UNREACHED
In Revelation 7, John shares his vision of heaven with members from every tribe, tongue, people and language standing in the throne room before the Lamb.
Yet today there are still over 7,000 unreached people groups around the world.
For the last six years, my family and friends have been on a journey to find, vet and fund the task remaining.
Come journey with us to the ends of the earth as we share the supernatural stories of God at work through the men and women he has called to reach the UNREACHED.
UNREACHED
Impacting The Kingdom Through Angel Investing with Patrick Farrell
Discover how spiritual discipleship can transform business leadership as we sit down with Patrick Farrell, a true visionary in the investing space. Patrick shares his extraordinary journey from a high-powered consulting firm to the vibrant world of startups, driven by a deep spiritual calling. Learn from Patrick's firsthand experiences about the critical role of a founder's spiritual and emotional health in driving company success. Be inspired by his commitment to fostering a community of high-net-worth individuals and family offices dedicated to investing in mission-driven startups.
Early-stage entrepreneurs in innovation and technology won't want to miss Patrick's insights on the necessity of startup capital, often secured from friends, family, and angel investors, before institutional investors come into play. Patrick emphasizes the indispensable value of relational and spiritual support alongside financial backing. Hear personal stories that showcase the transformative power of a faith-based approach to business, from workplace discipleship to cultivating a familial company culture that nurtures personal and professional growth.
Lastly, delve into the unique structure and philosophy of faith-driven investing. Patrick reveals how Potomac Angel Capital creates meaningful relationships between investors and entrepreneurs through engaging networking events, portfolio updates, and rapid-fire pitch sessions. Explore how donor-advised funds can revolutionize impact investing, blending charitable giving with profitable ventures, and hear a heartwarming story of global impact investing in a third-world country. This episode is brimming with valuable insights on building community and fostering kingdom investments.
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In Revelation 7, John shares his vision of heaven, with members from every tribe, tongue, people and language standing in the throne room before the Lamb. Yet today there are still over 7,000 unreached people groups around the world. For the last six years, my family and friends have been on a journey to find, vet and fund the task remaining. Come journey with us to the ends of the earth as we share the supernatural stories of God at work for the men and women he has called to reach the unreached. Hello friends, Welcome back to the Unreached Podcast, Season 3. Dustin Elliott, here, your host. I have a friend of mine, somewhat of a new friend, who has recently been called to and moved to Austin. This is Patrick Farrell's story today and the story of Angel Capital, the story of building fellowship and community among Christian families with resources and something to give back, something mentorship, discipleship, finances, et cetera. How do we come together and equip them and show them a way to invest in Christian-led companies and then bring those up? And so, Patrick Farrell, welcome to the show.
Speaker 2:Dustin, thanks for having me. Man so good to be here and excited for the conversation today, patrick let's start with a little bit about you.
Speaker 2:Yeah, so I grew up in the Washington DC area, northern Virginia, left for college, went to Vanderbilt University in Nashville, came back to DC really just to work in a job and eventually started in consulting big 20,000-person consulting firm, did that for a couple years and then decided to join the startup space.
Speaker 2:A couple of years into my career I had this awesome startup experience where I just learned a ton. I was the director of corporate development so I helped the business. We had a family office that was behind us, so we had a growth by acquisition strategy, helped the business acquire a couple of companies and then integrate those companies. And then we needed the people, processes and systems to scale the business and so I moved over to director of operations role and eventually that startup kind of exited in 2020 to a larger startup, a larger cybersecurity startup called Threat Connect. So I got to see venture from beginning to end, which really was formational for me. But most importantly, I would say when I walked in the business, I believed in Jesus but wasn't really walking with him by the time I walked out of the business. I had an intimate relationship with him and that was mainly because I was discipled in the business context.
Speaker 2:My manager and the president of the company was a strong believer, saw I had potential, we had a good working relationship and he started to just patiently disciple me. I mean I would come in honestly guys. I'd come in after weekends doing God knows what and just being like in my head I think subconsciously, like I wonder if he's going to tell me what I'm doing is wrong. I wonder if he's going to like he's going to punish me for my behavior. And he was always patient and God just kind of did the work in my heart. And so when I walked out of that business, not only did I have an exit under my belt but I also had just a really strong walk with God, a real intimacy with God that had been formed and shaped in that period of time. I also left that business with a few strong convictions. One is that the spiritual and emotional health of the founder is essential to the business being successful. We've seen over and over again you can have a great plan, you can have a great team, but if you're not aligned in your spirit, if you're not aligned emotionally, then things like that typically fall apart because ventures are incredibly difficult. So I recognize the role that the founder had to play in the success of the business, but I also recognize that businesses can be mechanisms for kingdom growth. Whether internally like my story blessing employees, discipling employees who I was when I walked in the business and who I was when I walked out of the business were like two different people. So internally, but then externally we were in cybersecurity mission driven company really felt like we were making a difference on the world at large, and so, with those convictions, I decided to say, okay, well, what does it look like to support early stage entrepreneurs who are going to be bold cultural witnesses, by getting behind them with capital and doing so in relationship? And what emerged from that was the angel network model, which is let's get a bunch of high net worth individuals and family offices together in community and let's invest together, relationally, in early stage founders. And so, long story short, started Potomac Angel Capital in January of 2022 to do just that. To date, we've done 17 deals. We've deployed almost three and a half million in capital across 14 companies. Our portfolio is, by God's grace, performing incredibly well, having some awesome missions. We're walking alongside some amazing founders.
Speaker 2:As we were building that business, we started to realize we had a unique model that we'd I don't want to say stumbled into, but that God had kind of led us to. I was down here in Austin South by Southwest 2023, and really just validating the market, thinking about replicating into a new city from DC, and I can't explain it other than day one in my time with Jesus, in the morning I felt like he had invited me to move to Austin, and so that went through a discernment process that, dustin, you know my folks I'd gone through layers of guys I was walking with that were praying and they had all been affirmatively, but then I was like, all right, lord, we're going to really test this. I'm going to ask my parents to think if they think I should leave DC, where they were a 10 minute drive from me.
Speaker 1:And involved in the business and involved as investors and mentors and part of the network, right, totally, yeah, all of the above. So, hey, you're the main guy and we're not only parents to you, but we're in business with you and it's nice to have you here because we have access to you doing all these things, leadership for this company and these ventures.
Speaker 2:And then, hey, what do you think about me leaving? Exactly that was the conversation. I mean, the absurdity of leaving my friend's family investors in business in DC was like it was mounting at that period of time. So the final test was really my parents, which were totally incentivized to say no, um, and they went back and prayed about it. And they came back and they were like we hate this, but yep, you gotta go.
Speaker 2:And so it just felt sent, and so I came down here in the fall really to build a second network of investors and really double down on how do we build community among stewards of wealth who are looking to align their capital with their faith.
Speaker 1:I love it. I love it. So there's only about 74 different strings. I want to pull on from what you just said, but the first thought I had. So, just for the listeners, we've got a very diverse group that listens to this, from traditional missionaries to pastors at churches to business people, international business folks, et cetera. So maybe just let's talk briefly about venture capital, stages of venture capital, angel capital, walk us through kind of the timeline capital structure. How does a company get started, right? So I decide I have an idea, I want to start a company, I've got some way to innovate or disrupt. And I realize, ok, I need a few bucks, right, I need, I need some money to build this product or hire some folks. And what happens next?
Speaker 2:Typically when a business is in the idea stage, sometimes you can kind of build or grow organically, meaning, hey, we're going to go and we're going to start a restaurant, start a shop, something like that, and we're not going to really need to raise outside capital. We'll just kind of organically grow our business. But in other instances, especially when you're talking about innovation, whether it's technology or something otherwise that has an intended large impact on the world at large or is going to grow and scale to be a large business, they often need startup capital. Typically in the world at large that will come from friends and family, but often it'll also come from outside investors, high net worth individuals called angel investors. Typically those angel investors are investing in what we would call the pre-seed round, pre-revenue round, which is when the business is just an idea stage, it hasn't actually built a product and launched to customers or just thereafter. So we've built the product, we've kind of started selling to customers and we just need some growth capital to start hiring folks to see if this can really take off. So you're investing really before what we would call institutional investors are coming to the table venture capitalists, private equity firms, folks with large amounts of capital coming to the table to really get alongside the business.
Speaker 2:You have to kind of get that from individuals and typically family offices before you can kind of grow and scale.
Speaker 2:However, obviously, at that stage of the business, it's obviously the most risky stage of the business because a lot of these startups will fail, and so what you're really doing is partnering with these entrepreneurs in their missions and getting behind them and their vision and saying I've got your back, I want to provide capital to your business so you can grow and scale, but also I want to be a resource for you as you walk this incredibly tumultuous and tough journey. I was talking to a partner of mine earlier this week who was talking about tech entrepreneurs early stage tech entrepreneurs as the athletes of venture capital. It's tough to perform in the early stage and really all the pressures that come with it, and so if we can get relationally in relationship with entrepreneurs when they're young and their businesses are young, then we can help form and shape their culture and their intent moving forward and hopefully get them past that vulnerable stage so they can actually have the impact that they desire on the world at large.
Speaker 1:It takes me to this concept and we've talked about this before, but I think people are walking around living in one of two dispositions they're living in a disposition of scarcity or a disposition of abundance, right?
Speaker 1:I mean, if we really believe God owns it all and we really are walking around in a spirit of you know, he's going to take care of the birds, he takes care of the animals, he's going to take care of us. I think a key for helping some early businesses succeed, some early missions succeed and missionaries succeed A lot of that is, you know, hey, we're going to hold the rope on the finance piece. We're going to fund you and here's your runway. Because if, if you're laying awake at night worried about how you're going to pay the bills and keep the family fed, then you're not being able to get into the creative space of what are the next steps and things we need to do for the company, right? So I feel like when you add the biblical narrative and the discipleship piece to that, you're only. You're not only providing some abundance, but you're also kind of discipling. The theory of abundance Is that fair, that's super fair.
Speaker 2:And I think early stage entrepreneurs typically fall into a scarcity mindset very quickly because there's so many pressures. And so if you can provide that sort of financial arm and, more than that, that relational space, safe space for an entrepreneur to go and just be themselves and be honest about how they're feeling and help provide spiritual guidance Because, honestly, a lot of my investors are serial entrepreneurs who have been there, done that, exited businesses before, and so they know what it's like. But they're also following Jesus and they're typically older, they typically had a few more miles under their belt. When they meet an early stage entrepreneur and they get alongside them, they can kind of provide that spiritual discipleship that, honestly, is way more important than even the financial piece, and that's really the goal for us is like how do we not only disciple entrepreneurs but then help equip investors to be able to do that piece well and align their capital well with the kingdom?
Speaker 1:Next thread next string here the gospel traveling further and faster on the wings of business than the traditional missionary sense. I think it's happening today. I think the ramp up of that is incredible right now From the leveraging technology standpoint, from folks like Switchboard and what they do to connect people with a skill set to a company or a mission with a need there's that component to a company or a mission with a need there's that component. But what I love is that you're a guest who literally lived out coming to faith, maturing in your faith through the workplace, and that's fairly rare. I don't know that. A lot of folks have experienced that. But tell us. I mean, what was the rhythm of a work week? You kind of talked about coming in on Monday, maybe a little hungover and a little tired, but what was the rhythm of? Did y'all do a Bible study? Did he just spend one-on-one time with everybody, like what was this founder doing?
Speaker 2:that was different, I would say maybe a few key characteristics of how the business worked. One the business was super familial, so it was about relationships, about making people feel comfortable. It was about bringing people into the fold. We had a lot of company lunches and things like that that were just pulling people together in relationship. For clarity's sake, the business, the CEO of the business, was actually my dad, so Paul was the CEO of the business. His business partner, todd, was my manager.
Speaker 2:We made the smart decision for me not to work directly for my dad but to work for Todd, which was strategic in a number of ways, but also Todd had authority over the business units and areas that I was going to plug into. So it made sense practically speaking as well. But ultimately, as it related to me and Todd, I think what it really started as is a good working relationship, like I was showing up, trying to, to work to, to do well in my work, to execute, um, and he was. He was a great manager, and so we started a good working relationship and we were purpose, we were on mission together, without even really knowing it, within the business. And so once you get that trust and that rap, once that trust is built and that rapport is built then it allowed Todd to start me and Todd to start building a personal relationship where he started asking me about my life. Todd has a really crazy story, but one of the key pieces of it is just really rooted in prayer. What does it look like to really communicate with God and let him tell you things about who you are and about how beloved you are? So a little bit more on the charismatic roots, which I had never been exposed to before, and so when we started talking about my life, we would Todd would offer to like pray for us and I would have these experiences of God that I couldn't really explain and I couldn't really.
Speaker 2:I didn't know how to rationally think through. And so God started meeting me in that space through Todd, and then Todd, as I mentioned, was incredibly patient with me. So even when I was kind of even having these experiences and starting to slightly change my life, everything was everything. Not everything was super aligned, and so there was moments in time where I would kind of backslip or come in and be like, yeah, I wonder, is this the moment where God's going to be like no, like you, you suck, you got to get your act together, right and, and God never did that and Todd never did that.
Speaker 2:And so, as God worked on my heart, I was able to start trusting God that I could make decisions that aligned with his will. And then Todd, to this day, would say that he would pray like, all right, lord is today the day that I need to tell Patrick to stop doing that. And God would be like, absolutely not, I'm gonna do it myself. And so his patience in relationship personally, god did the work in my heart, um, and so that was. And so really our tag ups, I would say to answer your original question they started with like an hour of like, all work and by the end of our time there, it was like 10 minutes of work and 50 minutes of life in relationship, um, which, um, we were still getting work done and we were still being excellent in our work. I'm not trying to suggest that we were taking company time to only do discipleship, but by the end he was forming me as a person and then I was able to go out and execute in the business.
Speaker 1:Well, man, it's a beautiful thing to just model how to act for somebody and pray for them and ask God do you want me to engage in this manner or not? And listen, god gave you some experience. He gave you some real life stuff that lets you see things in a founder, in a leader and in a company that you can tell your investors or your potential investors about. So let's pivot to the network. Those groups, y'all come together monthly, monthly meetings, yep, okay, and at a monthly meeting, tell us what a monthly meeting looks like.
Speaker 2:Yeah, so the monthly meetings have actually been part of our I wouldn't say secret sauce, but part of the thing that makes it so valuable is consistent in-person relationships between high net worth individuals and stewards of wealth. As you all know, it can be very lonely Now no one's crying for somebody who's been blessed with wealth but typically they comes with a whole bunch of challenges that no one really sees behind the scenes and it's very hard to have a shared relationships where you feel open and able to share about some of the struggles that you're having with your capital. And so that consistent monthly meeting just allows relationships to form among people who typically don't have spaces like that in their lives. So that's been a key piece the monthly meetings.
Speaker 2:The way we structure it is we'll do about an hour of dinner networking, letting people just kind of free flow, organically create relationships.
Speaker 2:We'll take about 30 minutes and I'll give updates on the state of our portfolio, what's going on with entrepreneurs, and then we'll take about 30 minutes and I'll give updates on the state of our portfolio, um, the what's going on with entrepreneurs, um, and then we'll also share a testimony or story. So most of the time we'll have a member get up and just talk about, like, here's my been, my walk with Jesus, here's what I've learned about faith-driven investing, um, all across the spectrum of folks who are brand new to folks who have been investing for years now and what it means to them and how it plays out. So we either do that or we'll bring in like an external speaker to talk about a particular subject or just kind of educate the group. So we'll do a little bit of fellowship, a little bit of admin, a little bit of testimony, and then the back half of the meeting we'll have three pitches, so three entrepreneurs will come virtually or in person.
Speaker 2:We, we go, we try to it really does. So it does feel a little bit like Shark Tank in the way that we're moving through it 10 minutes of pitch, 10 minutes of Q&A, then the entrepreneurs leave and it's 10 minutes of investor discussion, we're on to the next one. I mean, it's fast and what we're really trying to do is get investors to see if they're interested in the opportunities opportunities before we spend a lot of this founder's time. So on one hand, it is a shark tank. On the other hand, what we've tried to build a culture of is we're not going to tear anyone down. We're going to bless all the entrepreneurs we're going to give, but we're going to give strong and transparent feedback at the same time. It doesn't help an entrepreneur if they're up there, um, uh, being vulnerable being vulnerable pouring themselves out and you're just tearing them down.
Speaker 2:But it also doesn't help them if you're just not telling them why you're not interested. So we try to strike that balance really well. But it is in some ways a Christian shark tank just behind closed doors with a closed community of folks who can actually put capital to work and come along to these entrepreneurs.
Speaker 1:So let's keep going here. So we've heard, we've prayed, we've had fellowship, we're building community, we're gaining trust among the families that are involved. And a pitch comes and there's interest. There's interest. Do all 20 families invest in every company, or can six or eight families pick one that they really like? And what happens after?
Speaker 2:that Our investors make individual decisions on which companies to invest in and which not to, and how much they want to invest. So think of me as more of a grand facilitator. I'm finding the opportunities, I'm hosting the meetings, and then we have a proprietary diligence process that is highly professional, that we help our investors evaluate opportunities, risks, risk and opportunities within deals so they can understand whether they want to invest or not. Because typically after a conversation or two you really got to get underneath the surface, underneath the hood of the car, so to speak, to get to know the founder better and the business better, to understand whether we're willing to accept the risks for the upside of the relationship, the impact and then obviously, the returns.
Speaker 2:After there's interest from a meeting, we will go through a proprietary diligence process with the founder. We'll create a report. We'll share that with our investors, we'll kind of bring them along in the process and then we'll decide whether to invest or not. We'll invest directly. We only do equity deals. So we're not, we're not doing debt, we're not doing anything like that. We're we're, we're getting on the cap table, becoming part owners of the business. We think that that aligns the relationship for in the incentives in the long run for success.
Speaker 2:And then after that that's really where the key pieces start to come into play. So myself, or a number of our investors, will likely get in relationship with the entrepreneurs that we've made investments in. We build that relationship through the process. We kind of set some of those expectations throughout the process that we don't want to just write a check and walk away. We want to be resources and there'll be varied ways of engaging or depths of how we engage with founders. Some founders we're walking with monthly, consistently, getting on the phone with them all the time, like really really in lockstep. Others, we're just available when they need us. We want to lean more and more towards the former, where we're really deeply in relationship, the proactive kind of version.
Speaker 2:yeah, Totally.
Speaker 1:And now, when you say we, I know you mean you, but I think, right, some of the families or men and women who have been in business and then are now investing in a business who maybe have an expertise for that business. They're part of the ongoing engagement, right?
Speaker 2:Yes, yeah, and again, it depends on how the relationships form during the evaluation process and what the entrepreneur is looking for, what the investor is looking for. But yes, oftentimes it's not just me walking alongside the entrepreneurs. I'm getting calls from my investors saying, hey, I talked to Mike yesterday, I talked to Vinit yesterday. Here's what's going on. Here's how I'm helping. That's amazing. We love that. That's what we really. That's really where we want our value to be is not only just me doing it, but also our investors getting alongside as well.
Speaker 1:Yeah, just for the audience, look, we'll get. We get to some stories, I promise, cause you know, you know we've got to tell some stories, we're going to get there. But I really want everybody to grasp this concept because I think this is a significant new method. We always talk about we need new methods. We need new methods. How are we going to do it? People coming together in funding companies is not new, but people coming together intentionally in relationship and fellowship and prayer to bring the best of them and various backgrounds and various skill sets, and then pour that into a founder and their company and various skill sets, and then pour that into a founder and their company. The relationship that builds is just incredible. It's just different. There's another layer to it, right. It's a triple rated cord. Maybe is a way to think of it, right?
Speaker 2:For a capital allocator or somebody who's looking for their capital to really have some purpose to it. It's in the relationships where a lot of that meaning is found, and so we've been blessed that none of our portfolio companies have gone under yet. But you can see a scenario where an investor has been in a relationship with an entrepreneur, pouring into them aligned, praying for them and, let's say, the company goes under. The investor can still say, man, that was worth it because of all the meaning that my dollars went towards and all of the relationship that was built here they can feel good about. And, trust me, we want to do good deals, we want to make strong returns. We are not investing without excellence. No doubt we are pushing for excellent businesses because they're not going to have the impact that they're going to have unless they get sustainable and scale and grow. But in the case that things go wrong, at least you can say, man, my dollars were aligned towards where God had obediently called me in this relationship with this founder, and that's incredibly powerful.
Speaker 1:And they learned some lessons and they're probably going to start another company, and I may be here to invest in that one as well, or they might just do really well in another space, and this is part of the steps of their journey.
Speaker 2:Totally. And Gary V, who's obviously a secular investor, famously said I bet more on the jockey than the horse because it might not work this time around. But if I trust you and I believe in you, then I'm going to bet that the second, third or fourth time it's actually going to work out.
Speaker 1:So, coming back to this concept of new methods, this concept of how do we finish the task remaining, how do we get the gospel where it's not? How do we plant healthy churches in the hardest to reach places? Right, how do we translate scripture into languages that don't have it yet? Into languages that don't even have a written language yet? Right, all of this work that's going in is to accomplish a task which we mostly know as the Great Commission, right, which is to get to Revelation 7, to see this reality of a future event happen, possibly in our lifetimes or maybe soon thereafter, and I think you're playing a pivotal role.
Speaker 1:Now I want to go to the thread of the spiritual component and the discipleship, because if someone's hearing this and they're like, hey, I want to be a part of this, right, I want to allocate some resources to some companies. I realize the risk, I realize that this may not all make a financial return, although some might make a very large one, but I know that this capital, it's almost like a gift, tithes and gifts, right, and actually can be a gift. We talk a little bit about how you don't have to do this with for-profit dollars, right, you do have some investors that are using their private foundation or their donor advised fund. Talk about that strategy.
Speaker 2:In the concept of it's all God's. And so the question becomes okay, lord, how do you want us to align our capital? There are wise strategies out there. We want to align with them, but oftentimes God is just calling folks to say, hey, invest in the early stage because we know it's risky. But the ones that hit are not only going to do financially very well but they're going to have a huge impact. And so that's where a lot of our investors come to the table, as they say how do I do this?
Speaker 2:Well, obviously a lot of investing, especially in the early stage, comes from personal funds towards for-profit companies. That's pretty standard. When you're thinking about investments, you put an investing cap on and you say is the returns worth the risk? And you kind of walk through that. But one of the vehicles that we've used a lot is a vehicle from a group called the Impact Foundation that allows donor advised fund capital, charitable capital, to be invested in for profit businesses and then, if returns are created, they go back into the donor advised fund and can either be reinvested or given away to a nonprofit. And so the donor advised fund for those who aren't familiar with it is basically a vehicle where you have a liquidity event on December 30th and you want to take a tax write-off and you don't know, man, how are we going to give all this money away on December 31st? You can put it in a donor advised fund and it's going to stay as charitable capital. You take the write-off in the current year but then you can give that capital out years and years in the future.
Speaker 1:Yeah, oftentimes it makes a lot of sense when you talk about a liquidity event to reduce the taxable event in that year. So you could almost front load your giving for a number of years, right, while kind of redirecting Uncle Sam's dollars to the causes you care most about?
Speaker 2:Totally, yeah, and I should have let you explain that because we're giving you a background.
Speaker 1:You're doing a great job.
Speaker 2:You're going to be able to do it better than I can, but yeah, so the donor advised fund just a great vehicle just in terms of a wealth strategy, part of a wealth strategy of a high net worth individual Should be a part of everyone's, everybody yeah, absolutely. And so if you capital towards for-profit businesses, well then now we can create a multiple On your giving capital, on giving capital, but also we can get for some folks this is where talking about the Unreached podcast, this is where a lot of folks are leaning is saying, hey, we're investing in a business in a really hard to reach place somewhere around the world that's going to be spreading the gospel. That's probably not going to provide the type of return profile that we would look for in our personal portfolio, but if it's successful, man, is it going to have a huge impact, so you're able to take that charitable capital that you'd otherwise give away and put it towards a mission that could likely be sustainable, and some of these may not be huge investments.
Speaker 1:I think it's helpful for the audience to hear this. I mean, if you just look at the math, with 20 families and three and a half million, and what 18 companies 17 deals, 14 companies. Yeah, yeah. So you see that the hit rate or the capital per is not huge. So you're not talking about multi-million dollar investments here. No, you're talking about 10s and 20s and 30s and 40s and 50s. A lot of times, right Sure.
Speaker 1:Sure To close the loop on this donor advice fund concept. I've said this before but I want everybody to hear it again Cash is the least tax-efficient gift you can make, and so if you're in a situation right now where you're doing your tithes and your offerings and you're giving to causes you care about via a check or a wire or a credit card, swipe at an event, you really need to talk to somebody about setting things up differently. If you have an investment portfolio or you have a company or you have real estate or something with long-term capital gains in it, it makes way more financial sense to use a DAF, a donor-advised fund, to gift and not pay taxes on those long-term capital gains but right off that full amount. So that's my little plug for the day. So let's go to stories, Because I know there's some sensitivity in some of the companies that you've invested in and we can't say all the names and all the places, but there is some.
Speaker 1:Like your portfolio is really cool. It's very diverse across different sectors of the economy, almost like a small-cap fund, and it's got, I would say, global. It's not international and it's not all American right, so it's kind of a small cap global fund in the angel pre-venture super early stage phase right.
Speaker 2:So tell us a couple of stories yeah, that's a good way to characterize it, and I think I mean just some high level stats and then we'll get into some stories. Our portfolio is probably 80, 85% US-based companies and target markets in terms of who they're selling their product to and, as we've talked about, we're looking for strong founders with intentional impact and market rate or above returns. We want to be excellent in the type of deals that we're doing. However, every once in a while, we'll see an international opportunity where the impact is so strong and we're seeing the value of that founder that we'll get behind that and it's not concessionary returns. We're investing in excellent businesses that we think are going to be successful, but they just might not have the return profile that we would expect, the asymmetric return profile that you'd expect when you're investing in an early stage company in the US target towards a US target market. A couple of stories I'll pick two one from kind of our typical blend and one from that sort of international, more impact heavy blend, or one or two from the second category.
Speaker 2:In 2021, a guy named Andrew Asher was building a company called Lucid Drone Technologies in Charlotte, north Carolina, and Andrew's vision was how do we take drones and put them in dangerous and dirty jobs and automate what humans are doing right now? So if you've been walking down the street in a downtown area and you see guys with the squeegees up 10 stories against a building washing the windows, andrew just felt like that was a dangerous thing that technology should be able to automate. He built a really high tech drone to be able to handle that sort of workload and we invested in with him very, very early on and then subsequently invested with him in 2022 in his next round and then recently, earlier this year, invested with him again in his Series A and kept bringing more investors into the fold. But what's most cool about that experience is not only the impact that they're having, the kind of lives that they're saving legitimately and the sort of opportunities that they're providing to the blue collar workforce to really automate their work and scale their businesses the process alongside a few of our other investors, and just to watch his openness, his growth, his ability to learn what God is trying to tell him right now to help grow him personally, and watching how that personal growth translates to business growth almost every time. So just to see the longevity of Andrew's journey over the last three plus years has been just a joy and, by the way, the investment's looking pretty good, so we're excited about that.
Speaker 2:Another story, just kind of on the international front. We invested in a business in a third world country. They're doing a pretty cool. They're in a commodities business and the founder of that business had been planting churches in this kind of hard to reach area of this country for a long time, oh yeah yeah, here we go.
Speaker 2:Here we go. Here we go Unreached podcast. So he had been a pastor to them for a decade almost and had been able to plant among this unreached people group and is now planning a business there to help uplift this tribal community out of some of their poverty and try to give them jobs and opportunities. But as he's doing that, he was preaching recently on missions and after the service a lot of these folks from his church community came up and said, well, you were on mission, like we want to go. And he was like blown away, right, because we're talking really impoverished people who have never left their 10 square mile radius of where they've grown up and been a you know, been a part of this church. And they're saying that we want to go to the nations and so, um, the founder exactly Jerusalem, judea, samaria, the ends of the earth right.
Speaker 2:The spirit is just totally rested on these people and said let's go, um, which I think should be a challenge for us.
Speaker 2:You know, sitting here in this room and here listening to the podcast on, like, these are folks that are getting called, like, are we open to the voice of Jesus telling us where to go and how to get there and asking us to take risks?
Speaker 2:I mean it should be inspiring to us. And what's really cool is the founder now has this business where he's thinking about replicating to another hard to reach place and he can. After the people in his church are trained on the job, he can now send them to that place with a job and an intent purpose so they can go share the gospel. So it's like it's a mechanism for these folks to be actually be able to go on mission. Where they're not good, they're not going to be able to raise support from their friends and family. So they're able, but they're able to now be missionaries in a place where they would never have a shot of doing that previously. So it's just a beautiful story of how that business has potential to really reach even more of the nations and kind of bring other folks into the fold.
Speaker 1:Love it, love it. I want to talk about measuring returns. Okay, so to invest with excellence, to speak to investors, credited investors, qualified purchasers, folks that really have the capital and experience in the space, they want to measure returns. Historically, you're talking about market rate returns are better. We're thinking IRR, we're thinking MOIC. We're thinking these different concepts of just how is my money doing? When is it going to come back to me? Can I borrow against it? Can I have liquidity if I need it? A lot of these concepts, but there's a lot of folks right now talking about how do we build a mechanism for measuring the impact? Right, and it's happening in the secular and the sacred space right now. What are your thoughts on that conversation? Sure, yeah, I mean, I think it's definitely in the secular and the sacred space right now. What are your?
Speaker 2:thoughts on that conversation. Sure, yeah, I mean I think it's definitely an evolving space. I'm not sure I've found a framework that has totally figured it out. So, before I even answer the question, I'm not sure there's like a go-to, like this is the way that we do this. A lot of organizations are taking stabs at it. So Praxis is an accelerator program out of New York. They're great partners of ours.
Speaker 2:We've invested in a few of their portfolio companies and they have these ORIs Opportunities for Redemptive. I think it's Opportunities for Redemptive Impact where they've kind of classified the type of impacts that they want to see and then are trying to measure against like how are we moving against these kind of theoretical goals? And then are trying to measure against like how are we moving against these kind of theoretical goals? Problem is it's hard to connect those with actual metrics of like how much have we improved poverty in this place? Or how many folks have we reached with the gospel, or whatever that metric is for impact, whether it's spiritual, social or environmental.
Speaker 2:The hard part is getting from a theory of change to a KPI where we're saying we're seeing this. Oftentimes, when we're doing diligence on companies, really we look at like a few core areas and, again, we haven't perfected this, but some of it is. Yeah. What is that theory of change? What are the KPIs? What are we actually measuring to show that we will have had the impact that we're trying to have?
Speaker 2:Key performance indicators Correct, yeah, sorry, metrics metrics, you could call them, um, or just measuring the impact in some way, shape or form? Have you even started to think about what those key performance indicators are and like how you would measure them and where you would integrate those? So those are some of the questions we're asking asking, but we're also asking things like founders. Founder impact alignment is something we think about a lot, which is like what part of the founder's story has led them to this particular problem and why are they passionate about it? Because it's one thing to say I want to have impact. It's another thing to be passionate about that impact and then really resonate with that person.
Speaker 2:And you know they're going to go to bed thinking about it and they're going to wake up thinking about it A hundred percent Not that that's necessary for having impact or even having a successful business, but it's a good indicator for like whether or not the founder is really going to engage well in that space. You know.
Speaker 1:The reality is what I think you're doing. That is beautiful is its connection and its fellowship and its intentionality, and it's getting to know the founders and the founders getting to know the investors. And, man, I just commend you. It's great to see someone taking a leadership position in this space. Effectively, man, you're a missionary, you are working in a space leading people to Christ through redemptive investing, and it's beautiful. And I'm so glad that I've got to know you. And so the next question I have, because I think everybody's wondering you're here in Austin. You've been here for 10 months, 10 months, 10 months. Okay, you said you came here to replicate to see can this be done again? Where are we at? Well, you know when.
Speaker 2:I got here in late August of last year. I kind of came in open-handed just saying I have this experience, I think I have something unique in DC, but I don't want to be prescriptive for what God is doing in Austin, so let me just build some relationships and kind of see where it's going with the intention of I'd love to replicate what we've done in DC and have that same impact here. We've been building relationships for about 10 months. We have enough commitments to get a network launched here in Austin in September Praise God, man, that's great. So we're moving towards that. We'll start with seven to 10 investors and we'll be bringing now 30 plus families to the table.
Speaker 2:When we're thinking about opportunities and be building a community here in Austin, and what we're hearing, experiencing, hearing from our customers, hearing in prayer is this is really double down on community. How are we providing a space for folks to really get equipped and activated to go deploy their capital for the kingdom, whether it's early stage or beyond? How are we creating those sort of experiences and fellowship among high net worth individuals and family offices that are faith aligned so that they can really feel equipped to go do this work? We're working on continuing to build the strategy. I'm kind of an entrepreneur of entrepreneurs, right Like I'm investing, but I'm also building this network in this community and thinking through where God is leading, and so just very, very excited to be a part of the community here in Austin, Very, very excited to start investing with folks here in town and excited to see where God brings this vision in the next few years and where else the vision ends up going.
Speaker 2:I think God has called me here, so I'm not sure how it replicates across cities beyond that, but that's part of the equation that we're going to start trying to think about is like, really, where does this go outside of Austin and DC? Cause it? You know there should be a community like this in every major city in the world.
Speaker 1:Well, look, I do not hesitate to share with the listeners that we're going to be part of this. My family's excited to be a part of this. My family's excited to to engage in this, learn with you in this, share what we're learning so that the network and others can learn as well. And you know, if it ends up being God's plan, that this is something that should replicate to other places, like we want to be there to help that in any way we can. So, man, just in closing, today, you know what we do here is we always ask the guests to pray for the listeners. So I want to ask you to pray for everybody. But I just want to say again, man, I just I'm grateful for you.
Speaker 2:Looking forward to these next chapters together. And thanks for the kind words and I'm excited about your partnership in particular, just the level of influence you have, the vision that you see, it's not often that you meet somebody who kind of you just kind of get it Like. You see, you're seeing what I'm seeing and you're seeing the potential for where this is going to go, and it's just so encouraging when you got people coming alongside you that are like no, no, no, I see you, I got you, and I really appreciate the kind words.
Speaker 1:Same thing you're doing for these founders, right, same thing you're doing for them, you know, it's the same thing we hopefully we're doing for all the relationships that God brings into our life is just taking time to sit down and listen and say I hear you, I see you, I'm with you, let's go, let's go take this, let's go take this next step together 100%.
Speaker 2:I'm excited that you're going to be one of those people for me.
Speaker 1:Right for us.
Speaker 2:That's amazing. So, yeah, let me play for us. Wow, jesus, thank you for the amazing ways that you're establishing your church and that you're allowing us. We get the unique privilege of participating in your redemptive story for the world at large through our capital, through our vocation, through our relationships. Lord, that you're the one who's building and we just get to be a part of that. And who are we to be able to participate with the sovereign Lord and his purposes and his ways, man, it's just such a privilege and such a benefit of the gospel and benefit of knowing you.
Speaker 2:Lord, I thank you for all of the businesses here in the United States that are blessing their employees, living missionally, hoping to accomplish things, and all the struggles and challenges that come with that.
Speaker 2:Pray that you'd be with their leaders and their employees as they move throughout the world. And then also, lord, especially for those businesses throughout the world that are intentionally going to hard to reach places so that people might know the real you and might be able to experience life and peace and salvation. Lord, we just pray that those businesses would be established. We pray for new models. We pray for new strategies. We pray right now, in your name, for more folks to be called to that space. So right now we just pray for anybody listening to the podcast that's feeling led that you would just that, jesus, that you would call them to these spaces and places so we can have more workers working towards bringing about God's redemptive story. So, lord, thank you for Dustin, thank you for the Unreached podcast and thank you for what you're doing here. We pray you'd establish your work and we pray all these things in Jesus' name. Amen and amen.
Speaker 1:Thank you for listening to Unreached. Our sincere desire is that what you've heard today will cause you to see the mission of God differently and your role in it more clearly. If this adds value for you and we hope it does would you please rate and review the podcast wherever you listen. Also, share with your family, your friends, your church, your life group, small group, d group, wherever you do life, and if you want to connect with us, find us on Instagram at unreachedpodcast, or email us at unreachedpodcast at gmailcom.
