Speaker 3: 00:00:35 Hey everyone, if you haven't already heard about it. Canada's biggest impact investment conference called the social finance forum is coming up from March seventh to ninth in downtown Toronto at the Mars Center. It's now in its 11th year and the conference really brings the best and the brightest, um, not only from Canada, really from all over the world to Toronto to talk social finance. I'm going to be participating in a panel discussion with actually last episode's guest, uh, Alexa, Blaine of deep can impact and we're going to be joined by Dan Mia, Dov, Nick from Social Finance U K, and we're going to be talking about what changes need to occur in order for impact investing to reach mainstream investors. So if you're interested in impact investing, there's really no better place to network and to learn. Uh, so come on out to the conference. You can register@wwwsocialfinanceforum.ca. Hope to see you there.
Speaker 4: 00:01:30 Hey everyone. It's David O'leary and we're back for another episode of the impact investing podcast. Today on the show we have Jonathan Hera, who is founder and managing partner of miracles capital. And by way of background, Jonathan has a load of incredible experiences on his resume working with some of the most impressive organizations and people working in the field of social finance. I'm Jonathan started marigold as an impact advisory firm helping private foundations, family offices, corporations, all organizations like that make the move into impact investing. And recently though, marigold launched its own, uh, impact fund and is in the process of raising capital for that. So without further ado, Jonathan, welcome.
Speaker 5: 00:02:10 Hi David. Thank you. Thanks everyone for listening and it's great to be here.
Speaker 4: 00:02:14 Yeah. I'm, I'm excited to have you on. I've been aware of you for longer than for quite some time and been excited to get a chance to finally meet for context. For people listening. You're actually sitting on the investment committee of World Vision, Social Venture Fund, which, which I sit on as well and so we haven't had a, I think he missed the first meeting, unfortunately, weren't able to make it so we will connect to the second one, but this is exciting for me.
Speaker 5: 00:02:38 Yeah, no, me too. Which is a, it's a great opportunity. I'm really excited to be, to be a part of it. So thanks for having me. And I was just recollecting earlier today with some colleagues about the evolution of the space and speaking of sort of the, the two degrees of separation and it's interesting to note that, um, I met Matt [inaudible] who's on your team many years ago when I was on the board. I'm still on the board, I see of an organization called the youth social innovation capital fund. And part of that organization was Jewelry Cohen who's now part of the spirit foundation running. They're impact investments. We at Gellis, who's portfolio manager at Grand Challenges Canada site is [inaudible] who's now a JCC as well and not to WHO's now at World Vision. So it's really interesting to see the space, the space is small, but it's really fantastic to see how such a small organization like why I cy has been able to been able to provide a platform for so many people. Anyway, that's a bit of an aside, but it was a really neat reflection to see how the space has sort of evolved in the last five, six years
Speaker 4: 00:03:39 is very cool. It's, it's both a small sort of still nascent in sector and industry, but growing quickly and some pretty amazing people in it. So it's always fun. They sort of see and find those as you say, those few degrees of separation between everybody. Yeah. So what else can you give everybody a quick introduction to who you are, your background, what you guys do over at Maryville. It's capital.
Speaker 5: 00:04:05 Sure. I'll make this as brief as possible. It's super interesting to me of course, but maybe not to everybody else. Right. I was born in Kitchener Waterloo to a single mother. Um, I'm the only child, a first generation Canadian, grew up in lower income, lower middle class income neighborhood. A really common story. I think for so many Canadians, small family, the rest of the family that we had was still in Hungary or Germany a little bit in Canada. So there was this feeling of I'm really deep connection to my mother but not so much with many other people. And so friends that I immediately had were also newcomers or marginalized populations that are kind of related to. And uh, I'm, I'm, and by the way, I'm looking back and connecting dots. It's not as though all of this was super clear to me as I was a child or a teenager on so forth.
Speaker 5: 00:04:56 Um, grew up in kitchener waterloo and started to volunteer a lot with community development groups along the way, wanting to give back something. I'm not really sure why I wanted to reach out and connect. I'm not really sure why I end up going to school, chemical physics, the University of Guelph and hated it and transferred eventually to mcgill. I'm in political science and loved it. Really focused on international development. Um, but the focus in the Middle East, my graduate thesis is actually on the subversive elements of the new Iranian cinema, which is a fascinating topic and I didn't actually speak Farsi at the time, nor do I now, but I, I learned sort of along the way and so I was really looking at the capitalist system, didn't really feel a part of it and it was kind of picking at it from a political policy sort of angle through some of the international development and community development work I was doing, bumping along a little bit.
Speaker 5: 00:05:47 I ended up working for many nonprofits both here in Canada and abroad on my route to discovering micro finance, realizing that working on the frontline grassroots, uh, within these organizations was fantastic, but I might not actually be altering too many systems from within, by doing so. And so micro finance was my first foray into playing with how that might actually change by using finances. A tool for social change fell in love with micro finance, ended up working with a micro finance institution, raising capital for it, helping build it, um, worked for the micro finance think tank called C gap at the World Bank, so sort of on the ground as well as $2,000, million miles removed in DC. And that led me to discover a small and medium enterprise financing or impact investing. I had a chance to work with asset management, which is based in Waterloo. I'm private equity fund to funds, you know, providing a growth stage capital to fund managers to then fund their own companies and their own portfolios.
Speaker 5: 00:06:52 I then was the founding fund manager of RBC Generator Fund, which was the first in Canada to launch an impact investing anything. And so that was a fantastic initiative for domestic footprint. I then had a chance to build and lead and investment process and team at an organization called Grand Challenges Canada, which I jumped out of course, and I was there for three years and on the heels of that launched Miracle Capitol in April of 2017. So the Xo, it's a very long linear trajectory. Um, but I would say that I would have been extremely fortunate. I worked hard, but I've also been extremely fortunate to work for such bleeding edge organizations, all very different mandates, sizes for profit, nonprofit, whatever, but all bleeding edge organizations within the Canadian impact landscape and marigold. Now we're looking at a few different things. We're raising our own fund, which I'm happy to talk about, which uses a gender or diversity and inclusion lens and all of its deals were fairly early stage coming in at seed and pre series a sort of financing.
Speaker 5: 00:07:53 But everything that we do, uh, is holistic in our approach. We often say that everything is material. There are no longer any extra analyses, the social and the environmental that don't necessarily show up on a balance sheet or an income statement or cashflow statement. Those are material and they need to be captured. And you know, everything being an impact investment is something we've been saying for a long time. And slowly, slowly as I'm sure you know, the market is going that way. And so all we do is look at things as holistically as possible, is trying to uncover biases that we have that the market has things that are overvalued. We try to undervalue and course correct and then the deals that have big markets, big populations that are targeting underrepresented folks and uh, you know, uh, you know, not hoping for the best but really trying to up end the, the two and the aid or the two, six to sort of model of traditional vc with a, you know, the power logs models and really trying to play different types of financing to different types of organizations and is all based on the work that we're, we've learned from at Serona and RBC and GCC.
Speaker 5: 00:09:00 So I'll stop there. It's a really different approach. Like I said, we, we've done some consulting work with folks, but we're now in this fundraising mode and so the proof is in the pudding, so to speak, and we don't have that putting yet, but we're, we've got a thesis and, and we're really curious to, to test it out.
Speaker 4: 00:09:17 Well boys, so there's a lot to impact there. I don't even know where to begin. That's great. You've got a really impressive resume of organizations and experiences. So yeah, I could. There's a number of places I could go from here. Um, maybe just to start, you sort of glossed over. The quickly said sort of early on you kind of started to have these various experiences where you were, I guess the purpose of what you're doing and making an impact on the world was important to you and you weren't sure why is that? Is that the case you just, you're unsure and that sort of where you leave it? I always find it fascinating to know what makes people sort of start to think and care about what's going on in the world. And for a lot of people it's kind of more part of their upbringing, but for others that just at some point in their life, things just kind of take a switch.
Speaker 5: 00:10:09 Yeah. So I, I'm aware of it now, but what I was trying to say is I didn't know going through it. I wouldn't say it was all premeditated. It was all planned. I think that looking back as an only child raised by a single mother who didn't speak perfect English, he was a factory worker even though I'm, I'm a CIS male, born in Canada and I'm aware of my position of privilege at the time I felt quite marginalized. I didn't really feel a part of the system to be very frank and I somehow felt as though my mother had sacrificed a lot for me and I also felt as though I needed some greater sense of connection then to just her in the world and so I wouldn't have been able to articulate that as a 10 year old or even a 15 year old.
Speaker 5: 00:10:57 But I did feel that and at many times as a teenager that was actually a lot of anger. You know, I, I'm a bit of, to be honest, I was a bit of an activist on the left, on the left wing. I think see my undergrad studies as I've kind of described to you to be proof of that. And so I was rebelling a little bit. Um, but at the same time trying to connect with my tribe. Right. So it was trying to feel bigger than my two bedroom apartment by connecting with other things that were bigger than my issues. I'm just feel less marginalized. So that came really clear, I would say in my mid twenties, um, when I started volunteering with different kinds of organizations and discovering micro finance. But I would say that it took me that long to figure out why I was constantly volunteering.
Speaker 5: 00:11:45 Um, why was, um, learning new languages at the, you know, at that point in my mid twenties, I'd probably traveled 35 countries or so. I'd studied abroad, worked abroad, really trying to figure out who I was because of this wanting or longing to connect to others. And you know, marigold now it doesn't look at necessarily too many environmentally oriented investment opportunities. We look almost solely at social social issues, social solutions. And so that connection now super clear to me, but as a, as a young boy and as a teenager, it just wasn't. It really wasn't. And so I think you're asking a great question. I think the why is clear now looking back, but it just was a really a muddy water at the time.
Speaker 4: 00:12:31 Yeah. And I think that's me. I think that's the case. You only is that great. Steve Jobs, commencement speech, talking about you can kind of connect the dots looking. You can only connect the dots looking backwards. Um, yeah. So, I mean I'm, I want to get into miracle and everything so, uh, but I, I'm really curious you, you made this comment about you have this sort of longing to want to connect with others. I have this thesis. I'd be, I'd be curious for your reaction to it because just for way of background I got my sense of community I think was up ended when I had my first sort of experience traveling to developing world than it was Africa and my case and it was Sierra Leone in particular and I spent six weeks doing some volunteer work there and I really came out with a very profound sense of how different a sense of community is in at least Sierra Leone.
Speaker 4: 00:13:26 And as it turns out, and I think a lot of, a lot of developing world context, um, the sense of community is just so radically different and, and how, how different that was from what I had experienced and that the broader point being that I think that, um, in the developed world, you know, as your wealth accumulates and we all have our own property and we build big houses and we get busy with work and jobs in the rat race that you sorta grew both physically more distant from the people you live around. And then emotionally more disconnected and that ended up itself is the cause of at least a good number of the, I think discontents and social unrest and just general, I guess maybe feeling of unhappiness that people are finding themselves in. Even among the wealthy. I'm curious whether you think there's any validity to that or not.
Speaker 5: 00:14:20 Yeah, I don't disagree. I really don't. I, I remember distinctly feeling, hopefully this isn't too much information, but a lot of times like a victim as a child. Not many people. We lived in a big apartment building and we are all essentially anonymous, nameless, you know, ghosts. Essentially we all lived in the same building but we didn't live together and I, I, I remember that, you know, as though it were yesterday and you know, we now in a community within Toronto where it is an older neighborhood, we live in a little Portugal and so you have a lot of younger families moving in, but you still have a lot of older families and they're, I wouldn't say it's an amazing sense of community compared to some of my experiences, but it's so much better than many other communities or lack of communities within Toronto. And we were striving and searching for that, you know, when we moved here and you wanted to have our family because that's what we, we completely agree with your sentiment to your, your shared experience there. So, no, no disagreement there. And you know, I think, uh, I think the interesting potential question would be, so what happens next? How can our potential investments go to lowering the physical or emotional or psychological walls, breaking them down over time? That might be a really interesting question, maybe not for me, but for someone else because it's, it's a fascinating issue that social networking is not necessarily solving. It might just be actually exacerbating issues of course, and I don't have the answers for it, but I.
Speaker 4: 00:15:58 Yeah, I hear you. It's a big, it's a big question so we won't spend the entire podcast talking about that because. Yeah. Anyway, thanks for your thoughts on that. That's interesting. So maybe let's just dive right into. I will circle back maybe through the rest because I am interested in your experiences than other places, but um, let's, let's get into miracle and talk about maybe sort of break it down as much as you can probably have a wide range of listeners to the podcast. So break it down a little bit in kind of more accessible layman's terms and some of the things that you're doing. So if I'm, if I take sort of take a stab at it, you are working with kind of a variety of clients to help them make the, basically make the move into impact investing. So setting up a strategy, sourcing investment possibility is researching them actually, you know, making recommendations on specific investments, putting together an impact portfolio. Is that sort of a big part of my accurately
Speaker 5: 00:16:59 describing that? That's exactly, that's exactly what we did in 2017. We worked with a couple of nonprofits and foundations, both us and Canada to develop a strategy, a thesis deal with all their capital flows and, and, and the light just as you described. Um, and that actually develop a portfolio model, constructional model, the model of the construction and then find deals, structure those deals, negotiate the deals and start to manage the deals. It also think through governance issues if required hr issues if required. Um, and that was what we did in 2017 and we've really sort of, we haven't really sorted. We've stopped doing that work entirely in 2018 in order to focus solely on the development of our fund, which were, like I mentioned earlier, um, we're soft launching right now and formally fundraising for by, by November. Right. So I'm happy to tell you a little bit about that.
Speaker 5: 00:17:57 I would say that the work on the consulting side, our specialty has always been, we always offer a gender lens investing or a deep impact approach that dealt with equitable practices, um, equitable products and services, whatever it would be, wouldn't see just general impact investing. We always had that, a deeper focus which really stemmed from, um, some of the work that we did at Grand Challenges Canada, which was funded by global affairs Canada. So I'm happy to tell you about the fund now if you want, but it'd be great. Yeah, please do. So refund is domestically focused, uh, Canada and the northeast us, um, I would want to call out a partnership that we have with the youth social innovation capital fund. And she eeo together. The three of us were awarded Ontario Ministry of Economic Development Growth Financing through the Social Enterprise Development Fund strategy in order to place capital into Ontario based servicing social enterprise.
Speaker 5: 00:18:59 So we're raising a fund around that small pool of capital. We're looking at a early stage organizations because we believe that innovation is incredibly important to the development of a robust economy. We also think that, uh, not just from an economic development point of view, but in terms of setting the tone for culture, for diversity and inclusion, a top down role is really important. But I think we, we, we actually think the, the bottom up approaches is really, really powerful. I'm more so and so we're financing organizations that our product or service oriented software, hardware, hardware as in technology or hardware as simple, fast moving consumer good kind of product can be government or business or consumer oriented. It really doesn't matter, but we are focusing on organizations tackling certain themes, um, that impact marginalized populations the most and marginalized populations mean women and girls.
Speaker 5: 00:19:58 It means people of color. It means newcomers. It means rural populations. It means those with mental health issues. It means those with accessibility issues. And of course none of those demographics live in isolation. Of course you'll have double, triple, quadruple minorities in many, many cases. And the themes that impact these people the most or what we're targeting and they are education and training, financial inclusion, food security, sustainable fashion, mental health, sexual rights and sexual health, reproductive rights and gender based violence writ large. So these seven categories, and this is based on our top down research, which is secondary research, primary research is are these seven sectors that can impact marginalized populations the most, of course, as I rhyme them off, you know that a ton of impact investments already going into these areas. Some of them more so than others of course. So it's not as though we're creating necessarily new markets and our thesis is as opposed to being sector specific to be theme specific.
Speaker 5: 00:21:10 So we'll be looking at to be looking at ceos who are women were c suite people who are, are women or minorities of course, um, have boards that are diverse and inclusive, have employment practices that are equitable, diverse and inclusive, have products and services that are geared to marginalized populations and have supply chains and value chains that are holistic in terms of their employment practices, their procurement, their distribution systems. You don't have to, we don't have, we're not looking for deals that have everything, but we are looking for opportunities that have multiple areas and as soon as you start to fit a few of these things together, these, these pieces together, you'll find undercapitalized founders in underrepresented markets with products and services that might not be known by the traditional white male vc and a clientele who isn't really well recognized or understood by said traditional vcs.
Speaker 5: 00:22:10 And so there is a feel good component to what we're doing. No doubt there's an ethical and moral case to be, to be made. And while I don't like to always make the business case, we're also exploiting a market opportunity because no, not many vcs come into the space and of course big banks, BDC or whatever isn't a, are providing debt. Um, so there's, there's a, an opportunity to be backing really strong entrepreneurs with 12 markets that have been in the product and services that no one's funding. And so this is essentially the core of a miracle thesis. It's a $20,000,000 fund that we're looking at. And so in the Canadian space that makes it a real fund, a economically viable, it's not a massive fund of course, but as a demo fund, it's an appropriate target and no one is doing anything like this in Canada.
Speaker 5: 00:23:00 The closest we'll get his organization is looking at women in technology and access to capital is a huge issue as you know, David. So we're not saying that's a bad idea, but it might be under the same old terms with the same old structures where the women are maybe using the same techniques that have been used in a patriarchal system to suppress them in the past, which may or may not be helpful. I'm making an editorial comment there of course, but the point is that might not be enough to actually alleviate some of the social biases and structures that we have. And our approach is one that we feel can be replicated by others even if they don't have the same mandate. We do are the same thesis we do. Um, which is where the power of this demonstrative $20,000,000 we feel really as. So that's what we're up to as we're starting to raise this fund.
Speaker 4: 00:23:50 Yeah, thanks for that. That's great. I'm really curious about your gonna comment towards the end around here looking at kind of structuring deals and I'm offering financing on terms that maybe are more favorable and you mentioned sort of as opposed to traditional forms that are, you know, and the more patriarchal system where, you know, maybe not all that conducive to success for women in technology as an example. Can you, can you elaborate a little bit on that? I'm interested in, I'm, you know, I'm not from the VC space myself and so I'd be curious if you could kind of elaborate on that. Are there examples of, of that you can sort of illustrate that?
Speaker 5: 00:24:31 Yeah, sure. So I think we know that 99 percent of the companies in Canada, small medium enterprise, not large corporations, so the vast majority are small and medium enterprise, but we also know that vc only goes to two or three percent of all companies. I think I can actually make that number is higher than it actually is. So the vast majority of small companies in Canada are not receiving VC dollars, VC dollars, use the babe ruth approach, meaning you're swinging for the fences all the time. And this is the power law distribution, the logarithmic models that I mentioned earlier. You have to return the fund, uh, as essentially a common statement within, within a VC fund, every deal has, has to have the ability to make the fund. It has to return the fund and when you think of dilution, because you're investing in equity now, but hopefully this company raises capital in the future because it's going well and growing and you're going to get, your dollars are going to get diluted, your position is going to get diluted, so you need to make sure that you own enough at a certain valuation now so that in seven to eight years when you're exiting, you can still return the fund.
Speaker 5: 00:25:48 If you raise $100, $100,000,000 fund, and you own 10 percent upon dilution that deal. Now it needs to be worth a billion dollars upon exit for you to get your 100 million back. If we think about the Canadian vc landscape, how many billion dollar exits do we hear about how many billion dollar exits plus two, we hear about the United States more, but my point is we swing for the fences because of the certain model that we have, so essentially you've got one or two fun makers per fund. You have a bunch of goose eggs and maybe one or two singles. This. This is the listeners must be aware of this general general model of how, how the 10 deals kind of shake out per fund. What we're saying is quite different. We're saying let's use the moneyball approach. If we need is pop culture for a second. Talk about Michael Lewis's book. Why don't we hit a bunch of singles and doubles and get on base as much as we can.
Speaker 5: 00:26:44 If we start thinking about different kinds of capital and look at funding different kinds of businesses with different kinds of exits, maybe we can perform just as well in better from a downside protection perspective as well as an upside maximisation perspective as a traditional vc fund and maybe not just financially, but maybe that's actually better for the economy and community overall. What do you think? Doesn't that sound brilliant? So how would we maybe go about doing that? Maybe we could use things like blended finance and to cut through the jargon they're blended finance normally means public and private financing coming together, um, maybe on the same terms, which is called Perry, but oftentimes on public funding coming in as a concessionary are subsidized position in order to leverage private capital m or risk risk, capital oriented positions on top of that. Put that aside, but use the same idea of blended finance.
Speaker 5: 00:27:39 What if we could provide some debt financing? And on top of that, provide a lawyer a royalty. And on top of that provides an equity kicker. So three types of financing. One is a very stable sort of cashflow based on an asset debt. One is based on cash flow from top line revenue for royalty and one is based a more traditional vc, which is equity you're buying, you're buying a piece of the company in order to hopefully see that company size grow and grow and grow, and then our position grows. Three types of capital could be used in theory to fund the company. That same amount that you'd find a via equity and those capital flows all work differently. They all have different risk return profiles. They provide liquidity at different rates and you can actually return your 15 to 20 percent or whatever it is you're targeting based on how you structure that deal.
Speaker 5: 00:28:32 The traditional vc, if you actually look at benchmarks, we're seeing that the top decile, the top 10 percent of funds of vc funds perform extremely well. The next, the medium sort of 50 percent of funds don't perform that well. An eight percent return is a really good return. An eight percent return is not what they're targeting. They're targeting a 20 to 30 percent internal rate of return net of fees to their investors than most funds don't actually return that. So what I'm saying is can you structure something that gets an eight to 12 percent return that isn't based on an equity deal, which is waiting for some sort of future market liquidity, liquidity event that may or may not happen that you don't have control of? Yes, you can probably structure this through blended finance arrangement or, or, and even not just using a royalty or something else.
Speaker 5: 00:29:23 So that's one answer. There's a different way to structure things that can return just as well, if not better, with more downside protection than the old vc model. The next thing I want to say is, and thanks for letting me elaborate on this, many companies aren't actually vc backable because they're not assumed to the moon rocket ship hockey stick growth model. Meaning you know, as long as we get $2,000,000 of injected capital right now, we're going to grow or annual, our rate of revenue to $3,000,000 this year and then 10 million next. Soon we'll be at the moon. Many companies have lots of HR requirements. Inventory requirements may still have bricks and mortar, um, elements to them that doesn't make them a bad business model, but it does mean that there's more friction in the model and therefore their operating expenses, uh, their Sgna, maybe even their, their gross margin, uh, aren't as clean as a, a frictionless piece of software that is highly sticky.
Speaker 5: 00:30:27 And so the seas will not necessarily look at that because they won't make the fun. But nevertheless you have a highly profitable business that is looking for funding and that's a missed opportunity. So you have those kinds of companies sitting there that are not getting capital from the side equity and aren't necessarily ready for the super risk averse debt side coming from financial institutions or a bdc or something like that. So there is a pool of companies that are, that are just waiting kind of organically growing slowly but could use an injection of capital to help really grow. And the last thing I'll say that's part two, the last thing I'll say is then for overall economic development and community development, our model, and this is not something that we've developed on our own, this is based on many other organizations using this model is a growing model.
Speaker 5: 00:31:18 If more companies survive, which a lot of them die, of course when you're talking about one fund maker or to fund makers in a traditional vc model, you're essentially saying the eight losers, we don't care about you. We need to back the one or two winning horses or jockeys or whatever, whatever you want to describe the winters as maybe eight out of 10 is a better number or 10 out of 10 is a better number. I'm not saying you know, everyone's a winner, but maybe maybe that's actually better for economic development overall in a collaborative abundance mindset is better than a competitive scarcity mindset. And this is really where the patriarchal system in my mind comes up. Um, and where some power dynamics are at play. Maybe that's not the best for community and for economic development overall. Maybe a bit more of A. I'm a slower growth pattern.
Speaker 5: 00:32:08 Makes a lot of sentence. That's part three. The very last thing I'll say is that, um, when thinking about marginalized populations, the businesses that they build, and this is a generalization, but this was based on a lot of research that we did our grand challenges Canada, which is focused on global health solutions, both products and services and emerging markets. We found that there were a lot of women involved. We found that a lot of marginalized populations were involved as founders. Many of them would build, I would say a service oriented business or businesses that were more integrated into the supply chain than their white male counterpart, ex pat counterparts who were often more focused on building the shiny, sexy product at the end of the valley chain. So the, the question that's the question that I'm asking that we asked is how does this tie to community development or economic development overall?
Speaker 5: 00:33:06 If these companies are actually more integrated into a value chain, these companies are actually more connected to their customers and their communities. They're probably serving those communities and driving economic development growth better than just a product or service that could be developed. So we're taking that thesis here into Canada as well, saying, you know, based on the resource that we have a lot of marginalized populations, founders of marginalized populations are doing similar work and we're testing that right now. So that's the fourth and last element of my answer to you on how to better structure for different types of businesses that are serving different populations with different products and services.
Speaker 4: 00:33:45 That's fantastic. Again, I'm left at a point if I've got a lot I want to ask you about all of that and I'm sure I'm not going to get to all of it. Can you maybe one thing also to tease out, it sounds to me when you were sort of talking about the different ways that you know, three different ways you can structure an investment and going for kind of singles and doubles with a higher probability of success and a lower rate of return is, you know, more attractive overall from a variety of perspectives. Is, is it the case then that like the argument is the types of the way that you're structuring financing in and of itself is helping. It's more favorable to the business and so that is one, one way in which you're going to mitigating the risk and so increasing the likelihood that you're actually getting on base to begin with and not striking out is that fair?
Speaker 5: 00:34:37 So we're certainly lowering the cost of capital provided, uh, an example where we be theoretically structured three types of financing onto, on top of each other. So obviously the debt and the royalty lowers the cost of capital from pure, a pure equity play, which is pretty darn expensive so that the debt is tied to a balance sheet. So it's really disconnected from the actual wellbeing of company. If there's a nice asset though that our inventory or something that you can lean against, it's a nice predictable type of financing to provide the royalty really rides the company's wellbeing very well. And that's really a really strong alignment with, with founders. That doesn't have to be cheap though. You know, you can still, if you sort of calculate this to a, an irr equivalent or a timeline equivalent sort of approach that doesn't have to be cheap capital, but the good news is you're not waiting for some external market events, um, that you can't to liquidate your position and exited that.
Speaker 5: 00:35:40 You've kind of structured that in. And so there is unfavorability there. I'm on the other side of the market as an investor, as a VC, you're providing liquidity to investors who, if they're Canadian are probably risk averse and conservative and if their foundations or you know, sort of dipping their toes into the water of the space and you're providing them with something that's really comforting, which is liquidity. And of course you can still do that. Um, nutritional, traditional fund model. Because I would say that there is much, much greater sense of alignment. It's lower cost of capital and if you think that the deal is going really, really well, you could provide a small kicker on top an equity kicker where you own just a fraction of the company that you can kind of hang onto if the, if the company does really well. So I hope that answers your question.
Speaker 5: 00:36:29 Think the ultimate question is what allows you to get on base at a higher rate than a traditional vc where they're making these investments and they're expecting nine and attend to fail because the, you know, the one they hit. Yeah, sorry. Yeah, I think it really comes down to this is called um, a obese vc backup model. You know, they'll, they'll calculate um, what they need to hit when they're exiting, um, before they even do a deal. And this is kind of what I did when I was talking about, you know, you come in at a company and a VCR, see if they're coming in at a series a round, we'll own 20. They'll want to target that round. They'll want to own 25 to 30 percent of the company. That's super standard. They want a sizeable chunk, a minority stake, but a really big minority stake so that as they get diluted because there's only going to be able to follow on with the pro rata round once probably, and then they're dry, they want, they're going to get diluted so they're gonna have to make sure that they own a sizeable chunk after dilution in order to return the fund, so to speak, and so they're tossing away thousands of thousands of deals.
Speaker 5: 00:37:38 That may be completely viable because if calculated that that those deals can't return the fund. The market size isn't big enough or the company can't grow into the market fast enough for a seven year exit and so they're throwing all of these deals away. But when you think about a royalty, let's think of a normal normally royalties, we'll look at a three or four x, so if I throw in $1, I want three or four back and I'll traditionally structure it to be a seven to eight year period that I think that the money will be returned. If you calculate the irr on that deal, that's traditional vcs sort of return land, that deal never has to have a billion dollar exit. It just needs to return my money, you know, very selfishly if I feel that it's going to grow top line so that I can get my four x back and its an investible deal. So that opens up a ton of opportunities for me to look at as a funder that have been passed up by the traditional equity options weren't vc type investors. Got It. Yep. There's another point I wanted to touch
Speaker 4: 00:38:36 on. I wasn't a major one, but I was curious about it. You, you were sort of talking about this abundance versus scarcity mindset and you kind of mentioned it sort of the traditional patriarchal, I guess vc land where it's this sort of competitive, you know, we're looking for the one home run and let everything else fail and that's fine. And I'm curious, do you think that there is something inherently, man, I'm thinking about some very personal anecdotes that kind of relate to this and I'm wondering if you was intended with your comment. Do you think that there's something about traditional patriarchal structures that is more geared towards a scarcity mindset of this zero sum game
Speaker 5: 00:39:16 type of mentality? Yeah, absolutely. Yeah. If you want me to elaborate, but absolutely that wasn't. That was intended with the comment. Yeah, I'd love to. I'd love to hear your thoughts on that. So let's focus on the, on, on financing though, because I think I could really go off on a tangent here, but think about, think about a vcs portfolio where most often he and he having gone to a set number of schools, um, with a certain number of degrees or types of degrees, is investing in a number of companies that he understands that many times the founders look like him and often is, are solving problems that he wants solved or can relate to. You're starting to really have a ton of biases there. So that's, that's an obvious point. And so you start looking at the. Let's say you look at the thousand deals you look at per annum and you know you say we can only do one company, company and enterprise fintech focusing on small to medium enterprise, solving this middle office function, blah, blah, blah, blah, blah.
Speaker 5: 00:40:31 You start to categorize categories, categories, and we can only pick one of those and I guess what my fundamental question is why can you only pick one in that category? Is there no way that the other 50 companies in that category could somehow collaborate to build these stronger market? Maybe not in all cases, but probably in some. The fact that it's essentially never asked within the traditional vc landscape is in Libya. Question Mark and that's the big question that we see. Is there not a way for you to back several companies that are doing very similar things so that they could potentially partner? You see this and accelerators and incubators. You don't see this in very many portfolios of course, other vcs portfolio and you certainly often see portfolios as opposed to communities. Now, I know in the past few years vcs have been talking about their communities much more.
Speaker 5: 00:41:24 They've actually hired community managers to work with these portfolio companies, but the amount that these portfolios actually beyond just, you know, here's my best practices, here's a hiring trip tip that actually collaborate in terms of contracts, procurements, distribution, whatever it might be, is very limited. And so this is the, this is that mindset that I'm, that I'm thinking about the vc model as it currently exists, sort of forces that on us, I think, and this is where I think we can still use, we can use existing systems both financially and legal, um, that exist to still change enough of the financial system and enough of these call load enough of these biases, um, or almost dogmatic practices and questioned them. I don't know if we're right, but questioning them and challenging them and trying something new is, is what we're trying to do at marigold's. So those are the ways we could go. That was A. David, you asked a really large question, but with respect to vc financed, that's what I wanted to speak to around the patriarchal system or biases.
Speaker 4: 00:42:32 I can talk to you about this stuff all day. So I'm going to try to also avoid the temptation to really dive more broadly into that. That question, I mean I don't know if there's an attendant, I mean anecdotally, and this may just be a unique thing to me in my, my wife, but my wife interestingly just enjoys like there's whole categories of board games for instance, that are collaborative in nature where the you're, you're sort of playing together to win as a group against the sort of the rules of the game and not against each other. And that's a whole category didn't even know existed. I'm sort of, I like competition in particular when it comes to trivial things like board games and sports and that more than she is and maybe that's just a function of, of us as individuals and not our, our gender, but I couldn't help but think about that when we started thinking about sort of this abundance versus scarcity mindset.
Speaker 4: 00:43:22 I'm also aware of increasingly aware of how, how much. I don't want to be too melodramatic about it, but how much brainwashing there is or at least limited thought that happens or very narrow scope. A narrow view of the world when you come up through the traditional, you know, funds through traditional financial education. I kind of did an MBA and CFA and you're just sort of went through the traditional investment world where you just are taught investing is a zero sum game and that that purpose and profit can, you know, that if you're going to do the right thing, that that's obviously going to come at a cost and um, you know, you can't, you can't generate the same types of returns and do something that's good for the world at the same time. And there's a lot of these sort of assumptions that you don't question and you realize one day, right. I did anyways. Right. Wait a minute, why is that the case where it was that ever written that that's just the truth, a universal truth. And I think that's what you're sort of getting at here. Is this a traditional vc models like, wait, wait a minute. Why is that? Is that the only way? Is that, that even the best way. And so I, I really appreciate this because I have. This is an area that is not my background and I've never sort of heard
Speaker 5: 00:44:32 described in the terms that you're, you're talking about it. So I think it's amazing that you as an inspiring, aspiring investor go to the ground and actually talk to a founder, um, you know, rural, emerging market, true base of the pyramid is the best case, um, in my experience. But you know, just seeing something on the ground with your own eyes, for a running numbers and you know, reviewing a deck or whatever it is you're reviewing, running best due diligence. It's eyeopening right? You, you, you smelling something, touching something is so much more powerful than just writing numbers at your desk and say, I'm agreeing with everything you're saying because the, the idea that you have a such a, you have blinders on at your desk, you're comfortable with everything there. You know exactly where your water bottle sits, all of this, all this crap and you're then thrown into unfamiliar territory or uncomfortable waters or whatever it might be.
Speaker 5: 00:45:36 And you know, you now have the chance to experience something. And I think that's the key word experience. And experience means eyeopening, eyeopening to me, and this is what I'm hearing with you say as well meant no longer having to think about. And this is me again, looking back and connecting the dots, me hating capitalism. So strong word, but I would probably say in my angry early twenties, it was pretty close to that, uh, you know, is ignorant and angry, but I'm not sure what to do with capitalism. To think that, you know, I had to volunteer and be on the grassroots and, and, and, and instead of thinking about how to actually use capitalists, use finance as a power for good. And that idea is the, the one pocket thinking, right? You don't have to slay the lay at a job you hate during the week in order to then volunteer your time on the weekend or cut a donation on the weekend.
Speaker 5: 00:46:30 There are ways, and this is what impact investing at its best sense is trying to achieve. There are ways to do those two things, make some money, feel good work, whatever. I'm simultaneously and, and I, and all I'm trying to get at is that experiential, um, light bulb flash or you know, the fall of the apple or whatever it might be I think is the best and most powerful way that many people sort of a kind of clue into the power of, of impact investing writ large. So that was a really aside sort of tangent. But anyway, I wanted to comment on, on you on yours because I really feel that I got it once I actually talked to entrepreneurs on the ground. That's really interesting. So just to sort of move back a little bit right now as you've, you've raised some money and still raising money for I guess you said you're sort of soft launching it. You're starting to make investments, you made investments and talk a little bit about kind of how you're kind of coming up with deal flow and Canadian businesses. Just maybe talk a little bit more about.
Speaker 5: 00:47:40 So no deal's done as a, what are we today? We're October 15th, October 15th. We are looking to make three by the end of this calendar year and two by the end of November. So we are certainly, I'm circling in on a number of great opportunities. They are all Canadian right now. They are all women founders. They're all tackling issues that impact marginalized populations with the. We are seeing two pieces of software. We're seeing one in sustainable fashion. We're seeing a couple in media and that'll tell you about. And they, they're all at sort of series of pre series a seed rounds, meaning, you know, they've had friends and family and angel money in the past. This is their first sort of foray into institutional, uh, raising. So they're all, none of them are profitable, but they're all revenue generating as well. What's really interesting is our deal flow. Of course we're getting deal flow from other investors.
Speaker 5: 00:48:44 But you know, what's most interesting is if you see that comment I made earlier about financing underrepresented, underrepresented undercapitalized founders, you know, they all talk with one another. This is the fascinating point. We're not going to universities or ngos or a ton of these C's and finding deal flow as as many would suspect. We're not going to conferences and findings, we're doing all of those things, but we're actually. Our best deal flow is coming from business networks, entrepreneur networks because the underrepresented all are supporting one another and themselves. And so this is a really, this is not proprietary in any way and you know, any, any investor will say we'll have, we have proprietary deal flow. This is not proprietary, but this just goes to speak to how untapped just this entrepreneur's segment is. So the number of folks that have had decent conversations with us and then introduced us to their other entrepreneur friends.
Speaker 5: 00:49:44 I can't name the number. So this is, this is how we're finding a lot of the deal flow right now. I'm not, not to say that, that, that, um, source of pipeline won't dry up, but right now there's no one in Canada offering a product like this. And so we've had a really strong response from entrepreneurs and we've not even announced that we're officially open for business yet. So all that to say why I'm, I tell you a little bit more about the companies. We've got a couple of media companies and if you know anything about media, you know that media is going to a much more community driven, locally oriented approach that is developed in part with communities. And so the voice of marginalized populations has a much stronger possibility of coming through. Um, we understand the membership and subscription models much better now since we've seen how a number of paywalls work.
Speaker 5: 00:50:37 And so we're seeing a strong market trend to growth and towards this community of hyperlocal model. So we've got a couple of organizations that we're looking at there. We've got sustainable fashion of course is a really big issue. We from both an environmental as well as from a social perspective. And so we've got a couple of deals we're looking at where founders are designing and then manufacturing offsite and importing and they're doing so in more environmentally responsible ways. They're looking at getting rid of tackling fast fashion, um, by developing different kinds of products that are more biodegradable, of course, um, and that have a longer shelf life. So you're actually slowing the consumption habits and that are working on re, what's the word I'm looking for? Procurement Practices to actually at end of life of product, um, take on the products and, and dispose of them properly.
Speaker 5: 00:51:34 So we've got a couple of companies there that's a huge market as you're, you're likely aware. Um, and then there's a couple of companies that we're looking at, I'll tell you about one that is looking at some working on diversity and inclusion within the workplace. So this Kinda connects to employee engagement, but it also looks at um, wages and um, responsibilities within an organization. And there's a couple of organizations working on software as well as consulting arrangements to better equip companies to have their internal organization represent what's actually outside. I'm in the country of Canada or US or wherever we're looking. So there's been no shortage of really interesting deals that we've been looking at thus far, but we're always open to hearing about more about. Those were Rad. Stay tuned for, I guess end of November when we're looking to announce our first two. That's awesome. Very cool. Exciting time for you as well then to be that close to being.
Speaker 5: 00:52:32 Yeah, absolutely. And these are, you know, these are demonstrative of the rest of the funds, so they play a really important role for us. You know, we're working on one other thing, David, if I can talk about it. We are working on something called a new power investing forum, which is November seventh, which is just the, the morning of the Social Finance Forum, uh, here in Toronto as well as the same day as move the dial from it's taking place here in Toronto. And this is something that really has been on our mind for a really long time. We increasingly in the impact investing space, having more and more screens or tools or frameworks to analyze environmental risks or, you know, close to us, um, uh, gender risks. And so we have more and more of these tools, uh, evaluate companies how to evaluate companies. I'm sorry. And, and we think that's a great step in the right direction.
Speaker 5: 00:53:27 What we're really interested in is Simon Sinek, start with why, why, how, and then finally what, you know, the tools that I just mentioned, uh, help you better analyze the, what doesn't necessarily speak to the why or the how or the WHO. And those three pieces are most often internal to the funding organization. And so long story short, we're bringing together a bunch of funders, both public and private, small and large, for profit and nonprofit to talk about the WHO, the how and the why they fund and how decisions are made, the deals that they structure and why the informal versus formal decision making processes, the management team, the boards, the investment in these, all the various people involved in all the processes involved in order to think about how best to use finance as a tool for social change. A screen is only as good as those who are using it.
Speaker 5: 00:54:28 And so if we don't actually think about who and how and why we're not actually using those tools to our, our, our best, I'm the best possibilities or best possible outcomes. So this event is trying to bring people together, um, all, all different types of funders to talk about these practices in order to share challenges but also best practices regardless of their thesis, regardless of their mandate in order to better represent society writ large, um, since we know funding across the spectrum has some, some room to improve, of course. And the idea here of course is we're trying all of the stuff out at marigold and marigold is a bit of a demonstration for what we're talking about this event. But we're also thinking that this is an opportunity for vcs, for foundations, for family offices, for nonprofits to start talking about this. And then incorporating some of these practices themselves in order to essentially to walk the walk the talk.
Speaker 5: 00:55:25 So that event is on November 17th. We've got a report that's going to come out. I'm highlighting the outcomes of that event as well as the signals report that discusses what's next. So I want it to call that out because that's essentially the same time we're starting our fundraising and we think that that community building, that network building event won't be a one off. It can actually grow to something as powerful if not more powerful than the fund to our own fund itself. So that's really cool. Is that to sort of open for people that are listening are interested in something that isn't an open event and can you give people information about it? If it is, yeah, it's on our website right now. So you can. The new power of investing for them NPI forum is the way it's listed on our website. You can see who the speakers are in the facilitators, you can see that the participants are. We updated every couple of days so it is open to. It is open to to funders. We are trying bring funders in. A center is essentially a cone of silence or Chatham House rules to discuss, but we also want to bring some public in to see what some of the funders are actually up to when we think this is a really powerful concept. And we hope we're right with that idea. So take a look on the website, NPI forum, new power investing for them and all the details are there.
Speaker 4: 00:56:44 That's great. And for everybody listening, it's www miracle-capital.com. Yes. That's really good. I should have said that. Fascinating. I have a couple more questions. We'll aim to wrap it up because I don't want to keep you too long here, but can you just to switch gears for a second, um, or as we transition over here, are there other players in the impact investment space that you either mean I am not going to be too prescriptive about this, but are there other impact investments that you've made personally that you think are really cool and there's organizations doing a really great thing, other impact investors, vcs that you really respect, you can sort of take that any direction you want.
Speaker 5: 00:57:28 Yeah. So the, the first shout out would be to Serona Gearhart, priests, and Sarah's liver show saul at Serona. They took a chance on me to be quite honest. I was pretty versed with micro finance. Um, when, when they hired me, I was pretty good at doing some basic, you know, communications and marketing, but I hadn't cut a deal before and they took a chance on me and they really, really taught me so much of what I know they are leaders in the space. Um, they're extremely humble. They're extremely dedicated, passionate, and when and, and full of integrity. So when, when I think about the Canadian landscape, you know, I can't say it starts or ends with them, but for me both personally and professionally, they hold a very, very dear spot and one of the biggest, one of the biggest things is I take away from that experiences.
Speaker 5: 00:58:23 We often got the comment that, you know, people thought we were a 12 person shop when we were three or four. The scene. So institutionalized. We punched so much above our weight and I've always taken that with me to any other organization, you know, having such a policies and procedures document, I'm having amazing communication. Really putting that effort to make a relationship with everybody there. There was some tremendous learning there. So they aren't the only ones. I'll give you a few more, but I learned a ton from those guys at Serona. I invested in one and I call out one more and I'll call her tomorrow. So. And there won't be any surprises here. So when I was at RBC, we, we were investing in both funds, so in direct investing as well as direct investing into companies and so I'll call it an indirect deal.
Speaker 5: 00:59:15 We invested in I think renewal to at the time. Renewal of course is based in Vancouver and the team at the time that I knew was Joel Solomon and Paul Richardson, Nicola Bradbury and Kate's story were also there and so their passion, integrity, their focus on on impact was all there. That they were also so focused on making deals work from a financial perspective, from my market building perspective, from a strategic sense in terms of the support they provided to entrepreneurs. The with that deal, I learned that there are times when acting like a, being a traditional vc, not just acting like one, but actually being a traditional vc makes a ton of sense that there are, there is no reason to sacrifice necessarily any financial or business managerial discipline just because this is the impact space. Now, not saying that that didn't, that wasn't the case at Serona, but I really took that to heart with the renewal, the renewal renewal team.
Speaker 5: 01:00:24 So that was a really great lesson learned that I had a chance to learn. They're, the last is um, again, a really common name in the space and I think he was on your podcast when I was at RBC. The very first deal I did was actually with Liat Gallus while she was at social capital partners. And social capital partners is founded by bill young. So the very first deal I did well with RBC was with bill young and Leah. And the idea was a really interesting one. We, we at RBC bought a portion of its loan portfolio and this is that loan portfolio that was financing, you know, the Mr Lubes and the active green and rosses and some restaurants and things like that and providing that loan where the rate would actually go down based on the number of community hires. Um, so really, really interesting piece of financing and the idea was to buy that portfolio or piece of it and then see if we could get other business units within the bank interested in some of the loan products and the structures that set was offering to actually act as like a junior lender take on a bit more risk to some of the more senior lenders within the bank.
Speaker 5: 01:01:33 So the idea was to bring an innovative product into a really traditional financial institutions. So, uh, and I don't know if you've heard any of that story from bill young or anyone else sep, but the idea here, which was fine, it was fascinating, was the Trojan horse, if you will, of making a really solid deal. It was, you know, to be honest, I went to, I want to declare anything confidential. There's a very strong deal, no one would get upset at RBC for the deal that I made, but that wasn't the end. The idea was actually to get business units involved beyond the social finance unit at, at RBC because we made such a compelling offer to them as well. And so that's the strategic, the forward strategic mindset to always be thinking of the next thing. Even when you're still working on the thing.
Speaker 5: 01:02:25 Prior to that, you know, thinking about policy, thinking about government, every player coming together, a bill young really opened my eyes to thinking about the future in a, in a far more expanded strategic sense than I was used to. And so that was another piece that I really learned. So, you know, I can't put all of those, those comments together, but I would say that being agile and being extremely strategically, also being extremely tactical and technical risk, one of the biggest pieces I guess I, you know, through everyone would aggregate as some of the biggest lessons learned. So those are the three that I'd call out for now. No surprises of course, but those are my takes on almost daily.
Speaker 4: 01:03:08 That's really, that's really cool. I love that. That's kind of comes full circle on that, you know, that conversation I had with, uh, with bill and our first episode where he did talk about that as really some of what he thought was some of the best work he's ever done. I'm so real cool. You also mentioned liat who, I guess, did you overlap with her at grand challenges?
Speaker 5: 01:03:30 Yeah. So Leah was my first hire at grandchild. Um, I, I stole her from Bill Young. Oh Wow. Very cool. He was my first. She was my first hire. Yeah. Sorry, go ahead.
Speaker 4: 01:03:45 No, no. It says it's funny, as we've kind of talked about right at the beginning of the, the ways in these interconnections between everybody in the industry. It's interesting to find those connections. So we'll, maybe, we'll wrap up just with one final question. I've asked still a lot of the guests and I sort of say it as like I kind of dream of the day in which, um, you know, my daughter grows up and it's just the case that, you know, purpose and profit are not seen as mutually exclusive that businesses understand that, you know, are their actual impact on the world at large is can't be ignored, that they can't pursue profit at the exclusion of every other impact that they have, that investors, you know, just view it as part of normal course of business that you, you can't make investments without regard for the impact that those investments have on the world at large and that, that will be obvious and commonplace. So my question to you then is do you think that that's a thing that will happen? And if so, sort of what type of timeframe would you. Would you would you guess?
Speaker 5: 01:04:48 Yeah. I was at one of the very first global impact investing network, Jen egms representing Serona. Think the first or the second one and we were talking amongst ourselves about intent in 20 years. Impact investing with low longer be a ghetto, but impact investing would be investing. And so that was what I was 2009 or something like that. So that's where essentially 10 years later, um, I don't think we're 10 years away, but we're, maybe we're pretty close. I would love to say that by 20, 30, you know, thinking about the Sdgs, we can actually say that all investments are impact investments are investments. The one thing, you know, the one thing that we know is I, I talked about this when I teach a class at the Schulich school of business and I often speak to other university students and uh, about the growing market in terms of uh, job opportunities in this space.
Speaker 5: 01:05:47 And I talk about being on the right side of history and I talk about young people being the ferry last generation that can either make the world a better place or a worse place. So the bet is that we know that we have to do something now and we assume that we're going to make the right decision to do something. So the only question is how long and so, you know, I want to be optimistic and the, let's say within the next 10 to 15 years. So let's just align with SDG timelines. We know that accounting standards changing, so from a very slowly, you know, from a top down perspective that all of the externalities that aren't included in on financial statements will be placed on the financial statements for public companies. We know that's going to be tried a couple of years and a couple of countries, so that's probably going to be commonplace within seven to 10 years.
Speaker 5: 01:06:39 We know that movements like b Corp or whatever other third party audit firms continue to grow. We know that provincially and statewise in North America, that's the tax systems and the legal systems are, are slowly changing. So I guess all points, you know, um, seem to be changing in our favor, um, political systems in, in United States a cause, some concern to be honest. So that's a big wrinkle. You mentioned your daughters. I have two daughters as well. Fortunate to be in Canada, but, uh, I'm, I'm wondering about, you know, what we see in the US is pendulum swings from a political sense and I don't want to talk politics too much, but we see pendulum swings and so I'm curious to see if anything like that comes in, in, into, into the federal system here in Canada. We've seen it of course in Ontario in the last election, so there's a lot of optimism on my part to be honest.
Speaker 5: 01:07:31 But I also want to say, you know, my position of privilege in my biases and say maybe things aren't going as well as I think, you know. Um, and if I look from a different Lens, maybe that's not so great. I'm going to stick with my answer of 10 to 12 years to cut it short. But I, and I hope I'm right. I really do. But the, some of the micro things that we're seeing the Misa cycle in the macro cycle, I think I'm right, but the Misa, the micro stuff that we're seeing, um, makes me pause. I really, I'm really not so certain them.
Speaker 4: 01:08:05 Yeah. I completely understand where you're coming from. A resonates a lot with me, so that's great. I appreciate it. And the interest too much further into even though I'd like to listen to this, I really appreciate you taking the time to, uh, to chat. Jonathan. This has been really interesting and I think will be insightful and eye opening for a lot of the listeners as well, I hope. Anyway, so thanks a lot for taking the time. I appreciate it. Yeah, thank you. It's my pleasure. It was great to talk with you and yeah, hopefully, hopefully some, some points were new and if old or challenging, you know, that's, that's great too. So thank you so much.
