Infinity Investment Strategies Member of the Month Featuring Kirkland Capital Group
At Kirkland Capital Group, we are proud to share that our very own Chris Carsley was recently featured on the Infinity Investment Strategies podcast, hosted by Erica Neal. With a career spanning investment management, hedge funds, fund of funds, derivatives trading, venture, and other alternative investments, Chris shared his unique insights and expertise on various topics, including the evolving landscape of private debt and fixed income investments.
He also talks in depth about our fund, the Kirkland Income Fund. This is a great video to watch for current and potential investors in the fund as Erica asks insightful questions that may be on the mind of many investors.
Key Highlights:
His career evolution from portfolio management to hedge funds, and ultimately to leading Kirkland Capital's private debt fund.
The philosophy underpinning Kirkland Capital’s focus on micro-balance commercial real estate loans.
Navigating recent economic conditions and rising interest rates within the alternative investment space.
The significance of building a robust network and leveraging varied skill sets for achieving long-term success.
“In our fund, we only do one thing. We only originate direct mortgages for micro-balance commercial real estate.”
“Our main focus as a private debt fund is to offer high yield with debt-level risk profiles. We position ourselves as a fixed income alternative rather than a traditional real estate investment. The real estate component of the investment helps to preserve the principal.”
“I tell people that this fund does not aim to make people rich. Instead, it focuses on building and fortifying people’s wealth over time as a fixed income alternative in their portfolio.”
Watch the full video below.
Transcript
Erica: Alright, everybody, welcome to the member of the month. We have. The, as I said before, one and only Chris Carsley, Chris Carsley with us, and I'm so excited to have him on with his wealth of knowledge, experience, background, so I'm not going to go into too much detail. I'll let him tell you a little bit more, but Chris, I'm so glad you could join us today.Thanks for coming.
Chris: Thanks, Erica. Thanks for having me. And yes, your one and only became quite a joke behind the scenes off LinkedIn. cause my response was, yeah, there's a lot of people probably out there that are happy. There's only one of me, including me. If I had to, if I called myself and it came out like me, I'd, I'd have to get rid of it.
It'd be way too dangerous. But, so no, thanks. Thanks for having me. Yeah, it's great. Uh, I, you know, I love, I love doing these things and hopefully we can cover some interesting material for people who are watching.
Erica: Absolutely. And that's the thing, right? Like you've got such an amazing background and I, you've talked to me a little bit about your fund and all the different things you have going on.
So my goal is to share all the wonderful and amazing people that I know with all the other wonderful and amazing people that I know that happen to not know one another. So that's what this is about. Thanks for sharing. So I guess. You know, we'll kind of get into a little bit of your background, I guess.
Tell us, you know, education background, like what drove you to where you are now and any unique and valuable experiences you've had along the way.
Chris: Oh, so you want to start where my daughter likes to start when fire was invented and dad got his career started. No, yeah, I, let's, let's, I guess we can start from the beginning and move forward because, uh, it's far more entertaining in the beginning.
No, I actually, uh, I got into investing, uh, cause one day I think I was about 12 years old, maybe 13 or on the way in between there and picked up a wall street journal. And if you've ever looked at an old wall street journal and turn to the investment page. It's like a whole other language if you don't know how to read it.
And so I had no idea, so of course I went to my parents who were not big in investing, asked them, they looked at me like, how would I know what this means? I think that, you know, they gave me a lot of, I think this, and I was like, uh, hmm. And so they passed me onto some other people and finally figured out what that, all that gibberish meant.
It seemed quite interesting. I just kept on pursuing. And then found out that my dad had like, I don't know, 13, 1400 saved up in some mutual fund. And I was like, well, let me do some research, figure out how we can, you know, do this. So I would get off. This is back in the day when obviously parents. didn't know where their kids were, there was no cell phones, and didn't care where they were.
Erica: They had that commercial on TV.
Chris: Yeah, yeah, exactly.
Erica: Do you know where your kids are?
Chris: My mom used to say, it's like, if he gets kidnapped, they'll give him back. So, yeah, they won't, they won't want to hold on to him. But I would walk, I'd get off the bus and I'd walk two or three blocks down to, uh, the Smith Barney office, uh, where, you know, my account was at.
And this is back in the day when ticker tape still came out and was hanging on the wall. They did have a Quotron on the tape. Desk and it was the monochrome, green and black. And you could, if you knew the symbols, you could type 'em in. And, uh, I don't know how up to date pricing that was, but you, uh, it's probably, you know, lagged by a few hours back then.
Erica: Hopefully you got the same day pricing, right?
Chris: Exactly. So, um. I just started doing research. It was fascinating. Didn't have anything else to do as I was waiting for parents to come pick me up and do a number of different things. It was me and a bunch of older gentlemen, reading ticker tape. They thought it was quite hilarious this little kid, you know, trying to read the top of the ticker tape, uh, which was at about six feet, which I was nowhere near there. That's kind of where I got started. I sold the mutual fund and invested in a few stocks and one of them, interestingly enough, and this is where you always wonder if this didn't happen, where would I be in my career?
There was a company called Contel and it had, you know, great revenues, all, all the usual things that people are looking for. But here's the one thing that really got me is the stock symbol was CTC, which is also the initials of my name. So, you know, Christopher Thomas Carsley, and so that just had to be fate, about three months into buying the stock, I mean the stock was doing quite well, it was paying its dividend, you know, standard, you know, telephone, you know, stock, you know, all about the dividends, and then GE decides to buy it, and it goes up considerably, and I sell it, and I think on that one trade, I made like three or four hundred dollars, and I thought, wait a second.
You know, at this time you understand I grew up on farms. I was driving tractors, getting up at 430 in the morning, digging post holes. So at a very young age, a lot of heavy labor, on a farm. And I was like, wow, I didn't dig a hole, rake anything, pull weeds or anything whatsoever. And I made this money. I could, I could get used to this.
And that's kind of what started it. I was the weird kid in college that knew exactly what he was going to do. So everything was all directed towards my major. Whereas a lot of my friends were still trying to figure out, well, what am I, what am I going to do with my life? And then, you know, that obviously led into my, you know, first career, uh, was lucky enough to go out to New York and Found the pavement in 94 and got a couple small, you know, interns sitting on some desks for a month or two and then finally got an offer back in Seattle of all places.
And then started as a junior portfolio manager and worked my way up to, you know, managing sort of the second largest account for, you know, key asset management. And then my specialty was always math and derivatives and I was always playing with, you know, options, which was like Voodoo back in that day, like only bad, only bad, dangerous people played with options back in the 90s.
But I was able to do what now people, I joke, it's like, you know, I'm doing covered call structures and things like that. I mean, now I joke because it's like grandma's doing that in her IRA now, so it's not really that special anymore. But, uh, that's, you know, did that for a number of different years.
Got very lucky, ran into someone who worked for a hedge fund back in Greenwich and they were opening up a desk in Seattle of all places and that sort of led to my next life is sort of learning how hedge funds work, arbitrage trades, securities, finance. I mean, just, just that, you know.
Erica: And that was all while you were in New York.
Chris: No, I was back in Seattle.
Erica: Oh, you went back to Seattle. Okay.
Chris: Yeah. I had to go back to Seattle to, you know, where I got the, the asset management job, you know, managing a high net worth and, you know, small family offices and trust accounts and things like that. And then, you know, what's the chance, you know, a major well known hedge fund, uh, happens to be opening up at one of their trading groups is opening up a desk in Seattle.
And, you know, I got invited to join there and that was, as I tell people, you know, it got pulled behind the curtain. And then that just sort of kept me in the alternative space where, uh, you know, I left there and went on to work for a fund to fund And then, you know, post that I started doing a lot of angel investing and then, you know, ran a small seed angel fund, you know, and then just kind of spiraled on to where I am today, you know, running a private debt fund, you know, in real estate.
Erica: So that's interesting. Like, and I, you know, my, I think you and I've talked about this a little bit, like my background is traditional finance as well, kind of moving out of that space, but I think it's really unique. I think it's a really unique advantage when you can look through multiple lenses and be able to see things right.
And have that experience be like, well, because here's the thing, if we're honest, not what's advertised versus what really happens are two different things. Right. Like when you drive down the road and you see the fast food sign and it shows that burger, it never really looks like that in real life, unfortunately in life, like that kind of happens too.
So being able to have that perspective do you feel like that's helped at all with your current place?
Chris: Oh, I mean, it's, it's helped through many different aspects. You got to think how does a hedge fund guy get invited into the room to sit and review companies for Microsoft? I mean, why, why would, why would they want someone like that?
And, you know, That differentiation that you're talking about is, you know, and don't get me wrong. There's a lot of people who specialize in things and they're really, really good at that one thing. That was just not where my career took me. It was this, all of a sudden, I'm being exposed to all these different ideas, you know, constantly and kind of moving, you know, through the alts world in, in, in multiple different facets.
And a few people, uh, that are, were part of the early accelerators and things like that, that were going on in Seattle were like, wait, this, this. This guy really looks at things differently. So you can put a bunch of venture capitalists in the room and you might get all the same point of view. He's going to attack this from an entirely different, you know, angle.
And even I joked when I was in that room, I was like, Oh, well, I'm, I'm a hedge fund guy, pretending to be a venture capitalist today. But it was, it allowed me to really see just a, a, a ton of different things that, you know, others just didn't think about. And I also would ask the, the not so nice questions because you, I'm pretty much all about like, well, where's your money coming from?
There's a lot of people in venture trying to save the world and for right or wrong, I say, Hey, that's great, but it's tough to save the world when you're not making any money.
Erica: Yeah. No, I mean, that's totally true, right? Like you can have a good heart or big pocketbook. Not that you can't have both, but sometimes it takes both to make moves.
Chris: Oh yeah, no, it, it, you got to show where the money's coming from. I mean, in a startup, which I've, you know, still advise a couple of different startups and, you know, that's always everything I, the two things I bring to the meetings is usually is where the money, where's the money coming from and two, don't do that or you'll get a personalized, uh, orange jumpsuit with your own number on it.
There's a lot of people in tech that are coming in to, you know, fintech. and trying to do things in the investment world and they don't realize, those aren't the really nice soft padded bumpers you have when you're doing the, you know, the kiddo bowling, the bumpers that the, uh, the regulators put into the securities world have spikes and blades and nasty things on them.
If you hit them, you're in trouble. Yeah, you're in trouble.
Erica: And there's no warning. There's no like, Oh, don't do it again.
Chris: Oh yeah, no, I mean, I, there's. So many people who are like, Oh, we can get in here. We can gamify investing. I go, that's a really bad idea.
Erica: That's so oh my God.
Chris: Yeah. The regulators don't like Investing and the management of other people's money to be a game.
Erica: Yeah. Gamified is not the right
Chris: Word, man. Choose
Erica: Your word. Yeah.
Chris: So, yeah.
Erica: Well, that's kind of a good segue though. Kind of like moving into your investment focus now. So I guess, I know you've got your fund and, and you know, you've got Kirkland Capital. So I guess tell us, what are you guys doing now?
And how has it changed from when you originally got into the alternative investing space?
Chris: Oh, wow. You're, that's a tough question. Cause I mean, your knowledge base always grows the, the, the longer you stay in, uh, one particular field. So I guess the one thing is you always think, you know, a lot, and then you do something and you're like, wow, I didn't know half as much as I thought I did.
And then you, and that just sort of compounds on itself and you keep on learning constantly.
Erica: The more I learn, the more I realize what I don't know.
Chris: That's actually, that is one of my quotes that I actually use. It is, the more you learn, the more you realize you don't know. That's actually applies to a lot of my hobbies. Martial arts is one that I constantly, uh, I still teach martial arts.
Erica: I forgot you do martial arts. I forgot about that.
Chris: And I say that to people all the time of, well,
Erica: Strong brain and strong body. That's awesome, man.
Chris: It's uh, yeah, you know, martial arts people think it's just a physical thing and it gets to the point where the physicality needs to be combined with your mental acuity or it's not going to go well for you. I mean, it, uh, when I mean, not well, I mean,
Erica: You can't just Hulk smash through your Marshmallow.
Chris: No, I, no, that, I mean, trust me, I mean, that works sometimes if you can catch someone off guard. And, you know, anyone who tells you size doesn't matter in fighting, they've never fought a house, which I have, and, yeah, size is important. Those guys get a glancing blow on you, you're gonna have a bad day.
Erica: Uh, I'll take your word for it.
Chris: So, yeah, yeah, no. It's not something, unless you really want to. But, back to the investment attitude, it's exactly that. There's too much to know. And that's one of the things I'm actually, I just did a short webinar on, you know, I tell everybody, Hey, build your network, build your network.
It takes time and keeps building over time. And so I did another short webinar of like, well, how do I do that? And sort of shared with people, all the different angles and things to think about that I'm thinking about, because, you know, 20 years ago, I didn't think about the network at all. Yeah. I mean, I was like, what is it?
Who cares? I just, you know, I just go do my trades, and I make money, and that's great, and why do I need to know anybody? Then all of a sudden you realize, when you step out of being sort of a guy who sits at a desk, cranking away on a particular trade, you actually, you actually need people. You can't know everything, you can't do everything, there's not enough time in the day, and you need those, those resources, because the knowledge, the knowledge base is just too vast.
And, you know, it's like, I always tell people, I go, well, I'm going to do what I do, and I totally believe I could go do almost anything if I put my effort into it. But I just don't have enough time to do that. And so
Erica: time's better spent doing what you're already good at.
Chris: Exactly.
I mean, and it's like, okay, this is the opportunity set that I can bring to the table and this is what I'm going to build and do.
And even for my own personal investing, you know, people are like, Oh, well, you know, do you use funds? I go, of course I do. I know some very, very intelligent people that do things that I'm just not going to do. And, but I'm willing to pay them a fee to go do that. Even though I can probably figure it out, but I need another lifetime to do that.
Erica: Yeah, the time, the effort, the energy that it takes to do that, just pay the person who's already good at it.
Chris: Exactly. I mean, I always have all these people that are trying to, well, we, you know, what is it that this year and the end of last year, you know, being in private debt, I always laugh because I've been around.
You know, doing this since all before the dot com era. And I've heard it so many different times over the years. And this is always about when it's about to fall apart. When everyone thinks they can do everything themselves better than in the professions. That's always a time where people, it's about to fall apart.
Erica: And so You know what, that's a really good scale to think about because, and I'll, you know Even on the infinite banking side, when I wouldn't, you know, we work with a lot of real estate investors, uh, business owners, but on the real estate investor side, even when we were talking to people in 2018, 2019, we're having that conversation and.
As you know, Infinite Banking is not like, Oh, it's a great rate of return. Obviously that's Infinite Banking, not Infinite Investing. But when I'm talking to people and I'm asking them and they're talking about, Oh yeah, I'm going to do, I have this and I've got this going on and that going on with their real estate.
My, one of my first questions I always ask is how long have you been doing this? And it was, Oh, since 2015, 2016. Now don't get me wrong. They've learned a lot in those few years, but they haven't experienced a full cycle or some sort of economic reset.
Chris: Yeah, and honestly, yeah, it was kind of a shock in a lot of ways to have interest rates go up so much But that wasn't anything like I mean that was like a slow like Someone, you know, punching you slowly instead of just this quick jolt and a massive gap and you realize and you wake up because you just hit the ground.
Erica: Yeah, like death by a thousand cuts.
Chris: Well, that was kind of like where, I mean, a lot of people, a lot of people saw 08 coming, but they weren't exactly sure what it really was. You knew there was a problem and a lot of people were preparing. I know that for a fact because on our sick lending desk, all of a sudden I had people calling in like, 500 million, billion dollar lines.
Hey, we need to wrap this up. And that was in the beginning, that was sort of mid 07. Yeah. I mean, so people knew things were not right. And so, but when it actually happened, it was actually quite quick. I mean, all of a sudden, you had Lehman fail. I was on the phone with Morgan Stanley. He's like, Oh yeah, we've been told that we could be next unless there's some kind of bailout.
And then it was like, Oh my God, this is, this could be absolutely catastrophic beyond people's imagination. And it was actually happening quite quickly. I mean, so.
Erica: But it had been leading up for an extended period of time.
Chris: Correct. I mean, but to the outsider who wasn't privy to the bigger moving game, You had no idea it was coming and so it's like when you see interest rates going up in this last little problem.
I mean you kind of had some time to think about it and there was no lack of news out there saying well interest rates are definitely going up And so like to your point, there were a lot of people who've been doing things since 15, 16, 17 It's like okay. Well, I hope you've been really super conservative and unfortunately a lot of them are not, now I laugh, because there's lots of problems in the smaller players, but the bigger guys who are supposed to know better and they're on the forefront of everything, well, they're the ones really struggling right now.
I mean, they're the ones that have all the Gateway City office space. If we're sticking to the real estate issues, I mean, it's like, everyone's like, oh, I should go work with the big guys. And I know they're super smart because I used to work with all these guys, but let's just say they got caught too.
Erica: Yeah, it's all like you said, it's all about their, like the, the investment philosophy, right? Like, what is it that you're trying to do, what is it that you're trying to accomplish within your, you know, whatever fund or investment that you're putting your money into? Yeah. What would you say, with Kirkland?
I know you guys have a couple of things. What would you say is y'all's philosophy? Like, what are you guys doing within your fund? What are you offering to people?
Chris: Our core angle is about, you know, it's, it's, it's a private debt fund. So, I mean, the core angle that we're, we are trying to provide yield.
You know, you know, an equity-like return with debt level risk profiles. And, you know, I really label ourselves as, I know everyone wants to bucket things in real estate or this. I always say we're really much more of a fixed income alternative. And the real estate aspect is really what allows your principal preservation.
I mean, because every single loan obviously in a mortgage is backed by, you know, a physical building. And, you know, our specialty is we're doing, uh, micro balance loans in commercial real estate. So a lot of multifamily, a lot of mixed use, some, you know, light industrial, retail. Uh, we don't do any office obviously, just avoiding that, you know, That space.
I mean, there's enough deal flow and, you know, opportunities in our, in our lending space. We don't really need to do anything in Office. I mean, everything will wax and wane. I mean, I'm sure it'll be back in one form or another. Just not right now. You know, I always tell people, it's like, I've got a few friends that own tech companies here in Seattle and I'm like, well, if you wanted to go from renting your own office to owning your own office, this might not be a bad time to think about that.
Yeah. You know, if you wanted to buy an office space and, you know, and so it's like, cause you know, it's not gonna last forever. So yeah, I mean, that's what we focus on and we're just trying to build a relatively, you know, consistent yield, that is, you know, above what you can get from traditional markets and at the same time, really offering that principal preservation.
I mean, I tell people this fund is not about making people rich. It's about the solidarity and, you know, the fortifying and building over time of people's wealth as a fixed income alternative in their portfolio. You know, I've got a few webinars and things that I've done out there where I talk about, you know, the impact of, you know, 2022, where you saw a traditional fixed income, you know, really hiccup, uh, as big as you've ever seen.
Mm-Hmm. In history, at least in my career. And everyone else I was talking to, everyone's like, I've never seen anything quite like that, that bad. Now equities are still doing quite well and continue surprisingly to do well. We'll see how that plays out. I'm not gonna make any market predictions, but.
You still can't believe where the S& P and all the technology companies are going.
Erica: It makes no sense. It makes zero sense based on everything. So, yeah.
Chris: Remember the, remember the markets about investors’ expectations. Right. And a lot of those expectations are not based on numbers. They're based on emotions and feelings.
Erica: It's emotions. Yes. Yes.
Chris: So, I mean, I always tell people, when people, when people tell me it makes no sense, I'm like,
Erica: Yeah, let's talk about what actually creates the
Chris: Yeah, well, I got that. Well, that's a whole ‘nother conversation. We don't have time for that.
Erica: That's a real campfire conversation.
Chris: That's a, yeah.
Erica: But it is. I mean, it's one of those things where when you're, when you're, you know, when you're looking at what's going on, it's hard to make those predictions, especially right now. Like I try to tell people at this point, I don't know what the future holds. Like everyone keeps talking about the Fed rates.
Are they going to lower, you know, who knows what's going to happen? But
Chris: I've always, I mean, I, this is not really a prediction to me. I have to bet, I have to keep saying this because I've been saying it for years. There's no reason why there would be a Fed easing this year unless it's a political move.
It's just not in the numbers.
Erica: There is an election year. So I'm like,
Chris: And that might create something to where, oh, hey, someone wants to create a small, ease in rates and some political party wants to take credit for it. Okay, sure. I mean, that's a possibility. But. I think your move, if it does happen, it'll be a lot smaller than anyone really needs.
I mean, I haven't, I haven't met a venture capitalist or an equity real estate person or any else on the equity side. That's not, you know, doing their rain dance of, uh, praying for, you know, somebody to lower the rates, so that they can crawl out of whatever hole they fell into, over the last couple of years.
But I mean, in, in private debt. you know, it's, it's, it's where, you know, even that situation, I tell people, it's like, you know, yeah, we're definitely capturing the rise and the ability to charge higher rates, but anytime you have a move like this, there's two sides to a coin. If you're benefiting, there's a risk that you're taking somewhere.
And I've always said, you know, that risk has been in, in valuations and that's where sticking to what you do and understanding the space that you're in and understanding the risk you're taking. And then saying, wait, what do we have to adjust so that we can help mitigate that risk? I mean, you can't eliminate risk if you're making a return.
I mean, I'd love to be putting up double digit returns with no risk, but. I think somebody would find my trade and take it away from me. But, uh, you know, we're, we're doing the best we can, where it's like, okay, Hey, if we're sticking to that model. So, I mean, in our fund, we only do one thing. We only originate direct mortgages to microbalance commercial real estate.
And I mean we had to come up with microbalance. I should probably define that for people who are listening to this. Cause we, we came out the gate four years ago with the word small, and then we realized. Wow, small in real estate can mean a fairly large loan, like 25 million loan could be small.
Erica: Yeah, that's all relative, right?
Chris: And it's all relative. So we had to come up with, you know, microbalance because, you know, our loan size is, you know, I think, you know, our, we've got a couple that are 250,000 and the highest we go is 1. 2 million. So we are, we are really, we are really operating in a very niche, you know, fragmented space that is, you know, it's, it's underserved from capital.
I mean, that's, uh, you know, You know, you, you've met and talked to Brock and, you know, Brock's the one that, uh, had that existing network in the background and underwriting and in 2019, he brought me this idea and said, do you think we have something here? Do you think people would care? And I was laughing, oh man, people have cared about yield since 2015.
They've been trying to fix this, like, hey, 100 percent equity portfolio and harvesting equity for a while because, you know, everyone who's been around for a while knows that trade can't last. Now, of course. It lasted a lot longer than people thought. But, you know, here we are.
Erica: Well, and that's one thing too, like, and I was talking about this in, like, 2018 19, even prior to 20.
My concern was, we, we were waiting for, we were, like you said, it lasted way longer than we expected it to. My concern with that was, the longer you pull back on that rubber band, when it finally does snap, the more that it's gonna hurt. And it just, I mean, I almost had like this, And even through 2020, like we saw a little bit of a, we saw a little bit of a pullback, but it wasn't to the degree that we all thought it would be. And so,
Chris: No, it, it really, I mean,
Erica: And so now I'm like, we're, you're gonna suffer the consequences. We all are gonna, like, economically, we're gonna suffer the consequences. But how long did it took to get to that point? And it was slow. Like you said, it was not like this. It has been slow and slow and slow. It's been, like I said, a death by a thousand cuts as opposed to like a quick No, it was like a long pullback and then came down the hammer.
Chris: And even that hammer has been pretty light. I mean, it's like, you know, we'll see what happens within the year being, being, being the next hedge. Oh yeah. This year and this year could be, you know, we're not done with this year, so we'll see what the next six months brings. Yeah. But there's a lot of economic stress, that's for sure.
But I mean, being an ex-hedge fund guy, you know, I'm always sort of. Praying for chaos and destruction, because that's where things come from.
Erica: Alright, you heard it from here guys. It's Chris. He's been one doing the right hands.
Chris: But I mean, you know, it's, it's one of those, it's, it's like, I don't think we've seen it. I mean, in certain areas, in certain books, in certain little microcosms, yeah, there's been massive damage. But not on a hole. Not across, no, you're absolutely across multiple sectors.
Erica: I agree.
Chris: I mean, it really, you know, there's a lot of people still living pretty high, so
Erica: I agree. We have not seen it on a widespread scale.
It's been very, very pocketed. Very almost like. Divisive as far as how we've seen the impacts go, but well, and I, I'm glad you brought something up and I want to, I want to come back to it because you mentioned this. So obviously being in a private debt fund, you guys are offering, you know, a fixed income alternative.
So I guess it's fair to say like you would say that it's almost been quote unquote beneficial with these rising interest rates. Have you guys been able to perform better through that?
Chris: Yeah, the way we, I mean, two sides to every coin. Yes, we've been, you know, we run a pass through model so we don't run a flat like I'm going to pay you at 9 or 10 percent or whatever and I take everything else.
you know, as rates, as rates grow, you know, and we are doing higher and higher, you know, you know, Gross coupons to our borrowers, you know, that benefit passes on, uh, to the, to the investors and, you know, we don't run an incentive fee also. So I mean, that really is passing through. We have a management fee and fund expenses and everything else that we, you know, collect.
Now with that said though, you know, especially in this year, you. You've seen a lot of people, and this is, you know, across most funds, where you've seen, you know, more forbearances, more extensions, more, you know, foreclosure activity. And so that's the other side of the coin, which, you know, hey, yeah, we're charging, you know, mid-teens, but you take a few loans off the plate because you're not collecting interest yet and you're solving a foreclosure.
Well, that obviously dampens the return. So really, really what you've seen, and we continue to be in this mode of where, you know, it's 10 to 12 percent net. I mean, that's the range that we sort of picked day one. We started this and that's still the range we're in. Even though you've seen rates go up, well, you're just dealing with more problems.
Now that's the one thing I always say is like default doesn't mean loss. You know, even foreclosure doesn't mean loss. You know, it does, uh, yeah, there's more legal fees and a number of other things, but you know, we're first lien full recourse on everything. So if there's something that goes wrong with the property, we always have, you know, a personal claim that we can, you know, bring against our borrowers to, you know, try and shore up of, you know, as much of that money or even, you know, try to capture accrued and you know, unrecognized, you know, interest and late fees, things like that.
So, I mean, definitely this is a year of a lot more work. A lot more work.
Erica: You're having to work for those double digits, those 12 digit fees. Yeah, it's a lot more work,
Chris: But, uh, you know, it's still, you know, it's still performing exactly as, you know, we had planned and in the range that, you know, we're targeting.
Erica: Yeah. So what would you say, like you said, there's two sides to the coin, so when interest rates back in, you know, 2019, even in 2020, like we saw in 2021, we saw super low interest rates. Yeah. Interest rates. So on, on that side of the coin, if we were to, you know, look down the pipeline and people are looking at, you know, possible investment opportunities, if you're looking down the pipeline right now, we're in a high interest rate environment or relatively later on down the line when we're in a low interest rate environment, What would you guys say?
Like, how do you, how do you navigate those waters and how do you continue to, to perform at that same 10 to 12 percent rate?
Chris: Yeah, no, I mean, the cycle of when money gets cheap, equity is king. It was that way for 10 years. I laughed because it took a while for everyone to realize what fixed income and private debt was.
I mean, I had the conversation with a lot of people because for so long, people had never seen the other side of that cycle.
Erica: Right.
Chris: What do we invest in when money is really expensive? Well, not equity. That's the place, I mean, it's pretty easy to walk through the math and you're going to get hit.
Now there's still opportunities and I would just, I'd let people say, you know, it's not like you're going to make a zero return or you're going to necessarily lose money. You just have an expectation of lower return. Don't think you're going to get the same returns as money gets more expensive. It's a, it's a cost line in your, in the equation.
But, for us in particular, now this is really interesting. In private debt, depending on how correlated you are to various sectors and what I call the volatility of money, how much money flows in and out of your sector, will have an effect on this. But, you know, we were lending money at 10 and a half to 12 when cash was free.
And now we're lending at, you know, 13 to 15. But cash is five. And everyone's like, well, wait, why didn't you just move in lockstep? Well, I'm not going to go into that here. There's a lot of supply and demand factors that go into that, but you also have the ability of like, well, hey, I want to target better borrowers, things like that.
So you get to be more choosy. There's no lack of people wanting money. That doesn't actually change. What changes is, well, the shifts you make in your own risk profile of what you're going to invest in. We're choosing to be on the less risky side, knowing that I'm not targeting. outside of that 10 to 12.
So if I can actually be in the 10 to 12 and take less risk, in my view, that's actually even better for my investors. And so that's the kind of way we've looked at it. Now, there was an interesting paper and I wrote it up in my last newsletter, uh, last month's newsletter, where I described a little bit about, we're actually kind of excited in a certain way for rates to kind of come down because our rates aren't going to fall as fast as you know, traditional, you know, public rates.
Erica: Right, because you have outstanding loans, so they're going to be.
Chris: So the net, so the net spread for my investors right now, let's say, you know, it's five and we're making an 11. Great, I get six. So if it drops to three and I'm still making an 11. Well, the net spread for my investors just went to eight.
Yeah. And so that's actually one of the things that I've been actually watching pretty carefully. And we think that's actually going to happen. And, and I know some other people who've been in private debt for 20 plus years, and they've said, this is, this is kind of. happened before historically. And they're like, you know, so, you know, what actually happens is the spread to the investor over the risk free rate actually increases sometimes, especially if you're in a non-correlated area.
So that is my best guess of what's going to happen for us. So I don't think we're going to necessarily put up lower returns or somehow magically come up with some higher return, but still within our range, but the net spread over the risk free rate You know, we're hoping actually widens.
Erica: That makes sense.
Chris: That's our guess.
Erica: Okay. No, that's, and that, and that's something that, that's not intuitive, right? Like I wouldn't have written.
Chris: It's not intuitive because people think, oh, well, well, people are like, well, how come you're not raising your rates 500 basis points? And I'm like, well, it doesn't really work that way.
You could, but you're going to take extra risk to do that. And just on the other side, if it drops 200 basis points, well, it's not like I'm going to wake up tomorrow and, oh, well, all my, all my rates go down 200 basis points. It doesn't happen like that.
Erica: Yeah. It's a slow process.
Chris: Because we all, I mean, banks will eventually come back to the water and they'll feel it's safe and everything's great in one form or another.
But that doesn't happen overnight either. Right. And so it all takes years to kind of, these waves are not really high and sharp. They're very long and gradual. So it's…
Erica: But I think that's so much more, that's something digestible for investors. To know. Right. And if it's explained and you explained it very well, thank you.
When you explain it like that and they can kind of see, hey, here's what's going on, here's what we're doing, here's why. I mean, boom, boom, boom. That's it. It's something to digest. So, it sounds like you're, you're, like you said, you're doing those micro balance lows. Minimum 250 on the high side. 2.11.
Chris: 1.2.
Erica: Pretty small. 1.2, excuse me, my dyslexia kicked in. No. So I guess, let me ask you this. So for if someone were to. Call you and I'm going to look at this from two lenses. If there was an investor who was going to call you, who do you think is your target person? Who would be the, who would benefit the most from calling you in Kirkland Capital?
As from, uh, as being an investor.
Chris: Who would benefit the most? I'm actually going to quote someone else. I had a luncheon with a very intelligent lady who's now running an investment shop. And she goes, Well, there's almost no one who wouldn't want what you're doing. And I was like, well, you're correct.
I mean, who doesn't want to have an equity-like return with debt level risk with a built in principal preservation. Here's the question, or here's the statement. It's like, well, do they want it? What I'm doing? Because I'm not the only one providing that product. There are other people out there. And so from her words, it's like, well, everyone wants that.
It's just, In what form do you want it in? Do you want it in some diversified where you're going to invest across multiple different private funds doing something of that nature? You really like me and what I'm doing? Great. Or nope, I found somebody else and you know, and these guys are great. I mean, you know, it's, it's, you know, there's, there's a lot of ways to skin this cat.
We chose the real estate angle. I mean, I've got people, I got friends in venture that lots of, you know, you know, you know, different, you know, business and, you know, You know, accounts receivable lending and filtering. I've got a lot of friends that do all that. And all of it has a place. It's just, you know, we chose real estate for two reasons.
One, after doing my homework, I was like, wow, this has a lot of downside protection built into it. And two, well, it's also where Brock had an existing network of loan brokers and he had done underwriting specific to this, you know, you know, pool. So, I mean, he had that network and that background in there and it was just a matter of me, you know, putting together the investment and building the fund and, you know, marching forward, you know, with, you know, the products that he was able to create and in sort of this evergreen fund.
Erica: Nice. Okay. Do you guys have, and I didn't ask this, within the fund, are there any depreciation or tax write offs that are available?
Chris: Not in true private debt. There's a lot of people that do mixed funds where they got some private debt, Pref equity, and then equity plays and everything else. And yeah,
Erica: I was thinking with debt, I was like, I don't know what that fits in there or not. So I figured I'd ask.
Chris: I mean, debt, I always say, I tell people with equity, it's like, listen, you know, you can, it's a longer haul, longer lockup, you know, greater internal volatility and risk, but you do have the possibility of higher returns. And you know, there is a, you know, a tax benefit to that.
Now I will say that in debt, there's not, but you know, our fund does have a sub REIT built into it. So we actually created a, uh, a REIT, structure at the beginning of this year. So this is the first year of its existence. It also helps that, you know, all my largest investors are actually using taxable dollars.
So they're all very, very happy that, I'm bringing the best tax efficiency I can bring, through the REIT structure.
Erica: So through the REIT structure. So that's available within the fund as well now.
Chris: Yeah. Everyone participates, whether you come in with qualified money or not. So, I mean, yeah, there's no immediate, benefit to the restructure for, you know, qualified money, you know, come in with your self-directed IRA or something of that nature.
Now we don't use leverage. I can't find someone who will provide leverage in a, in a manner that. Adds value to my investors.
Erica: So, uh, well, I think that's really valuable for self-directed. IRA investors though, because I Exactly, I just did a webinar, in fact, I need to connect you with Kaaren Hall, who I just did a webinar with on alternative investing strategies.
And one of the big things that people who have self-directed IRAs, if they're wanting to avoid UBIT, you need to find investments. So I've got to get you connected with Kaaren.
Chris: Yeah, no, you hit on the key there is, you know, a REIT blocks that.
Erica: Look at that. Okay. So perfect. I'll get you connected with Kaaren. She is a beast.
She actually is the founder and owner of U Direct Self Directed IRA. Nice. So anyway, I'll get you connected with her. What is the, what's the typical hold time? One, minimum investment. And two, hold time within the fund. Okay.
Chris: Yeah, for a lot of people in a variety of different investment groups, we've been bringing in people, you know, at 50, 000.
You know, I mean, it's very important. One thing I've learned in running on a lot of different funds is I want people to come into the fund at a level that makes sense for them. Because if you're having, if you're stressed out and you're having a bad day, that eventually is going to bleed into me being stressed.
So I wanted to be sized correctly. And, so I obviously I'm not a, you're financial advisor, but I do tend to ask some questions of like, well, hey, how does this fit into, you know, what you're trying to do? And I always, I always liked, I always liked to understand, cause I have had a few people are like, Hey, I just had this sale of like 2 million and well, how much else do you have?
No, this is pretty much it. And I, you know, I'd like to put it all on your fund. I'm like, that, that, that's a horrible idea.
Erica: Backpedal man, backpedal. Yeah.
Chris: Don't do that. And the whole period, you know, most of what we do is a 12 month paper. We do a couple loans that we've done in 18 months, but we ask for a one year lock And because most of our portfolio is 12 months So we're just really trying to do the best we can and manage that asset and liabilities You know, my liability is the investors’ money and the asset I'm holding is that that mortgage So I want to You know, give myself time.
We've actually had, we've already had seven loans roll off this year. I mean, and that's one from a sale and like six from, you know, credit unions, commercial, uh, or community banks taking them out. So as much as there's a lot of different hardship going on, there's a lot of just business as usual, you know, things are still moving forward.
Banks and community banks are lending. It's not the end of the world. I mean, we're, we've had pretty good liquidity. Like we had one guy, he's like, Hey, I got a unique investment. I'd like to have 100,000 out. So he had a partial redemption. I mean, he literally talked to me Friday of last week and I said, you know what, we just had a loan, you know, basically come off.
I've got the cash. You know, we always reconcile with our fund admin and that takes a couple of weeks. And I said, listen, let me, let me check with the fund admin. Let me, let me look over the books. And you know, if I have the ability to make it happen, you know, no lawyer really likes your writing in this, writing this into your docs.
It was like best efforts. Right.
Erica: Yeah, I know. I don't want that on paper.
Chris: I will always try to do best efforts if people need money and they've got something going on. And I've got
Erica: The 12-18 month hold time is significantly shorter than what you're seeing?
Chris: Well, they're all bridge loans. I mean, they're all bridge loans.
So it's, yeah. You know, I don't, that makes total sense. Know we, we've been able to capture, as interest rates go up, we've been able to capture those rising interest rates quite effectively. And you know, like I said, we're not really worried about if interest rates come back down 'cause we're not going back to free cash.
This is not gonna happen. I mean, there's a part of me that would be like, wow, that would be really cool, but it's not going to happen.
Erica: I don't, yeah, definitely, definitely not in the short term. I don't, not, not anytime soon. I want to come back. My other question was if there is, so I asked about who would be somebody coming to you as an investor for a target audience.
If, and I don't know if this is an appropriate question, would you have a target audience for somebody who's looking for private debt?
Chris: I want to make sure I understand, I want to make sure, oh, for, oh, someone, oh, someone's, so someone who's looking for us to lend to them. Yeah, yeah, no, uh, if you are looking at the purchase or you already own a commercial property, obviously, like I said earlier, we're not doing anything in office.
Uh, we, we, you know, we'll probably throw you terms. You're going to say no to anyways, if you're in office, unless, you know, you're really good with very, very low LTVs, but, uh, you know, if you're, yeah, like I said, if you're looking to purchase a building or you're looking to, you know, Refi, we don't do construction, raw land, you know, and even though there needs to be some light rehab, because obviously, you know, there's a value add component if you already own the building.
You know, we have limitations, like we can't have you come in and, great, I want to borrow money against this existing building, and I'm going to knock the whole thing down to the studs. That's just not, that's not, that's not a trade that we're looking for, because then that takes on a risk profile much more like, you know, construction, and we're just not. That's not what we focus on.
Erica: You're not underpaying for that.
Chris: Yeah. Yeah. And, and like I said, you also, it's, uh, it, I always laugh. I said, if you needed, I could probably get you a 20 million easier than I can get you a million. And that's why we're in this niche is to really be there and provide a capital option for people who need to borrow smaller amounts.
Erica: That's awesome. Is there any particular geographical location that you prefer? Or don't like on either one of them.
Chris: We don't really, most of our loans are sourced through, you know, loan brokers. So anyone listening to this, if you're a loan broker and you run into these types of loans, I'm sure our underwriting team would love to chat with you or get you in the system.
Erica: I do have a couple of loan broker clients, so.
Chris: Yeah, no, I mean, uh, you know, we.
Erica: Attention loan brokers.
Chris: Yeah, no, we'd love to, you know, because a lot of people see these trades and we hear this all the time. Wow, I see these all the time and I usually just push them off the end of my desk because I just don't know anybody who does this.
Erica: Yeah, or even my, even my, I have some, uh, multi family or commercial real estate brokers, right? So, yeah, if they're looking to sell this deal and they don't know how to finance it, then they can call you guys. So
Chris: yeah, it's like, well, hey, I need financing. So someone can step in and, you know, Hey, they need 12 month bridge to get the purchase done.
And they think they can get to a stabilized level within, you know, that 12 months. Which really, I always tell people you're dealing with banks today. So you need to be able to like eight to nine months in reality, you got to get to a stabilized, cause it's going to take your bank a while.
Erica: So it will happen in nine or even 12.
Chris: Yeah. It's going to take your bank a while to, you know, get, get the documents put together. But if that's something you're looking at doing, that is, we, we, we, we love that optionality. I mean, that's, that's our, that's our trade. So, uh, cool.
Erica: Awesome. Thank you. Yeah, that helps. So we can know like. You know, how to, how to promote that.
so like I said, we got personal, then we got into the meat potato. That is so helpful. Thank you. I know you and I have talked about that, but I like going into the, you know, the details of it. So that helps me as well. I didn't even think about connecting you with Kaaren Hall, especially, you know, and then, you know, anybody else that's doing self-directed IRA.
I just, like I said, I just did a panel with her. So she's on the front of my mind, but, yeah, that's a super unique investment opportunity.
Chris: Yeah. That's been an ex, that's been an explosive area. Yeah, I, I really had no idea there's that many providers out there until all of a sudden in the last three or four years, there's really been an explosion of investors taking control and taking the reins of their investing and saying, Hey.
this set plan of mutual funds is not really meeting what I want. I can actually, you know, do some stuff on a self-directed basis and really get into some interesting things that are offsets to maybe other pieces of their portfolio. That's, it's, it's been very advantageous for a number of investors.
And, you know, I, I work with all, I mean, we work with a ton of custodians. I mean, we don't choose them. where most of our investors show up with them in hand. Like I'm already at this place. I know there's a lot of custodians that kind of like, Hey, can you, can you send our information to all your investors?
And I'm like, we list you on our website, but we don't really, I mean, it's not, we don't really market one over the other. We're just like, Hey,
Erica: I'm the same way with our investments. I have so many people that are like, Oh, well, I'm like, listen, I'm trying to open up the window so everybody can see. And that's, Where it's at. Like,
Chris: yeah, I mean, I can give references to, well, okay. There's some that have been really, really good from a customer service standpoint where we've run into, you know, a special situation and they jumped on it and
Erica: Yeah, there you go.
Chris: I can, I can mention those things, but it's like I don't. We don't, we don't have any arrangements with any custodians or anything else.
So it's kinda like, well, there you go. I mean, yeah, but we're also on the big guys. We're on Schwab and Fidelity. We're we on, we, we were on TD Ameritrade, but that all became Schwab. Yeah. But, uh, you know, and I always tell, you know, it's, well, if you're at those places, it's, and that's actually where we accessed a lot of, you know, we make it administratively easy for a few of our RIA, you know, investors.
It's like, well, you're, you're in custody.
Erica: I don't even think about RIAs either. Okay.
Chris: You, you custody, you custody at Schwab already? Well, great. We're on their platform. The money doesn't actually need to leave their system. It actually stays in their account. They don't have any money leaving, you know, okay.
That's what, that's what they're always worried about is, you know, it's, Hey, it's all about AUM I get it. I used to manage money. I know how it works. And, you know, you need to have optionality for these people to realize, Hey, I can actually, you know, keep it all within my custodial platform for my investors.
It shows up on their statement and my system. And that's what we've been able to do for a few RIAs.
Erica: We're seeing a lot more of the traditional, even so the firm that I worked for when I left. You know, they were only offered able to offer like the traditional stocks, bonds, mutual funds, but over the last few years we've seen a huge swing in the traditional space going more into alternative investing.
Yeah. So there's a ton and even the firm that I, that I used to partner with, we still have a great relationship and, you know, I send some traditional people their way, but they actually just became an RIA to be able to offer that because I think people are starting to realize, here's the thing.
There's no such thing. You know, I say this all the time. There's no good or bad tool. It's just, what are you trying to accomplish? Don't cut a piece of wood and half of the hammer. And that doesn't mean that stocks are, you know, stocks are bad. There's nothing bad. It's just, what are you trying to accomplish?
And for so long, people put so much effort and belief in the stock market. But it was all weighted in this one area. All the eggs were in that one basket. And that's not the end all be all to your financial picture. That's not going to build your entire wealth portfolio in this one area. So anyway. that's another,
Chris: I always, you know, even 25 years ago, I always tell people, it's like, listen, you build a hub of what you want exposure to.
And then you have spokes around it to where you're taking various, you know, risk plays or offering something that gives diversification to your portfolio that doesn't come with traditional assets. I mean, there's a lot of things you can do. It's like, you know, build the core of what you want and maybe that's a traditional stocks and bonds.
Maybe that's your core. That's great. I mean, it, that's actually a lot of the people I worked with. And then it's like, well, wait, what else do you want exposure to? I always tell people I'm, I'm not probably the model picture for your standard investor, because I've been in alts for so long.
I have very little traditional assets. It's probably about, it's probably about 25 percent and I'm about 75 percent alt.
Erica: I think most people who have left the traditional space would agree with you.
Chris: I'm not saying that's right or wrong. I'm just saying that's just because of my background and my understanding of my network.
That's just where I ended up and it actually. Well, I mean, one half, one part of me is very happy. The other part of like, well, man, I really wish I had more S& P 500 because the thing just keeps on going up. I mean,
Erica: It's impenetrable. I can't even say that word. Oh my gosh. Anyway, so impenetrable.
Chris: We'll see if AI can keep pushing it further. Really, how much more value can AI bring? We'll see.
Erica: We'll see. All right. So we'll wrap up here. So I know, thank you for sharing all that, you know, on the, on the investment business side. So, I would say to wrap up, can you give us maybe, you know, two or three books and or podcasts that you really felt like have, benefited you?
And then also, is there anything in particular, any belief, behavior, habit, or experience that you've had within the last five years that you felt had the most positive impact on your life and kind of changed your, changed your perspective of things.
Chris: We'll start early. I, I watch a lot of different podcasts more for like education.
So I don't think that'd be terribly entertaining because it's like, well, if I don't know something, I use that as a source to go quickly educate myself on, you know, some random subject that someone asked me about. And I don't, uh, I don't really know. Many people call me, I'm definitely the person you want on your, your team for, you know, that the bar, uh, what do they call it? Trivia. Yeah. You want me on your trivia team. Yeah. Uh, I had a mind blank there. Uh, I, I, I run into things I don't know and I'm like a moth flame where it's like, Hmm. And so I'll find that out. But, yeah, I gotta go figure that out because I'm not going to become an expert in it, but I should probably know something.
So, you know, I knew nothing. But from a book standpoint, Brock put me onto a great book of, especially if you're a small entrepreneur or running a fund or you're scratching your eyes out of how you're going to stop working, you know, 26 hours in a 24 hour day. It's a book called, uh, 'Who Not How.'
Erica: I need to read that one.
Chris: And it's a, it's a great book. I, I read it once and then I go back and reference different pieces and Brock and I use it a lot. as we restructure our thinking. I've always been a how, I'm the tip of the spear and I need to do this and how am I going to get that done? And that's a lot of people, especially in the startup world.
Erica: I'm guilty of that myself.
Chris: Yeah. I mean, well, a lot of people, a lot of people are, so that's been a great book. And then, it's an older book, but I just ran into it recently. It's, uh, you know, 'Persuasion'. and I'm in a mind blank of
Erica: How to how to persuade people and make friends. Was it Carnegie?
Chris: Yeah. No, it's, it's uh, here.
Let me I'll pull it down here. I'm having multiple mind blanks all of a sudden. Um. It's, you know, Presuasion by Robert, uh, Cialdini. So P R E, Suasion. So it's Presuasion. And so what it talks about is a lot of biases and, uh, the effects of biases that people can take advantage of to sell you things or to get you think, thinking things that, You know, cloud your, uh, clarity of, uh, of judgment.
and so it's a really interesting book of, he walks through his career of being a sales expert and the things they did and the things that he ran into and the studies that he did, all about what do you do before you even start to sell? So it's a pre suasion is the name of the book. Interesting.
Okay. Yeah, so those are, those are two great books. And I guess your last question is, uh.
Erica: Unique experiences, beliefs, anything that has impacted you in a way positively that made you kind of change your view or perspective on it.
Chris: I don't know if it was a one impact but a life of dealing with, you know, unique stressful situations that most people are not You know, and I hope, I hope you don't get into these on a regular basis, unless you're training like I am, but in martial arts, you deal with a great deal of stress, you know, depending on what level you're at, that stress can be fairly mild, or it can be fairly intense, depending on what you're trying to achieve.
If you're going like me, when I was much, much younger, I did some tournament fighting, and so you had people really trying to hurt you. And, uh, there's a certain level of stress and realizing you got to stay calm, even in the most stressful situations.
Erica: Yeah, I'm in physical danger right now.
Chris: Yeah, physical danger creates a very interesting reaction in a lot of people.
Which I mean, you'd be, uh, I have a saying that I told my daughter. If I'm standing there and I'm assessing a situation, we're probably not in danger. If you see me running, don't ask why. Run. I've already assessed, I have already assessed that, this is, this is bad. And we got to go, we got to get out of here.
So don't bother asking why. Cause I don't, the joke in martial arts is, I, you know, I'm not a, not a long distance runner. I was born with mild asthma and things like that. So I don't tend to run from problems. I tend to square up on them. And so, but back to the main point of, uh, just being able to face a variety of different stresses and really maintain calm.
A lot of people always, it's this very classic. I mean, everyone's had this happen. They come to you and they say, Oh, do you want the good news or the bad news first? And I'm Yeah. Cause what I generally find is What people view as bad news is really not that bad. It's all manageable. It's a matter of just keeping a clear head and, and solid thought and maintaining a calm.
You might, you might be ready to go, you know, in whatever situation, but it's a matter of really keeping attached to your mental acuity of what's happening and saying, cause I always tell people you can't solve your problem. You can't defend yourself if you're panicking.
Erica: Yeah, you need to remove your emotion from and use logic in the situation.
Chris: And even in martial arts, I tell people, I, I, I'll put my foot on the white line against them. And I'll be like, okay, stop, go take a deep breath, relax your shoulders. Cause you've already lost. All I have to do is look at you and you've lost. Let's go get, get, get in the right mode because I can tell right now you're super tense and it's not going to go the way you think it's going to go horrible.
Yeah. And so, and so, you know, that's the same thing in work. It's like, okay, you get that initial blow, take a deep breath, relax. I do a lot of breathing exercises. So I tell people all the time, if you feel super panicked, stop. whatever you're doing and just focus on your breath. Just, just breathe. Just breathe.
You know, nothing's the end of the world, except the end of the world. Everything else is somehow solvable.
Erica: Yep. I love that.
Chris: And so that's, uh, that's what I've sort of built over many, many years. Just, uh, you know, uh, Bad things are going to happen. There's always challenges. I literally believe life is just a series of challenges until you're just out of challenges.
And we all know what that day is.
Erica: And the last challenge is death. And that's one that you can't win.
Chris: That's not, not much of a challenge. You can't win that one. But you know, everything else and out of some of those challenges, if you can solve them and be successful, you know, good things can happen and it's just that realization, you know, some of them you're going to fail and you try to learn what you can from that and apply it to the next challenge because the next challenge is probably coming sooner than you realize.
Erica: That's not the truth. I feel like that happens, especially as you get older. All the challenges seem to get freaking closer. I just got this done. Oh, I feel like God looks down on me sometimes. He's like, I just came up with this mess. I've got to deal with another one. Anyway. Yeah.
Chris: And work is stretching you out while your knee's giving out.
Yeah. You know,
Erica: so what is the, and I'll put all this in the email and the posts and all of that good stuff. What is the best way for people to get in contact with you? Phone, email, website.
Chris: Yeah, certainly you can go to the website. That's KirklandCapitalGroup.com. You'll get all our information.
You'll be able to access them. If you don't want to talk to me, you can talk to Brock, you know, whatever. I mean, obviously I'm on LinkedIn. There are not too many Chris Carsley’s on LinkedIn and there's very, there's even fewer Chris Carsleys that are CFA, CAIs. So not tough to find. I connect and talk to a lot of people through, uh, LinkedIn.
So if there's, you know, there's something you want to talk about, there's questions, a lot of ways for you guys to reach out. And if you're interested in the fund, it's something you'd like to look into. Like I said, you can go to the website or you can reach out to me. We can always have an initial conversation or I can hook you up on the investor library. Whatever works for you, whatever's easiest for you.
Erica: And I'll put, I, obviously you and I are connected on LinkedIn, so, I'll put the website and a link to the website and a link to your LinkedIn profile. I'll put all of that in the email and as well as the social media postings. So everybody can blow up your, blow up your inbox, right?
Chris: Oh, well, that's, that's part of the game, right? You got to, you got to build awareness.
Erica: Oh, yeah. And in the meantime, I'm going to reach out to Kaaren too. And I have another, another buddy that actually is a manager of an RIA. So hopefully, man, get some people, uh, great.
Chris: I look forward to, look forward to, you know, I, one thing we didn't really talk about is I spend a lot of time doing, uh, educational work.
So it's like, if, if, if anyone has questions or things that I've run into, or they're looking to network with someone, you know, I, you know, I, back in 2004, I started up the Seattle Alternative Investment Association and the people who run that are doing a great job. Still, you know, amazing events. And then co-founded, uh, Five years ago now, the Pacific Northwest chapter for the CAIA.
So, always trying to work, uh, on networking education. Yeah. So it's, uh, if people want, I mean, I, I even had people in Australia, Hey, can you try and connect me to the local CAIA chapter? And, uh, you know, was able to make that happen. So, I mean, there's chapters all over the place. If you're looking for further network, for the resources for education, I always tell people, and it really doesn't matter.
Oh, but I'm not in the industry. It doesn't matter. I mean, Those organizations already
Erica: get more educated on this, on this stuff.
Chris: You're gonna be sitting in a room of people who do this for a living. Yeah and you can go and learn some and meet some of those people. Listen to some of the things that they are listening to and how they're thinking about putting things together for their clients.
Yeah. Um. And maybe there's a, uh, a gem you can walk away with, uh, that you can use in your own portfolio. So yeah, if there's, if there's interest in that as well.
Erica: I'm so glad you brought that up. You're right. We didn't, we didn't get to spend a lot of time on that. But if you'll share those links with me, I can include, I'd like to include that as well.
So then, you know, cause that's the thing like, you know, we always make the, I know it's kind of cliche, but your network is your net worth. And so getting people connected and letting them know all the resources that are out there. The more we educate, the more we provide those information and resources, the more, more opportunities people have.
So I would really, really, really appreciate that. So we'll, of course, we'll wrap up. Thank you so, so much, Chris. This was really great info. Like I said, I already knew about your fund and we had talked about it. But this was so much more detail. And it kind of got into, I like that we got into, Like you said, two sides of the coin, right?
When, when, and here's the thing, like, I think you kind of talked about this. There's so many people I've talked to that are like, Oh, it's great. The market's great. Everything's booming. Like it's so easy to make money when the market's through the roof and money is free. And, but when you're able to manage through and get through more economically compressed times, I mean, that's really what you're going to see make the biggest impact on investors and on yourself and your business.
I mean, that's just huge.
Chris: And trust me, we launched in January of 2020. So we all know what happened in March. That was, that was a lot of fun.
Erica: Man, what a trial by fire.
Chris: Your anchor investor calls and is like, Hey, I'm not gonna be able to anchor you. And I said, I had a feeling that was the conversation you were calling.
Now, I mean, with that said, you know, Brock and I were already ready to go. I had already sold a number of different things. So we actually put, we, we bootstrapped this basically. I felt like I was back in a startup. I wasn't in a fund. I was in a startup. And all of a sudden now I'm bootstrapping this with my own money and friends and family weren't doing much either.
So it was literally day one was Brock and mine's money. And we just started doing loans with our own money. Cause, uh, I told Brock, I said, listen, in a startup, you got to go from idea to real or no one, no one's joining. You can't pitch an idea. It's all about not, not when things are tough. And we were, we got a little lucky because COVID was a little bit of a, dead cat bounce.
And, you know, by, by May, June, some people already coming back into the water and then, you know, we, we started seeing some outside investors. I see.
Erica: So you guys have the ability to, at least get through that front part, which is the hardest, right? Like getting started doing it and all that. And what you're saying actually reminds me of, I'm reading a book, right.
Call it right now called nine figure mindset. I will have to remember who it's by, but he basically talks about the same thing, bootstrapping, getting things started from the ground up, all with your own money. If you haven't read that book, I think you would really like it, you know,
Chris: send me the link on that one. Yeah.
Erica: I will. But it was, uh, I'm getting pulled up right now, but anyway, it's great to just kind of say Brandon Dawson.
Okay. And he actually, he partners now, he does some other stuff with some pretty big people on the coaching side. But anyway, no, that's fantastic. Like you said, you and, you and Brock, and you know, both of you guys, I think it's so funny cause y'all are both so analytical and so intelligent, you know, Brock's a very, uh, very smart guy and does a great job diving into everything.
So y'all are both so similar, but you're just different enough that your partnership like works and y'all create that synergy. So y'all bring such a unique feature.
Chris: There was a very interesting, there was a very interesting interview we had very early. I mean, that's what actually really made this work and it continues to make it work was we have some similarities, but We have a fair amount of differences and differences in background and, and, and specialties that we bring to make this work.
And I don't get quote for this, but I, I laughed because the person brought it up. She goes, well, you're kind of like that, you know, the super friends, those, uh, wonder twins. And I go, Oh my God, the fact that I actually know what you're talking about. Yes. The wonder twin wonder twins activate. Yeah. But it was really kind of an interesting view.
It's like, well, I couldn't do without Brock and Brock couldn't do it with out with me, but bringing the two backgrounds together is what allowed this to be created. So we've actually,
Erica: One plus one equals three, right? Like it's, worked out. There's another good book called Rocket Fuel, by Gina Wickman. That is really powerful too.
So anyway, these, this is great. Thank you so much, Chris, for coming on and sharing all of that. And
Chris: It was great. Thanks for having me.
Erica: Absolutely. We will.
