I had been working with their investors as a Goldman Sachs equity analyst for several years, three years.

Eve: [00:12:58] Oh, okay.

Jamison: [00:12:58] And then they brought me basically from Goldman Sachs into their own into internally. And a year and a half after joining, LifeLock got bought out for three times our share price. From the time I joined. When I joined, it was about eight dollars a share and we ended up getting bought out for twenty-four dollars a share. So that was a good outcome for everybody. And at that point, I had an opportunity to do something new and different, and that kind of leads us to where we are here now with with Neighborhood Ventures and the current company. I had bought a few buildings when I was in New York, including a 10-unit building, renovated it. The buildings weren’t in New York. They were in Idaho where I was from. And I really was drawn back to real estate. Kind of came full circle back to some of my roots and where my family had spent so much time. And so I went from wanting to go to Wall Street, getting to Wall Street, seeing everything that was there and saying, you know, I kind of want to go back to the. tangible assets in real estate.

Eve: [00:14:10] But with a pocket full of different experience, right, that you could apply.

Jamison: [00:14:14] Yes, and realizing that, you know, a lot of people don’t have the opportunity to put money in real estate. They invest it in the market because you can do it from home and you don’t have to manage anything, you don’t have to be a landlord. And a lot of people think, Well, if I’m going to invest in real estate, that means I’m going to have to become a landlord and I’m going to have to get that phone call on a Saturday afternoon that the toilet’s broke. And I don’t want anything to do with that. And that’s kind of when this idea came together, about how can we make real estate more attainable as an asset class for people to own, because I saw an opportunity where it’s very easy to invest in the market, but the market has a lot of downsides. It’s a roller coaster. There’s a lot of risk there. And as I was drawn to real estate, I think a lot of people, other people are too. If we could find ways for them to invest in real estate without them having to become a landlord.

Eve: [00:15:18] Yeah, it’s definitely a more stable investment if you invest in it correctly.

Jamison: [00:15:23] Yes. And there’s REITs and there’s some of these big instruments you can invest with in real estate, but they’re also very Wall Street in many ways because they don’t really, they don’t disclose much about what they’re doing.

Eve: [00:15:37] Yes, that’s right and you don’t have a choice. You don’t have a choice about what you invest in. You’re investing in a big bucket, almost a blind pool of funds that could be invested into something you really hate, quite frankly. So…

Jamison: [00:15:52] Yeah.

Eve: [00:15:52] Yeah.

Jamison: [00:15:52] It’s more of a financial decision where they’re just saying, I want to invest in real estate, let me invest in a REIT. But there’s not that, you know, the thing that’s fun with real estate, just like piggybacking on what you’re saying is, you know where it is, and you see the, you can drive by it and you can touch it and you can… There’s a pride of ownership there that you don’t get when you just own a bond, you know, or something that…

Eve: [00:16:16] Right, especially if it’s in your own city, right? If it’s somewhere where you care about, yeah.

Jamison: [00:16:21] You can drive by it. We have investors now that drive by the assets that they own every month, and they just drive by it. And I think they do it just because it feels good. And you can’t do that with a financial instrument that’s traded on Wall Street. So…

Eve: [00:16:36] Do they send you comments about what you have to fix?

Jamison: [00:16:39] Yeah. And you know what? We think it’s an advantage because we have a couple of hundred owners keeping their eye on it.

Eve: [00:16:48] That’s right.

Jamison: [00:16:51] Our property managers do a great job, so we don’t get that feedback very often. But we’ve gotten it before. And when we say thank you, we’ll get it fixed and happy to have more sets of eyes on things.

Eve: [00:17:01] So just tell me about Neighborhood Ventures. Like, how does it work and why did you develop that? Like after this wanting to get into real estate, looking for something new? Why Neighborhood Ventures and how does it work?

Jamison: [00:17:15] Yeah. So, after I came out of the sale of LifeLock, I wanted to figure out a way to get more people to be able to invest in real estate projects. And I actually wanted to just create a platform similar to what you’ve done at Small Change. And as I dug into it, I realized that is going to be a ton of work. And thankfully. for people like me, there’s people like you that you went out and did that work. And around that same time, I met my now Co-founder John Kobierowski, and he basically convinced me instead of creating a platform, why don’t we just create a company, and I can lead all of the financial aspects of that fundraising. And he would be the real estate expert. He’s been in commercial real estate in Phoenix for 30 years. He’s been an apartment broker, very, very great reputation, and knows this market extremely well. And so, we decided to launch Neighborhood Ventures as a crowdfunding company. So, we raised funds via the Arizona intrastate laws on our first nine projects. $1,000 minimum investment. And I don’t know if I can say that or not. Maybe you can edit that out, but we raised money.

Eve: [00:18:42] No, you can say that. You can say whatever you like about Arizona intrastate.

Jamison: [00:18:46] Yes, we raised funds through the Arizona intrastate crowdfunding laws, $1,000 minimum investment. And in each of our first several projects, we had 100 or 150 investors. The first project we did…

Eve: [00:19:02] Hey, let me just stop for a second for the benefit of our listeners. So, there’s this rule called regulation crowdfunding that lets everyone 18 and over invest, but it took the SEC four and a half years to write it. So, in that four-and-a-half-year period, many states just didn’t want to wait any longer, and Arizona was one of those, and they created their own crowdfunding rules, which are called intrastate, which really only permit Arizona residents to invest. And they sort of bypassed the Federal SEC. It’s kind of like marijuana laws in individual states. Yeah, everyone, sort of, just looked away and said, okay, this has to happen because it’s happening so slowly at the Federal level. Is that a good explanation of it?

Jamison: [00:19:52] Yeah that’s, you hit the nail right on the head. Because it took so long for the SEC to implement The Jobs Act that was passed in 2012. A lot of the states like Arizona, I think we passed our intrastate law in 2015 and it’s nice in some ways, because we our regulator is the corporation commission in Arizona. And then there’s also very various and obvious limitations that we can only raise money in Arizona. So, for us, it gave us a good opportunity to start our business, but we knew at some point that we would need to grow nationally with our investors. But for our first nine projects, they were all in Arizona and all Arizona investors.

Eve: [00:20:41] So what sort of real estate projects do you focus on?

Jamison: [00:20:45] So John’s experience had been in multi-family and specifically in value-add multi-family, in walkable core areas. So, in Phoenix, what has happened in the last 15, 20 years is there had been a mass exodus of the downtown area in the eighties and nineties and moved to the suburbs, and the downtown area was kind of like the place nobody wanted to go. And then in the late nineties, the Arizona Diamondbacks built their stadium right downtown and there was became this energy around downtown. And then millennials and pre-millennial, but the younger folks decided downtown is kind of cool, and I don’t want to live way out in the suburbs where it’s a 45-minute drive in traffic anywhere. And in the 2000s and in the 2010s, we started seeing this urban migration back to these core areas, and we’re still seeing that. And what we do is we find buildings in those core areas that haven’t been renovated for a long time. A lot of them have been owned by the same owners for decades, and they’re just basically cash flowing them, and we’ll go in and fix these, kind of, cool, unique buildings. A lot of them kind of mid-century architecture that has been covered up over the years and not brought out, and we’ll go make them cool again. And people really love to move into a newly renovated building that’s in these core areas. So that’s really been our focus.

Eve: [00:22:22] And what are the limitations for you, like how are you feeling? Well, you know, financing altogether or just the Arizona rules like…

Jamison: [00:22:31] Well, our first project was a small building in Tempe, which is where Arizona State is. So, it’s a great area because there’s a lot of activity there, not only the college, but just in general. And we thought we might raise that. We’re only looking to raise half a million dollars. And we thought we might raise that in the first couple of weeks, and we launched the project on our website. We had done a little bit of PR and marketing before that. And I think the first day we got five or six investors who invested a few thousand dollars, and it became really clear about two or three weeks into it that I think we had hit maybe 100,000, but we had a long ways to go.

Eve: [00:23:15] Yes, it takes a while. Yeah, yeah.

Jamison: [00:23:18] It was our first project. So even though I had a finance background, John had a commercial real estate background, it was our first project and one of the things we committed to do, he and I, was that we wouldn’t call our friends that have deep pockets and have them invest. We want to really build a real business here with organic new investor base. Not just, kind of, call the rich folks and have them write quarter-million-dollar checks. And there’s a lot of people out there that can do that and do do that in real estate. But we wanted to open it up to a broader group of people with a 1,000-dollar minimum investment, and that’s going to take time to build. We knew that, but we didn’t anticipate how long it would take. Long story short, we ended up barely being able to close on time, it took six months to close. We had a friendly seller who gave us a six-month escrow and we literally got our, the 500,000 we needed two or three days before we needed to close. We barely made it.

Eve: [00:24:25] Wow.

Jamison: [00:24:26] We ended up having 103 investors, all Arizona residents, none of whom were our friends, that were juicing the deal. All real folks. It was painful because it was like, what are we doing? Is this really a business? But we wanted to see if there was a business here, if it was…

Eve: [00:24:47] I’m sure it was very gratifying as well.

Jamison: [00:24:49] Yeah, absolutely.

Eve: [00:24:50] A hundred people who want to invest in your project, that’s significant. You know, for first project, it really is.

Jamison: [00:24:57] Yeah. And it took a lot of work and people don’t realize that, you know, raising funds from people for investments is one of the hardest things to do because whether it’s 1,000 dollars, 100,000 dollars, that means a lot to that person. And they’re not getting any product today. They’re not driving out with a new car today. It’s just a promise that we’re going to not only pay that back, but with a nice return and good communication along the way. So, it’s hard. It’s hard and it takes time.

Eve: [00:25:27] It’s very hard. Yeah, I do agree with you.

Jamison: [00:25:29] Yeah.

Eve: [00:25:29] Facebook followers do not become investors.

Jamison: [00:25:32] Right.

Eve: [00:25:34] So I have to ask how many of those investors, original 103, have invested again?

Jamison: [00:25:40] Well, that’s really what’s built our business is those folks. We did another project two or three months later, might have been six months later that about 80 percent of those invested again.

Eve: [00:25:55] And they probably told their friends too, right?

Jamison: [00:25:59] They’ve told their friends to the point now, so we’ve just hit four years, we’ve only been working in Arizona, and we have over 500 investors in Arizona, and we have 1,500 investments, in that period of time. So, those 500 investors on average have invested in three of our projects.

Eve: [00:26:18] Pretty fabulous.

Jamison: [00:26:19] And our average investment is 5,000 dollars. So, some people invest 1,000, some people invest more than that. But it’s hard work. It’s real, it’s education because people before they’re going to place an investment, rightfully so want to feel very comfortable with our team with our strategy. And this isn’t a get rich quick for anybody. It’s slow progress. And then we sold. Now we’ve sold three of our projects, including that first project. And so, it’s gone full cycle. So, our investors have received all their principal back and all their returns. And now we’ve done that on three projects total. And that’s where things really start to click in for people and they start to see that what we’re doing works.

Eve: [00:27:08] That’s a fabulous story. So, what is your latest project?

Jamison: [00:27:15] So one of the things that’s happening in Arizona is that there had always been a lot of migration to Arizona from other states. Mid-West, California, even northeast. On average, Maricopa County, which is basically the Greater Phoenix area. It’s about four or four and a half million, folks. About 100,000 people, 100 to 125,000 people move here every year, so it’s like 10,000 people a month are relocating.

Eve: [00:27:46] That’s a lot of people. Yeah.

Jamison: [00:27:49] And when COVID happened, that accelerated because you had folks in California who were tied to working in and living in the Bay Area, for example, and now they could go, move somewhere else and start working remotely. And maybe that would be a short term. And then it’s kind of turned into more of a hybrid model. And we’re seeing a lot of these companies saying Hey, you want to keep working remotely? Go ahead. Live in Colorado, live in Utah, live in Arizona.” I’m talking about the western states because a lot of that’s from California, but we saw an acceleration in that migration. And so we’ve had a shortage of housing. And in Mesa, which is one of the fastest growing large cities in the country. I think 800,000 people live there close to a million people in Mesa alone, which is a suburb of Phoenix. There’s very little housing available, and we found a deal of a hotel owner who owned 120 unit extended stay hotel. And that meant that all of the units had full kitchens. And we went and looked at the building as a potential conversion to an apartment to meet the growing demand of folks moving here. And it had actually looked and felt like an apartment building already. We did our due diligence. We have a great attorney who’s helping us and helped us with our due diligence, and we purchased the building with the intent to convert it to an apartment where we actually have already started that process with the city and have got a lot of great initial feedback. And so, our current project is this 120-unit hotel to apartment conversion. And the great thing is, it’s not a big, heavy lift when it comes to renovations, and we’ve done some projects that are extensive renovations. It’s really cosmetic. So, we’re going in and updating the carpet and the paint and the fixtures and the appliances. And we don’t have to do plumbing and moving things around to accommodate and turn it into apartment because it was already an extended stay project. There’s 20 studios, 12 two bed two bath and the balance, I think that’s 88 one bedroom one bath, which is a really great mix when it comes to apartments.

Eve: [00:30:28] Yeah, that looks like your biggest project. What’s the total cost, development, purchase price and everything? How big a project is it?

Jamison: [00:30:36] Yeah. So, it’s just over 13 million to purchase, and our renovations are going to end up being about 6,500 per unit.

Eve: [00:30:49] Okay.

Jamison: [00:30:50] Or a total of 800,000 in renovations.

Eve: [00:30:56] Ok. Ok. So then I have to ask, how are you financing this?

Jamison: [00:31:00] Well, yeah, we have some great lender relationships we’ve built over the years. And so, we had a great lender who loved the project. They’re helping us with the purchase, and we’ve already closed on the project about over a month ago. And then they’re also helping finance some of the renovation expenses. And then we’re raising money for the equity, as we have historically in Arizona from Arizona residents. And then this is our first project that we’ve opened up nationally, through the Small Change platform, and we have 25 investors or more now from that platform. And so, we’re between raising money here in Arizona and on the Small Change platform. We’ve already had enough to close on the building a month ago and now just filling out the rest of our financing needs over the next several months as we continue to fundraise on this.

Eve: [00:32:01] So, you know, you and I talked about this national push. We must have been talking about it for years. I think before you sort of…

Jamison: [00:32:09] We have, you know, I’ve been following you for a long time. Actually, you didn’t even know, but I was watching what you were doing because you’re one of the early folks in the crowdfunding.

Eve: [00:32:19] Feeling just as much pain as you were, right?

Jamison: [00:32:23] You are definitely feeling more because you’ve been in the mix of it all. And we’re, you know, from our standpoint, so appreciative that you spent a lot of time there where it wasn’t, it was a thankless job, because you had to deal with the three-and-a-half-year wait before the thing was launched and then once it was launched following all the rules correctly, you know, doing anything new as a pioneer is going to be difficult.

Eve: [00:32:50] Yeah. And actually, you know, the interesting thing about Reg CF and is that, you know, we’re regulated by the SEC and members of FINRA. So, you know, they’ve grown up with this as well. So, I don’t want to say their interpretation, but they over the years they focused on different things in the rules. And we have to change things as their opinions have changed. And so, it’s a kind of ever moving target. It is pretty tough. But so what you, like we, were talking about this for years. So this is the goal to go national and to find some alternative investment tools to be able to let people invest in your projects all over the country.

Jamison: [00:33:38] Yeah, that’s right, and I think one of the things that prompted our discussion just to go back to your point was when they did raise the limit to five million.

Eve: [00:33:50] Yes.

Jamison: [00:33:51] It was a million for so long. And so they have improved some of those rules. And I hope that continues to open things up. And the timing worked out well for us because we were now, got to a project where it was our biggest project and we wanted to go outside of Arizona and let folks who wanted to invest in Arizona. All of our projects have been in Arizona so far. We don’t think that will always be the case, but we know the market very, very well. Our projects have done well here. And so, your platform gave us a great opportunity to start building our investor base nationally and with the same idea in mind. You know, these are these are folks who are trying to put a few thousand dollars away. And we will and they’re more comfortable investing in something that is tangible that they can see and that they can understand rather than investing in crypto or something on Wall Street. That’s so far out there.

Eve: [00:34:56] I think the advantage with the value-add is interesting, too, because value-add properties, they might even be cash flowing all along, whereas a brand new ground up project, you have to wait a while for the return. So, what I find interesting about what we do is, you know, some people can’t wait for a return because they’re on a fixed income. So, they’re looking for projects that will sort of provide more continuous cash flow and other people can wait and are more excited by an idea. And it’s just, it’s fascinating to me because you say the word investor, but investor can mean very, very many different things to different people.

Jamison: [00:35:33] That’s a great point. And if you do a ground up project, you could be a few years out before you get any cash flow coming in the door.

Eve: [00:35:40] But the returns might be better. Maybe not. It’s a risk.

Jamison: [00:35:44] Yeah, yeah, but that’s not what we do. So we take an asset that’s already generating cash flow, but that is underperforming. And that’s what we had here with this hotel.

Eve: [00:35:56] Right.

Jamison: [00:35:57] And we did liquidate the building, had everybody move out because we’re doing a renovation. But the renovations are ahead of schedule, and we have, we’ll end up being closed for about two months and then it’s we start generating cash flow again.

Eve: [00:36:12] That’s fantastic.

Jamison: [00:36:13] We’ll start sending distributions in December.

Eve: [00:36:17] Yeah.

Jamison: [00:36:18] From cash flow. So, it’s a…

Eve: [00:36:20] It’s a great model. And then the other thing, you know, while you’re opening up the market to people you don’t know, I know that some of your investors on Small Change have been following you for a while in Arizona and have been frustrated that they haven’t been able to invest in your projects.

Jamison: [00:36:35] Right.

Eve: [00:36:36] And we’re pretty early in the Small Change offering, which is nice that you sort of already started developing your crowd outside those arbitrary borders.

Jamison: [00:36:48] Yeah, that came from word of mouth because, you know, we have a lot of snowbirds in Arizona, people who live elsewhere and then they come here in the winter to golf and enjoy Arizona winters, which are amazing, but they live elsewhere and then they talk to their friends there. And so, we had a lot of folks, kind of a backlog of folks, who wanted to invest and weren’t able to because we were only open to Arizona. So yeah, that’s the great thing about Arizona, and I’ve lived in multiple places, but it’s kind of a bit of a melting pot, and it’s only because we have a lot of part-time residents. We have a lot of people who have just moved here in the last year, and it’s become a really, kind of, eclectic place with a nice southwest and Mexican influence. You know, we’re two hours from the border. I have a property in Mexico that’s an Airbnb property on the beach. That’s a three-hour drive from Phoenix, so I can go to get to the beach in three hours. And then the other thing is, in Phoenix, you’re two hours from Flagstaff to the north, where there’s snow and skiing, so you can live in Phoenix and you can be, you know, three hours from the beach in Mexico, and you can be two hours from the snow in Flagstaff.

Eve: [00:38:02] You know what? That sounds like Australia where I grew up. Sydney. On the beach, you know, two hours to the mountains.

Jamison: [00:38:12] Yes and, no knock against New York, I love New York, but when I was living there, the coolest thing you could do is get out to the Hamptons, which I couldn’t afford, right? So, you know, when you get used to living in the West and you grow up out here and you’re by West Yellowstone, you’re by the Grand Canyon and the trails, it’s tough to not have that in your life. And so, I’m happy to be back out West.

Eve: [00:38:41] So, tell me, you’ve got that building purchase, do you have another one targeted?

Jamison: [00:38:46] We’re basically slated through the end of the year to finish out our existing projects, including mostly this hotel conversion, which should be done by the end of the year. So, we’re always looking for our next project, but we’re not actively making offers on anything just yet. It’ll be a few months before we’re doing that.

Eve: [00:39:07] So one last question and that is, what’s your big, hairy, audacious goal?

Jamison: [00:39:14] That’s a good question, I don’t share that with everybody, but I will share it here, is we want to double our size every year for the next five years. So, we want to double the number of investors that we have. We want to double the number of projects, assets, the funds that we’re raising for projects for the next five years. And that means, you know, that’s kind of easy the first year and maybe the second year, but the third year, now you continue to double that as the numbers get larger, you have to double it. So that’s our goal. The next five years is doubling the business, but ultimately, it’s to bring more people who have never been able to invest in these types of assets into the game. In our early days when we were struggling, we had an open house at one of our projects, right when we had got it renovated and I was kind of like, oh man, I don’t know if this is the business for me. I’d given up a lot of other opportunities to start this, and we went to the open house and there was a man there in a U.S. Postal uniform and I thought is, I went over and talked to him, I wondered, is he an investor? And he immediately said, I’m so appreciative to what you guys are doing, because I never thought I would be able to invest in something like this.

Eve: [00:40:39] Isn’t that fantastic?

Jamison: [00:40:41] I’ve been delivering mail in this neighborhood for 20 years. I saw your flyer and I thought I could actually invest in this. $1000 minimum. And he showed up to the open house before work. You know, they have to work on Saturdays, so it was a Saturday morning. And he just said, I’m so happy to be here and to be able to invest in this, and that gave me, personally, the juice that I needed that day to get through it. This is why we’re doing what we’re doing.

Eve: [00:41:15] Well, I’m really impressed, Jamison, and I hope you’re wildly successful and I can’t wait to see what you do next.

Jamison: [00:41:23] Same to you and thank you for all your support and everything that you’re doing, and we’re all in this together. So, hoping more folks get the opportunity to get involved in these great projects.

Eve: [00:41:42] That was Jamison Manwaring, CEO of Neighborhood Ventures. Jamison’s putting his determination to work, building his innovative company in Arizona. It’s a real estate company, for sure. They buy, hold and sell property. But the capital plan is innovative, with a growing pool of Arizona residents permitted to invest through Arizona intrastate securities law. He’s seen early success, and now he’s taking his plan to the national stage raising funds on my crowdfunding platform, SmallChange.co. We can’t wait to see how it turns out.

Eve: [00:42:35] You can find out more about this episode or others you might have missed on the show notes page at rethinkrealestateforgood.co. You’ll find lots to listen to there. A special thanks to David Allardice for his excellent editing of this podcast and original music. And thanks to you for spending time with me today. We’ll talk again soon, but for now, this is Eve Picker signing off to go make some change.

Image courtesy of Jamison Manwaring, Neighborhood Ventures

One year. 41 more conversations.

41 amazing people. 41 inspiring conversations.

Cynthia Muller. Richard Rothstein. Andre Perry. Charmaine Curtis. Lyneir Richardson. Darryl Scipio. Libby Seifel. Beth Silverman. Patrick Quinton. Daniel Parolek. Charles Durrett. Heather Hood. Diana Lind. Scott Flynn. Atticus LeBlanc. Sam Ruben. Andrew Luong. Stephanie Gripne. Shannon Mudd. Ken Weinstein. Garry Gilliam. Andy Williams. Daniel Dus. Patrice Frey. Bruce Katz. Christopher Leinberger. David Peter Alan. Annie Donovan. Michael Shuman. Dan Miller. Scott Ehlert. Katie Faulkner. A-P Hurd. Max Levine. Brian Dally. Jonny Price. Michael Lee. Kevin Cavenaugh.

These are the rockstars of my show.

Season Three starts soon …

Read the podcast transcript here

Eve Picker: [00:00:14] Hi there. Thanks so much for joining me today for the final episode of Rethink Real Estate. For Good, season 2.

My name is Eve Picker and I’m on a mission to make real estate work for everyone. Real estate can help to solve climate change, can house people affordably, can create beautiful streetscapes, unify neighborhoods and enliven cities. 

You can learn more about me at my website, rethinkrealestateforgood.co, or visit my real estate crowdfunding platform, SmallChange.co. Our projects offer impact, solve housing problems, invest in neighborhoods and give everyone the opportunity to invest and build wealth for as little as $500.

[00:01:12] Today marks the second anniversary of this podcast. Two years ago, I didn’t know that our audience would grow as it has. In fact, two years ago I wasn’t sure we would have an audience at all. Now 10,000 people download episodes every month. That’s 10,000 people who care about thoughtful and impactful real estate solutions.  Wow!  I am humbled that all of you want to listen in.

This second year has been an opportunity to learn from yet another class of extraordinary leaders and innovators in real estate. My guests are working on housing solutions, policy issues, manufacturing, in fintech, on preservation, on developing new technologies and on providing real estate metrics, on mobility issues, as architects, on sustainable development, on community capital, on equity for women and equity for minorities and in many other niches, pushing the boundaries of the built environment to be better for everyone. 

The range of work that is being accomplished is quite awe-inspiring.

[00:02:25] Perhaps the most important theme this year was equity.

Cynthia Muller, director of Mission Driven Investments at the Kellogg Foundation. has been described as a “thought leader of the impact investing ecosystem and a trailblazer in the field.” In No guilt. Just Action. she reminds us that every time there has been an opportunity for black and brown people to build an asset, to build wealth, it’s been taken away from them. Let’s change that. 

Richard Rothstein and Andre Perry have written about these inequities.In The Color of Law Richard argues for a national civil rights movement to ensure that we all get to reap the economic benefits of living in this rich and diverse country. And In Know your price, Andre share findings that homes are underpriced by 23 percent, or $48,000 per home, in majority black neighborhoods. That’s $156 billion in lost equity.

[00:03:31] Charmain Curtis, Lyneir Richardson and Darryl Scipio are a new breed of black developers. Charmain has built a successful career as a developer despite being a black woman. She didn’t realize what she was up against until she was in her 30s. In Spread the Wealth she ponders how wealth could be distributed equitably to everyone.

In Building Generational Wealth, Lyneir describes his plan to buy 100 community shopping centers with 100 community members, all focused in majority black neighborhoods. He provided the first opportunity to 140 investors on Small Change early this year.

[00:04:17] Justice runs deep with Darryl.  In Turning renters into homeowners he describes his latest passion project, Savers Village.  He aims to help every tenant save enough for a down payment on a home.

And Libby Seifel is focused on women.  In Women building collective muscle, she describes the network of women leaders in real estate she has built. After more than 30 years in the industry, she is no longer the only woman in the room, and that some of the biggest new projects in the Bay Area are being driven by women.

[00:04:56] Housing solutions are importantly getting a lot of attention.

Perhaps the boldest of these is Beth Silverman’s Lotus Project. In Radical in its Simplicity she tells us how ,for just $800, her organization can successfully house a homeless family and change the trajectory of their lives forever.

We learn about accessory dwelling units as an affordable housing solution in Yes! In My Backyard! Patrick Quinton has developed a manufactured solution that drops a 32×14 foot ADU into a typical 50-by-100-foot lot in Portland, Oregon without hitting the setbacks and without requiring city design review. And he’s raising money for this project on Smallchange.co

[00:05:48] On the west coast, Daniel Parolek, architect, coined the phrase, The Missing Middle just as the critical absence of affordable housing was becoming a major planning issue for cities nationwide. He explains what the missing middle is, why it is important and how we can build more of it. 

Charles Durrett brought co-housing from Copenhagen to the US many years ago and wrote a book about it. He explains why he’s spent a career in co-housing and how it can make people’s lives better in It takes a Village.

[00:06:27] In Northern California, Heather Hood oversees efforts for the Enterprise Community Partners that ensure low- and moderate-income residents have access to affordable, quality housing. We talk about the enormous size of this problem in The elephant in the region.

And Diana Lind wraps it up for us in Lets be Brave. She’s written a book called Brave New Home in which she argues that the single-family home is at least partly to blame for our current housing woes.

[00:07:01] Technology is rapidly transforming the real estate industry in many different ways as well.

Some of my guests, like Patrick Quinton and Scott Flynn in Manufacturing change, are focused on manufacturing affordable homes in factories. Scott’s company, IndieDwell, manufactures smaller, sustainable and affordable homes at the pace of 10 homes per week and growing.

But others are pursuing new ideas.  Atticus LeBlanc tells us about PadSplit in One Room at a time.. He wants to dramatically change how we address affordable housing by using space that is now under-used in everyday homes.

[00:07:46] Or Sam Ruben in 3D-printing, robotics and automation, oh my! His company is printing buildings and hopes to create affordable and sustainable homes with their new technology.

And finally, Andrew Luoung who has deconstructed the often lengthy and confusing process of small scale real estate investment, making it accessible to everyone.  In Andrew loves real estate he describes the online turnkey service that he has developed into Doorvest.

[00:08:20] Some guests are focused on fertilizing tranches of future impact investors and leaders.

None is more passionate than Dr. Stephanie Gripne. In The impact accelerator, she tells us about founding the Impact Finance Center with a mission to identify, train and activate philanthropists and investors to become impact investors. Her big, hairy audacious goal is to move a trillion dollars into impact investing.

Dr. Shannon Mudd is right behind her, teaching students how to invest $50,000 of real money for maximum social impact. His Young Angels are carrying this knowledge into their professional careers.

[00:09:09] Others want to pay it forward.

Like Ken Weinstein, a highly successful Philly developer whose career was inspired by his landlady in Germantown. He’s created a boot-camp for aspiring developers called Jumpstart Germantown and describes the program in Jumpstarting a community.

[00:09:32] Garry Gilliam may be best known for playing in the NFL. Today he has a second career as an impact real estate developer. He tells about his first project in The Bridge. It came about as a joint effort with Garry’s friends from the Hershey School, a philanthropic school for low-income children. That school gave them all a leg up and now they want to give back to their community. 

Or Andy Williams, a former Marine who was determined to secure his future through real estate. He’s built a substantial portfolio of homes, a real estate development business focused on larger projects, and now, a program that seeks to turn veterans into entrepreneurs just like himself.  

[00:10:23] Some guests, like Daniel Dus and Patrice Frey, are focused on building on what’s already there. Learn how Daniel is planning to redevelop the dramatically underutilized historic luxury estates of the Berkshires for the shared economy in Everything old is new again.  And in Saving Places, Patrice explains the role of the National Main Street Center in servicing the revitalization of commercial main streets in big cities and small towns alike.

Bruce Katz moves the focus back to metro areas in Cities are networks. As a foremost policy expert, Bruce argues that cities must knit together solutions. It’s an imperative. And he calls this the new localism.

Christopher Leinberger is thinking along the same lines in Back to the Future. As a renowned urban strategist, teacher, developer, researcher and author Chris thinks “Back to the Future” got it right.

[00:11:30] While David Peter Alan enchanted me in I’ve been working on the railroad with his singular passion for the country’s railway system. He has ridden the entire Amtrak system and about 300 transit providers in the U.S. and in Canada.

Annie Donovan and Michael Shuman are focused on alternative finance. Michael thinks we have it Totally backwards. Local owned businesses make up 60 to 80 percent of the private marketplace in the average U.S. community. But economic developers and subsidies almost always overlook them. And Annie believes that disruptive capital is critical for solving thorny problems. She describes her pursuit of fairness in economics and finance in The world beyond banks.

[00:12:27] A handful of guests are diversely focussed on sustainability in the built environment.  Perhaps the most interesting is Dan Miller, who has launched a platform that connects everyday investors with farmers who need loans. He’s Stewarding the Future of Farming with investments as low as $100.

Scott Ehlert and Katie Faulkner are mass timber experts.  Katie as an architect with an eye on sustainability in From here to there.  In Mass timber for the masses, Scott tells us about the installation and cost benefits of a proprietary hollow core mass timber system he is designing that uses 50% less wood fiber. And, as if that is not enough, Scott is also designing a robotic fabrication facility to anchor a new wood product innovation campus, in California.

While A-P Hurd remains focused on building Livable and delightful communities.

[00:13:28] This class of guests would not be complete without my colleagues in the crowdfunding industry.

Some like Max Levine and Brian Dally are focused on real estate.

In Hello, Neighbor we learn about Max’s Neighborhood Investment Company, which has a mission “to localize wealth creation and broaden access to neighborhood equity.”  While in Get in on the ground floor,  Brian describes the platform that he has built into the go-to funding platform if you want to fix’n flip property.

Jonny Price, previously with Kiva and now with Wefunder, is focused on Filling the “crazy” gap. There’s a common theme for Johnny – financially excluded and socially impactful businesses.And Michael Lee is Building Virtual Communities using blockchain. Instead of using blockchain for crypto, he’s using it as an organizing tool to democratize the power of data.

[00:14:31] Finally, what better way to end than with Kevin Cavenaugh a developer in a class of his own. In I do a bunch of weird stuff, you can tap into this unique developer. Left brain, right brain, head and heart all come to bear on his wildly creative buildings. “I’m tired of mocha-colored, vinyl-windowed boring. I can’t change the fact that the streets are gray, and the sky is gray. But the buildings?” says Kevin.

Phew. That’s a lot of podcasts.  I’ve enjoyed every interview with every person.  I’m in awe of them all.   But it’s time to take some time off to recharge and get ready for Season Three. We’ll be back refreshed in September with many more amazing people for you to listen to and for me to learn from.

Thank you so much for joining me.  Now go forth, invest a little in your community and make some change!

Stewarding the future of farming.

After a decade of building a career in real estate finance, from a pre-college stint as an analyst for an established D.C. development firm all the way to co-founding (with his brother, Ben) the first real estate crowdfunding platform, Fundrise, Dan Miller changed lanes.

Sort of.

In 2016, he founded Steward, a private commercial lender which enables people to help fund the growth of sustainable farms. In a way, it wasn’t such a shift from Fundrise, which used an online funding platform to connect developers and investors. Think farmers instead of real estate developers.

When Dan’s real estate work led him to cross paths with a local D.C. chef, and as he learned of the financial difficulties facing independent farmers that supplied his restaurant, Dan connected the dots. “This generation of regenerative farmers has more opportunities than they’ve ever had. The demand is exploding. They really have a chance to grow sales and revenue but they can’t get funding.” So he set out to solve that problem.

Steward is a B Corp, which allows individual lenders to pick specific farm-based agricultural projects to back. The loans vary in interest, often 5 – 8%, a reasonable rate for business owners who cannot find financing anywhere else. “I always saw finance as a way to open up access to new groups of people,” says Dan, and true to his word, one can join in for as little as $100.

Read the podcast transcript here

Eve Picker: [00:00:08] Hi there, thanks for joining me on Rethink Real Estate. I’m on a mission to make real estate work for everyone. Real estate can help to solve climate change, can house people affordably, can create beautiful streetscapes, unify neighborhoods and enliven cities. So I’m on a journey to find the most creative thinkers and doers out there. I’m not the only one who wants to rethink real estate. You can learn more about me at rethinkrealestateforgood.co or you can find me at smallchange.co, a real estate crowdfunding platform with impact real estate investment opportunities open for investment right now. And if you want to support this podcast, please join me at Patreon.com/rethinkrealestate where there are special opportunities for my friends and followers.

Eve: [00:01:08] Today, I’m talking with Dan Miller, who co-founded Fundrise, the first real estate crowdfunding platform to emerge in the U.S. and which has now raised over 500 million dollars. Those early years Fundrise were a slog, but that hasn’t stopped Dan from starting over. He’s changed lanes. Sort of. In 2016, he founded Steward, an online platform which raises loan funds for sustainable farms from the crowd. In a way, it wasn’t such a shift from Fundrise, which used an online funding platform to connect developers to investors. Think farmers instead of real estate developers and loans instead of equity. How did this happen? When Dan’s real estate work led him to cross paths with a local Washington, D.C. chef, and as he learned of the financial difficulties facing independent farmers that supplied his restaurant, Dan connected the dots. This generation of regenerative farmers has more opportunities than they’ve ever had, says Dan. The demand is exploding. They really have a chance to grow sales and revenue, but they can’t get funding. So he set out to solve that problem. You’ll want to listen in to learn more.

Eve: [00:02:33] If you’d like to join me in my quest to rethink real estate, there are two simple things you can do. Share this podcast or go to Patreon.com/rethinkrealestate to learn about special opportunities for my friends and followers and subscribe if you can.

Eve: [00:02:56] Hello, Dan, I’m so happy to talk to you today.

Dan Miller: [00:02:58] Happy to be here, thanks Eve

Eve: [00:03:01] So I have followed you since the early Fundrise days and now you have GoSteward, a very different type of enterprise. So I wanted to start by just understanding what is GoSteward?

Dan: [00:03:16] Steward is a funding platform for regenerative agriculture, and I began meeting regenerative farmers in my real estate days in the past through chefs I knew, and these types of farmers, diversified, direct sale, smaller scale, generally have very little access to capital. So it’s meant to be a platform that lets farmers raise money and lets individuals provide capital to them that they can’t fund otherwise.

Eve: [00:03:43] So, but why did you start it?

Dan: [00:03:45] I started in 2016. There was a well-known chef in the D.C. area that I had been working with from real estate projects there. And through him, I started to meet all these farmers growing amazing products with great stories, selling them at well-known restaurants and farmer’s markets. And then in those conversations, it was clear that that none of them had access to capital, which was surprising because they’re selling products that everyone wants, you think they’d be able to get access to funds. And this was in the early days of when I was working on Fundrise, so 2010. When Fundrise was launched was when I started to meet some of these farmers. So I shoved the idea for a bunch of years and then it kind of kept coming back to me and then I eventually read the Wendell Berry ‘The Unsettling of America’, one of the kind of iconic foundational texts around agriculture and the challenges and issues of modern agriculture. And that just put me on, I would say, the path and obsession of this type of agriculture and then the positive impacts that it has through land use and ecology and health and wellness. And you, kind of, once you get into it, I find that people, they tend to not be able to stop.

Eve: [00:04:54] So how does it actually work? How does the platform work?

Dan: [00:04:58] So farmers come to our platform through insurance, through referrals, through direct relationships. They apply for funding through the traditional application process, telling their background and their experience, what products they’re growing, so we can learn more about their farm. We do due diligence, we vet them. We have a farmer on our team who does the agricultural diligence, understanding their operation, their bottlenecks or challenges, their farming practices too to make sure they align with the principles of regenerative agriculture. Then we do the credit underwriting the classic financial stuff that’s not as sexy, but it is critical for any viability of any platform. And then the loans are put on the platform so that people are buying loan participations, and they’re buying slice of the loans that were making, and then they earn the interest and return on that loan. So it’s essentially a way to connect farmers who need capital, they need credit with individuals, whether high worth family offices or small retail funders, and give them the chance to lend money to these farmers.

Eve: [00:06:04] There’s always an issue with finding loans for anything that is really standard, right? And I feel like that’s partly why we’re in the predicament we’re in. Like, banks are really focused on lending to, sort of, tried and true things that they know will guarantee a return for them.

Dan: [00:06:25] And that’s, I think, the broader theme of the work I’ve done through Fundrise or now Steward, that most funding is looking for safe and traditional and corporate and reliable. And so, when you see that, what businesses are able to access capital, it’s the larger ones that have a lot of assets and are more predictable. But money needs to go to small businesses and entrepreneurs across the spectrum, whether that’s in agriculture or real estate or small business. And the way that the funding system is set up is, it’s just not built for that. So, creating these decentralized models where smaller dollar contributors can participate and entrepreneurs can tell their story and raise funding, I think is fundamental to really unlocking more capital, which gives more opportunity to people. So I see parallels in the, kind of, the different sectors, but in the need to bring different types of funding to the end result.

Eve: [00:07:20] Well, you know, I wholeheartedly agree so, you know, in real estate, it’s exactly the same problem as in business. So it’s always the same old, same old that gets funded and that’s, that doesn’t really encourage innovation and moving forward, does it? It just staying where you are?

Dan: [00:07:40] Not at all. And I think I found a lot of similarities in agriculture to real estate. The focus on credit tenants, the focus on the users of the space being well-capitalized corporate users, forces a certain type of development with chain stores and large corporations. And similarly, in agriculture, they’re focusing on large commodity producers, huge operators with just tried and true grain, corn, soy, whereas anyone that’s doing anything a little different is just not worth the effort. They’re just left out, completely left out. Part by design, I think, but part just because it takes more time, which is basically harder to assess.

Eve: [00:08:20] It takes more time. Yeah, but damn, it’s so much more exciting!

Dan: [00:08:26] I can’t, I can’t do it because I just have no motivation. So there’s no option for me.

Eve: [00:08:33] No, I’m not wired that way either. Like, you know, I’m just not. So where did you start your operations? What were the first farms?

Dan: [00:08:41] Yeah, I began in 2016-17 working on Steward. The first farms that we funded were two urban farms in Detroit. You know, I had left Fundrise, I had started speaking to farmers through many different connections and actually found a lot of real estate people I had met around the country. I asked them if they knew agriculture and was connected to a lot of local farmers. So, there were two urban farms in Detroit. One is called Fisheye Farms, one is called Acre Detroit. They were farming on small lots, a tenth of an acre lot and they were hoping to buy land from the city. The city owns ten thousand acres of vacant land but was hesitant to sell them to farmers because, I don’t know what they’re waiting for. So we stepped in, provided funding for these farmers to buy two acres of land each. The original loans I personally provided as I was building the platform and figuring out the regulatory infrastructure. And just as an example of the kind of growth and opportunity of these overlooked farms, Fisheye farms went from ten thousand of revenue to one-hundred-twenty-thousand revenue in the three years since they were able to buy that land, so…

Eve: [00:09:49] So how much was the loan? Like, how much was it?

Dan: [00:09:54] That was a hundred-thousand-dollar loan, so, I mean, relatively small,

Eve: [00:09:56] Relatively small.

Dan: [00:09:59] And it shows the demand for those products. You know, people really want to buy wholesome food and they want to connect with where their food’s coming from. And so, in a city like Detroit, they’re in a food desert, they have fresh food that they can sell locally, and people are thrilled to do so. So, I think there’s a lot of misnomers around the viability of these types of farms. The reality is they are viable, but they’ve been under-capitalized. It’s hard to get to viability when they can’t access funding but when they are able to access funding, we see the same story of really rapid revenue growth. So, we started with urban farms in Detroit. I thought we would be a niche business. I thought most regenerative farms were funded well and maybe urban farms and other niche farms struggled. And I soon realized that it’s a global problem. Any non-traditional farm struggles with capital and so that kind of broadened from urban farms to really all types of farms now.

Eve: [00:10:54] How many farms if you help to date with loans?

Dan: [00:10:58] Over 70 now. That’s about one or two new farms a week so it’s really picked up. Just some recent farms as an example, we’ve a livestock branch in Western Oregon, right near Astoria, Oregon. We have a urban farm in Detroit with a Black farmer who’s about to raise funding. And we had an Amish dairy farmer in Pennsylvania raise funding to do value added processing for fluid milk. We had a fisheries project with just line-caught tuna and line-caught local fisheries that are then processed and sold direct. So, I think the narrative that’s similar is farmers are people that are obsessed with the quality of the product. They’re obsessed with the traceability of it. They’re obsessed with taking care of the natural resource, whether that’s land or the watershed. And they have customers that are along for the journey that want to support them. And they need money for equipment, infrastructure, land, you know, operating capital. So it’s a fairly simple business plan. They have demand and they need more production to meet the demand. But because they’re non-traditional, they’re just ignored.

Eve: [00:12:05] So you say they have customers who want to support them. Do those customers also invest?

Dan: [00:12:09] Yes, those customers do fund the loans. We actually have the first 20 percent of every loan gets funded through the network of that farmer. So, they share it at the farm stand they share it through social media. And that gives a chance for their community to be engaged and connected to the farm. And it also provides social validation of, if those people are engaged in supporting the farm, then I think it provides us confidence, too, that there’s really a community to support them. If you have customers that love your product, you’re in good shape as a farm and those are the types of farms we support. They’ve established their markets, have established their products. They know what they can produce. They know where they can sell it, and now they need to grow. And whether they’re a small farm or a larger farm, they have that same kind of demand, they’re unfulfilled.

Eve: [00:12:55] So, I think you’ve said this is not a crowdfunding platform, but this sure sounds like crowdfunding. So what’s the regulatory structure that you’re using?

Dan: [00:13:04] Yes. So, you know, crowdfunding and the general term of raising money online from many people, but ever since regulation crowdfunding came out, then that’s kind of narrowly defined crowdfunding.

Eve: [00:13:15] Really? I don’t think of it that way.

Dan: [00:13:16] In terms of fundraising, introspective. So, yeah. So, I think in broad brushstrokes it meets the premise of crowdfunding, of raising it online in smaller, larger amounts and people telling their story. We’re providing loans so we work under a framework of syndicated or participated loans. So, Steward is a private commercial lender. We provide the loan for the lender record and then we sell the participations to qualified basically members of our platform. There was a recent legal ruling over the summer, last summer, in 2020 around commercial syndicated loans not being considered securities. So there’s always been a discussion around the determination of when is a loan a security or not a security?

Eve: [00:14:02] Oh interesting.

Dan: [00:14:03] And so under that premise, we’ve kind of designed our business. So basically, we’re just providing credit, providing loans and giving the people the chance to participate in those loans.

Eve: [00:14:13] That’s really fascinating. What’s the typical loan size and what’s the rate?

Dan: [00:14:19] So most of the loans, I would say, as small as ten thousand. Average loan, probably fifty to one hundred thousand. The largest we’ve done is seven hundred thousand. Larger loans tend to be for mortgage, for property purchase. The midsize tends to be for equipment and isome nfrastructure. And then smaller ones are often quick bursts of operating capital.

Eve: [00:14:41] I mean, it’s really sad that a farm can’t get a ten-thousand-dollar loan from a bank, like…

Dan: [00:14:46] Well, the sad thing is it’s easier to get a ten-million-dollar loan as a big soy farm than a fifty- or ten-thousand-dollar loan from a bank. So, it’s kind of this strange circumstance you probably see in real estate that the bigger, formulaic deals can raise money and smaller deals that can’t get it.

Eve: [00:15:01] Exactly what we see on Small Change, and yet, I mean, I really think that if you’re really going to support that change in real estate and growing experience with people who’ve never had the opportunity before, that’s exactly what has to happen. Smaller loan sizes, smaller equity needs. Like, smaller.

Dan: [00:15:18] Yeah, you need a pathway to viability. Right now, the system’s set up that only if you’re inheriting large amounts of farmland can you get credit because you need big assets and big dollars. But a lot of the farmers we support didn’t grow up farming. I mean, it’s, I think the real sea change that’s happening in this type of regenerative agriculture. People of non-farm background, often college educated, going into farming, which certainly never happened in the past, at least not consistently. How are they going to get on the ladder? How are they going to be vetted and able to support? So a ten, twenty-five fifty K loan helps them get started. And then eventually they buy land and grow as a business. In terms of rates, most of the loans are between five to eight percent. So, I think very fair rates.

Eve: [00:15:59] That’s really reasonable.

Dan: [00:16:01] Very reasonable rates. We found that the funders are comfortable with those. Five is secured mortgage, solid cash flow. Eight is equipment with an earlier stage business. The highest we’ve done is 10, which is kind of a scrappy year one, year two farm where they’re early in their days and they just need funding to help grow. And so that’s what we’re really trying to do, create a capital market for regenerative agriculture. At what rates are people willing to lend the money? At what rates can farmers afford to borrow the money? And connect the two. Which is surprisingly uncommon in agriculture because the entirety market, most of the market is government funding. And so, there’s very little private capital market in agriculture, pretty much all USDA and government loans. And so what we’re trying to do is create an alternative of private capital that’s a different option for these farms.

Eve: [00:16:55] What about vertical farms? Have you helped any vertical farms ’cause that’s all the rage, right?

Dan: [00:16:59] It’s all the rage. I’m sceptical of vertical farms. We’ve helped urban farms, we’ve done greenhouses, hoop houses. The thing I struggle with, with vertical farms as the concept is, they are only needed in certain places. Generally, land is not that expensive in most places that you would need to produce vertically. And I struggle with the capital costs. A million dollars into some infrastructure to grow greens, you know, when you can go not too far outside the city and buy a piece of land for ten thousand dollars and grow greens there. And so, the economics of overhead of a million, or overhead of twenty-five-thousand,

Eve: [00:17:35] It doesn’t make sense to you. That’s really interesting.

Dan: [00:17:36] I just, I struggle with that as a credit provider. That you basically have, you know, the thing I’ve learned in agriculture is you want to keep your overhead low. You want it to have as little debt to service as possible. And so loading huge infrastructure costs for the vertical ag just kind of breaks that mold. Farmers, I think, do find it frustrating that a startup in Silicon Valley that’s doing vertical farming can raise one-hundred-million dollars, but they’re doing livestock in Missouri, and they can’t raise 50 K. And it’s just like, why do we keep throwing money into the non-sensical billion-dollar thing when there’s just good people out there who are doing farming the right way and just need a little bit of money to get to take the next step.

Eve: [00:18:19] Dan, you really like to support the underdog,

Dan: [00:18:22] Always, always. I don’t know how that…

Eve: [00:18:26] You’re a man after my own heart.

Dan: [00:18:29] And with these farmers, I mean, they’re persevering. They’re sacrificing, they’re doing whatever they can, most of them have off-farm jobs. One of the farms we funded in Detroit was washing dishes at the restaurant he was selling to, I mean, whatever it takes. And so, the ability to get them more resources and help them grow, it does, it is meaningful. I find it more meaningful than my work in real estate. But not all real estate developers, I would say, have the best ethic. But these farmers are really values-oriented people.

Eve: [00:19:01] Interesting. So, but you have to keep the doors open. How to Go Steward make money?

Dan: [00:19:06] Yes, you do have to. And that’s part of our proposition, that it’s a commercial platform. You’re paying rates of return that are reasonable but fair to lenders. We charge a loan origination fee. So, we charge roughly between two to three percent of the loan amount. And that’s a success paid at closing of the loan. So, when they go through the lending process that fee is added to the loan balance. And we’re also working on some other revenue streams. We’re providing services, support to some farmers, such as bookkeeping or helping with branding a website. So, I think over time a lot of the kind of business functions of these farms we could help and streamline. And then we’re also providing our technology infrastructure. And one of the farms now is using our software to raise a round of equity capital for their business in a private syndication. So they’re using our software to do that, and we have other firms. So, I think over time, this kind of value of this system we’re building, the kind of decentralized financial platform and then its application is to agriculture. And I think over time there’s ways to monetize both of those. But we’re in our early days and I mean we’re, we obviously have a long way to go. There’s a lot of growth and demand and interest from both sides of the market. So I definitely see the viability. I’ve seen it before from before with Fundraise from the beginning. How will this business ever work? But if the right market forces and trends are behind you, you can surprisingly get to scale. And I see the same thing here where just the interest in regenerative agriculture is exploding. The kind of viability and demand for these products is exploding and the need for alternative capital credit is becoming more aware. So, those kind of all weave together, that there’s more farmers that need funding, more people that want to fund them, and that the winds of ESG and climate and kind of the policy support is going is going in the right direction.

Eve: [00:20:59] Right, right.. Interesting. So how do you hope to scale?

Dan: [00:21:05] For us, it’s just more farms, I mean, we started making loans originally smaller, 50 K, 100 K. Recently we funded a project that was seven-hundred-thousand. So we’re now starting to work with more mid-sized farms that our hundreds of thousands revenue, really solid operations starting to grow. So, by being able to provide more capital, we can support operations that have more capacity to grow. So, I think, just expanding both sides of the market. The more farms we have, the more capital, the stronger the platform. The more capital on a platform, the more interest there is from farms. So we’re seeing that symbiotic kind of viral effect of each side of the market strengthening the overall platform, which is what you always hear about, but it’s nice to see it in action, that, kind of, the more the business grows, the more it can offer.

Eve: [00:21:56] Yeah. Yeah. So, you know, you said you started in Detroit. Where are you lending now?

Dan: [00:22:02] We’re lending all around the country. Right now, we’re US focused. We’ve had a lot of interest from non-US farms, that’s definitely on the horizon. But in terms of the US, Oregon has been our biggest market. Our HQ is in Portland, though our team’s remote. So just amazing farmers and farmland in Oregon, really knowledgable and thoughtful consumers, a lot of them hoping to also put their money to work in local food systems. And we just made a loan to a farmer in Hudson Valley. We funded a bunch of farms in Louisiana. So, I think we’re now at probably around 30 of the 50 states in the US. So it’s by no means limited to big coastal cities. We’ve got farmers in all parts of the country. And the business model depends, you know, you’re closer to a city you often have produce, if you have livestock that tend to be farther from a city because you need more space. And it all varies. But we’ll support any type of farmer anywhere in the country and hopefully soon the world, as long as they’re following the right practices and can have the knowledge and experience they need.

Eve: [00:23:06] So do you have investors who invest across all farms?

Dan: [00:23:11] That’s what we found. That’s one of the most promising aspects. We have over half of the people that have funded a farm fund, fund another farm, and I think we found that there we’re building a category of, well, I’ve funded this one farm and now here is another farm. It’s a similar story and a similar profile, maybe in a different location and a different product. But I, I see their challenges. I believe in them, and their kind of values focus. So, I think we’re finding that people who want to support regenerative farms have very few options. And if they’ve come to support one farm, maybe they’re a CSA member of a farm and they heard about the opportunity to help fund it and they have. Now they see another farm, and they fund it. We have people who funded 10 or 15 farms, even. Some are putting ten, twenty-five thousand dollars into every farm. So, I think that kind of stickiness of the customer on the funding side has been very positive because that’s not always the case with platforms. Sometimes people come in and do one deal and that’s the end of it and if you can cultivate a community, it goes a long way.

Eve: [00:24:09] Yeah, we’re actually finding the same thing. We definitely have a community of investors who come back again and again and again for particular themes. I think those people are truly impact investors. They really, they really care about an issue like a farm. It’s great. It’s really great to see. So just shifting gears a little bit, the common theme in your life has been crowdfunding, at least for the last 10 years, right? You launched Fundrise, which looks more like a mutual fund now than a crowdfunding platform. And now back to sort of a very organic crowdfunding platform, helping farms. What else do you think crowdfunding might be applied to that could be really successful besides real estate and farms?

Dan: [00:24:55] Yeah, I’ve always felt there’s so many broader applications and I think people haven’t been creative enough, you know by developing Fundrise, I just again saw so many people go into real estate and it like, there are other verticals to be done.

Eve: [00:25:08] There are other things, right?

Dan: [00:25:09] And so I, I felt it was a lot of like, kind of, me too. Well, what’s the narrative? Why does it matter? And I think in reality, that type of passion shows the purpose behind the platform, not just sector, but the purpose behind it. So I think real estate still presents opportunities. I think a lot of, you know, you talk about green building and other aspects, I think there’s still a ways to go to push the envelope in real estate in terms of how the built environment is done. You know, agriculture obviously, now is my big focus. Parallel to agriculture where I think there’s an opportunity is also in forestry. And I think that’s a great way to build as a good asset, but also as a natural resource to be preserved. I’m seeing more interest in alternative energy. It’s something that we’ve even worked with farms who are planning to do solar on their farm. So I think ultimately more decentralized local funding for alternative energy can go a long way. In small business, I feel like there’s still a lot of gaps for small businesses that are looking for funding. I look at so many funding platforms and it feels like there’s a lot that are real estate, there’s a lot that are tech startups, you know, and that’s pretty much it. And the reality is there’s so many other enterprises that need the support.

Dan: [00:26:26] But where I tend to think the interest and ,demand is, is if you can back it with some sort of fixed asset, I think it always helps the viability of the business and the ability to take capital where you can be more confident that people can earn a return. And I think having a forward-facing business where they’re engaged with their customers goes a long way. So, I think if you have an audience of people that want to support you, I think it’s good to bring them in. So, yeah, I’ve always been interested in crowdfunding from the perspective of a different type of capital that thinks differently and is more aligned with the end project that Fundrise was originally developed around. Me and my brother doing real estate development projects that were non-traditional and finding that traditional funding didn’t fit it. So, I’ve been on the entrepreneur side. I began on the entrepreneur side of, the frustrations of trying to find funding that meets, that is really aligned with you and so all these platforms have been, had that as the theme of how do you have more of an alignment among the entrepreneur and the capital?

Eve: [00:27:30] Yeah. So, what is your background before Fundrise?

Dan: [00:27:35] So, I started a real estate development business with my brother right out of university and my father was in real estate development in Washington, DC, so that’s where I learned real estate. Just being around it. I have tons of experience in it, but actually for years not  necessarily, just you just grow up and then see around it. So commercial real estate, I would say, applies across everything. It applies to Fundrise, with the ability to build that. It applies with Steward because at the end of the day we’re funding a lot of commercial real estate and use of land that is commercial real estate. For some reason, agriculture is not thought of as commercial real estate, but it certainly is, I would say, commercial real estate. And then my kind of interest and experience in raising money through alternative channels was built around that, of being a real estate entrepreneur, trying to figure out different types of funding and then just creating a platform to do it. Just, well, if there’s nothing out there that can serve what I need, let me help build the platform that does it. So I’ve, my whole career has almost been in being an entrepreneur and finding alternative funding and building it up. And a lot of my work with these farmers is just helping them think through funding options. Not always just saying, you know, use our funding or just, well, what’s out there that we can weave together? We now even help some of the farmers apply for grants. We help them figure out what’s out there, and what can we weave together. And I think, I think that’s what a lot of entrepreneurs struggle with. An advocate for them, helping them think about what’s there from a kind of agnostic perspective. And then obviously finding that I think I can help them through our platform but understanding that there are options out there that they just may not be familiar with.

Eve: [00:29:25] Interesting. So, I mean it’s a nascent industry, crowdfunding, if you think about crowdfunding – all of it, not just regulation crowdfunding. How could it be made easier and more acceptable? It’s definitely not mainstream.

Dan: [00:29:41] It’s, yeah, it’s still early. And that’s why I think people have a short-term perspective. I mean, most of the regulations that define the world of securities and investment were written in 1933, 1934, and that quieted down requirements for fundraising and for basically eighty years provided very few options. So, we’re really only in the first decade of loosening of those types of rules, broadening opportunities and access to capital. And a lot of the rules and regulations are still challenging and problematic to utilize and maybe probably generally over the garden some. So, I think as these rules are streamlined and improved, it will become easier for platforms and entrepreneurs to use them, which will then expand the size of the market. I also find, I think the way to really drive growth in crowdfunding and drive adoption is through narrative storytelling. And so, I find a lot of crowdfunding is pitching return and that’s fine. But I think if you’re just pitching return, there’s a lot of places that are pitching return and it doesn’t stand out. And so, I find if you’re bringing people in on an emotional narrative level, you know, that takes someone who’s not classifying themselves as someone who funds things to now funding a project. And I think to bring people mainstream, it has to go beyond the investment world. And I find that few platforms to speak people beyond return.

Eve: [00:31:06] Interesting. So, what’s the biggest challenge you’ve had in building this Go Steward?

Dan: [00:31:12] I mean, the biggest challenge was really developing the market. I mean, I started in 2016 / 17. The idea of regenerative agriculture was very kind of unknown. I didn’t grow up farming. My mother’s family has been farming since the late 1800s so I was one generation away from that, but it wasn’t my personal background. And so, understanding who are these farmer customers? Where are they? How do I find them? What can they afford to pay? How can I structure a deal? Are they viable enterprises? And just validating that there is a customer who actually is a real business that can afford and raise capital, that took a few years. And then was just very pleasantly surprised at not only by the viability of these businesses, but the growth in this sector of just all types of people entering this world and wanting to become farmers and really focused on ecology and taking care of the land. And then the second challenge was, well, who are the people who want to fund these farms? I mean, I personally funded the first portfolio because you don’t want to try to build two sides of the market at once. It’s easier just to focus on one side. And then we took these farms to market over the past year as we launched the platform publicly. And I’ve been amazed by the breadth of people who are interested in funding these types of funds.

[00:32:26] I mean, most people have never funded a farm. I mean, I’ve almost never spoken to anyone who’s funded a farm that wasn’t their own family’s farm. And so you’re having to educate them about farm, farming as an asset class, regenerative agriculture as a subset of that of a different type of agriculture, and then, you know, the stories of these farms. And so, I think people, when I was saying the kind of narrative emotional level, they connect with these people. They’ve all bought food, they’ve all have that experience of being at a farmers-market of hearing a farmer and understanding their passion and their interest. So, if you can connect with who that person is and their challenges and their struggles and the importance of the funding, the other aspects of collateral security sector, I think, they can get comfort on the fact that that’s what we’re focused on and that’s our goal to make that simple and easy. So now we have both sides of the market working. Farms raising funding, funding happening very quickly. And now it’s growing the business. That part’s easier to me. It’s still a challenge but you at least know that there’s viability on both sides, whereas the first few years was kind of a lot of questions around who even is the market going to be?

Eve: [00:33:38] And are these real collateralized loans? I mean, what happens if someone defaults?

Dan: [00:33:43] Yes, so they’re all secured loans. Some are secured by real properties, some by mortgages or deed of trust, some real estate and some are secured by personal property which basically means equipment, infrastructure. So, they’re all secured. Some farms have better collateral than others. So that the interest rate depends on that. The five percent loans are the more secure lower risk loans, the higher rates are businesses with less assets or collateral. But that’s our sole business of vetting farms, helping farmers figure out what type of funding is needed and what amounts, helping them drive growth their business through other means. And then we service all the loans ourselves. So if there is a challenge, we’ll work with the farmer. Most of time if there’s a challenge, it’s a timing challenge. That there is an issue with the market or a customer or a job. So it’s not a fundamental problem. It’s OK, I just need a little more time or this customer drops so I’m now launching this, or I’m waiting on an inspection for my grade A milk, which happened when Covid hit and now it’s six months later, you know, just the reality. So rescheduling the payments is the most important. But if a farmer really can’t do it anymore, they just need to give up and move on, then we would step in. And our first scenario would be to bring in another farmer because we have a huge network of farmers who would love nothing more than to take over a operation that exists and is properly capitalized. And it’s ready to go.

Eve: [00:35:06] Interesting.

Dan: [00:35:07] So that’s our view. It’s not a type of business where you can just passively just auction off the assets and expect to get recovery. You have to be engaged in it. All we do is fund small-and mid-sized generative farmers all day, every day. And so that expertise gives us confidence that if situations do arise where there are challenges, that we can step in and resolve them. And I mention that team member who’s a farmer himself. I mean, he can literally show up at the farm if he has to and help them figure out the bottlenecks and the challenges that they’re facing.

Eve: [00:35:37] Oh wow! So then, what’s your big, hairy, audacious goal?

Dan: [00:35:41] I’ve, you know, I came into this with the view that there is a need for a fundamental transformation in our agricultural system. The reason why I support regenerative agriculture is because of the importance of taking care of the land and people and helping them all. All of those positive benefits are needed in part of our agricultural system. Instead, the system we have now has huge negative externalities with run-off, with low wages, with low quality food, with difficult access to food. So I think what we’re trying to prove is there’s a viable alternative of how you can do agriculture that is in alignment with ecosystems that provides health and wellness and opportunity for people. And I think if that can be shown to be viable and it doesn’t need to be subsidized and it can operate on its own, you can show that there is a different way and a different path forward. So many, I think, of the current modern challenges we face around societal economic, health challenges, find a root in agriculture, at least are impacted by agriculture in terms of climate or obesity or exploitation, labor exploitation. And so, it is one of those sectors that touches upon everything and each story, each farm has their own impact, which is direct and tangible, which then becomes part of a broader movement. So I think we’re in a historical kind of sea change of doing one hundred years of industrial agriculture with really negative results, misguided maybe by design or not, but the end result is not serving the interests of most people. And so, our goal is to really lead the transition to an agricultural system that is for the benefit of many and does provide opportunity for people.

Eve: [00:37:29] Well, Dan, it’s really interesting and I’m so glad you could talk to me and I wish you all the best success. It sounds like you’re well on the way.

Dan: [00:37:38] Well, thank you. Really nice to chat. And I appreciate all the work that you’ve done, also in building impact and focusing on storytelling and engaging people around funding things that are different. And I think more of that is always needed.

Eve: [00:37:52] Thank you. That was Dan Miller, founder of Steward, an online investment platform raising funds for sustainable farmers. Everything about Steward and Dan checks a box for me. With Steward Dan is serving an under-represented group of people, farmers who can’t get loans elsewhere. He’s non-discriminating in accepting investors. You can invest for as little as one hundred dollars. And he’s keenly focused on making a difference in everything that he does. I’m looking forward to seeing how Steward grows.

Eve: [00:38:45] You can find out more about this episode on the show notes page at rethinkrealestateforgood.co or you can find other episodes you might have missed. Or you can show your support at patreon.com/rethinkrealestate where you can learn about special opportunities for my friends and followers. A special thanks to David Allardice for his excellent editing of this podcast and original music. And thanks to you for spending your time with me today. We’ll talk again soon. But for now, this is Eve Picker signing off to go make some change.

Images courtesy of Dan Miller, Steward