Business Innovators Radio - Interview with Adam Jason, Partner at Legacy Group

Episode Date: May 4, 2023

Adam Jason is a partner at the alternative investment firm, Legacy Group, and a board member at the Green Coffee Company, Colombia’s largest coffee producer. He is an attorney specializing in corporate finance, governance, securities regulation, and international business transactions. He has advised Fortune 500 companies and investment banks, including JP Morgan, Morgan Stanley, Citibank, and Goldman Sachs, through initial public offerings (IPOs) and offerings of debt and equity securities exceeding an aggregate of $10 billion. Adam is based in Medellin, Colombia.Learn more: https://legacy-group.co/Influential Entrepreneurs with Mike Saundershttps://businessinnovatorsradio.com/influential-entrepreneurs-with-mike-saunders/Source: https://businessinnovatorsradio.com/interview-with-adam-jason-partner-at-legacy-group

Welcome to influential entrepreneurs, bringing you interviews with elite business leaders and experts, sharing tips and strategies for elevating your business to the next level. Here's your host, Mike Saunders. Hello and welcome to this episode of Influential Entrepreneurs. This is Mike Saunders, the authority positioning coach. Today we have with us, Adam Jason, who's a partner at Legacy Group. Adam, welcome to the program. Thanks, Mike. Appreciate that.

opportunity. Good to be with you. You are so welcome and it's always neat to learn from people and their experiences and then what their vision is of what they want to do to change the community, their region, and the world. And that's what I know we're going to be talking about. But get us started a little bit with your story and background. And then what led you to what you're doing right now? Sure. So talking to you today from Medellin, Columbia, down in South America, I've been here for five years now. grew up in Buffalo, New York, so long way from there, obviously, but better weather. My background professionally, I was a practicing attorney in the U.S. for about eight years before coming down to Columbia. Worked at two of the major law firms there in the States, really working for Fortune 500 companies doing IPOs,

advising boards of directors, raising money for a lot of businesses primarily out of the Midwest. And then when I was down in Texas, more in the oil and gas space. I got to a point in my career about eight years in, where if anybody listening has been

kind of through the law firms and in that field, you know, you get to a point where it's, you know, to become a partner in the law firm, Do you go in-house and work for a client or do you do something a little bit more entrepreneurial? And I think probably from where the conversation has gone so far and where we're going, it would be obvious that I took the ladder of the three options and wanted to do something

kind of outside the traditional field, but, you know, that allow me to use my skill sets and also do something that really was, you know, starting businesses, growing businesses, etc. So long story short, I had a one month between a job offer that I'd gotten in Houston and the job I was currently at in Dallas, really had never done any traveling, especially internationally growing up, pretty traditional path of, you know, college to post grad to going into the professional world, corporate America. I would travel when I had the job, but it was mostly like, you know, take your phone with you and you're traveling, but you're still working. So I had a, I had a first time in my life, like a month to kind of go. And I really wanted to push myself to live outside the U.S. And not, you know, bounce from tourist location to tourist location, but really to try and see what it would be like to live someplace outside, outside the country. So I'd heard good things about Colombia.

I was studying some Spanish at the time, decided to come down here and give it a shot. So I spent a month down here, saw a ton of opportunity in the market. a lot of investment coming into the country, especially foreign direct investment. And I met my now business partner at Legacy Group, which is our investment firm down here. And we've really, I'd say, hit the ground running since we started the business in 2017. I was helping back from the states before I made the official move. But January 2018, I sold everything I had, decided to come back here full-time. Now I think we've grown a special business. The flagship company within our portfolio is the green coffee company, which we founded back in 2017. It's become the largest producer of coffee

in Colombia in that short time period. We've got to about 11.5 million trees, 9,000 acres in the country. And we primarily work with, I'd say, U.S.-based accredited. and accredited high net worth investors who are looking for diversification across industries, but really across geographies as well. And, you know, we try to find opportunities that are big enough for them in Colombia now, but I think we'll expand throughout Latin America in the future that are big enough for them to justify, you know, maybe taking what they see as additional risk versus investing in commercial real estate in the U.S., for example, or putting money in the stock market.

you know, something in the alternative investment space that can really get some people, some really high returns and meet that diversification goal for them. So something special in coffee, we have a couple other businesses within the portfolio, but that's really where we're focused. We've brought about $60 million of investment into Columbia in the last few years, and we now have a portfolio of about 430 investors, mostly all Americans. And so that for an American investor would be more of an alternative investment as opposed to the traditional stock bonds mutual funds that you could look at your opportunity as a high yield, high growth industry in an international market that you have boots on the ground, finger to the pulse of. And this is an alternative investment to your traditional portfolio.

That's a great way to describe it, for sure. Yeah. And the neat thing, too, is it's not just like, oh, that's some good idea. So we have to throw some money at it. You're all in and you're right there. You're growing it like it's a company. And you're making sure that the returns are coming in and things like that. That's right. We founded the business back in speaking with respect to the green coffee company. We founded the business back in 2017. My business partner and I have put in about $3 million of our own capital. We really work in the business on a day-to-day basis. basis, even though we kind of sit in an outside role through legacy group. So we're on all the, we hire all the management. We have two of the three seats on the board of directors. We're in on all the meetings, strategy, et cetera. And, you know, it got to be so big that we really needed to put in the right executive team and grow it from there. But otherwise, I mean, it's really a a full-time job as well as doing a little bit of more of an advisory role for other

companies in our portfolio that we seed fund. So our goal is either found companies that can grow and we can build or we'll find some good opportunities and put some capital in, especially when we see some bright entrepreneurs that we can make some bets on. So what type of sectors are you looking at? So the green coffee kind of is your flag ship kind of a company, but what are some of the things of the horizon you're seeing? The theme for us is it's got to be big enough and I guess recognizable for foreign investors to, like I said, make that leap from more traditional investments into the kind of the alternatives we're proposing as you described. So something like coffee, people can understand.

Colombian coffee for any coffee drinker they're going to be familiar with quality coffee coming from Colombia. The two are kind of synonymous. So it was an industry for us where we saw a massive gap from how business is currently done. There's not a lot of foreign investment. There's not a lot of investment, frankly, at all. Technology is set back about 40 years. People aren't focused on kind of the sustainability and becoming clients for the next 50 years where ESG is going to be a huge focus. Companies like Starbucks and Espresso are going to be more picky about who they'll include in their supply chain. So we really saw an opportunity to look at the market with fresh eyes, fresh capital, and the opportunity was really big enough, honestly, because the

competition is so low for the consolidation play that we're trying to do that we could make it big enough to appeal to U.S. investors, structure everything out of the U.S. to make it kind of frictionless, have it governed by U.S. law so all our investors are comfortable, but also to maximize the potential exit opportunities. It's frankly more palatable to a potential buyer of the business or if we want to take the company public to have it structured out of the U.S. So we really look for those big opportunities that are recognizable to people. They can wrap their heads around it and see the potential if we can really build a market leading position in that industry. We're really trying to be number one because honestly that's kind of what our investors

require to make that to make that jump from a risk perspective. Yeah. You know, and you do a lot of work with being like socially conscious, environmentally conscious regarding impact. Talk a little bit about how those play into what the work that you're doing? Absolutely. So I would say we are capitalists at heart, but understand the need in the current market to be doing things in an environmentally, socially responsible way. And basically the ESG angle of the business feeds the capitalistic arm of make as much money as possible because if you don't do those things, you're limiting the amount of money that the business can be worth because you limit the number of clients you can work with, you limit the number of potential acquires.

So it's always a focus for us. We combine kind of doing things right, but also making sure it's a profit and value driver for the business. So some examples that we would have, you know, typically to process like one pound of coffee, you need about 40 liters of water. The technology that we're using at the farm, which is really the first of the kind, in Colombia uses less than one liter of water. All of our farms are rainforest alliance certified.

We comply with cafe practices from Starbucks, and we honestly do some things that are unique to the industry and have never existed. So we'll take it for granted that in the U.S., you get health care benefits, you get a pension, you have workers' compensation for the history of the coffee industry in Columbia and for many industries, that those worker benefits have never existed. But now we have 100% of our employees with health care coverage, workers comp, nobody else is doing it, honestly. And it's not always a people are cheap or they don't want to do it. Often it's in access to capital and they simply can't afford to provide it. But we see it as necessary for one,

attracting good talent and two for maximizing the value of the business. The other one I always mentioned because I'm proud of it is we're working with an organization here in Columbia. I'll give you the essentially it's a program for single mothers. I was going to say it in Spanish, but then it would probably lose it. It's meaning, but it's single mothers in communities, especially farming towns who have limited opportunities. This year on our farms, we're expecting to plant about two and a half million coffee trees and our entire greenhouse operation where we grow those trees, care for them,

et cetera, is all run by the single mothers that are within that program. So we have about 26 full-time single mothers who are working at the farm and really in, I'd say leadership and key roles. It's not just fluff or putting people in roles that don't really have a big significance to the business. They're people we depend on and really count on. And one thing we're looking at, for example, is building a kindergarten in the town so that it's close to the farm. So that, you know, it's often the mothers have to leave at one o'clock because they have to pick up their kids at school, you know, trying to make it more so they can drop their kids off, come work, kids are close by trying to fuel that whole system. So we always have a lot of people who want to work for us.

And we can tell that story, frankly, which is unique in the industry, not just in Columbia. Yeah. And you know, I've done a lot of work and research and teaching in corporate social responsibility and cause marketing. Have you ever heard of the phrase the halo effect? Yes. Yeah, I talk a little bit about that. right? Yeah, because I think when a brand is taking the approach that you do with creating that, you know, really cause, you know, let's, let's at the same time as providing the services we do, let's spotlight this cause or let's integrate it with this, you know, opportunity like what you

just described there with making a difference in the community and single mom's lives. So I find, and what has been proven with that research is when people see that, they then look at your brand, that much better because it's kind of got that halo around it. Like, hey, you're not just out for that buck or that return or that, you know, money. We're seeing you guys making a different. So have you had opportunities where people have brought that up and really maybe changed even the direction of how you're operating with them because that mindset kind of took off? I would say it's often a mover for attracting investment for sure. You know, it would be a bigger detraction if we didn't do these things.

Or we said we didn't, or we said we were doing them and didn't do them. Obviously, that would be bad. It's definitely giving us market opportunities and allowing us to bump up prices because we're doing things in the correct way. And there's so few that are, I don't even say few, like there's basically none that are doing the kind of initiatives we are. where, you know, people want to tack on to that story, whether it's a Starbucks or some of the other, you know, big buyers globally, you know, they want to be able to tell that story as well. And frankly, I think regulation is pushing them towards having to tell that story. So they're dependent on their, on their partners. So it's a win-win for everybody involved, whether you're an investor, whether you're a, you know, a worker in the business. And I, and I, I think. think it's you have a changing market sentiment where, you know, people won't pay three times what coffee is worth because of the story, but they will pay a little bit more if they believe in the mission of the company itself. Yep. Yep. And that's not a license to 10x your cost or

your, you know, things like that. It's just this is something to talk about because it's authentic. It's real. Real is rare. And I think that's pretty huge. So, yeah, well put there. You know, when you think about funds or investments or opportunities and things like that, talk a little bit about the risk and volatility in the sectors you're in. What type of risk and volatility are you seeing? Sure. So when we started the coffee business, it was really, it was meant to be an alternative to commercial real estate for investors who were already comfortable with Columbia and already invest.

here. They essentially asked us to create a product for them that function like commercial real estate. So it's an asset heavy, collateralized, strong cash flow, all those things that attract people to real estate. What we also get, though, as a farmland investment, which is essentially the foundation for the business, is you get a nice inflation hedge. We've just done some writing about this. It's available on NASDAQ. We do some contribution. writing there that's discussing really you know you always have the the asset back of a farmland but then you also get the increase in value to that land because of the commodity coming off of it so while real estate is relatively stagnant not always a productive asset in the sense that

it's kicking off the product a good example like is gold too as well you know it's farmland is gives you the benefit of it's creative. You know, it's got the ability to produce, which is, I think, something that people love, which I'd say really creates a stability in the pricing. Like if you look at the statistics over the last three years, the farmland has a 97 out of 100 correlation to the CPI index, of the typical kind of inflation measurements that we use.

In fact, it kind of beats inflation. The last three years, I think it's been 8% from an inflation standpoint. If we're talking about USDA and farmland has performed at about 10.2%, when you start combining that with vertical integration, selling consumer products, and another, I think, sustainability initiative and the thing we're doing is for the history, of coffee, everybody has basically discarded the fruit in which the coffee grow. So if you see coffee growing on a tree, it grows in a cherry form. People only basically use the seed and all of the

skin, pulp, all that stuff is thrown in the garbage, thrown in the water, you know, really becomes a pollutant. We're taking all of that byproduct and turning that into vodka, gins, other kinds of spirits, pure ethanol that can be used for energy creation. really trying to, one, cut down on our pollution, but also increase the revenue that comes to the business. So when you start tacking on all of those additional value ads, you know, you even trim any kind of volatility even more. Yes. You know, and since you have groundings in, you know, quasi real estate, not real, but land, you know, things like that. and an actual business.

It feels a whole lot different than, you know, like cryptocurrency kind of a thing where it's like, wow, at the whim of something, it can go up down or all around. So I think having that, you know, solid foundation is really huge. And it's an actual business. And it's a tangible product. And it's a product that's needed, not some obscure thing. So I think I just really like how you guys have that set up and having, you know, your whole team right there and building out the community. it just builds a stability right in there. I think that is so great, Adam. So if someone is

interested in learning more, what's the best way they can look over your offerings and then reach out and connect with you? Yeah. Where we are, we're finishing up our Series C funding round. So we started with $25 million. By the time this comes out, I think we'll be right around $1 to $2 million, depending on when this is released to your audience. So for U.S., accredited investors. Everybody who invest has to be accredited. We have a $100,000 minimum investment. Anybody who's interested can reach out to us. You can find us at our website. It's legacy hyphen group.com. Or you can find me directly on LinkedIn or by email it's adam.j at legacy hyphen group.com. Like I said, we're looking for some really meaningful multiples on capital for

investors in the around. So I'm hoping people are really interested and excited as I am about what we're doing. Perfect. Love it, Adam. Thank you so much for coming on. It's been a real pleasure talking with you. Thank you so much. Appreciate the time. Thanks, Mike. You've been listening to influential entrepreneurs with Mike Saunders. To learn more about the resources mentioned on today's show or listen to past episodes, visit www.com.com.com.com.com.com com.