WEBVTT - Now There Are One-Stop Shops to Launch Your ETF 0:00:05.840 --> 0:00:08.360 Welcome to Trilliance. I'm Joel Webber and I'm Eric bel Tunis. 0:00:11.520 --> 0:00:14.600 I'm really looking forward to this episode. Eric, we this 0:00:14.880 --> 0:00:16.280 is all you. You You were the one that was like, 0:00:16.280 --> 0:00:21.680 we've got to talk about white label issuers. What is that? Yeah, 0:00:21.720 --> 0:00:24.360 so a white label issuer. Um. I'm not sure if 0:00:24.360 --> 0:00:26.479 there's a perfect metaphor, but say you have an idea 0:00:26.520 --> 0:00:28.440 for an ETF, but you don't really have a big 0:00:28.480 --> 0:00:31.280 company a lot of infrastructure, um, nor do you want 0:00:31.320 --> 0:00:33.680 to spend the time on that or the money. But 0:00:33.800 --> 0:00:35.919 you want an e t F out there. That is 0:00:35.960 --> 0:00:38.519 your idea. There are some companies now that you can 0:00:38.560 --> 0:00:41.720 go to. They have all everything taken care of for you. 0:00:42.080 --> 0:00:44.559 All you do is give them some money. They do 0:00:44.640 --> 0:00:47.760 all the sort of infrastructure work on on your fund. 0:00:48.200 --> 0:00:50.559 They hook you up with even lead market makers and 0:00:50.560 --> 0:00:52.920 the whole nine yards. A lot going on beneath the surface, 0:00:52.920 --> 0:00:54.720 which we should We're going to explore in this episode. 0:00:55.120 --> 0:00:56.400 At the end of the day, boom, you have an 0:00:56.400 --> 0:00:57.960 e t F is treading on all these changes, and 0:00:58.000 --> 0:01:00.360 then your main job is to market it right and 0:01:00.400 --> 0:01:01.680 if it's active, I guess you have to pick the 0:01:01.720 --> 0:01:03.600 stocks and do your strategy, but they take care of 0:01:03.640 --> 0:01:06.319 everything else. So this is called the white label business 0:01:06.319 --> 0:01:10.040 and it's it's big, it's growing quickly. Um, there's the 0:01:10.200 --> 0:01:12.559 three big ones we have on today, who I'm calling 0:01:12.560 --> 0:01:15.760 the big three in their own regard. But the reason 0:01:15.840 --> 0:01:18.479 I wanted to explore this is Goldman just mentioned they're 0:01:18.640 --> 0:01:21.880 going to start a white label business themselves. This was major. 0:01:21.959 --> 0:01:24.800 This is the first massive firm that saw this as 0:01:24.800 --> 0:01:28.440 a potential. And if Goldman has their own clients saying, hey, 0:01:28.520 --> 0:01:30.560 I wanna launch an e t F can you help me? 0:01:31.120 --> 0:01:32.680 That is such a good sign for the E t 0:01:32.760 --> 0:01:36.080 F industry if Goldman sees this. So but these the 0:01:36.120 --> 0:01:37.720 people we have on today have been doing this for 0:01:37.760 --> 0:01:41.440 a long time, and they're also people who they know 0:01:41.480 --> 0:01:44.000 everything going on the e t F business Like they're 0:01:44.040 --> 0:01:47.840 they're they just have a lot of an interesting seat 0:01:48.440 --> 0:01:51.080 to the e t F game. Joining us for this 0:01:51.120 --> 0:01:56.600 episode West Gray of Alpha Architect, Mike Venudo Title Financial Group, 0:01:56.880 --> 0:02:03.160 and Garrett Stevens of Exchange Treated Concepts, this time on 0:02:03.280 --> 0:02:10.160 Trillions White Label et F s WES Mike Garrett woken 0:02:10.160 --> 0:02:14.760 to Trillions than awesome to be here again, likewise, appreciate 0:02:14.840 --> 0:02:18.200 it Okay, Mike, I've got an idea for an e 0:02:18.280 --> 0:02:22.280 t F. I come to you, You give me an 0:02:22.280 --> 0:02:24.480 e t F in a box, and then I get 0:02:24.520 --> 0:02:27.240 to wrap it. This is like perfect for the holidays, right, 0:02:27.280 --> 0:02:30.440 I just put Goldman wrapping paper on it. Yeah, let's 0:02:30.480 --> 0:02:32.400 not put Goldman wrapping paper on it. Let's put title 0:02:32.400 --> 0:02:35.960 wrapping paper on it. Um. But yeah, it's a chassis, 0:02:35.960 --> 0:02:38.880 it's a wrapper, it's a structure, right, And it's just 0:02:38.919 --> 0:02:41.480 a better way to deliver things. And the most successful 0:02:41.520 --> 0:02:44.840 ETFs we've seen are ones that already have a successful 0:02:44.919 --> 0:02:48.680 idea and a less successful wrapper. And if we can 0:02:48.800 --> 0:02:51.440 just enhance the return to the end investor by putting 0:02:51.480 --> 0:02:55.040 it in ETF, it's a win win for everybody. Um, 0:02:55.600 --> 0:02:58.840 let's let's rewind the clock here a little bit and um. 0:02:59.600 --> 0:03:01.760 You know, er, I want to talk to you because 0:03:02.160 --> 0:03:03.800 in my mind I could be wrong, but you were 0:03:03.840 --> 0:03:06.440 the first white label issue I believe. I remember once 0:03:06.560 --> 0:03:08.480 writing it might even been my first book. I wrote 0:03:08.960 --> 0:03:11.200 How Faith Shares that you had a company called faith 0:03:11.240 --> 0:03:14.400 Shares and it didn't work out, so you used your 0:03:14.480 --> 0:03:17.720 exempt of relief to help others launch their funds. And 0:03:17.760 --> 0:03:21.240 you had this huge success and I, UM, I wanted 0:03:21.280 --> 0:03:24.040 to use the word resurrected because of the sort of 0:03:24.600 --> 0:03:27.239 I was like, they resurrected themselves into this new entity. 0:03:27.400 --> 0:03:29.400 And it's you know, a great story of when one 0:03:29.440 --> 0:03:33.160 door closes, another one opens. Can you talk about that 0:03:33.440 --> 0:03:37.839 process and how you sort of got the idea for this? Yeah, 0:03:37.920 --> 0:03:40.320 so that's exactly what happened. You know, we launched the 0:03:40.360 --> 0:03:43.480 five faith shares funds. They were just not successful and 0:03:43.520 --> 0:03:45.760 gathering assets, and you know, it was a classic story 0:03:45.840 --> 0:03:47.840 of starting a new business and it you know, taking 0:03:47.960 --> 0:03:50.760 twice as long and costing twice as much as it 0:03:50.880 --> 0:03:53.200 was supposed to Originally. When when we launched the business, 0:03:53.560 --> 0:03:55.240 you know, you still had to get exempt of relief 0:03:55.280 --> 0:03:57.160 back in those days. So this was two thousand eight, 0:03:57.280 --> 0:04:00.360 two thousand nine. Um. If you remember the market environment 0:04:00.400 --> 0:04:01.600 in two thousand and eight when we were trying to 0:04:01.680 --> 0:04:04.520 raise startup capital to launch a new financial services company, 0:04:04.680 --> 0:04:07.119 was really terrible timing for that, but we got it done. 0:04:07.560 --> 0:04:10.000 Two thousand nine, we finally got our exemptive relief. It 0:04:10.040 --> 0:04:12.680 took about a year from the SEC to grant that. 0:04:13.400 --> 0:04:15.960 We spent nearly a million dollars in legal fees alone 0:04:16.240 --> 0:04:19.320 to get the exemptive relief. Back in those days, you know, 0:04:19.920 --> 0:04:23.440 those added expenses and added time took away from, frankly, 0:04:23.480 --> 0:04:25.880 the viability of the products once they got to market. 0:04:26.440 --> 0:04:29.040 And you know, we ended up closing three of the 0:04:29.279 --> 0:04:32.160 five funds after about eighteen months. When we did that, 0:04:32.760 --> 0:04:35.240 we had other firms start calling us basically to say, look, 0:04:35.279 --> 0:04:37.960 can we buy you We just want your exemptive relief right. 0:04:38.000 --> 0:04:39.480 We don't want to wait a year with the SEC. 0:04:39.680 --> 0:04:42.160 We want to get to market faster because once you 0:04:42.279 --> 0:04:45.120 had that exemptive relief, you can launch funds in seventy 0:04:45.160 --> 0:04:48.320 five days and that's the statutory review period the SEC 0:04:48.440 --> 0:04:51.560 staff has to review a new prospective filing, so it's 0:04:51.640 --> 0:04:54.440 much faster, and we had all the infrastructure there. You know, 0:04:54.520 --> 0:04:57.000 the multiple series trust model had been around in the 0:04:57.080 --> 0:04:59.480 mutual fund world for a long time, but no one 0:04:59.560 --> 0:05:01.200 had done anything like it in the E t F 0:05:01.320 --> 0:05:03.880 business at that point. So you know, once we had 0:05:03.920 --> 0:05:06.760 people call and saying, hey, can we just buy your infrastructure, 0:05:07.080 --> 0:05:09.200 that's really where you know, I had the idea like, look, 0:05:09.320 --> 0:05:11.440 why don't we use what we have here launch funds 0:05:11.480 --> 0:05:14.400 for other people? Because if someone had had this out 0:05:14.560 --> 0:05:17.200 and available when we launched ours. We could have saved 0:05:17.240 --> 0:05:19.920 a ton of time, a ton of startup capital, and 0:05:20.000 --> 0:05:22.960 been to market you know, a lot faster and probably 0:05:23.000 --> 0:05:25.880 had a much higher chance of success than than what 0:05:26.000 --> 0:05:28.000 we ended up with. So that's how we got here. 0:05:28.440 --> 0:05:31.360 And to just talk about real quick, your first couple clients. 0:05:31.400 --> 0:05:33.000 I when I think of you, I think of robo 0:05:33.600 --> 0:05:36.000 um and when I think of white label et f 0:05:36.120 --> 0:05:38.120 that are hits. Robot again is one of them that 0:05:38.200 --> 0:05:39.960 comes to mind. There's been a couple of pretty big hits. 0:05:40.720 --> 0:05:42.920 Was that the first one? Or how did the first 0:05:42.960 --> 0:05:45.320 couple come about? And did did they come to you 0:05:45.880 --> 0:05:47.720 have the idea for robot or were you like, hey, 0:05:47.880 --> 0:05:51.680 I got this thing. Yeah, no, No, they came to us. 0:05:51.800 --> 0:05:54.560 So UM, they were not the first. They actually very 0:05:54.600 --> 0:05:57.800 first fund we launched was y mlp UM an MLP 0:05:58.040 --> 0:06:01.280 e t F for firm called Yorkville at the time. UM. 0:06:01.520 --> 0:06:03.320 That one actually did very well. It ended up with 0:06:03.560 --> 0:06:05.919 something like four hundred million something like that before they 0:06:06.000 --> 0:06:09.000 ended up selling that to Vannack after a few years 0:06:09.200 --> 0:06:13.080 had a successful exit there. UM Alpha Clone was one 0:06:13.080 --> 0:06:15.520 of the other ones we launched early. That one ended 0:06:15.600 --> 0:06:18.360 up doing doing well also a few hundred million dollars 0:06:18.440 --> 0:06:20.640 in that fund. Um. And then and then of course 0:06:20.720 --> 0:06:24.440 Robo was the biggest success. You know, it's typical of 0:06:24.520 --> 0:06:26.480 the E. T F business right in in that fund. 0:06:26.520 --> 0:06:28.760 So it you know, organically picked up. I think it 0:06:28.839 --> 0:06:31.080 was ninety or a hundred million dollars within the first 0:06:31.400 --> 0:06:34.520 sixty or ninety days. But then it's set there, you know, 0:06:34.640 --> 0:06:37.880 for three or four years at that level, just kind 0:06:37.920 --> 0:06:41.479 of churning, waiting, building a track record. And then its 0:06:41.560 --> 0:06:45.160 theme hit right, it came into vogue. People started hearing 0:06:45.200 --> 0:06:48.880 on the news about drones and about robotics, you know, 0:06:49.160 --> 0:06:52.559 ruling warehouses and taking factory jobs, and everything was about 0:06:52.560 --> 0:06:54.920 that on the nightly news and everything. That fund picked 0:06:55.000 --> 0:06:58.120 up two billion dollars the next year after sitting at 0:06:58.160 --> 0:07:02.600 a hundred million for three or four and so that's there. Oh, 0:07:02.680 --> 0:07:04.160 you love to see it. I love when I love 0:07:04.279 --> 0:07:06.480 it's I called the indie feel good hit of the year. 0:07:06.920 --> 0:07:09.240 Robo was definitely that one year. Um, every year there's 0:07:09.279 --> 0:07:12.200 a couple and uh, it's fun to watch because it's 0:07:12.240 --> 0:07:15.240 hard to be an indie independent issuer or somebody using 0:07:15.240 --> 0:07:17.640 a white label. Um, you need a little luck, you 0:07:17.720 --> 0:07:19.880 need the stars to align and um, it's nice when 0:07:19.920 --> 0:07:22.720 it happens because I want that part of the industry 0:07:22.800 --> 0:07:25.880 to thrive, so others want to take chances because of 0:07:25.920 --> 0:07:29.160 the India is where you see the innovation in my opinion, Yeah, no, 0:07:29.280 --> 0:07:32.000 I agreed. And you know what's interesting about our our 0:07:32.080 --> 0:07:34.560 business and the funds that we launched, It's launched by 0:07:34.720 --> 0:07:37.840 experts in the field. Right. It's not very often someone 0:07:37.920 --> 0:07:40.040 comes to us with an idea that they have, you know, 0:07:40.080 --> 0:07:42.200 they've never done before, which is different than a lote 0:07:42.200 --> 0:07:44.640 of the major issuers. You know, you're I Shares or 0:07:44.840 --> 0:07:46.680 some of these big firms. They're looking to launch products 0:07:46.720 --> 0:07:49.040 that they can market and sell. The people who come 0:07:49.080 --> 0:07:52.040 to us, you know, our our experts and what they do. 0:07:52.160 --> 0:07:54.600 Our MLP fund was done by people who have been 0:07:54.600 --> 0:07:57.560 investing in m LPs for many years. The robo guys 0:07:57.600 --> 0:08:00.200 were investors in the space and knew it and not 0:08:00.320 --> 0:08:02.400 find an E t F that fit what they wanted 0:08:02.440 --> 0:08:05.120 to do. The uranium fund we launched, you know, again, 0:08:05.240 --> 0:08:07.600 somebody who's intimately familiar with that industry had been in 0:08:07.640 --> 0:08:10.800 it for many years, so you come up with better products. 0:08:11.000 --> 0:08:13.640 In my opinion, when you have experts working on it 0:08:13.680 --> 0:08:15.600 and wanting to launch it and coming through someone like 0:08:15.840 --> 0:08:18.640 us rather than a marketing team trying to decide, you know, 0:08:18.720 --> 0:08:21.080 what product they think they can sell and trying to 0:08:21.280 --> 0:08:24.320 you know, throw stuff against the wall and see what sticks. Okay, well, 0:08:24.400 --> 0:08:26.400 I'm gonna bring you in here. I've got a big idea. 0:08:27.160 --> 0:08:30.360 Maybe no expert, but I got ideas. Um and uh 0:08:30.640 --> 0:08:32.559 so I'm gonna give you a call. What happens next? 0:08:32.640 --> 0:08:36.559 And what do you look for to bring successful products 0:08:36.600 --> 0:08:41.520 to market? Yeah? So, unfortunately we've been surviving in this 0:08:42.000 --> 0:08:44.520 terrible business called e t F for you know, mist 0:08:44.559 --> 0:08:47.400 ten years now. So usually on our first call, my 0:08:47.640 --> 0:08:51.720 job is to anti sell going into the ETF business. 0:08:51.840 --> 0:08:54.760 Right Like, this is so expensive. You gotta have five 0:08:54.880 --> 0:08:57.400 years ready to go. You gotta light money on fire. 0:08:58.000 --> 0:09:00.480 If you don't, if you're not ready for war, just 0:09:01.040 --> 0:09:06.360 go back home. Yes, I am the cold shower because 0:09:06.400 --> 0:09:09.400 we don't want people, uh to get into something that 0:09:09.840 --> 0:09:12.920 they're not really ready for. Right. Um And and even 0:09:13.000 --> 0:09:15.559 though obviously our objective of our et F hit level 0:09:15.640 --> 0:09:18.560 platform is to lower bears entry to allow a lot 0:09:18.640 --> 0:09:23.160 more people to you know, access this great rapper, it's 0:09:23.240 --> 0:09:25.640 I just feel It's very important to make sure people 0:09:25.720 --> 0:09:28.480 understand that. You know, it's not a panacea. It's a 0:09:28.520 --> 0:09:30.959 lot of work, a lot of effort. But the good 0:09:31.040 --> 0:09:34.360 news is when you segment into people that you know, 0:09:34.679 --> 0:09:37.000 they listen to your pain trains story and they're they're 0:09:37.040 --> 0:09:40.360 still standing there, that means they're probably pretty well fit 0:09:40.559 --> 0:09:43.080 to be successful in the et F industry. I feel 0:09:43.160 --> 0:09:44.559 I know you were in the military. I feel like 0:09:44.600 --> 0:09:46.520 this is the basic training. If you can make it 0:09:46.600 --> 0:09:50.600 through those couple of weeks, maybe you're good. Um, quick question, 0:09:51.200 --> 0:09:53.640 explain to us again. We'll stick with West on this one. 0:09:54.400 --> 0:09:56.600 What do you do? Um? So I have the idea. 0:09:56.840 --> 0:10:01.599 Let's say my idea is, um, Philadelphia based companies. You 0:10:01.679 --> 0:10:05.280 probably tell me to go away. You'd probably colder. Let's 0:10:05.280 --> 0:10:08.040 just assume I'm standing after your whole speech, Um, what 0:10:08.320 --> 0:10:12.199 are you going to do for me? Exactly? Yeah, so 0:10:12.400 --> 0:10:15.760 you really There's there's kind of three areas of e 0:10:15.920 --> 0:10:19.439 t F needs. Right, there's legal compliance and just broad 0:10:19.520 --> 0:10:23.120 based brain damage I call it. Uh, there's portfolio management 0:10:23.200 --> 0:10:26.800 and train execution, and then there's marketing and distribution. Right, 0:10:26.840 --> 0:10:28.719 those are kind of like the three big levels you 0:10:28.760 --> 0:10:32.760 can pull. So different white labels are different. We what 0:10:32.920 --> 0:10:35.559 we do is we deal with all the brain damage, 0:10:35.600 --> 0:10:38.880 so the legal compliance, regulatory component, we do, all the 0:10:38.960 --> 0:10:44.199 portfolio manager train execution component. But the marketing and distribution 0:10:45.000 --> 0:10:49.120 we keep that open architecture, and I think the gentleman 0:10:49.160 --> 0:10:52.199 on the call have have actually offer those services. But 0:10:52.320 --> 0:10:54.839 that's our core focus is how the heck do we 0:10:54.920 --> 0:10:57.559 get you to market as cheap as humanly possible with 0:10:57.679 --> 0:11:02.280 full transparency and totally ran key from operational standpoint. But 0:11:02.600 --> 0:11:05.120 you've got to do the selling and distribution and everything. Okay, 0:11:05.200 --> 0:11:09.160 So Mike, when West gives someone a cold shower, um, 0:11:09.760 --> 0:11:11.520 maybe they come running to you. What do you do 0:11:11.720 --> 0:11:16.040 that's different than than what West does? That's a great question. 0:11:16.320 --> 0:11:18.920 You know. It's funny because all three of us share 0:11:19.040 --> 0:11:22.400 leads and put people back to each other. Um, you 0:11:22.480 --> 0:11:24.679 know for some of these cold showers and for some 0:11:24.800 --> 0:11:27.480 of the things that different people want. Uh, you know, 0:11:27.640 --> 0:11:31.240 for for Eric, I just reserved the tickers C S, 0:11:31.320 --> 0:11:35.000 t K for cheese steak, so we can do it. Yep. Um, 0:11:35.960 --> 0:11:39.560 So uh, what do we really do? So our our 0:11:39.679 --> 0:11:42.559 process includes more of an assessment. We do kind of 0:11:42.600 --> 0:11:45.439 that McKenzie style report and we do come back with 0:11:45.600 --> 0:11:49.200 the same kind of thing that Wes or Garrett will saying, hey, 0:11:49.800 --> 0:11:52.480 you're not ready, or you are ready, or you need 0:11:52.600 --> 0:11:55.079 this to be ready. A right, So we we go 0:11:55.240 --> 0:11:59.480 through all four kind of buckets. We do strategy, product, uh, sales, 0:11:59.520 --> 0:12:02.520 and marketing, and we score everybody against everyone else we've 0:12:02.559 --> 0:12:05.280 ever done this too, um, and then we come back 0:12:05.320 --> 0:12:09.120 and say, here's your ProForma, here's your your assessment score, 0:12:09.400 --> 0:12:11.319 and yes we want to work with you, or no, 0:12:12.080 --> 0:12:13.880 we think you should either go back to the drawing 0:12:13.960 --> 0:12:17.120 board or call West or called Garrett. And you know, 0:12:17.320 --> 0:12:19.920 I guess the question for all you guys, are you 0:12:21.160 --> 0:12:23.120 what you obviously do all this work for them? Is 0:12:23.200 --> 0:12:25.120 this an upfront cost or do you get like a 0:12:25.200 --> 0:12:28.480 percentage of the expense ratio? I guess I'll just all 0:12:28.520 --> 0:12:32.280 three of you start with Garrett. Yeah. So you know, 0:12:32.360 --> 0:12:34.760 we do a lot of consultation with them upfront. Right, 0:12:34.800 --> 0:12:36.920 there's a lot of education that goes into it. Let's 0:12:36.920 --> 0:12:38.880 figure out your product, let's help you get the idea 0:12:39.000 --> 0:12:41.480 kind of nailed down here, make sure we all like it, 0:12:41.679 --> 0:12:43.560 make sure we can do it. Frankly, right with all 0:12:43.600 --> 0:12:47.000 the forty Act regulations, involved. Once we're all comfortable with 0:12:47.160 --> 0:12:49.440 that and everyone's agreed, we're ready to get going. They 0:12:49.480 --> 0:12:51.680 do pay a set up fee to get the product 0:12:51.720 --> 0:12:53.920 to markets, so that covers the legal that covers in 0:12:53.960 --> 0:12:57.160 the exchange listing fees. You know, we build custom websites, 0:12:57.240 --> 0:12:59.760 marketing materials, you know, all of those things to get 0:13:00.120 --> 0:13:02.559 to market. That's a fixed fee for all of that. 0:13:03.000 --> 0:13:06.200 Once you get to market. Then what we charge at etc. 0:13:06.520 --> 0:13:09.840 For our portion of it is a number of basis 0:13:09.880 --> 0:13:12.640 points with an annual minimum, and then all of the 0:13:12.720 --> 0:13:15.280 other expenses to run the fund or just direct pass 0:13:15.320 --> 0:13:18.040 throughs from the service providers, and so we break it 0:13:18.080 --> 0:13:21.199 all out provide transparency on it. Um. But we've just 0:13:21.760 --> 0:13:24.319 basically done a cost plus model is how we operate. 0:13:24.800 --> 0:13:30.000 And well, Mike, you guys are similar, Yeah, very similar. 0:13:30.160 --> 0:13:32.439 Set up fee and then a fixed costs and then 0:13:32.679 --> 0:13:35.800 declining BIPs costs as you get bigger, with the objective 0:13:35.880 --> 0:13:39.320 of of allowing the operators to basically leverage our operating 0:13:39.400 --> 0:13:43.080 leverage as much as possible. Yeah, so again same model. 0:13:43.400 --> 0:13:47.319 UM are slight differences are we do have ad on 0:13:47.480 --> 0:13:49.839 services the marketing and sales that you can pay hard 0:13:49.920 --> 0:13:54.640 dollars for and uh. We also offer fun financing right 0:13:54.720 --> 0:13:57.640 if somebody comes to us and has a great idea 0:13:58.240 --> 0:14:02.080 and wants to launch it but doesn't have the full 0:14:02.160 --> 0:14:05.920 financial backing. Uh. In cases where we really like the idea, 0:14:05.960 --> 0:14:09.200 we'll put up our own economics and you know, own 0:14:09.280 --> 0:14:12.000 a part of the profit. I think the key thing though, 0:14:12.120 --> 0:14:14.200 for all three of us is none of us really 0:14:14.240 --> 0:14:17.440 make any money on the minimums. Right. That's the brain 0:14:17.520 --> 0:14:19.560 damages West likes to call it, or I call it 0:14:19.640 --> 0:14:22.880 the headache business. The minimums are just there to pay 0:14:22.960 --> 0:14:26.320 for the the you know, the day to day. The 0:14:26.480 --> 0:14:28.840 real way we make money is when our clients make money, 0:14:29.040 --> 0:14:32.720 right Like, Um, we are not interested in having a 0:14:32.800 --> 0:14:36.000 fund that stays at million for six years. Like. That's 0:14:36.040 --> 0:14:38.640 not gonna make us money or make the client happy. 0:14:39.160 --> 0:14:41.200 It's not gonna make etc. Happy. It's not gonna make 0:14:41.480 --> 0:14:45.440 et f architect happy or alf architect happy. Um. So 0:14:46.200 --> 0:14:48.360 we're really partners with our clients at the end of 0:14:48.400 --> 0:14:51.040 the day, all three of us. You know, Joel, they're 0:14:51.080 --> 0:14:53.920 talking about this. I just went through the process of 0:14:54.720 --> 0:14:57.440 writing a book. They're like publishers. This reminds me a 0:14:57.520 --> 0:15:00.400 lot of the publishing business or there you want hits man. Yeah, 0:15:00.520 --> 0:15:03.440 And one thing the publishers look for, and I've learned 0:15:03.480 --> 0:15:05.840 this over with the two books I wrote, is a platform. 0:15:06.640 --> 0:15:09.400 Do you have reach? You know, are you in the media, 0:15:09.480 --> 0:15:12.160 do you go to conferences? Like basically can you sell 0:15:12.240 --> 0:15:15.280 the book? It seems like there's a similar vibe here. 0:15:15.640 --> 0:15:17.520 I guess, um, let me go back to Mike, because 0:15:17.920 --> 0:15:20.920 somebody you just took on is this guy, Um meet 0:15:21.000 --> 0:15:25.200 Kevin and he's a YouTuber with two million subscribers, but 0:15:25.280 --> 0:15:27.600 he's not in the financial business. How much do you 0:15:27.720 --> 0:15:30.800 look for, say, can you bring your own assets like 0:15:30.880 --> 0:15:33.680 b y O A versus Hey, you've got this huge 0:15:33.760 --> 0:15:36.560 platform and we're we'll roll the dice with you because 0:15:36.880 --> 0:15:42.360 you've got reached. Yeah. So the number one determining success 0:15:42.720 --> 0:15:46.080 of an et F is seed capital, right, Like if 0:15:46.120 --> 0:15:48.960 you go through the list of all the hits, I mean, 0:15:49.160 --> 0:15:51.720 Robo as a hit, like yes, but it's because they 0:15:51.800 --> 0:15:54.680 had like ninety million in seed capital and they waited 0:15:54.720 --> 0:15:57.000 for the market to come to them. And they're all great, 0:15:57.360 --> 0:16:00.400 awesome people with great knowledge and that's ace, but the 0:16:00.480 --> 0:16:01.800 market had to come to him and they had to 0:16:01.840 --> 0:16:05.680 survive through seed capital. So an absence of seed capital 0:16:05.760 --> 0:16:08.720 call it we We pretty much tell anyone who doesn't 0:16:08.760 --> 0:16:11.640 have twenty million, you probably don't want to do this, right, Um, 0:16:12.640 --> 0:16:16.280 the in absence you have network or platform, right, so 0:16:16.440 --> 0:16:19.960 fis on our platform, we're on their platform. Meet Kevin 0:16:20.080 --> 0:16:23.280 George Noble with what he does on Twitter spaces, um, 0:16:24.000 --> 0:16:27.280 Adam Curran with his radio show for y'all, like a 0:16:27.400 --> 0:16:38.720 platform is the closest substitute for seed capital. I do 0:16:38.840 --> 0:16:42.280 want to talk about greatest hits because that's the fun part, 0:16:42.480 --> 0:16:45.640 right So, West, if you had one hit that you 0:16:45.760 --> 0:16:50.480 were the most proud of, what would it be. I'm 0:16:50.520 --> 0:16:53.520 gonna say the fund that started our et F white 0:16:53.600 --> 0:16:56.920 label business, which would be per Tolls Freedom Fund um 0:16:57.560 --> 0:17:00.160 F R d M. And it's you know, just it's 0:17:00.240 --> 0:17:03.040 just her literally, uh and she's already got two in 0:17:03.080 --> 0:17:05.480 her seventy mill and that fund maybe it's higher at 0:17:05.560 --> 0:17:08.480 this point. And and you can kind of see the 0:17:08.560 --> 0:17:11.280 writing on the wall just based on number emails and 0:17:12.040 --> 0:17:15.919 crates and activity that comes with that. The pitch when 0:17:16.000 --> 0:17:19.920 she came to you, How how formed was it? It 0:17:20.080 --> 0:17:22.800 was very well formed and and long story short, you know, 0:17:22.880 --> 0:17:24.840 we've been in the et F business for a long 0:17:24.920 --> 0:17:28.280 long time, and we're we're running asset management business called 0:17:28.280 --> 0:17:31.880 alf Architect, and we had no interest in ever opening 0:17:32.000 --> 0:17:35.879 our infrastructure to anybody because you know, we just say, hey, 0:17:35.920 --> 0:17:38.520 we're low cost infrastructure provider. Why would we want to 0:17:38.520 --> 0:17:41.239 give us other people? And then Perth, who I known 0:17:41.320 --> 0:17:44.480 for probably five six years prior. You know, she's always 0:17:44.560 --> 0:17:47.080 pitched me on freedom and you know, obviously used to 0:17:47.080 --> 0:17:48.800 be in the Marine Corps and I'm a huge fan 0:17:48.920 --> 0:17:51.800 of you know, go America, Freedom, all that kind of stuff, 0:17:52.200 --> 0:17:55.199 and so I was obviously amiable to her idea at 0:17:55.240 --> 0:17:58.440 the outset. And then finally, uh, you know, after enough 0:17:58.720 --> 0:18:03.440 strong arm and and twisted my elbow, uh, we said, fine, part, 0:18:03.640 --> 0:18:05.840 We're we're gonna do it. You're gonna be our guinea 0:18:05.920 --> 0:18:09.560 pig into you know, doing et F servicing for someone else. 0:18:10.080 --> 0:18:12.440 And so we kind of started it basically with her 0:18:12.840 --> 0:18:16.320 um and so once we made that decision to engage 0:18:16.400 --> 0:18:18.880 in the business, you know, there was no looking back. 0:18:19.080 --> 0:18:21.639 You know, now the rest is history. But I've always 0:18:21.720 --> 0:18:24.680 liked her idea. It was always very well baked. It's 0:18:24.720 --> 0:18:27.520 just like anything when you launch a fund, you know, 0:18:27.560 --> 0:18:30.240 it's a long game thing. And she's been playing the 0:18:30.320 --> 0:18:34.040 long game and she's finally winning it. Mike, I'm gonna 0:18:34.080 --> 0:18:36.240 ask you the same question, what what's the what's the 0:18:36.280 --> 0:18:39.400 greatest hit that you're most proud of? I mean, we've 0:18:39.440 --> 0:18:42.160 had some awesome hits, and I think I normally would 0:18:42.160 --> 0:18:43.840 just go with the biggest one, like our part, But 0:18:44.240 --> 0:18:46.359 I'm gonna bring out a real in d one. Um. 0:18:47.240 --> 0:18:51.080 There's this company sp Funds. They were at eighty million 0:18:51.160 --> 0:18:54.800 dollar r i A focused on Sharia compliant. They are 0:18:54.840 --> 0:18:57.720 are sleeper hit, right, Nobody would ever think that this 0:18:57.920 --> 0:19:01.359 was gonna hit. Now it's like three million, three different funds. 0:19:01.400 --> 0:19:03.439 They have the only secook fund. They have a Sharia 0:19:03.520 --> 0:19:07.879 real estate fund with US Sharia SMP five hundred with 0:19:07.920 --> 0:19:11.159 the full license, and their little eighty million dollar r 0:19:11.200 --> 0:19:13.680 a A is now almost four hundred million all in 0:19:14.800 --> 0:19:17.560 because they embraced the et f rapper to get the distribution, 0:19:17.720 --> 0:19:21.000 to get the access, like the wire houses call us 0:19:21.040 --> 0:19:23.639 about it, like West and J can tell you, Uh, 0:19:24.000 --> 0:19:26.159 Garrett can tell you, like it's freaking hard to to 0:19:26.320 --> 0:19:29.880 get the uh the wirehouses to call you. So that's 0:19:29.960 --> 0:19:32.320 my sleeper hit. That's the one that was out there 0:19:32.400 --> 0:19:35.560 for six seven months and then uh College radio made 0:19:35.600 --> 0:19:39.960 it a hit awesome and Garrett, what about you, Well, 0:19:40.080 --> 0:19:42.520 Robo is certainly the one, you know, that we're most 0:19:42.640 --> 0:19:45.359 known for. One of our biggest you know, individual funds 0:19:45.920 --> 0:19:48.040 UM e m q Q was another one that was 0:19:48.080 --> 0:19:49.959 really kind of the first of its kind. When when 0:19:50.040 --> 0:19:53.399 we did that, it's it's the you know, the Amazons 0:19:53.520 --> 0:19:57.200 and UM those kind of companies of the emerging markets, 0:19:57.440 --> 0:19:59.520 and so it's really an interesting thesis there that really 0:19:59.600 --> 0:20:02.359 took off and and was interesting. You know, say, one 0:20:02.400 --> 0:20:05.080 of our other, you know, bigger clients that has turned 0:20:05.080 --> 0:20:08.280 out to be a really interesting model is Cabana, and 0:20:08.400 --> 0:20:10.600 so they've got eight funds with us at this point. 0:20:10.960 --> 0:20:12.800 But they're an s M A manager and what they 0:20:12.840 --> 0:20:15.480 did was converted those s M A s into E 0:20:15.640 --> 0:20:18.280 t F s and so they're running the same strategies 0:20:18.320 --> 0:20:20.440 they ran as s M A s in e t fs. 0:20:20.840 --> 0:20:22.359 So what they're able to do is give their clients 0:20:22.400 --> 0:20:25.840 a much more tax efficient vehicle, a lot lower trading 0:20:25.920 --> 0:20:27.760 costs when they're just trading you know, the E t 0:20:27.880 --> 0:20:30.080 F s themselves, and they're underlying our our other E 0:20:30.200 --> 0:20:33.040