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NWA Founders is a voice for Founders, Owners, and Builders driving growth in Northwest Arkansas, and is hosted by Cameron Clark and Nick Beyer.
'NWA Founders' is a voice for Founders, Owners, and Builders driving growth in Northwest Arkansas, hosted by Cameron Clark and Nick Beyer.
To recommend a guest or ask questions, reach out at nwafounders@gmail.com and follow us on YouTube and LinkedIn for video content.
[00:00:00] Brad Henry: There's a lot of families in Arkansas that have helped build all the great things that we have. We shouldn't have to go to other places to get the capital and they should be able to take advantage of what's going on,
[00:00:12] Cameron Clark: keep the resources here,
[00:00:14] Brad Henry: you know, workforce and affordable housing for folks in the region.
[00:00:17] Brad Henry: It's getting harder and harder to mm-hmm. To find that,
[00:00:19] Cameron Clark: I
mean, it's a sensitive issue in the fact that like someone who is here, it's different than someone who's in LA or New York or Dallas.
[00:00:26] Brad Henry: Absolutely.
You may not be able to answer this question, but when you look at the funds, is there a heavy allocation towards real estate?
10% of our is, is company focused. The other nineties real estate, or
[00:00:36] Brad Henry: the best case study that we have is he wanted a capital partner to kind of help take to the next level. That was three years ago.
How much. Of the outside Capital N. Uc in 2026.
[00:00:50] Brad Henry: Yeah. Um.[00:01:00]
[00:01:03] Cameron Clark: Afternoon, Brad, thank you for coming on here with Nick and I.
[00:01:06] Brad Henry: Yeah. Happy to be here and thanks for having me.
[00:01:08] Cameron Clark: So, natural capital, give us kind of a high level for those who aren't aware, um, you know, maybe who're not in the financial space Sure. At all. What, what y'all do. Um, yeah, what do you do?
[00:01:21] Brad Henry: Yeah, so we are a relationship driven private investment firm.
[00:01:25] Brad Henry: We have, uh, offices here in Fayetteville, Bentonville, and Little Rock. Um, and we invest in what a private investment firm means is we invest in real estate, uh, primarily here in northwest Arkansas. So, um, housing, office space, medical office and industrial space.
Mm-hmm.
[00:01:47] Brad Henry: Uh, we would own that. And, um, and then.
[00:01:52] Brad Henry: On the company side, we primarily partner with founders, um, and, um, [00:02:00] invest in their business, privately held companies. That's what a private investment firm does. Mm-hmm. So, um, and, uh, we've been doing it now for almost seven years.
[00:02:09] Nick Beyer: And the structure, it's a fund structure, correct? That's
[00:02:11] Brad Henry: right.
[00:02:12] Nick Beyer: And so you raise the fund, deploy the capital, raise The next one.
[00:02:15] Nick Beyer: Is the goal to get capital back from the current fund before we start raising for the next one? How, how does this work for someone who's not not familiar with the
[00:02:23] Brad Henry: Yes. So, uh, we're a, we, when we set out we wanted to be a platform for investors, primarily here in northwest, in Arkansas and northwest Arkansas.
[00:02:36] Brad Henry: Um, to be able to participate in private markets, private investment.
[00:02:40] Nick Beyer: Yep.
[00:02:40] Brad Henry: Um, it is. It can be difficult for, um, for people to access or find those investments. They're private by nature, right? Yeah. And so what we do is we raise a fund, it's a pool of capital from investors. Most of them local here in northwest [00:03:00] Arkansas.
[00:03:00] Brad Henry: Uh, primarily families and, uh, family offices and, and individuals. And then once we've raised that capital, we go deploy it. We go make investments, um, both here in Arkansas and Northwest Arkansas and throughout the Heartland region. Yeah. Um, and so then once those investments are made, we manage those and when we feel it's appropriate, we will exit those.
[00:03:27] Brad Henry: Mm-hmm. And, um, along the way, there's cashflow that's, um, uh. You know, that is generated by those investments, we'll send that capital back to the investors. Uh, and then when we have exits as well, we will send that capital back to investors. The idea being that, you know, they're putting a dollar in and hopefully they get more than a dollar back.
[00:03:49] Nick Beyer: Sure.
[00:03:49] Brad Henry: Uh, over the portfolio or over, call it, 12 to 14 investments that we might have in a, in a single fund.
[00:03:56] Nick Beyer: Yeah.
[00:03:56] Brad Henry: Um, and so you can think about a fund, almost [00:04:00] like its own company where, uh, it has a, um, a lifespan and so we're looking to. Acquire, manage, exit over a period of time. Uh, usually call it five to 10 years is how long we might hold an investment.
[00:04:20] Nick Beyer: And which fund are you on now?
[00:04:21] Brad Henry: So we are, uh, we've raised two funds. Um, fund one was, uh, we started in 2019.
[00:04:32] Nick Beyer: Yep.
[00:04:32] Brad Henry: And we are still actively managing assets within that fund. And then fund two, we, man, we launched in, um, 2022. Mm-hmm. And we're actively managing assets in that fund as well. Uh, both funds, um, have had, uh, exits recently.
[00:04:56] Nick Beyer: Yeah. And, and good exits too. I mean, it's like, what? I mean, I think I, I think the, [00:05:00] it's, it's been for people who are not in this world, I think from a really interesting thing, from my perspective, is. You know, you, you want to have a firsthand on and be an active participant in the appreciation in the market here and, and whether it be real estate or business related, I think for people don't understand, it's like a, the ability, the, your offering, giving different people in offices, the ability to invest in these things is really unique.
[00:05:31] Nick Beyer: Um, and was, I mean, was anyone doing it at the same scale that y'all are right now?
[00:05:36] Brad Henry: Yeah. So
[00:05:37] Nick Beyer: locally,
[00:05:37] Brad Henry: yeah. So private investing as a, for private firms historically in Arkansas has been. Minimal, or in some cases non-existent. Um, it's always been the large families that everyone knows about that, um, has driven private investing in the state, and we're very happy that they've been [00:06:00] willing and able to do that over the years, um, because of all the good things that they've, they've driven through that.
[00:06:06] Brad Henry: Um, but they typically invest their own capital. Yeah. They don't pool capital or, or raise capital from others. And so. We saw an opportunity where we could be that platform for families. There are others in the state, you know, a couple that do that. Um, but they have different strategies
[00:06:26] Nick Beyer: Sure.
[00:06:27] Brad Henry: Than, than we do.
[00:06:28] Brad Henry: And so, uh, so that, and because of our different strategies, we can be, um, friendly with them and Yeah. And, uh, where it's not competitive. Same with the, with the, uh, large families where, um, we can all be, um, you know, looking for opportunities here in Arkansas and their region and in some cases be collaborative and in others, um, you know, share that information, but not necessarily, you know, partner [00:07:00] on a transaction.
[00:07:00] Brad Henry: Yeah. So it's, um, so it is still a relatively small, um. Uh, industry. Yeah. In Arkansas, obviously not throughout the country, right? Mm-hmm. I mean, there are firms like ours in all the major metropolitan areas. Sure. That, um, um, and where we saw the opportunity is people here, whether it be, um, on the investment side, people seeking investment or on the investor side looking to deploy capital.
[00:07:34] Brad Henry: There's a local offering
[00:07:35] Nick Beyer: Yeah.
[00:07:36] Brad Henry: Um, that, um, that they can take advantage of if that's something that, that interests them.
[00:07:41] Nick Beyer: And what was the spark inside you that made you want to go to do this? I mean, obviously we've talked to a few of your partners now on, on the podcast, but primarily about their other businesses.
[00:07:52] Nick Beyer: Sure. Um, and we haven't, you know, really gotten to like, dive into the full natural capital story, but what, why did you do this?
[00:07:59] Brad Henry: Yeah. [00:08:00] So, um. My partners are Marshall Saviors, Todd Simmons and Brock Gerhardt, uh, the founding partners, other two partners are Rob Kimball and, and Ben Herberger. And, um, you know, the idea for natural capital really came from Marshall and Brock, so, um, their businesses, right, Marshall's businesses, Cushman Wakefield, Sage Partners, real estate brokerage and leasing firm.
[00:08:26] Brad Henry: Um, as Marshall will say, they had as much money trying to come in the door as they had going out, really more coming in the door than they had going out. And there really wasn't a way for them to aggregate that or put that together where people were asking him, how do I invest in real estate?
[00:08:40] Nick Beyer: Yes.
[00:08:40] Brad Henry: And, um, and then Brock as a, with Greenwood Gearhart as an investment advisor, similar, his clients were asking him how, how do I participate in private markets?
[00:08:51] Brad Henry: Right. I want some diversification other than the public markets. Mm-hmm. Um, neither Green Mcg, Gerhart nor Sage are set up to really do what we do [00:09:00] in house.
[00:09:01] Nick Beyer: Yep.
[00:09:01] Brad Henry: And Marshal and Brock are busy running their
[00:09:04] Nick Beyer: Yeah.
[00:09:04] Brad Henry: Their businesses. Their businesses. And, um, and so I've known Marshall, um, since the eighth grade.
[00:09:14] Brad Henry: Um,
[00:09:15] Nick Beyer: both grew up in Little Rock,
[00:09:16] Brad Henry: both grew up in Little Rock. Um, I've known his wife Beth since kindergarten. Um, so there's a lot of trust there. And, um, before Natural Capital, I was managing, uh, an investment fund for the state of Arkansas, an economic development, lending and investment fund for the state of Arkansas.
[00:09:35] Brad Henry: And, um, you know, that was great and it was, uh, a great place to, to learn. It was very fulfilling to be able to, to have a hand in growth throughout the state Right. From Little Rock originally. Sure. From, you know, went to Hendricks and then the U of A. So I'm an Arkansas guy through and through, um, and an Arkansas family.
[00:09:56] Brad Henry: Through and through. And so Marshall and [00:10:00] I were catching up, you know, normally we catch up about, uh, kids and the hogs or whatever else, and all of a sudden he starts asking questions about, you know, am I happy I'm doing what I'm doing? And, you know, it just kind of, it was a different type of conversation.
[00:10:16] Nick Beyer: Yeah.
[00:10:16] Brad Henry: And so then a couple weeks later. Uh, I was with Brock and we've known each other for a long time, and um, that's when they started talking about the, this idea that ultimately became natural capital. And it was just really exciting to say, okay, well I'm doing this for the state, um, on behalf of the taxpayers essentially, and, and helping grow the state.
[00:10:40] Brad Henry: What if we went and did this for, um, for effectively our friends and family and close relationships and something that we could build ourselves to. Um, and Todd came along pretty quickly after that and um, they're obviously a big [00:11:00] northwest Arkansas focused family. They love the idea of being part of something where we kind of like, you know.
[00:11:07] Brad Henry: We can do this here just as well as, you know, having capital come in from outside.
[00:11:11] Nick Beyer: Yeah.
[00:11:12] Brad Henry: And so that's what we set out to do. And so we've been doing it for seven years.
[00:11:16] Nick Beyer: Yeah. I imagine that was somewhat of a driver. It's like seeing a lot of this outside money coming into the market.
[00:11:22] Brad Henry: That's right. And that, and really, you know, there's a lot of families, um, in Arkansas that have helped build, uh, all the great things that we have and we shouldn't have to go to other places to get the capital and they should be able to take advantage of what's going on.
[00:11:42] Brad Henry: Right. Keep the
[00:11:43] Nick Beyer: resources here.
[00:11:43] Brad Henry: That's right. Where they don't feel like they're shut out of, of what's going on. Um, and so that was a big driver for us too. Now, you know, we still, uh, wanna make money for our investors and so that may mean ultimately selling to. [00:12:00] A national or regional firm, but at that point we're all, we're all doing, um, it's a, it's a positive outcome for mm-hmm.
[00:12:07] Brad Henry: For everybody involved.
[00:12:08] Nick Beyer: Is that hard for you though, when you see, I mean, talk about like, like the office deal you just sold Sure. That, you know, I, I, you know, you can look on, on talk business and see what you bought it for, what you sold it for is like, Hey, we ended up being a great deal.
[00:12:23] Brad Henry: Yeah.
[00:12:24] Nick Beyer: Um, but something like that, it's like you, you also see kinda long term 10, 15, 20, 20 year view.
[00:12:31] Nick Beyer: Is there an internal conflict there?
[00:12:33] Brad Henry: There really has been, um, especially, um, as we've matured as a firm of, okay, how do we, how do we, you know, one of our core values is impact, right? And so we describe that as how we have an impact on the community and the region positively. And, you know, if. And of course the easy way to do that is to hold assets long term, [00:13:00] continue to reinvest in them and, and build them up along the way.
[00:13:04] Brad Henry: We also have to manage, uh, generating a return for our investors. And, um, and so that has been, uh, we try and balance it, right? I mean, ultimately we've got a job to do, a fiduciary responsibility to, to, to manage the capital as best we see fit. So we try and try and do both, um, where without one kind of, um, uh, really.
[00:13:33] Brad Henry: Overriding the other. Right. The North Pinnacle transaction, we actually sold that to a local group that will, uh, Orion Capital Partners. Mm-hmm. Uh, they were our, our partners in the original transaction. We owned half, they owned half. And, um, they were excited about the opportunity to own the whole thing and, you know, to be able to sell to a great steward of the asset mm-hmm.
[00:13:56] Brad Henry: That will continue to reinvest and, and [00:14:00] grow. It was perfect for us. Right. It generated a, a great return for, uh, it was the right time for us too, and so.
Are there ways that over time, since you guys have matured, that you've gotten more creative in the fund structure to be able to return capital to investors without necessarily selling maybe as much of
[00:14:20] Brad Henry: those investments?
Um,
[00:14:22] Brad Henry: I think we are very focused on, um, generating returns along the way before an exit and not relying solely on an exit. That's actually been a core tenant of the firms since we started it. Um, and so, you know, we've been able to, to do that and, and I think that, um, helps build trust with our investors where it's not just a return on a piece of paper, right.
[00:14:48] Brad Henry: They're actually seeing those returns along the way. Mm-hmm. And then of course the exits are nice because those are big pops.
[00:14:54] Nick Beyer: Yeah. Well, and talk about, so why real estate and, and companies?
[00:14:59] Brad Henry: [00:15:00] Yeah.
[00:15:00] Nick Beyer: I mean, and is that, is that for folks that don't know who aren't in this space, is that like an industry standard, you know, national industry standard?
[00:15:06] Nick Beyer: Or is this, Hey, we were just trying to get creative and kind of play both sides.
[00:15:10] Brad Henry: Yeah, so it's not industry standard because we invest in both asset classes out of a single fund. Um, most firms like ours are very, are not generalists. They're very, they have a very specific niche even within an industry. Of an industry.
[00:15:22] Brad Henry: Mm-hmm. Right. Like, um, we met a firm actually last night that, um, they're student housing investors in, you know, tier one markets with tier one big schools, right? Yeah. I mean, that narrow we're the opposite of that. Um, and that's driven by two main reasons. Um, if you look at the backgrounds of, of, of my, my partners.
[00:15:53] Brad Henry: Um, they're all varied and none of us come from traditional private equity. And, [00:16:00] um, and so if we only focused on a specific niche or a specific subset of an industry, and it's like, well, why would they be involved? Right? If it's, if it was real estate only, why would Todd be involved? Right. His background's in companies, same with me.
[00:16:15] Brad Henry: If it's, if it was a company only firm, why would Marshall and Rob be involved right there? Sure. And so, um, and so it really made sense to have a diversified portfolio. We're obviously regionally focused, which if you're regionally focused and, um, industry focused, that's, that's a tight, um, tight area to really, uh, try and find good opportunities.
[00:16:39] Brad Henry: Um, the other reason that we did it is we wanted to provide diversification for our investors so that. There's different characteristics to a real estate investment versus a company investment. Right. Um,
[00:16:53] Nick Beyer: what are they?
[00:16:53] Brad Henry: So traditional real estate, if we buy an asset, most likely it's gonna kick off some cash flow if it's a good [00:17:00] investment.
[00:17:00] Brad Henry: Mm-hmm. That can be distributed along the way. Whereas the companies that we invest in, they may be reinvesting for growth.
[00:17:07] Nick Beyer: Yep.
[00:17:07] Brad Henry: And so there might not be cash flow coming back. So while we wait for those, you know, those companies are, it's better off for them to reinvest, uh, that capital than return it, uh, because their return on investment is, um.
[00:17:23] Brad Henry: Is stronger. Mm-hmm. While we wait for that to mature, we've got cash flow along the way from, from real estate that allows us to make those distributions back to back to LPs.
[00:17:33] Nick Beyer: Sure. And on the company side, obviously with the real estate you have the cash flow from the asset and then the exit on the company side.
[00:17:40] Nick Beyer: Are you said you're just kind of waiting on the roll up to generally private equity or is that
[00:17:46] Brad Henry: Yeah, generally yes. We are not, um, we have a couple company investments that make distributions along the way, but generally they're all reinvesting for growth. And then our return will be based on whenever they exit, whether they sell to a strategic, you know, [00:18:00] larger company in their space or, um, you know, maybe they sell to a larger private investment or private equity firm.
[00:18:08] Brad Henry: Um, or theoretically they could go public too. Um, we generally play in the lower middle market, which is kind of two to 15 million of ebitda. And so, um, we, um. So it's less likely they go public, but that's also a, you know. Yeah. Theoretically. Yeah.
Walk us through, like for someone who's listening, who knows business, but they don't know private equity or Yeah.
Private investments. Walk us through, Hey, we have a fund open.
[00:18:38] Brad Henry: Yeah.
The minimum is investment is X amount. Here's what distributions could look like. I don't, are they monthly? Are they quarterly? Yeah. Are they annually? I'm sure it's different by fund. I mean, just walk us through for someone who isn't familiar with your space.
[00:18:51] Brad Henry: Yeah. Um, so I have to be a little careful. Um, we're a registered investment advisor, um, [00:19:00] which we're registered by the s sec. Were registered with the SEC Securities Exchange Commission. And they have very strict rules on what we can and can't say publicly. Sure. Okay. That looks like marketing to the public because there are, uh, specific rules around, uh, the, the type of investor that we can, um, market to or solicit to.
[00:19:25] Brad Henry: Um, and that's based around, uh, income and, and net worth. So I probably shouldn't answer. Okay. That question that directly. Um,
[00:19:36] Nick Beyer: is there an industry standard? Is there a blanket or is this, is it really based off of Okay. The type of investor you're going, you're, you're going
[00:19:44] Brad Henry: with? It's really, uh, every firm probably has a little bit different strategy.
[00:19:49] Brad Henry: Mm-hmm. Um, and so, you know, one we do focus on, um. Making distributions relatively early in the, in the fund's [00:20:00] lifecycle. Uh, other firms may, you know, it may be 5, 7, 10 years before they make distributions. And really that's based on their strategy. Usually they're trying to, uh, you know, hit grand slams or, you know, they might be investing, um, in a way that they're trying to, you know, um, you know, 10 x someone's money or, you know, have a hu you know, a very large multiple.
[00:20:28] Brad Henry: We're very much a kind of doubles type investing where, you know, firms like that may invest and they may be comfortable with zeros, right. Taking that level of risk, that kind of binary risk. But they know two or three of them are gonna pay back the whole mm-hmm. Whole fund. We'd rather be a little more conservative, um, where, you know, by and large our.
[00:20:51] Brad Henry: Kind of bear case or, you know, negative case scenarios. We're still getting our principal back. Sure. Right. Um, and then looking to, [00:21:00] you know, still, still kind of hit those doubles and, and you know, occasional triple is nice too, but, but not trying to, to, you know, necessarily knock it outta the park and, and take.
[00:21:11] Brad Henry: Significant risk that goes along with that type of return.
[00:21:14] Nick Beyer: Yeah. Talk about evaluating that when opportunity comes off your, comes to your desk mm-hmm. Uh, you know, deal real estate, deal, business deal, whatever, whatever you call it. What is evaluating that opportunity? How does that look like internally?
[00:21:27] Nick Beyer: Yeah. For you guys?
[00:21:28] Brad Henry: Yeah. So we have our investment pillars, which starts first with the relationship. Um, you know, has this opportunity been brought to us through, um, through a close relationship or directly from the person that's, that's bringing it to us. That's very important to us. Um, you can, we can look back and say, okay, the, the better the relationship, the, the better the results we've had.
[00:21:52] Nick Beyer: Um, when I'd be surprised, I mean, just the you and your partners, just the, the deep relationships that y'all have here. Right. [00:22:00] Um. I mean, yeah, I'd be surprised if you said you weren't getting just a lot of kind of people saying, hey, 'cause they wanna do That's right. If they know you, they wanna do business with you.
[00:22:08] Brad Henry: That's right. And you know, you take the network effect of six people that have been, um, building their careers separately.
[00:22:17] Nick Beyer: Mm-hmm.
[00:22:17] Brad Henry: Um, but had a relationship over time and you smash that together and there's some pretty significant network effects where, um, you know, whether it be locally or regionally, we've got what we feel like are really strong relationships throughout that, that bring us, um.
[00:22:37] Brad Henry: Investment opportunities that are generally, uh, off market, meaning there's not a broker or an investment banker that's, that's kind of pushing those. And so that's really been part of our, part of our secret sauce. So that's number one. On the, on, from a, from a pillar standpoint, um, you know, we're looking for proven momentum, right?
[00:22:58] Brad Henry: We're looking for, [00:23:00] um, you know, uh, we are not turnaround specialists. There are firms out there that do that, that can come in and, and acquire or, uh, invest in an asset that, whether it be real estate or company, that, that may be struggling and they want to, they can turn it around. That's a very specific skillset.
[00:23:17] Brad Henry: We definitely want to add value and help, you know, increase the value of the investment. But, um, so, so we're looking for proven momentum, strong management team. Um, if it's real estate, you know, an a plus location, um,
[00:23:33] Nick Beyer: and momentum on the real estate front. I mean, but you're still investing in ground up developments, correct?
[00:23:37] Nick Beyer: I guess I assume the momentum from like the developer That's
[00:23:40] Brad Henry: right.
[00:23:40] Nick Beyer: Team.
[00:23:40] Brad Henry: Yeah. So we will do both ground up development or existing asset, right? And so, um, so yeah, so that momentum and the location can be. Right. Obviously northwest Arkansas has a lot of momentum behind it and from a, from a growth standpoint.
[00:23:57] Brad Henry: So that's, you know, why we, we want to [00:24:00] invest from a real estate standpoint in, in high growth markets like Northwest Arkansas. Um, because it just, it just gives you, um, you know, a little bit of room for error, uh, where you don't have to be, like, if you've got 10 points in your thesis, you don't have to go 10 out of 10 Yeah.
[00:24:16] Brad Henry: To, for it to still be a, a, a good opportunity. Um, and a good result you maybe you only have to go seven or eight outta 10. Mm-hmm. Right. And everything doesn't have to go perfect. Um, when, um, uh, when you've got tailwinds Sure. Behind you
[00:24:35] Nick Beyer: and the on, I mean, my background's the real estate front, so I've definitely got more things turned into my head.
[00:24:41] Nick Beyer: On the real estate side, the, when, you know, when, when you're brought an opportunity on the real estate side. Are you trying, are, are you an LP partner? Are you a GP partner? Like where, where do you fall in the capital stack? Yeah. Are you given Mez debt? What does, what does that look like? Is it the same every time or is it, hey, we're kind of trying, you [00:25:00] know, to
[00:25:00] Brad Henry: So short answer is, is not the same all the time and Yes.
[00:25:04] Brad Henry: So we've been an LP partner, we've been the gp, uh, we've provided, uh, both equity and um. Uh, mezzanine financing mm-hmm. For projects. Uh, and we pride ourselves in being creative in the structure that finds a balance that achieves our returns while making it a really good opportunity for the, for the person on the other side.
[00:25:33] Brad Henry: Um, and, um, that is, uh, so, but we don't have a one size fits all or a kind of cookie cutter deal structure for, for either, uh, companies or, or real estate. Right. Is we wanna figure out what's, what's best for both sides and, and, um, hopefully on the front end structure's a great outcome for, for sure, both on the backside.
[00:25:56] Nick Beyer: What do you tell folks that. The value that natural [00:26:00] capital's bringing outside of the money Yeah. To whether a company or real estate.
[00:26:03] Brad Henry: Yeah. And I think it's just the, the expertise and um, the experience and the willingness to, uh, you know, we do not come in and try and run someone's business or, you know, especially in the form of a ground up development tele developer, what to do or how to run it is, you know, we wanna be the capital partner.
[00:26:25] Brad Henry: We want to be value add from a strategic standpoint and lend, um, an ear for if they need help or advice. Or it's like, Hey, have you ever seen this before? Or, you know, um, I'm thinking about this. What do you think? You know, that kind of discussion. Um, but not trying to, um, to, you know, basically push someone aside and, you know, it's their project and we want to be.
[00:26:49] Brad Henry: We wanna be helpful in, in building that, um, and just be part of the team, um, because we feel like the, those types of partnerships, um, [00:27:00] will, will generate, um, better returns for everybody if, if we follow that path and just trying to do it a hundred percent ourselves.
Yeah. And so what does that look like if you acquire a business or provide capital to a business?
Yeah. Like what does it, what does that, I, I assume every deal is different, but what does it generally look like? Right.
[00:27:18] Brad Henry: So we like to be minority investors, uh, meaning that we don't own a majority of the business. We like to find, uh, CEOs or founders that. Um, have proven they can, can grow a business to a certain point and lead a business, and that they wanna stay in it and keep growing.
[00:27:38] Brad Henry: And that they may just say, you know, I could just, I could use capital for growth, uh, or maybe m and a both organically or inorganically. So acquisitions, um, or, um, you know, maybe they need to reset the ownership structure, right? There's a lot of ways to, to use the capital. And along the way, I want, um, some [00:28:00] strategic advice and help.
[00:28:02] Brad Henry: And so in many cases we'll sit, uh, on the company's board, right, where we're managing the investment, we're monitoring what's going on, but we're not. You know, in the day to day and just helping with, with strategy.
[00:28:18] Nick Beyer: Do you have a case study you could point to if like, Hey, I mean, I know it's, it's the fund's not, I mean the company in general is not that old, right?
[00:28:24] Nick Beyer: So I imagine like in 2020s when the, everything first kicked your first acquisition Correct. Kicked off. Yeah. Yeah. And so, um, is there a case study on the the company side? On the company
[00:28:35] Brad Henry: side
[00:28:35] Nick Beyer: point
[00:28:35] Brad Henry: to, yeah, so, uh, the best case study that we have is, is Harvest Group. And so it's not, uh, overly public that, that we are and, and, um, investor in, in Harvest group.
[00:28:48] Brad Henry: Um, and so that's a perfect example is Ross Culley, CEO. He is first guy y'all interviewed, right? Yeah. Great guy. And, um, amazing guy. He, um. He, he wanted [00:29:00] a capital partner to, um, kind of help take harvest to the next level. That was three years ago. And, um, so we've sat on the board, um, Todd is our, uh, board representative, and I'm, uh, in those meetings as well.
[00:29:17] Brad Henry: And so, and, and when, you know, when Ross needs, um, you know, maybe an outside perspective or, uh, help thinking through something that he's working on the management team with, he'll give us a shout and, uh, we'll obviously help him do that and, um, excited that, that we could be part of, of that journey with Ross and help him get to the next level.
Hmm. That's awesome. And I assume, uh, over the course, since y'all started in 1920. Y'all have had some venture opportunities. That's not your focus, but That's right. I assume. And then I assume with your background and what you did for the state, you had a lens at that part of what we've done in Arkansas and then what you're doing right now.
Yeah. And so [00:30:00] why have y'all chosen not to do that? Not to pursue those, or, or have you, and what's the perspective on
[00:30:05] Brad Henry: that? So, so yeah. So when I was with the state, a big portion of our portfolio was traditional venture and early stage investing. And, um, those, um, can be great outcomes and they can be difficult outcomes too.
[00:30:21] Brad Henry: Very, in many cases, very binary, right? You either win or you don't. And, um, ultimately it just came down to risk of why we have, um. Chosen to be supportive, right? Where, um, we go to the events, uh, in many, in some cases we help sponsor the events. We're, um, you know, um, a friendly ear to the people that are help, uh, helping, um, continue to grow that ecosystem.
[00:30:53] Brad Henry: And, uh, both up here and in, in Little Rock and a friendly ear to [00:31:00] founders that are, um, seeking to raise capital maybe for the first time, maybe they're looking to raise an Angel Round or a, or a Series A where it may not be something that, that we're gonna do directly, but maybe we have a relationship with someone that.
[00:31:16] Brad Henry: That would be interested or we can, you know, say, Hey, have you thought about these few things, um, in your strategy as you get ready to go out to, to market. And so, uh, we view that as a positive for obviously just to, to support the, the region and the, uh, the community, the entrepreneurial ecosystem.
[00:31:38] Brad Henry: Selfishly, that deal might come back to us too. Mm-hmm. Right? When it's, uh, when, when they're raising another round of capital or when they do grow to a point where we feel like that it is a, a fit for us, um, you know, from a, from an investment standpoint.
So you do y'all, you hold, you said low to middle market, like is that pretty firm?
Two to five or [00:32:00] like y'all have, y'all have had stuff outside those parameters That's just your, like, normal.
[00:32:04] Brad Henry: That's right. Yeah.
Cool. No, you're good.
[00:32:08] Nick Beyer: The, and so I, I wanna get a little more of your story too. Yeah. So obviously you kinda said what you were doing here before for the state. How did you kind of, I mean, for someone who's trying to, you know, pursue the same career path or, um, how'd you get to where you were?
[00:32:23] Brad Henry: Sure.
[00:32:24] Nick Beyer: Little rock to.
[00:32:25] Brad Henry: Yeah. So, uh, born and raised in Little Rock. Um, still live in Little Rock, even though we're doing the NWA founders. I, uh, spend enough time up here. I should, um, I guess I'm a, uh, honorary, uh, uh, citizen of Northwest Arkansas. But, um, we, uh, so yeah, from Little Rock, originally went to Central, uh, little Rock Central and then went to Hendricks College for, uh, for college, then came up here for, for grad school, um, at the Walton College, um, with a degree in economics.
[00:32:57] Brad Henry: Moved back to Little Rock. [00:33:00] Um, and, um, we've been there for 18 years now. Um, so my wife and I are both from Little Rock. Um, we've got two kids, a 15, well be 15 on Monday, 15-year-old daughter on Monday, and then a 10-year-old son. And so we've been back in Little Rock ever since. Um, I actually started with the Arkansas Economic Development Commission, um, right outta right outta grad school on the policy side of, um, you know, helping shape, uh, at that time, governor Bebe's economic plan.
[00:33:37] Brad Henry: Oh, wow. For the, the state. I was the, uh, researcher and the, you know, kind of the analyst on helping build all that out, uh, a long time ago. And, um. And so a big part of that strategy was how do you support and build a tech entrepreneurial ecosystem, right? That was a very nascent thing in Arkansas roughly 20 [00:34:00] years ago.
[00:34:01] Brad Henry: And through that program, I didn't even know what it was, like, full, like, didn't know, um, that something that, that, that this existed. And through that research, you kinda understand, okay, all these other states are trying to build this in the, um, in their own states. And so Arkansas should try and, and do the same.
[00:34:21] Brad Henry: Um, those program, there were some programs created through that initiative and ultimately, uh, somebody needed to be kind of the point person for those programs within the state. So I raised my hand and said, I'll figure that out. And um, so I did that for, uh, six years. So spent a lot of time coming up here from Little Rock to Northwest Arkansas, spending a lot of time at the U of a research park and other spots where there was tech, entrepreneurial eco, um, building going on.
[00:34:51] Brad Henry: And, um, so after about. Oh, seven years of that, um, left and went and [00:35:00] worked at, worked at Stevens Inc. Um, in equity research. So what that is, is covering publicly traded companies, um, and, um, and, you know, reviewing their, their performance and, um, quickly learned that, uh, public markets were interesting, but not really for me.
[00:35:20] Brad Henry: And, uh, loved the time that I had it at Stevens. And then about that time, um, uh, some of the leadership at the state called back and said, Hey, would you like to come run the portfolio? Oh wow. That, um, you had been working on as an analyst. And so I jumped at that opportunity and, um, and so did that for another, uh, six years before um, we launched Natural Capital.
[00:35:52] Brad Henry: And the thinking being that, um. You know, fund management and, [00:36:00] um, you know, uh, having firms like ours at that time when I went back to the state that it didn't exist. Yeah, there was, uh, really one in the state at that time and I was like, well, I'll go back. Do this for the state. It's what I wanna do. It's where my passion is.
[00:36:16] Brad Henry: Um, and worst case, uh, I'll do this for a long time for the state and help hopefully build some really cool companies, be part of building really cool companies, uh, that are located here in Arkansas. Um, as we got into it, more and more just continue to, you know, like, okay, this is what I should be doing.
[00:36:35] Brad Henry: And, um, and the opportunity to, to transition to natural capital presented itself. And it's like, okay, well let's go try and help build a, an industry in Arkansas and um, and build a firm here, located here in Arkansas, doing what I was doing for the state.
[00:36:51] Nick Beyer: Yeah.
How much, um. Now that you're sitting, where you're sitting, how much of the [00:37:00] outside capital can you see in 2026 and when you guys started in 2019?
[00:37:06] Brad Henry: Yeah. Um, you know, I, I don't think we expected, right? Uh, we manage a little over 200 million today. Um, about 215 million per our last A A UM, give or take a couple million. Um, and, um, you know, if you had asked us when, uh, we started, um, you know, could we get to where we are? It's like, okay, maybe. But, um, we've been, um, it was really just about what type of service can we provide to our investors, and if we do a good job, then it would, it would grow from there.
[00:37:48] Brad Henry: Um, so.
[00:37:52] Nick Beyer: Say talk like the investors maybe talk about like the raising the first fund.
[00:37:57] Brad Henry: Mm-hmm.
[00:37:58] Nick Beyer: And you're, you're bringing a new [00:38:00] offering to the state that hasn't really Yeah. You know, existed in the same way. I mean, people obviously responded well. Did that take longer than you thought, or did it, did it, was it faster than you thought or,
[00:38:10] Brad Henry: uh, we did it in the middle of COVID, so that was something.
[00:38:14] Brad Henry: Um, we launched the firm in the summer of 2019. Um, and most firms, I mean, usually you take about 12 months to do the fundraising. Um, that's pretty standard in our industry. And so, um, we, uh, got to, you know, started that in the fall of 19 and, you know, then in the spring of 20, you're right, everything changes.
[00:38:38] Brad Henry: Um, so it definitely took longer, but there were some, um. Extenuating circumstances, I guess. Mm-hmm. Um, and so, um, but yeah, I mean, uh, we just went to our closest relationships that we have and asked them to take a bet on us, and, um, they did. Yeah. Uh, we [00:39:00] didn't really know, uh, we thought we knew how the market would respond, but we weren't sure.
[00:39:04] Brad Henry: And, um, and so it did resonate with, with some of our closest relationships. Um, and so I had a, uh, a banker in the state once we got going, it's like, well, how'd you raise the capital? And it's like, well, we went to basically our friends and family Yeah. And, uh, close relationships. And he's like, okay, so then if it doesn't go well, you're not gonna have any friends and your family's gonna be.
[00:39:30] Brad Henry: And I was like, well, we thought about it. The, you know, difference between a bank, you know, we thought about it the opposite. We're like, well, we're gonna go do great things with this and. Uh, generate a great return for, for our closest friends and, and our family. And so, uh, so, but yeah, we did take a risk and, um, you know, as much as our own capital, right, we invest in the, in all the funds ourselves as well.
[00:39:56] Brad Henry: Um, you know, we took a lot of reputational [00:40:00] risk as well, um, to kind of put ourselves out there to, to try and build something that we can be very proud of.
[00:40:06] Nick Beyer: And the first acquisition was in Little Rock, correct?
[00:40:08] Brad Henry: Mm-hmm. Yeah. That's right. Uh, first investment we made was the doctor's building in, uh, little Rock, uh, which is a medical eight story medical office building, uh, in, in midtown, right on university.
[00:40:21] Brad Henry: That was, uh, the fall of 2019.
[00:40:23] Nick Beyer: And have you sold that?
[00:40:24] Brad Henry: Still got it.
[00:40:25] Nick Beyer: Okay.
[00:40:25] Brad Henry: Yeah. Still got it. No, still we still have it. Um, and, uh, still manage it and, um, you know, are uh, you know, continuing to, to, to work it.
[00:40:37] Nick Beyer: Yeah. What was the first Northwest Arkansas acquisition?
[00:40:40] Brad Henry: So, the first Northwest Arkansas acquisition, uh, we call it Heartland.
[00:40:44] Brad Henry: Affordable Housing, is affordable housing portfolio. Uh, we acquired in October of 2020. Um, and um, it is approximately 25 different, um. [00:41:00] Uh, locations. So different, uh, units throughout the, throughout the region in Northwest ar, primarily northwest Arkansas, mountain Home, Harrison, and then a couple down in Cabot.
[00:41:11] Brad Henry: Uh, so we acquired that from, uh, an Arkansas family here that had, that had built those, and, um, they were, they were ready to, to exit it. And, um, and so that was the first one. And, you know, that's a way that we feel like we're, uh, you know, back to the impact and generating return is that, you know, we're helping make sure that that, you know, our part in, you know, having, um, a role in providing.
[00:41:43] Brad Henry: You know, workforce and affordable housing for, for folks in the region, it's getting harder and harder to mm-hmm. To find that. And so, uh, so that was, uh, October of 2020 when we made that investment.
[00:41:54] Nick Beyer: Well, and it's, I mean, it's a sensitive issue and, and I think for people to understand the fact that like [00:42:00] someone who is here, you know, having ownership of it, is it, it's different than someone who's in LA or New York or Dallas.
[00:42:07] Nick Beyer: Absolutely. Doesn't drive by it or see it. That's right. You know, run into
[00:42:10] Brad Henry: this, right. I mean, we drive by our properties all the time. We, um, uh, you know, visit them. We have local property management that we use. Um, so everything is from that standpoint is local. And we take, uh, great pride in that. And also we have our investors that are driving by that.
[00:42:28] Brad Henry: And so they know that they own that. And so if it is yeah, not being properly managed, more than likely they're gonna hear about it and then we're gonna hear about it. And so, um, it's, it's very important to us that, that, you know, when we. Of course our assets that aren't in the region, but um, those that are in the region, we, we take great pride in.
[00:42:49] Nick Beyer: Hmm. And so fund the, the first fund all have, has, has that been, I mean, do you call it fund closes or what happens at the, what's the end of the life cycle?
[00:42:59] Brad Henry: So we [00:43:00] call it fully allocated. So we've invested that capital and so then we are managing that portfolio. Mm-hmm. Um, and then we will, we'll look to wind that down over the next few years as the assets, uh, fully mature and, and exit as
[00:43:14] Nick Beyer: it performed.
[00:43:16] Brad Henry: I can't talk about that.
[00:43:17] Nick Beyer: Okay. Yeah.
[00:43:18] Brad Henry: Uh, so, uh, we can't, um, sorry, we can't, um,
[00:43:24] Nick Beyer: no, I get that. I
[00:43:25] Brad Henry: just discuss Yeah. Uh, performance, um, in a, what this would be considered a public Sure. Venue. Yeah. Um, so fund two's also fully allocated.
[00:43:35] Nick Beyer: Yeah.
[00:43:35] Brad Henry: Um, and uh, which just happened this year.
Congrats.
[00:43:39] Brad Henry: Yeah. And so, uh, managing, managing that portfolio as well.
[00:43:43] Brad Henry: And then kind of thinking about what's next.
And when you say fully allocated, so I think the first fund I read was like 41 million.
[00:43:51] Brad Henry: Mm-hmm.
At, does that all go in, y'all say, Hey, it's open for a year, that 41 million goes in the pot for a year and then it takes you [00:44:00] a couple years to fully allocate it. Is that kind
[00:44:02] Brad Henry: of Yeah, that's right.
[00:44:03] Brad Henry: With a, with one little caveat. So it's called a committed capital structure. So you commit to your commit, you make a commitment on the front end, um, and then we call that capital as needed as there's deals. So it usually takes us two to three years to, to call that and then, and through making investments.
So if I make a commitment of a million dollars in fund one. I may not actually give you the money until a, a year, whenever, whenever a deal comes up. And you That's
[00:44:33] Brad Henry: right. So like fund one, it took us about two and a half to three years to, to fully call that capital. Right.
And is that
[00:44:42] Brad Henry: a same with fund two?
Okay. And is that fund structure pretty common in your industry? Yeah. Okay.
[00:44:46] Brad Henry: Yeah, so you, you, you get the commitments upfront, um, usually because you don't have all, you may have one or two deals identified, but you don't have all of 'em. So one and two both have 14 investments in each, in, in each [00:45:00] fund. And so, um, it obviously takes time to, to get those Sure.
[00:45:04] Brad Henry: Identified, do the diligence and close. And so rather than taking everybody's capital upfront, um, and then it just sitting there for a period of time, you know, we, we call it as needed. Okay.
[00:45:18] Nick Beyer: Is that industry standard?
[00:45:20] Brad Henry: Yeah,
[00:45:20] Nick Beyer: yeah,
[00:45:20] Brad Henry: yeah. And some people do it faster, some people do it slower, but yes, they, it's, it's a committed, the committed capital structure is very industry standard.
And then is your goal for each fund, does it have, are you guys like, Hey, we want to be at this, this level, like, or is it, it's open for a year and the first, the first fund just happened to raise 41 and then the second fund happened to raise.
[00:45:42] Brad Henry: Yeah, we definitely have goals. Um, you know, and so, um, I think the, the goal for fund one originally was probably closer to 20.
[00:45:53] Brad Henry: And then we were able to, to exceed that. The goal for fund two, we definitely wanted to materially increase that, [00:46:00] which we did. Right. And, um, I think, you know, so we always have, have goals, um, and it's really just about, okay, what amount of capital do we need to execute the strategy from an investment standpoint mm-hmm.
[00:46:12] Brad Henry: In terms of the types of investments that we want.
And then has the investment strategy shifted over time? And if so, what, what shifts have there been? I know when I was looking through some of the investments you made, it looked like a lot of them were in the multi-family. Mm-hmm. Or housing space.
[00:46:27] Brad Henry: Yeah.
[00:46:27] Brad Henry: From an industry standpoint, not really, or nor a regional standpoint. Um, I think the biggest switch, uh, that we've seen in the last few years is being much more conscious about when we feel like that the value of the investment has been maximized, then it's time to strike and go ahead and make that exit.
[00:46:47] Brad Henry: Um, versus going, oh, well, we'll hold it a little longer. Um, when, when we feel like, okay, this is about as good as it's gonna get, then we need to go ahead and, um, [00:47:00] and, and strike rather than, um, think about it more of a like a, where it's like, oh, we have this asset, it's doing great. Um, but. If we do hold it, even though it'll perform fine, are we, is it really truly kind of going up to the right or is it kind of plateaued?
[00:47:17] Brad Henry: And so now we need to go ahead and, and look for an off ramp. That's good.
[00:47:23] Nick Beyer: And so fund three, is that being talked about now or is that, when, when, when is that come in conversation?
[00:47:30] Brad Henry: Yeah, so fund three, um, or future offerings. Again, can't talk about that in public, but
[00:47:37] Nick Beyer: I'm assuming that's the next step.
[00:47:38] Brad Henry: We, we are a growing firm.
[00:47:40] Nick Beyer: Yeah.
[00:47:41] Brad Henry: Yeah. And so, uh, we, um, don't expect to, to slow down anytime soon.
[00:47:48] Nick Beyer: And what does growth mean? Um, let's talk about northwest Arkansas more in particular.
[00:47:52] Brad Henry: Yeah.
[00:47:53] Nick Beyer: Like. What do you, how do you see growth in northwest Arkansas?
[00:47:56] Brad Henry: Yeah, so I think, you know, obviously, you know, [00:48:00] uh, you saw that, you know, Northwest Arkansas was number one on the milking list.
[00:48:05] Brad Henry: I think everybody has, has talked about that a lot. And so that is a, uh, you know, really good indicator of not just growth, but stable growth, um, which we feel like is just as important than, than growth, right? You can see, um, kind of spikes in different, you know, from a growth standpoint and then they have laws and spikes mm-hmm.
[00:48:27] Brad Henry: And lull. And we feel like that the region is set up really well to have that kind of continued, um, growth at, you know, 35 ish to 40 people growing, uh, moving in. Um, was it a day? Yeah. And so, um, you know, that gives you a good base along with the stability of the, um, of course the university. Washington Regional Mercy, um, all the large corporations and, um, just a lot of opportunity in front of us where [00:49:00] we're, what the region's almost between 650 and seven, 8,000 on its way to a million.
[00:49:07] Brad Henry: Um, and, um, a lot of runway for us too, because as much as you hear about the national and regional capital coming in to look, you're still like, well, do I put a dollar here in a, you know, a fast growing but a secondary MSA or do I stay in a, you know, a Dallas or a Chicago or la Sure. And so, which we like, right?
[00:49:31] Brad Henry: It gives us more opportunities. And so, um, we're glad that they're looking and we're also glad that, that we still have some, some runway before they're really coming. Yeah. Talk,
talk about the growth of natural Capital, the team here. Yeah. The resources that y'all have kind of put into this, the offices, who's doing what
[00:49:51] Brad Henry: kind.
[00:49:51] Brad Henry: Yeah. So when we started in, in 2019, I was the only full-time person, right? Uh, Todd Marshall Brock are, um, obviously [00:50:00] have their businesses that they run. Um, and, and so now fast forward to today, we have, uh, 12 people on the team, right? Both, uh, and so, um, that includes myself, Rocky Earhart, Marshall Vers, Todd Simmons, rod Kimball, Ben Herns, Berger.
[00:50:19] Brad Henry: Um, we have three, uh, investment analysts appear, uh, in, in Fayetteville, uh, Hayden, Henry a j Hayes, Brendan Anderson. Uh, Rachel McGee, um, is, uh, handles our investor relations and, and marketing. And then down in Little Rock with me is myself, uh, Denny Moss, our CFO, and, and Amy Bagnall, our Chief compliance officer and, and general counsel.
[00:50:45] Brad Henry: Um, so, um, so that's the team today. Um, I think there's, you know, could be opportunities to continue to grow that like, you know, we've got Austin Little Rock here in Fayetteville and then Bentonville as [00:51:00] well. And we feel like it's important to have offices across the state because while there's a heavy focus on northwest Arkansas, uh, we want to be a statewide firm.
[00:51:11] Brad Henry: We have relationships throughout the state. And so, uh, being able to, to have those locations is, is really important to us and, and we feel like serves, uh, the company and our investors, uh, in the best way possible.
[00:51:28] Nick Beyer: What do you see opportunity wise for, for company investments in Northwest Arkansas for the future?
[00:51:35] Brad Henry: Um, so there are, uh, a lot of businesses, obviously in the retail space, right in and around Walmart, uh, in the industrial services space is something of interesting is that's very interesting as well. Um, that are. And then, um, those are the two areas probably here locally. Mm-hmm. That, um, we've seen the, the most [00:52:00] opportunities.
[00:52:00] Brad Henry: Um, and I think we will continue to grow and help, uh, the region diversify.
And when you say industrial services, give a couple Yeah.
[00:52:09] Brad Henry: It could
be off cold storage, stuff
[00:52:11] Brad Henry: like that. Yeah. It could be cold storage, it could be plumbing, HVAC, it could be, um, all different types of services in that space. Yeah.
Um.
You may not be able to answer this question, but when you look at the funds, is there heavy allocation towards real estate? Like is there an app? Hey, we, 10, 10% of our is is company focused. The other nineties real estate or, yeah.
[00:52:36] Brad Henry: No, I can't answer that one. Okay. Because, uh, uh, we are able to talk about our specific investments.
[00:52:41] Brad Henry: Um, and so, um, we fund one was probably 55% real estate, and fund two was about 50, is about 58. So, so the goal at the beginning, and that's on a dollar Yeah. Basis. Uh, the [00:53:00] goal is to generally try and hit 50 50, but if we're a little skewed one way or the other, then, then we're, we're comfortable with that.
[00:53:06] Brad Henry: But no, it wouldn't be like 80 20 or something like that. And so we do want to try and provide a balanced portfolio for, for our investors
and how much of those businesses exist in our state. For people who are like. I didn't know. I mean, it's, yeah. I think it's clear on the real estate side, anybody who's been here Sure.
Read the news. Like, that's clear. I think there's probably a lot of people listening to this that are like, oh, okay. Like, those are, those are fairly large businesses. Yeah. And across the state. So maybe just share your perspective on that.
[00:53:36] Brad Henry: Yeah. It, there's only so many of those that are, that meet the criteria in terms of a, you know, industry focus size and a willingness to look for a capital partner.
[00:53:46] Brad Henry: Right. You gotta, you kind of, kind of check all those buckets and so. You know, as much as the, the real estate portion of the portfolio is hyper-local, our company portfolio is basically the inverse. You know, harvest is the one [00:54:00] Arkansas investment that we've made. Um, on the company side. The rest are scattered all over the region from Birmingham to Minneapolis to Dallas, St.
[00:54:10] Brad Henry: Louis. So, um, so we want to invest in as many Arkansas businesses as we can, and I think that as we grow and mature, and then there will be more of those opportunities, um, just because, you know, just frankly getting the word out right? Mm-hmm. That we want to be the go-to capital partner, um, both for real estate and company investing in the state.
[00:54:37] Brad Henry: And that's not sent away from a competitive standpoint as much as it is just that we want folks to know that, that we're out there, um, sure. And that we, um, are excited to partner with. Uh, on, on Arkansas opportunities.
And if you had a thesis right now, where are those people going? Do they not exist? Are they going out of the state to get that money?
Are they just selling to private equity [00:55:00] and closing? You know, like Yeah. What, what, where, what's your thesis on that?
[00:55:02] Brad Henry: They definitely exist. Um, they are primarily going outta state or, um, or maybe they're just holding on because they, um, don't necessarily know, or that they want to exit to, to someone that's, that's not local.
Gotcha.
[00:55:25] Nick Beyer: Yeah. So for someone who's looking to invest
[00:55:29] Brad Henry: mm-hmm.
[00:55:29] Nick Beyer: Where like, I assume everyone has to be integrated an investor mm-hmm. And like, um. Just go to your website to like, to, to reach out. Yep,
[00:55:37] Brad Henry: that's right.
[00:55:38] Nick Beyer: Yeah.
[00:55:38] Brad Henry: Yeah. And, and I'd say even if you're not, you know, great if, but just if you're wanting to learn or understand, um, we, we actually have a revamped website.
[00:55:48] Brad Henry: We just, uh, with a little help from a friend that's off camera in the room and, uh, so, so yeah, I think anyone, whether it be, um, someone that's seeking [00:56:00] capital, maybe looking to invest or just learn. Mm-hmm. Right. The website's a great place to go. It's, uh, it's completely up to date and we feel like is in a, uh, is a great spot to, to learn about what we're doing as a firm.
I think one thing that could be cool, just from your perspective, while we have you here, we've, we've obviously Cameron already hit on well, we've, we've talked to a lot of your partners.
[00:56:23] Brad Henry: Yeah.
We know from a business perspective on paper how, how you guys like it, it makes business sense. Mm-hmm. Talk about some of the unique gifts that people don't know about.
Marshall or Brock, like what are they really good at? Yeah. Um, not just like, you know, Brock's an IRA guy.
[00:56:41] Brad Henry: Right.
You know,
[00:56:42] Brad Henry: um, I think, um, Brock is really, uh, in tune to what our, um, what, because there's a lot of overlap between Greenwood Gearhart clients and, and natural Capital LPs, um, [00:57:00] is really in tune to what the investor is, is wanting to, to see from us both in a, uh, reporting standpoint, um, and, and product standpoint, but also of obviously an, an investment standpoint.
[00:57:14] Brad Henry: Um, and really helpful to me as, um, you know, kind of think through firm strategy, um, and, um. Todd's the, the rah rah guy, and I mean, he's just the best and, um, is, is extremely supportive. Um, you know, and, um, and thoughtful when it comes to, to, um, how we may a attack a issue. And, um, you know, Marshall's kind of the, the, the rock where he can just, you know, kind of sit back and take everything in and, and kind of help.
[00:57:58] Brad Henry: Um. [00:58:00] Pushed stuff along, but without, um, it feeling overbearing, uh, by any means. And, um, you know, to have three guys that have been building businesses for a long time, um, after a long time before we ever started Natural Capital, to have, you know, those guys to be able to call on when I'm, I'm working through something is, is invaluable.
[00:58:25] Brad Henry: Um, we're, we're all friends. Um, and so working with with friends is an amazing gift and, um, and so it's just been a, a blessing to be able to, to partner with, with guys like that.
That's awesome. How about Rob and Ben?
[00:58:43] Brad Henry: Yeah. Um, so, um, Rob, I didn't know Rob at all when we started Natural Capital. That was a relationship that, that Todd had.
[00:58:53] Brad Henry: And, um, just the, the. Integrity and determination that, [00:59:00] that Rob has. And, um, you know, helping, helping me learn how to, um, you know, uh, take those qualities and, and build upon those that we already had. And, and seeing how he, um, you know, his creativeness around deal structure along with, um, you know, the, the importance of, of relationship has been, um, great.
[00:59:29] Brad Henry: And then Ben and I have known each other since, uh, we worked at Stevens together. And so he's been, um, effectively, um, my right hand on, on all the investment decisions since he joined the firm, uh, really on the investment management, um, since he joined the firm almost, almost three years ago. So we wouldn't be here, uh, without his, um.
[00:59:54] Brad Henry: You know, tenacity and, uh, attention to detail and, um, [01:00:00] you know, being able to help me get stuff done. We wouldn't be here without him.
[01:00:04] Nick Beyer: He's a smart guy.
[01:00:05] Brad Henry: Yeah. Uh, all very, very, uh, bright and successful guys for sure. Yeah. And so having them as part of the firm is, um, uh, I mean, it's our biggest asset.
[01:00:19] Nick Beyer: So for back to the, the growth for the, for the future, does, does that look like growing more people here internally as well?
[01:00:26] Nick Beyer: Or is, or is, I mean, is this team
[01:00:27] Brad Henry: here? Yeah, I think so. I think we'll see, uh, additional team members, uh, over time here and in Little Rock. Yeah.
[01:00:38] Nick Beyer: Right now you're the only one in Little Rock
[01:00:40] Brad Henry: I two other, our CFO and our, uh, Denny and our, uh, chief Compliance Officer, Amy. They're in Little Rock. And so, uh, the easiest way to think about, it's kind of outside of Rachel on the, she's on the IR and marketing side, but the investment team is, is here in Fayetteville and the ops team is, is down at Little Rock.
[01:00:59] Nick Beyer: Mm-hmm. [01:01:00]
[01:01:00] Brad Henry: No real, just kind of a function of finding the best people. Sure.
[01:01:04] Nick Beyer: Yeah.
[01:01:05] Brad Henry: Mm-hmm.
[01:01:06] Nick Beyer: There's two questions we ask at the end of every episode. Okay. Um, one, you know what our main why behind doing this is to encourage other entrepreneurs to build businesses in northwest Arkansas. And so. Why, I mean, kind of a two part for, for you, why build a business in northwest Arkansas and then, and why invest in northwest Arkansas?
[01:01:26] Nick Beyer: Yeah.
[01:01:27] Brad Henry: So I think a lot of it has to do around, um, around legacy. And, uh, we wanted to build something that we could be proud of and that the region and the people can be proud of participating in. Right? And we've, um, so far been able to do that, where I think if you talk to both the people that we've invested with and our investors, that they're very proud to be part of, uh, kind of the natural capital ecosystem.
[01:01:54] Brad Henry: And that is extremely gratifying to me and our, and our partners. Mm. Um, and [01:02:00] so, um, being able to, to do something together is, uh, is, is really, um, something that we're, we're proud of and, and doing something that, um. We're from here, right? All my partners, all of our, all of us are from Arkansas. And, um, and so that's, uh, something we're very proud of.
[01:02:25] Brad Henry: And we can do this just like anybody else, right? You know, and so that's been, um, a big driving force for us as well.
[01:02:35] Nick Beyer: And how do you define success?
[01:02:38] Brad Henry: Um, well, obviously we've gotta generate returns for our investors, right? And, and manage those funds, um, in a way that, uh, both from a fiduciary standpoint and, um, you know, that they, that they're, uh, proud of.
[01:02:55] Brad Henry: Um, but there's more than that, right? We [01:03:00] want it to be something that, um, that. Again, those two groups, right? The people we invest with and the people that have, uh, trusted them and trusted us with, uh, their capital. That they're, um, that, that they will say, yeah, we're, we're natural capital investors and we're, we're proud of it.
[01:03:18] Brad Henry: And they do a great job. Mm-hmm. And so, um, you know, if we can, if we can do that, then, um, then, then we're achieving our goals.
That's good. Well, one thing we do at the end of every episode is kind of highlight the big themes that we learn from you today. We think the people who listen are gonna learn. And, uh, I think every, every time we've talked about natural capital, a word that's come to mind, and that was even pre this interview, but then even being part of this interview is like pride.
And I mean that in like the best way possible. Like, proud to be from the state, proud to have gone to school in the state, proud to reinvest in the state. You know, and that's something [01:04:00] that when we look across all the founders that we've interviewed. It makes this place special. People are proud to be from here.
They're proud to be from our state. And so to hear the investment thesis, to hear the like true impact focus, like that, it just, it, uh, it elicits pride. And, uh, so that's a, that's a big word. And I think if you're a founder, if you're building something, if you're working in a business, like being proud of what you're doing can go a long way.
And it can lead to some of the most, you know, some of the best results if you're really proud of what you're doing. So I think that would be like the first thing I'd start with. The second word that I'd use is focused. And I think it's, it's funny 'cause when we started it was like, we don't have, you know, our, our, our buy box is not, you know, a lot of these private equity shops, it's like HVAC 2D, you know?
Mm-hmm. And it's not that for y'all. Um, but you are focused in this area, in this state. Mm-hmm. Obviously you have investments outside of it regionally. [01:05:00] Um, but I think the biggest focus that I heard coming, coming out of this is we want to help people who are in Arkansas
[01:05:08] Brad Henry: mm-hmm.
Deploy capital back into the state.
That's
[01:05:10] Brad Henry: right. Yeah.
And we want to make them returns.
[01:05:12] Brad Henry: Mm-hmm.
And I think that is a really, really neat, um, and even thinking back to when you guys started 2019, it doesn't sound like that really existed. Maybe if it did it, it, it wasn't
[01:05:24] Brad Henry: Yeah.
What it is now. And so thank you for that. Um, and then the last word that I'd use is impact.
And I look at, I mean, all the, all the other people we've had on the podcast that are part of Natural Capital, like are all very impact focused. Mm-hmm. Like, doesn't matter who they are, what their title is, if you called them, if you texted them, if you needed help with something, like you would get that help.
Yeah. And it's because that you guys are all focused on impact within the state, impact within the region. And I think if you own a business, if you're trying to operate a [01:06:00] business, if you're trying to grow a business, if you can do it with impact on the forefront, you're gonna, you're gonna have success.
And it's clear that y'all, y'all have done that both for investors and you know, natural capital growing over time. So thank you. Yeah. Thanks for your time, Brad. Thank you. Really appreciate having you. So yeah,
[01:06:16] Brad Henry: thanks. Thanks, Brad.
Sweet.
[01:06:18] Nick Beyer: Thank you for listening to this episode of NWA Founders where we sit down with founders, owners, and builders driving growth here in northwest Arkansas.
[01:06:26] Nick Beyer: For recommendations are to connect with us, reach out at nwa founders@gmail.com. Lastly, if you enjoyed this episode, then please consider leaving a rating, a review, and sending it to someone who you think would benefit from it. We'll see you in the next episode.