Adam Torres and Bo Parfet discuss impact investing.
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Show Notes:
Impact investing has the potential to solve the workforce housing crisis. In this episode, Adam Torres and Bo Parfet, Managing Principal, Head of Growth at DLP Capital®, explore DLP Capital® and how it’s working to solve the workforce housing crisis.
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About DLP Capital
DLP Capital is a private, diversified real estate investment firm. The firm’s core focus is on investing in, developing, and financing attainable housing for America’s workforces, including multifamily and single-family rental homes, along with related investments including RV resorts, among other live-work-play communities aimed at enhancing the lives of working Americans. The firm’s portfolio is capitalized via a series of evergreen investment funds for accredited investors, each of which has provided superior year-over-year consistent returns since inception. With more than $4.5 billion of assets under management, DLP Capital has been on the Inc. 5000 list of “Fastest Growing Private Companies in America” for 11 consecutive years. Through its exclusive membership platforms focused on wealth legacy and business scaling—including its proprietary Elite Execution System—DLP Capital empowers its clients and impacts lives while fulfilling a core mission of the firm: Doing well while doing good. DLP Capital is headquartered in St. Augustine, FL, with offices in Allentown, PA and Asheville, NC.
Full Unedited Transcript
Hey, I’d like to welcome you to another episode of Mission Matters. My name is Adam Torres, and if you’d like to be part of our community, head on over to mission matters.com/community to apply. All right, so today is a very special episode. Today we have on the line Bo Parfitt, who’s managing principal O and head of Growth over at DLP Capital.
First off, Bo, welcome to the show. Thanks, Adam. Thanks for having me. So I mean, you got a lot of things under your belt. First off you you’ve climbed the cloud. This is my hook for the show. Climb the seven summits. You have a book out the precipice of life, leadership and personal growth insights from a mountaineer’s edge.
We’re going to get into that. And of course, we’re going to get into today’s overall topic. So impact investing to solve the work. Force housing crisis. So you’re doing some really special things along that housing crisis. And we’re going to talk about that as well. But Bo, you just like our audience all know the drill.
We’re going to start this episode the way that we start them all with what we like to call our mission matters minute. So Bo, we at mission matters, we amplify stories for entrepreneurs, executives, and experts. That’s our mission. Bo, what mission matters to you? Impact investing. So what that means for the folks that are listening for the first time, or maybe a refresher from someone who’s listened to in the past.
So impact investing is you means you can solve a problem in the world and you can make a financial return at the same time. That’s pretty darn cool. It’s having your cake and eating it too. So for me and all the folks that I get a chance to work with at DLP Capital, our mission is to solve the workforce housing crisis in America, and that’s why we jump out of bed every morning.
Thank you for asking. So Bo, first off, great. And thank you for sharing that. And we love bringing on mission based executives, entrepreneurs, and experts to share, you know, why they do what they do, how they’re doing and, and what we can all learn from that. So thanks again. So Bo, let’s just, just to get us kicked off here.
Like, how did you get on this path to becoming interested in impact investing and just investing in general? Like where’d all this start for you? So this is a great story. I was working at JP Morgan in New York city, and I was an investment banker. And, you know, working 80, 100 hours a week, I had worked eight months straight, that includes Saturday and Sunday, and I had put on about 40 or 50 pounds and I wanted to take my first vacation.
So I went into my manager, managing director’s office and I said, Hey, you know, I’ve worked every day for the last eight months, you know, you, I, you know, he’s like, I know you haven’t, you barely left before midnight at any of those, Beau, you’ve been working hard. And I said, thank you. Thank you. He goes, where do you want to go?
I said, I want to go climb Kilimanjaro. It would be really good for me. I’d be a reason for me to get in shape. And, and then he said to me, he goes, he kind of looked at me and he looked down at kind of my, my bigger belly. And he goes, well, what makes you think you’re going to make it? And I said I kind of was like covering up my belly a little bit.
No, I’m kind of determined. And he said, you know, Beau, I, what I’ve heard you say. Is why you want to go to Kilimanjaro and you’ve listed reasons for just for yourself, which is fine. He goes, but do you want me to teach you something that will give you more energy for the rest of your life than you could possibly imagine?
Would you like to know what that is? I said, yeah, tell me. He said, if you do things for something bigger than yourself, you’ll have more energy than you could possibly imagine. More creativity. learning. And he goes, you think about that now, get out of my office and come back in a couple of weeks. So I came back in a couple of weeks, did a bunch of research and I discovered, hey, listen, since the tallest mountain in Africa is Kilimanjaro and Africa has a lot of things that they need help with.
But one of them is there are Children and there are people there that there’s not enough doctors. And they’re dying. People are dying when they shouldn’t die. The light bulb went off for me and said, Hey, I want to create a doctor. So for 6, 000, we could put someone through medical school. And I shared that with my boss and he said, well, you’re going to do more than one.
Right. And I said, yeah, yeah, I guess we are going to do more than one, even though I just thought of one, but he, you know, but he made it sound like, you know, he, he got really into this. Yeah. So he, he opened up his drawer. Adam took out a checkbook, wrote the check and said, boom, there’s one. Let’s let’s do two.
I’ve sponsored one. Let’s do two. Let’s create two doctors. Yeah. And, and then he goes, go meet this person and this person. So I went all over JP Morgan. I got to know people that were way above me. I was just a lonely financial analyst and they did a an article on me on the JP Morgan magazine. Other media outlets picked it up.
Hey, and this was, was this all before you actually climb the mountain? Yes, man. You want to talk about sticking your neck out here? Totally. I just want to, because you know, there’s something to say about committing, like, and making that public and like, I’m sweating a little bit over here. You can’t see it, but just hearing your story, go ahead.
For sure. So we, we, we funded over the years now we’ve, we funded over 10 doctors. Wow. And then we track the number of lives we’ve saved, saved. And our goal is to save over a million lives. And so far we’re over 400, 000 lives saved. Well, and that’s pretty cool. And that’s an impact. And through that Kilimanjaro experience, it really catapulted my life to think, you know, what.
You can make a difference. It doesn’t take much. It just takes effort and passion. So when I like, so when I made a shift in my life, I went from when I joined DLP, I went from making a living to making a life and just really fortunate to be part of the. The large DLP capital team. So, so I want to go further into the work that you’re doing over at DLP, but first, I don’t want to assume that maybe any of our audience or myself for that matter, really truly understand the workforce crisis and like what’s going on.
So maybe let’s start kind of basic there. And, and some, one of the, some of the problems that, that you’re, you and DLP are working to solve. You bet. So a wise person once said the two most important moments of your life are the moment you’re born and the moment you know why. So figuring out your why, and you, by the way, you could have more than one why.
I get asked that question a lot. So a why for me is we’ve kind of, you’ve done a nice job at Adam of unfurling. My why, and it’s, it’s to make this impact, right? To have a mission that I care about. So there are, it’s an estimated that there’s about seven to 10 million units, homes, apartment buildings, mobile homes that are a shortage.
So there’s a seven to 10 million shortage. Of workforce housing units in America. And we’ve had this problem by the way, for hundreds of years. Okay. It’s very hard to fix it. So at DLP, because our founder, Don Wenner, who has an amazing story, amazing background, because he grew up in such a challenged economic environment, his parents were 16 years old when they had them in Bethlehem, Pennsylvania, they moved 35 times by the time he was 17 years old.
At one point they lived in a cabin in the woods with no electricity. You know, it was his, that upbringing was challenging for him. And it’s frankly, it’s challenging for a lot of kids that grow up and they’re moving all the time. So the average person, Adam stays in an apartment building. Do you know how, how many months, how many on average, about 14 months.
And boom, you move again. So when you move again, it’s a new school. It’s a new teacher for the psychological safety of a kid. is compromised and then t and cognitive developmen because you’re moving al have that safety net. And Don winner experienced a our mission at D. L. P. I what happened to him as a To happen to any other kid growing up in America.
So isn’t that cool. So that’s kind of what we’re focused on. And we want people to stay at our either single family home rentals or our apartment rentals or mobile home parks. We want them to stay with us for seven, eight, nine, 10 years, not 14 months. We want that psychological safety and that cognitive development to flourish.
So that’s, that’s, that’s something we’re so excited about. And so, okay. So now we, we kind of have a broad understanding of some of the crisis and what’s taking place. How is DLP capital maybe different? Like, how’s it different and how is it looking to solve and address and accomplish what you’ve mentioned staying multiple years, like how’s that taking.
So there’s a lot to unpack here. So yeah, you have housing or urban development. You had people that are homeless. You have people that are section eight. So the government’s paying their rent or helping them. So there’s a lot of different call it asset classes or demographics in this, in this huge problem.
Okay. And, but one of those is a market rate workforce housing. So what does that mean? So, so how we’re different is, is we’re focusing on that demographic. So that’s a teacher, a fireman, a police officer, a small shop owner, a mechanic. You know, hardworking folks. Okay. So, and because there’s a shortage of seven to 10 million for that demographic, there’s a big momentum for us there.
We get asked all the time, Oh, come to California, come to New York, come to Denver. We’d love to, we absolutely would love to, but we’re focused primarily in the Sunbelt that Southeast plus Texas. Okay. So how we’re different is we have a demographic focus. We’re focused on that very specific. Kind of niche that I just described.
We’re really good buyers. Okay, we’re really good buyers. We have a good resources of the communities and the states that we’re in where we feel we can buy at a competitive, you know, off market deals and so on and so forth. So that’s, those are some of the few ways that we’re different. But another one, and I want to double click on this, Adam, is Don Winter, our CEO, he wrote a book called Building an Elite Organization.
Best seller on Wall Street Journal, USA Today, Amazon. He created a managerial operating system on how to grow and scale your business. I think 99 percent of all businesses out there do not run on a managerial operating system. Okay. So when we, when he first published this, you know, some of our, our investors were like, what are you doing?
You’re sharing your secret sauce, right? Yeah. DLP’s culture is, you know, to help. And if we climb a ladder, we look down and we grab the hand of someone else and we bring them up the same ladder. So we share this managerial operating system. We teach it. That’s another way to have a big impact is education, right?
Cause no one can take your education from you. It’s very common for us to help someone by providing them debtor equity and, or the education system, that managerial operating system that I mentioned, they very often will help them grow financially if they use our managerial operating system, and that’s a game changer because.
You could kind of say, Hey, I could get a loan from anyone or I could get, I could find an investor, you know, down the road or whatever, but very few people are going to invest, um, and help you in you and your company and help you grow and scale your business. So those are some of the ways that we’re different.
So we know what the problem is with housing. We have an idea of some of the things that DLP Capital is doing. Can you connect the two in terms of how impact investing relates to both? Because I want to make sure this is super clear for our audience because I do think it is really a a differentiating factor.
Yep. And how it relates to both. Just tell me those two things one more time. So we, we already know, you know, some of the problem and we know there’s a lot of different way to allocate assets, right? There’s a lot of different things you can focus on. Now we know also what DLP is focused on, whether it’s housing for, as you mentioned, you know, teachers, police officers, the mechanics, like the mechanic.
How does impact investing relate to both? Because I don’t want to assume, for example, that our audience understands like how you’re, when you’re allocating assets. That, that is a very logical choice as to what sector of the market over and above returns, right? Because that’s a given for everybody watching, like, of course, you’re going to make the prudent financial decision on what’s going to be an ROI for your clients, right?
Like that’s a given in my opinion, but like the idea of taking that stance and saying that, you know, it’s going to be, it’s going to be under that banner of impact investing in your, and your CEO or founder, Don, like the fact that he made that decision, like that is a differentiator. So I want to make sure that’s clear for everyone.
You bet. So how the market and the industry defines if something is affordable, some people call it attainable or workforce housing. So there’s a term in real estate called AMI, Area Medium Income. It’s basically the average income in the average income in that area. Okay. And if your rents are 30 percent of your rent.
Of the average income or less than its workforce housing, or it’s attainable, it’s affordable. Again, those three words. A lot of people in the industry use those interchangeably. Okay. Yeah. Now, if your rents are more than 30 percent of the average income, then, you know, the government and, and, and kind of gurus in the industry or expert, you know, experts would say you’re in some form of financial distress.
Okay. And if you think about it, and by the way, for the first time in American history, the average American is spending more than 30 percent on their rent of their income on rent, which is not good. Many Americans spend 50 to 70 percent of their income on rent. Can you imagine that? So that, that’s very, you have very little room for education, for healthcare, a car accident, you’re kind of one, potentially one big disaster way of really being in trouble.
Okay. So we don’t want that to happen. So our rents at DLP, we aim for kind of that rents to be in that 18 to call it 24%. Of your average income in that area, and we’re, and we’re, we stay pretty close to that. So that’s, that’s something we’re very passionate about. That’s how we do it. So when we underwrite a deal, and to be very clear, DLP, we are a developer and owner operator.
Ourselves of real estate. Right. But then we also provide, as I mentioned before, debtor equity. Mm-Hmm. and education to other real estate operators that have the same mission we do. Mm-Hmm. And a lot of people say to us, well, why don’t you just do it yourself? Why do you help out other people? Well, it’s very simple.
We put purpose ahead of. Yeah, you can’t solve this problem alone. You know, group effort triumphs individual effort every time. And so another way of saying that is that you partners with others that are mission based and that are aligned and going the same way, right? Like I, am I understanding that correct?
A hundred percent, a hundred percent. And then another just adding to this a little bit more. So tell, tell us about the foundation as well. Cause I think that’s also something that’s super unique. You bet. So the furthest distance in the universe is the distance between your head and your heart. And what I love about impact investing in our mission is it merges the distance between your head and the heart in your heart.
So let’s unpack it. So let’s say you hear from someone from a nonprofit is they come and they pitch you and they want you to invest. Cause they’re helping out something. They’re making the world better or an impact entrepreneur comes to you and they have a way to make the world better. But usually the first thing that responds from a human being is your heart.
And you’re reaching for your checkbook, right? You’re, let me write a check. Oh my gosh, this is great. And then you, and then your head gets in the way and goes, well, wait a minute. Wait a minute. You know, how long have they been in business? Yeah. Right. Have they, are they even going to be around in three to five years?
And as we know, most businesses don’t make it past three or five years. Organizations, even nonprofits. Are they measuring their results? Okay. You know, how efficient are they going to be with my capital? So what I love about impact investing is it merges the distance again between your head and your heart.
So there are some things Adam, where market forces cannot solve the problem. Okay. I believe that, you know, who cures cancer? I think it’s likely going to be an entrepreneur. who cures global, you know, who fixes global warming? It’s probably an entrepreneur, right? But but what happens when market forces don’t or can’t solve a problem?
So to your wonderful question, thank you for asking it. 25 percent of D. L. P. S. Profits go to the D. L. P. Foundation. Hmm. Okay. So not 5%, not 10%, not 15%, not 20%, but 25%. That’s a staggering number. Everybody. That’s staggering. Yes. Yeah. For the, so for the audience, that’s a big, big deal. Very, a lot of companies do 1% or 2%.
Mm-Hmm. and kudos to them. They’re doing something. So, so thank you for doing that. Absolutely. Mm-Hmm. . So, but 25% is a big, big statement. So one of the things we focus on at the DLP foundation is homelessness. And we give a lot of money to charities. Many are faith based and many are not. Of course, both, both groups are doing amazing things, which is great, but we’re we’re, we’re going to zero in on trying to solve homelessness.
Okay. To go back to our theme of housing, right? Our mission of housing, homelessness in St. Augustine, Florida, and then we’re going to migrate to Jacksonville. And then hopefully go go, go bigger beyond that. So thank you for asking. So Jacksonville, when you say that, I mean, I cats out the bag on that one.
I mean, 23 city blocks, I think, am I, am I understanding that correctly? Like let my audience know, like the scope of what you’re doing in Jacksonville. Cause that’s, again, we’re just hitting them with these one after another. So for the audience, you know, we’re from Michigan originally. So we had Michigan roots in Detroit, as we all know.
A lot of people that urban planners, you know economists have studied Detroit. Like, how do we get Detroit to turn around? It really took a lot of effort to, to turn Detroit around and Detroit. I think it’s making good progress. Jacksonville, Florida has also struggled pretty significantly the downtown in particular.
So DLP and with our, some of our partners, We purchased about 23 city blocks, and it’s going to be a kind of fathom that 23 city blocks to go ahead. It’s a big number. That’s a big number. And I think, you know, it’s, it’s a minimum, you know, the, the first phase is about a two, call it a 2 billion. Kind of redevelopment of downtown Jacksonville, but there’s so much that, you know, there’s phase 2, phase 3 and beyond, and it is estimated and forecasted that this, that this will be the largest urban redevelopment project in the history of the United States of America.
So, this is really, really exciting. And there’s a lot of going to be, so Google it, check it out. Come be a part of it. Come help us because there’s so many diverse businesses that will be down there and nonprofits that are going to all be working together. And this is made national news already. Am I off?
Like, this is big news. It’s big news. It’s, it’s, it’s national news for sure. So thank you for asking. And if anyone’s listening and wants to come help in some form or fashion, we’d love to, you know, we’d, we’d love to talk to you. Yeah. And and talk to me about the, the event side of things. I know you have some some events coming up and other things like that on family wealth.
Like tell us more about how people can be involved. Yeah. Another crisis. That you know, or problem that’s facing, you know, not just America, but the world is, and this is pretty staggering is if there’s about a 70 to 90 percent chance that the wealth. Adam that you make, right? But anyone who’s listening that you make by the time it gets to your kids or grandkids, there’s a 79 90 percent chance that that wealth is squandered.
I mean, it should be the opposite, right? That’s a problem. Why? Why? Why is it? Why is that happening? Right? So we, we put on these really cool events. We have about, Just roughly 2400 families that invest with us. And of course we have a lot of real estate operators that we work with and they have hundreds of employees and family members.
So we put on these events where we try to pour value into our community. And one of the things we tack try to tackle is this family legacy issue that we just talked about. So how can you do impact investing? How can you give better to charity? How can you help work with your kids and grandkids? And by the way, it goes, you have to swim upstream to how can you work with your parents?
Right? And together. So that legacy, that financial legacy is not squandered, right? And not just gone, gone to You know, whoever it disappears to, right? So our events are, are a big, big deal to us. We put, we pour a lot of energy and time and passion to those. And, and people, it changes people’s lives. So the, the two most important moments, or sorry, the two types of pain in the world are the pain of discipline and the pain of regret, and what’s great about our events is.
People, their workshops, you come there and you do the work, right? You do, you, you do the discipline and you set things up so you don’t have regrets later in life and go, Oh, shoot, I should have done that. Or I should have done this. Yeah. Thank you for asking. So Bo, you know, you know, I can’t let you off the line.
Well, my audience knows for sure that have been, especially the hardcore fans that have been here a long time. When somebody is an author, I love. Like promoting their book. I know how hard it is to do a book, to complete it. And I think you have multiple if I’m not mistaken. I could be wrong on that one, but Oh no, you’re a three time author.
Yeah, that’s right. You’re multiple books, but the precipice of life. So whether it’s just this book or in general, like what do you hope your readers get away from your, from your writing, the biggest takeaway? I hope a reader gets to reading the book would be. Inspiration or, and or change, like they’re going to, they’re going to change or grow their life in a certain way.
And a lot of people I mean, let’s, I think this is a very safe statement to say on air, but most of the media that we read today is kind of negative, right? They’re just trying to sell clicks or ink, right? And people still buy the hard paper, right? They’re trying to sell ink or clicks. Yeah, and you know, there’s a lot of really good positive things that are happening in the world and I would love it if we could spend more time on those not to say that let’s let’s totally ignore something that needs to be improved.
Please don’t hear me say that. But it’s just it’s it’s out of balance. I think that’s fair to say. Yeah. So I tell anyone that should write a that wants to write a book or give a speech or write a short story. Man, let’s the more positivity. Yeah. You know, the more inspiration that we can put in the world, you know, like, let’s do it.
So I hope that a lot of people have read my books in the past and I get a lot of wonderful emails and you know, it’s, hey, I’ve always wanted to run that marathon, you know, and I read your book and boom, I signed up or hey, you know what? I’m not happy at my job. I like my job, but I don’t love it. I want to switch to find something that I’m more passionate about.
And your book put me over the edge. So those types of things where you’re, it becomes a change agent for people are really, really cool. So I hope, I hope people get a chance to, to read that. And I would say that it’s not just my insights. One of the things I think I did is that I think was pretty cool is that we interviewed.
About 20 experts in different fields. So Olympic athletes, you know, very successful business men and women. We have their insights as well. So their wisdom and and inspiration. So, you know, you’re going to get a lot of different views and opinions just with that one book. Thanks for asking. It’s awesome, Bo.
Well, Bo as always, man, I’m just telling you, it’s been great to connect, great to have you on the show. Finally, we got you, we got you on the show and booked. I mean, I just have to ask, what’s next? I mean, what’s next for you? What’s next for your career? So I would say, I would break down that question into three things.
So on a personal note I still love to, you know, I mean, I live in Colorado to, to climb and ski. To climb and ski great peaks. I would love to one day maybe get into the Michigan or Colorado ski hall of fame. Yeah, really cool. On a family note, I’m just trying to be the best dad I can be. I have two boys love them to death, have an amazing life.
So just want to continue to be the most famous person in my own home, uh, would be number two. And then number three on the business side, you know, at DLP. We’re trying to provide housing. Our, our BHAG or a big area audacious goal is to have a million people live in our wonderful, beautiful, safe, clean housing units, and that would be pretty, pretty cool.
And hopefully we’re there the next. You know, three, four or five years. So we’ll, we’ll definitely stay in touch and progress. Maybe we could do a lot a live event. We’re live now, but an in person live event in Jacksonville, you can do that in, in six months to 12 months too. That could be fun. Wow.
It’s a great idea. So both somebody’s watching this or listening to this. And they want to follow up and they want to connect and either to follow your story to get your book or of course, to, to connect about DLP capital and maybe how they can get involved, whether it’s as an investor or as a partner, maybe they have some deals, but like, you know, those synergies.
How do people follow up? Yeah, we’d love to talk to people that are interested. Dlpcapital. com and you know, you know, the phone number’s right there. Give a call and I look forward to speaking with anyone. You can email me as well and my email’s on the, on the website, so anyone that wants to call or email me or get in touch with me on LinkedIn.
So happy to, happy to help in any way I can. Wonderful. And well, and for the audience, we’ll put the links to the website and all that good stuff in the show notes. And speaking of the audience. If this is your first time with Mission Matters or watching an episode or listening to one while you’re driving in your car, we’re all about bringing on business owners, entrepreneurs, executives, and experts and having them share their mission, the reason behind their mission, you know, why do they do what they do?
Like, what gets them fired up to go out there and to make a difference in the world? If that’s the type of content that sounds interesting or fun or exciting to you, we welcome you. Hit that subscribe button. We have many more mission based individuals coming up on the line and we don’t want you to miss a thing.
Bo, thanks again. Really appreciate you coming on the show and making some time for us. Hey, thanks for having me, Adam. And thank you to your wonderful community as well. So thank you.
