KRR is always more than IRR
“Redefining return from a Kingdom-driven Investor’s mindset with a focus on Impact
Investing.”
“There is more.” I’ll never forget when I heard those words and the impact they had on me. I realize there is nothing deeply theological or philosophical about these three words, but the context in which I heard them and how God has reminded me in my journey of what they mean, have had huge implications.
I was attending my first Wild at Heart conference in 2003. I flew out to Young Life’s Frontier Ranch to meet my high school buddy who now lived in North Carolina. My friend invited me to attend this conference, and after reading John Eldredge’s book, Wild At Heart, I thought it would be great. It was. However, on the last day, I realized that I could catch an earlier flight home to Philadelphia. Being away since Wednesday, I thought it would be nice to get back earlier, especially since my wife was gracious enough to encourage me to go and she was home alone with a 3 year and 1 year old. So, Sunday morning, during the last session, I discretely packed up my things in the row I was sitting. My bags were already in the cabin. As I maneuvered my way out of the row, I heard John say the words: “There is more.” Immediately, I froze thinking he was singling me out amongst the 300+ people in attendance and was about to tell me to sit back down. As I casually looked up, I realized he wasn’t talking to me, but he had more to say. So, as I continued walking out of the auditorium, what I heard wasn’t that he had more to say...it was that God had more for us; that with God there is more – exponentially more. The message was that when we are faithful, obedient and trusting in God, His more is always greater than my idea of more.
It's taken me nearly 20 years to better understand this. Truthfully, on that day, I didn’t really think much about it. My mind was too focused on getting home. But those words have stuck with me. My idea of ‘there is more’ revolved around accumulating things: more money, more possessions, a bigger home, fancier car, etc. As a real estate developer and investor, more meant: more projects, more capital, more returns, more profits. And, I thought, that if I was faithful, obedient, and trusting in God I would see more – He would reward me with more things I could use and enjoy, now.
I have discovered that I was both correct and incorrect with what I thought. I was correct thinking that if I am faithful, obedient and trusting In God, He does provide more. I was incorrect thinking that the more would all come to me now, on my terms and the way I would like it for my immediate enjoyment, satisfaction and use. What was worse about my thinking was the notion that somehow my more could be greater than His more.
Scripture is replete with examples of how God’s more is greater than we can fathom or ever achieve on our own. Throughout the Old Testament, story after story shows how God provides for His people more than they could ever provide on their own. God tells Isaiah that “As the Heavens are higher than the earth, His ways are higher than (our) ways” – meaning we can’t even begin to touch what He can do and how much more He can produce. When Jesus shows up on the scene, His miracles demonstrate what Isaiah proclaimed. No human could even conceive how to make the lame walk, the blind see and the deaf hear – but Jesus could and did. No human could stop a storm or cast out foul spirits – but Jesus could and did. No human could feed thousands of people with a loaf of bread and some fish. Yet, on two separate occasions, Jesus uses a few loaves of bread and a couple of fish to literall feed thousands of people. His disciples couldn’t see how it could be possibly done, there wasn’t anywhere near enough to feed the masses. Yet, when Jesus was done ‘there was more’ leftover – talk about compounding growth!
God’s returns are always more than we could ever create on our own. This type of compounding growth is evident in our lives, when we (our hearts) are in a place to receive it, accept it and share it. As the illustration in the Parable of the Sower demonstrates, the 4th Soil – i.e. the good soil – produces a crop 100, 60 and 30 fold. In other words, a noble heart driven to serve God can produce a return for the Kingdom of God that has exponential growth and far beyond worldly measurements and benefits, and more than we could ever do on our own.
When it comes to investing, every investor wants more. We only dream of achieving 30, 60, 100x. The higher the return, the better the investment, which means more profit. Our way of measuring more profit is defined by multiples, Return on Investment (ROI) or Internal Rate of Return (IRR). We use complicated spreadsheets and formulas to tell us how much more we got or can get. Yet, we don’t consider measuring the impact of our investment nearly as voraciously as we do the financial return of our investment. For a Kingdom-driven investor, shouldn’t we consider the impact of our investment at least as much, if not more? Shouldn’t we redefine what returns truly mean to a faith driven investor?
As a real estate developer and investor, our pro forma models always show the projected IRR calculation. This worldly metric evaluates the investment over a certain time period. But, as a Kingdom-driven investor, is this enough or is it all that we should measure? What if we looked at KRR instead of just IRR? Kingdom Rate of Return (KRR) considers more than just the here and now, temporary monetary rewards of earthly investing...it considers eternal rewards that have no time limit. It’s a measurement that can’t be computed with a spreadsheet formula. It’s more of a mindset than a measurement of how we choose to utilize and invest God’s resources to impact His Kingdom and to further the Gospel.
Speaking from the perspective of real estate investing for Kingdom impact, these investments are more than just in bricks and mortar. Beyond developing physical community where people live, work and play, there is a purpose and intent to build redemptive community – this includes the physical (real estate) but also the spiritual and relational community that God desires and intended for us to dwell in.
When we invest our resources to serve and impact God’s Kingdom, the returns can be more than we could ever create on our own. Those returns cannot be simply measured in formulas and economic data. It is more about the impact than the income that we must consider. There is more when we faithfully serve God by investing resources to impact His Kingdom. KRR will always be more than IRR.