0 (2s):
Boom. Shake the room. Fire Nation, JLD here and welcome to Entrepreneurs on Fire, brought to you by the HubSpot Podcast Network. With great shows like My First Million. Today we'll be breaking down Colombian coffee in investing in businesses in emerging markets to drop these value bombs, I have brought to Adam Jason into EO Fire Studios. Adam is a partner of Legacy Group and a board member of the Green Coffee Company. Previously, he practiced law in the United States for eight years. He specializes in corporate finance, corporate governance, securities regulation, and international business transactions. And today's Fire Nation will talk about what it's like to just give it up here in the states to move down to Columbia and to make things happen.

0 (46s):
We'll talk about what it's like to run a company like the Green Coffee Company, what it's like to raise money, specifically a series C funding round and so much more. And the big thank you for sponsoring today's episode goes to Adam and our sponsors. Is this your year? Visit Thrive Time show.com to see testimonials of how Clay Clark's Business coaching has helped over 2000 entrepreneurs to dramatically increase profitability. It's month to month and less money than an average minimum wage employee Schedule your free consultation today at thrivetimeshow.com. Outbound Squad, hosted by Jason Bay is brought to you by the HubSpot Podcast Network, the audio destination for business professionals. Tune in for convos with leading sales experts and top performing reps to help you land more meetings with your ideal clients.

0 (1m 31s):
One of my faves, The Monthly app with Jason Ethan, where they share hacks, tips and tricks. Listen to Outbound Squad, wherever you get your podcasts. Adam, say What's up to Fire Nation and share something that you believe about becoming successful that most people disagree with.

1 (1m 50s):
John, pleasure to be with you. Hello to your audience. Thanks. Thanks so much for giving me this opportunity. Yeah, I think for the, we're talking about entrepreneurship here a lot today, obviously title of the podcast, entrepreneurs on Fire, and I think the entrepreneurs that have been around for some time now, you know, know this to be true, but I think there's a popular perception nowadays of the all-knowing visionary that starts a business and basically puts it on its back and, and carries it through. And I think for, for success as an entrepreneur, and really I think life in, in general, it's if, if, if you're trying to build something lasting and something that kind of extends beyond you, really, it's more about finding and, and putting yourself in, in a position to work with the the right people.

1 (2m 44s):
I think entrepreneurship is really guided more so by, you know, setting the right vision, establishing the values for the organization that you have, really working hard to get traction behind it so other people buy into your vision and you know, that that gives you resources and then you can find, recruit, and motivate the best possible people to, to be around you. So I think, you know, as, as, as Warren Buffett says, it's really about finding 400 hitters, giving 'em the bat and letting 'em swing. So I think it's good advice for life, good advice for good advice for business entrepreneurship in general, to make sure you're always putting yourself around the, the best possible people and, and doing what you're best at while allowing others to do the same.

0 (3m 29s):
Listen, whenever we're starting the episode with a Warren Buffet quote, Fire Nation, you know, we're headed in the right direction and as I think we

1 (3m 36s):
Are, I think

0 (3m 37s):
We are. And as Adam shared, we are gonna be talking about Entrepreneurs on Fire because that is the name of the podcast, that's what we talk about, specifically Columbian coffee and investing in businesses, in emerging markets. And a lot of people, Adam, they dream of moving to some South American country or maybe the Mexican coast and living the good life, but you've actually done it to a degree. So tell us your story of moving to Columbia after being a corporate attorney in the us.

1 (4m 9s):
Sure. It's exciting to, to share. I am talking to you today from Meine Columbia. I've been here for the last five years, as you mentioned. My background is, is pretty corporate. I, outta law school, started working at what the, at, at the time was the largest law firm in the world doing IPOs, public private equity and debt financings for Fortune 500 companies, wall Street Banks, et cetera. Did that for about 10 years in the, in the US I was at the kind of point in my career where you decide, do you want to be a partner at the law firm? Do you want to go in-house and work for a client or do you wanna do something more entrepreneurial?

1 (4m 53s):
I didn't have, I'd say the vision of, oh, I gotta do something in South America and leave the US and do something completely different. But I did have that entrepreneurial itch for I'd say a pretty extended period of time, kind of during my, the, the, the back half of my time at the, the law firm. You know, as it often does, life circumstances handed me a, some good luck. I had a job offer from a law firm in Houston. I was in Dallas at the time, and there was a month break between the new job and, and the old job. And I decided to do some, some traveling. My background is pretty, I'd say sequential and you know, what, what people would, I guess be, be used to I, you know, high school to college, to law school to a career without really having done any traveling or the year off that a lot of people do or exploring the world, et cetera.

1 (5m 48s):
But this kind of gave me that, that that month between positions gave me a chance to do that. I had heard some good things about Columbia. I wanted to find some place that I, I could basically go and just live for a month, not jump around to a bunch of places and without really ingraining myself in, in any one location, kind of wanted to see what the challenge would look like of actually living in another country, going to the store, you know, getting around and doing those kind of daily things versus an extended kind of sightseeing tour of, of a lot of different places. Fortunately, I really fell in love with the country, met some outstanding people here who were doing some exciting things from a business perspective.

1 (6m 29s):
And I saw the, the market opportunity. I was here for a month, went back to the US to start the new job in Houston, but really had the itch to, to think about what was next from a career perspective. My now business partner who I had met when I was here on vacation was, as you mentioned, starting our, our investment firm legacy group, but also the flagship company within that firm, which is called the Green Coffee Company. And he needed assistance with the initial capital raise for the, the business. My background as a S E C corporate finance attorney fit the mold well. So I started helping him with the initial funding round during my free time while I was back in the US and then saw enough potential in everything that was going on here and the team and everything that we could build to say, you know what, I'm gonna do it full-time.

1 (7m 23s):
So back half 2017, I started selling everything. I had slept on a deflated air mattress for a couple weeks as I made the transition from moving to Houston to Meine and I moved down here with a backpack and I had sold my golf clubs and used the travel golf bag to, to fill it with clothes and everything. I kind of had that I hadn't sold or left behind in the us and January, 2018 came down here full-time, been here ever since

0 (7m 54s):
Five years now, Fire Nation, five years. That's just one of those things where, hey, it wasn't like he had to go down there and commit to five years upfront. He was going down there. He was like, I'm gonna test it out. I'm gonna see if I can make my life down here. And here he is five years later, here I am in Puerto Rico seven years later. It's just one of those things where sometimes you take a chance, sometimes it works, sometimes it doesn't, but at least you know. And you did mention the legacy group and you, you are a partner, Adam, in the legacy group. Tell us more about the vision and values of what this is.

1 (8m 26s):
Yeah, the basis of our firm, investment firm down here is really built on our ability to find arbitrage by, by being on the ground in often overlooked markets like Columbia, where there's great opportunity. So our client base is primarily US based investors, high net worth investors who are looking for opportunities abroad, but still want the comfort of like, of, of, I would say working with us, trained US entrepreneurs who are familiar with, you know, the standards and the expectations for a, a US client base, but you know, that know the market locally enough that they can actually find opportunities, you know, based on private investing that, that people can actually get some returns and access to industries, et cetera, that they couldn't get, you know, if they were only looking at the, the US market.

1 (9m 21s):
So we kicked that off five years ago, started the firm, as I mentioned in our, our, our flagship company. Within the, the firm. We either, we either build businesses ourselves or invest a lot of our own capital into them and then open them up to investment to our, our client base. But the flagship companies, the green coffee company, you know, just kind of for proof of concept and to give some color around what kind of opportunities we see down here, you know, really with some fresh eyes, fresh capital, the world over knows Columbia and they know that it has great coffee. Nobody's really invested substantially in the market here in about 40 years. Just seeing that opportunity and being able to build something within the market.

1 (10m 5s):
In those five years that we discussed, we've, we've gone from really a concept and an idea to becoming the largest coffee producer in the entire country and substantially larger than even, you know, the, the second place participant, another portfolio company of ours called Polygons focused on digital education. You know, they're really doing what the government itself hasn't been able to do in terms of educating youth on how to participate in the digital age, get into computer programming, open up a new market here, we're getting these access to these deals or building businesses and taking them to our investor base at strong valuations so that they can participate in a lot of the upside and, you know, let us use our, our market knowledge to really build some, some special businesses for them.

0 (10m 54s):
Now I think a lot of people do associate Columbia with coffee as well as, you know, a lot of other places for certain things, but I don't think people ever really think that they could go down to a place that's so established and potentially start a company in, you know, one of the major exports and, and you have the Green coffee company. I wanna hear a little bit more about that, why you thought that was something that could be done, the process of it in your experience thus far.

1 (11m 20s):
Sure. So Columbia's the number three largest coffee producer on Earth. Number two, if we're talking about Arabica coffee, there's the Arabica or Busa coffees that populate the globe. But, but what we saw in the market was really huge fragmentation. About 95% of all the farmers here in, in Columbia own less than three acres. So the idea of them becoming large suppliers for a Starbucks or Nestle, for example, it's not, not really possible. The idea of of somebody with such a, a small land holding, you know, raising money, bringing capital in, making investments, consolidating infrastructure, it's just not really realistic.

1 (12m 6s):
So what we saw was some generational turnover in terms of traditional coffee farms at scale. So you have, you know, grandfather or great-grandfather who built a coffee farm that's 500 acres, a thousand acres a generation ago, and it was a great family business, and it gets passed down to the kids and now that they have some wealth in the family, they wanna live in Miami or go study in Paris and not work in in coffee. That created for us some outstanding buying opportunities of, of scale based operations that we could really put some infrastructure around. When we kicked off the business, really it was meant to be a, an alternative to commercial real estate for investors who we knew were, were already comfortable investing in Columbia.

1 (12m 55s):
As we saw these market dynamics, as I mentioned, the fragmentation, the lack of investment, et cetera. We really saw the opportunity to build the business into an enterprise, an enterprise that we could scale, that we could sell to one of the big names in the coffee industry, or that we could get to an I P O in the, in the US versus simply running it as a cash flow operation. So as I mentioned, you know, just in the last year, this time last year, we're the third largest producer of, of coffee in the country. You know, in, in about five years, we've become number one right now. We have about one and a half times the, the land holdings that the next largest producer in the country has.

1 (13m 38s):
This year has been incredible from a, a growth perspective, 2022, we should do just about 10 times the revenue that we had in 2021. We're looking at 4 million in, in net income, the farms themselves in terms of scale, 7,000 acres, 8 million coffee trees. Back, back to my point from the beginning of the conversation, everything has been built around finding the best possible team to, to, to put into the organization. So for example, on our, our board now, we just recently added Steve Oakland, who's currently the president CEO of Treehouse Foods. That's a 4 billion a year publicly traded company on the New York Stock Exchange with a 30 billion pound per year roasted coffee operation.

1 (14m 26s):
He used to run coffee for, for Smuckers, which for those who don't know, is one of the largest coffee companies in the world. They own Folgers Dunking Donuts, putting all these great people in place. So that, as I mentioned in the beginning, we can step out of the business, continue to look for more opportunities and, and grow something, grow something special to, to date into the business. We've, we've raised about 47 million, that's almost all from US based investors, high net worth accredited investors, and we've really focused on building a business that we could be proud of, you know, as, as just as the economics of the business of the coffee industry in Columbia.

1 (15m 10s):
Didn't make sense here for a long time, nor did the way in which employees were treated, the way in which the environment was treated. And a lot of things that from a sustainability perspective were, were not things that we would be proud to be a part of. So we've extended employee benefits to all the employees we have, the technology we're implementing usable uses about one 40th of the, the water that is typically used in the, the coffee process. Just, just kind of for, for reference, you know, this year alone, just from the investments we've made in technology, we'll use about 21 million less leaders of water than a similar company processing a similar amount of coffee.

1 (15m 55s):
So the impact that we're trying to have is, is huge and, and really goes back to the theme of the businesses we wanna build through, through legacy and the opportunities that we wanna take out to our investor base

0 (16m 7s):
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0 (16m 49s):
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0 (17m 30s):
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0 (18m 10s):
HubSpot just released some incredible tools that are going to level up your productivity and grow your business. Get early access to HubSpot AI today at hubspot.com/artificialintelligence. Now, a lot of Americans the only look within their own borders to invest like people who live in the United States are looking within the United States to invest in companies. Why do you think that we should look to invest in foreign markets?

1 (18m 36s):
Just as one example, if we just look at some of the market dynamics we're seeing right now on a currency basis. So you have a historically strong dollar, you have overpriced US assets by many historical metrics, whether you're looking at real estate or the stock market, which even though we've had a reset, you know, here, here in 2022 going into 2023, still historically trading higher than than historical price to earnings ratios, you know, you're seeing a, a decrease in, in the prices for assets abroad, largely to do with the movements from the Fed in the US that they drive up interest rates that has a global impact.

1 (19m 21s):
Federal Reserve Bank equivalents in other countries drive up interest rates. It makes it more expensive to borrow prices naturally come down where the, the same, the same ripple effect spills over into the competition for those assets. So, you know, basically the theme is folks who are able to invest in dollars can get some great opportunities abroad simply because the currency right now, the dollar versus, you know, whether it's the, the major currencies of the world or less, you know, significant currencies on a global basis in emerging markets, you know, there's a lot of arbitrage there available for investors.

1 (20m 2s):
Like if you, if you use Columbia as a reference point, just last year we were seeing an exchange rate of about 3,700 Colombian paces for each US dollar. In the last few weeks, we've seen that go up to 5,000 to 5,000 Colombian paces to one US dollars. So you're seeing a, a 35% swing in the currency where, you know, if you're buying in Colombian assets now in dollars and you just have a a currency correction where things normalize and go back to where they were a year ago, you know, you're looking at the potential for a 35% appreciation just on a currency basis, not accounting for the actual increase in value of assets or cash flow that might be be tied to it, et cetera.

1 (20m 49s):
So for markets where investors are comfortable, it's, it's an interesting opportunity to use the strength of the dollar and, and get some, get some great, great arbitrage that can be investing in businesses. Or it could be, oh, I've been waiting to buy a VA vacation home or rental properties real estate, et cetera, abroad and now might be a, a good opportunity to, to think about doing something like that.

0 (21m 13s):
Fire Nation always be thinking outside the box when you have opportunities because of the things that Adam is sharing. And of course past guests over the years have just shown that getting out of your comfort zone. That's where the magic happens. Now Adam, you're currently raising a series C funding round for the green coffee company. What does this process look like? Give foundation kind of an insight into this stage of funding.

1 (21m 38s):
Sure, I'll hit on some, some frequently asked questions for where we are. So we kicked off our series C funding round 25 million, the back half of September, 2022. I'm talking to you now here at the end of December. We're raising the money from high net worth investors. That's our, our core, as I mentioned, of the 25 million we've raised 13 million so far. I expect that we'll finish the round in Q1 2023. The capital that we're raising will be used for expanding the coffee operations, you know, pushing further into roasted coffee than, than we currently are expanding operations there. And then interestingly enough, and this is kind of something people find fascinating, we're also opening a new vertical with the capital, which is vodka and gin creation.

1 (22m 29s):
Way different from talking about coffee and what's the connection there that the, the, the science behind it is when you pick coffee off of coffee trees, about 80% of what you take off the tree is an actual cherry. So it has pulp, mucilage, sugars, skins, et cetera. And what we consume in terms of coffee is just the, the bean inside, which only makes up about 20%. What we've looked at over the last few years is how do we turn all of that byproduct really the scan, et cetera that I mentioned into a revenue source for the business. So we've done the clinical research and our building a distillery that we can use to turn all of that extra stuff, which right now for us is garbage and actually a cost into vodka's, gins, pure ethanols that ethanols that can be sold on an industrial basis.

1 (23m 22s):
All these additional products where everything that we're taking off the tree is creating, creating income for the business. So capital in this, this round will be used for that, which I think is something our investors get incredibly excited about and that we're excited to, to tack on to the business, it is a US-based investment. So everything is structured through a, a Delaware holding company for US-based investors. You know, the tax is the same. Tax tax consequences are the same as if you're investing in app in Apple. Legally everything is is based out of the us all the banking is done in the us Our goal is for a 2026 sale or, or exit of the business alternative would be of, of course an I P O In the, in the US the numbers tell us that we can get to an 11 x return on investment for, for investors.

1 (24m 16s):
So basically, you know, if we're looking at a hundred thousand investment, the idea is return over a million dollars in, in a relatively short period of time. Getting to that 2026 exit. We're taking a hundred thousand plus investments from accredited investors. Really a an exciting time to be coming into the business with a good valuation and all these new verticals coming in that I think are gonna add a lot of, a lot of value.

0 (24m 43s):
Adam, if Fire Nation wanted us to learn more about what you have going on with Legacy Group, with the Green Coffee Company, what's your call to action for our listeners? Where can they go?

1 (24m 53s):
Sure, specific for the series C for folks who are interested in investing, you can go to legacy-group.co. If you click the current offerings tab there, you can review all the investment materials and, and actually make an investment directly through our investment portal. And of course, see all the other things that we're, that we're doing here in in Columbia and the different businesses we're building and funding and, and planning to open to our clients. And, and to all of you,

0 (25m 21s):
Fire Nation, you are the average of the five people you spend the most time with. You've been hanging out with AJ and JL D today, so keep up the heats and if you have any questions for Adam, find this episode on the podcast listening app. Post a comment and of course eofire.com type Adam in the search bar. The show us page will pop up with links to everything we've been talking about. One more time, Adam, what's that URL

1 (25m 46s):
Legacy-group.co. And click the current offerings tab to, to see specifically for the coffee investment.

0 (25m 56s):
Adam, thank you for sharing your truth, your knowledge, and your value with Fire Nation. For that we salute you and we'll catch you on the flip side.

1 (26m 5s):
Thanks so much, Sean.

0 (26m 7s):
Hey, Fire Nation, a huge thank you to our sponsors and Adam for sponsoring today's episode. And Fire Nation, Successful entrepreneurs accomplish big goals. That's why I created the Freedom Journal to guide you in accomplishing your number one goal in a hundred days. And we're talking step by step. Visit thefreedomjournal.com and it'll catch you there or it'll catch you on the flip side. Is this your year? Visit ThriveTimeshow.com to see testimonials of how Clay Clark's business coaching has helped over 2000 entrepreneurs to dramatically increase profitability. It's month to month and less money than an average minimum wage employee Schedule your free consultation today at thrivetimeshow.com.

0 (26m 48s):
Outbound Squad hosted by Jason Bay is brought to you by the HubSpot Podcast Network, the audio destination for business professionals. Tune in for convos with leading sales experts and top performing reps to help you land more meetings with your ideal clients. One of my faves, The Monthly app with Jason Ethan, where they share hacks, tips and tricks. Listen to Outbound Squad wherever you get your podcasts.