Because a lot of the people attending are capital raisers, a few of the questions
we were gonna ask kind of relate to some of the best tools you've used to help
raise capital, some particular strategies that you used as well. So maybe we just go
down the line, if you don't mind starting, what is there a particular new technology
or what has been very effective for you recently in raising capital from a tool or
just strategy standpoint? - I mean, there's CRM tools that everyone uses and things
like that, but I've found, it's not just family office conferences, but I've found
in -person events are the best way to talk to investors and have them. And I think
email has a, what, two, three percent open rate. Text messages are slightly better,
but if someone's texting me to raise money, they don't want to talk to you, right?
- Right. You just got to be in front of people and talk to people, and when you're
talking to them about the prospects of what their capital can do, don't overdo it.
Just be honest and tell them what the deal is, and we've done that,
we've been very conservative in our estimates with people, and several other
investors, our largest investor just made a $2 million additional investment because
he started small, He's watched us grow. He's watched us do what we're doing. And we
over -accomplish what we say we would. And that's the number one thing,
is be honest with them and talk to them. - Develop that trust. - Yeah, it's only we
to do it. - So just building upon that, and I agree with everything you've said, we
have an advantage that I didn't expect to have, and that we're weird. I mean,
How many people here have ever heard of a cute, furry, adorable medical device
before?
The media loves covering us. We've been covered over 400 times by major media,
so television, all the major online print publications, and that we were a time
magazine, including their best inventions a few years ago. That has driven a lot of
investor Traffic so for those of you who are raising money out there trying to
figure out how to get the media To get interested in what you're covering that can
spread your sports story far and wide and get people that That you won't come in
contact with at conferences like this or through pitchbook or crunch base or all
those other tools
So I think for us being in the oil and gas space the biggest thing that we focus
on with our with the people that we raise money from is education. People,
especially a lot of our investors, come from real estate and they want an idea of,
okay, how does actually this work? You're going to go get oil out of the ground.
You're going to sell it. Who are you selling it to and kind of all the stuff that
goes into kind of a traditional underwriting. So we focus really heavy on education
in person events. I definitely piggyback off that are great because you can kind of
look that person in the I and see them and really what we do is actually is for
every deal that we help co -sponsor, we actually go ahead and release kind of a
webinar style video where we actually walk each, walk everybody through the
underwriting process so they can kind of see the soup and nuts version of how we
actually go about the underwriting process and kind of weave that in with the
education. Because you're kind of newer as it sounds like, Did you start just
through the family office and the connections there and local, or did the education
kind of start quickly after the kind of the decision to start raising capital?
- Well, I think we stumbled, like everything, it's not the first strategy you
stumbled across because you meet with investors, you learn what they're interested in,
you learn, you know, you figure out the questions that they have, and then all of
a sudden it's like, oh yeah, well, we're getting the same question over and over,
as well, Well, how do you know there's oil here? Well, okay, maybe we should tell
people how we go about analyzing that. And that's kind of the genesis of it from
that standpoint. But it's really been what I would say is kind of network focused.
Like you said, getting in front of people, one person introduces you to one person.
The other benefit with oil and gas is the massive tax benefits you get with
investing. And so one of the biggest target markets for us is CPAs. We get a lot
of CPAs who we partner with who need something in their tool belt to be able to
give to their clients who at the end of the year do need a tax write -off and it
may not be quick, there may not be a real estate portfolio they can get into,
there may not be other tax havens they can get into and with oil and gas. It's
extremely tax advantage. We were meeting with one of our largest investors this week
actually before we flew out here and one of the comments he had was, yeah, when I
first got your pitch deck and I saw your tax slide, I was sure you were lying to
me. And then I went and talked to my CPA and you weren't. It was, it's crazy. So
stuff to hear like that's cool, but I would say education for us is critical. - And
if you don't mind me asking again, with those webinars, is it something that is
kind of one -offs or is it now that you've kind of developed a network, is it
something where it's like once a week we have a webinar and it's to 20 people or
is it once a month or is it once for one person and then continue it that way?
- So we do them evergreen, so basically we record one and then any time we get a
new contact or somebody interested, we kinda just send them there, collect their
information and they gotta watch it at their own leisure. - Fantastic, that's great.
Michael. - Well we started, first we now have five profit centers and we started
with the charitable foundations and if we could help enough people, they then decided
that they wanted to come back and come back. And then our second profit center was
trade shows because I've been doing them for 50 years, and that to me was by far
and away the best face -to -face conversations that we could have.
And if we could help them charitably, that was great. And then it just naturally,
organically evolved into how could we invest?
How can we do more? And in the trade shows, just like this show, it was,
we just got into the family offices about a year ago in Fort Lauderdale was our
first show in Beverly Hills and this now as well. And I personally,
though not an employee of the company, a partner and investor these last six years,
take care of personally each and every communication. So it's not just from a
corporate point of view, it's a true trust -building bonding, or since I was a
certified senior financial planner, I don't think this is for you, basically. Or if
you're going to get into it, no more than five to ten percent of your portfolio.
And once you build that trust, if we look at our investments that are coming in
year by year over the last six years, it's about 80 % of investors coming back to
reinvest because they couldn't believe how really good it was going to be for them.
And then we developed a concept which I hadn't heard of prior, and that was since
there is a little bit of risk to precious metals, the volatility, and to fine art,
which a lot of people have not previously been blessed to invest in and are not
sure of the liquidity or the exit strategy, we said, look, what if we can secure
your entire investment, let's say $50 ,000,
with your choosing fine art that you particularly like.
So in the worst case scenario, World War III does happen, you will still have that
fine art instantly or as quickly as we can create it. And that was more of an
innovative way to truly build the trust and make the risk -reward ratio much more in
their favor, and by not being an employee and by being an advocate or an ombudsman,
if you will, for that investor, I was placed in a position that I could actually
not just present the opportunity, but represent them when we're negotiating with the
company. And that's an eminable position for me to be in. - Yeah, that's great.
It's not, it's really refreshing to hear you take it back from an initial as a
certified financial planner, like how does this fit in to the overall asset class?
I mean, to the overall allocation. - That's good. And we just, three years ago, out
of the six, we started doing IRAs and A's and 401 (k) 's, previously that wasn't
even thought of. And then two years ago, people would come in and they would say,
now that you're into precious metals, the fourth profit center, I have,
and this just happened three days ago, dental practice, which you know very well,
your cousin, John, said I've got 900 ounces of silver,
could you guarantee me that since you're gonna create Michelangelo's David and Pure
Silver, could I come and see you actually take my silver and convert it so I can
become part of history in the making? And I set 'em a FedEx account yesterday.
Ah, that's funny. That's great. How cool is that? That's really cool. Thank you.
Daniel. Capital raising for us has been focusing on the basics.
Had dinner last night with Joe and Jeanine Williams with Keller Williams and similar
strategy. They're 37 years now of raising capital.
The first part We just focus on having an extraordinary product and service, and
then make sure that we've got an extraordinary team, and then expand so we've got a
national and international client base, and then the fourth stage we're at now is
then expanding locations around the country, particularly in places which our family
like to enjoy, like Park city, Utah, where we like to ski, or that was last month,
this month is Honolulu, where we like to vacation. - Yeah, when you think of the,
like I said, it was interesting to, as someone who was in finance, to watch what
you had posted yesterday, when you look at those different strategies, like if you
take a minute and just, if you don't mind, kind of reflect, maybe say how does the
hedging help you know work or what is it what do you do from a hedging perspective
I guess would be sure so the niche that we're in is looking at trends quite
differently than the typical portfolio is structured where as the analogy goes who
would buy a Ferrari or any car for that matter that just has an accelerator pedal
but no brakes or skid control or reverse gear or turbo boost. So an answer to a
question as it relates to when all three of our primary trends are negative,
then that's an indicator for us to invest in inverse ETFs.
And so in 2022, for example, when the market was moving down the S &P 500 lost 18
% that year, our trends for most of the year were negative in all three of those
short -term, medium -term, and long -term categories. So we moved into leveraged ETFs
where then you can make 18 % to 36 % depending on its 1X or 2X when the market's
plummeting. And then also with the skid control, moving into investments like we're
excited about energy as well, energy was up 30 % to 60 % in to and our portfolios
automatically move where the trends are when energy is a great time to be investing
in as well as in gold. Do you ever use overlays? I mean, do you option overlays
at all or? We're pretty straightforward with public securities invested with ETS and
stocks. That way investors are always 100 % liquid. Yeah, nice. Great.
Get in. And What strategies have been helpful from both raising capital and and
maybe new technology anything new that has helped that way? for for getting investors
into you your fun And granted it's a new tech. I mean, I know it's the technology
has been around a while Yeah, it's really advanced recently is my understanding.
Yeah, and I think that you know as it relates to Helping find new investors,
you know, raising capital, I keep it simple, right?
Like, on one side, regardless of where you are, kind of in the value chain, whether
you're a new sponsor looking to raise a couple hundred thousand dollars or an
experienced sponsor looking for multi -millions of dollars from individual LPs or
institutional capital, I think that it's a relationship driven, it is relationship
driven, right? So I've heard my panelists talk about, you know, speaking to investors
and communicating with investors directly, like that is the case. I might not write
every piece of content that goes out, but I probably take a quick look at it and
it goes out in my name. I would say like I can't play the guitar and I can't
break dance, you know, But for some reason, people like and trust me pretty quickly.
And so that can be a superpower. It can also be a power used by an evil villain.
So I have to stand behind that and really perform.
And when things aren't going as planned, communicate as much as you can. We over
communicate in all of our platforms. And look, real estate hasn't had the best 18
months. So, the more you can be out in front of your investors and letting them
know that if business plans aren't going according to plan, like what is the
strategy, what is the pivot, what is the plan, you maintain trust, right? You don't
pick a sponsor really, I mean you do pick a sponsor when times are good, but you
really end up learning if your choice was a good one when times aren't so good,
right? How are they to stand behind that. From a technology perspective, look, it's
simple, right? ChatGBT, for me, has been a game changer for a time, right?
ChatGBT doesn't write my articles, but if I tell it what I want to convey, it gets
me started on marketing materials. It creates platform after platform and structure.
I did an explainer video for Charge Capital Partners. needed to write a script, like
how easy is it to sit down and write a script, but I can tell Chat T .P .T.
what I need. - It's so helpful to organize your thoughts. It helps from a time
perspective that way. - It gives a huge jumping off point, right? So it's just a
saving a ton of time across the entire portfolio. - Would you remind me, from a
standpoint of footprint, I Where are, where's your footprint,
so to speak?
- On the-- - The energy side. - On the energy side, we're focused mainly in New
York, New Jersey, and the Tri -State area. To begin with, because we find that blue
states seem to have a little bit of a more of a limited risk. You know, risk
profile, as well as the arbitrage margins are strong here. - That's great.