Episode 167 - Marks on the Markets: Angel and Direct Investing with Patrick Farrell and Luke Roush
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On this special edition of Marks on the Markets, Richard and Luke are joined by Patrick Farrell, the co-founder of Potomac Angel Capital.
The group connects like-minded investors with mission-driven entrepreneurs for mutual financial benefit, lasting impact, and meaningful relationships.
And in this episode, Patrick is going to dive into the unique opportunities and challenges that come with angel investing.
He and Luke will also highlight some of the specific market trends to be aware of for anyone thinking about early stage investing.
Find the Potomac Angel Capital video here: https://www.youtube.com/watch?v=bvRsD7xB9zM
If you like the content, please follow, rate, and share the show.
All opinions expressed on this podcast, including the team and guests, are solely their opinions. Host and guests may maintain positions in the companies and securities discussed. This podcast is for informational purposes only and should not be relied upon as specific investment advice for any individual or organization.
Episode Transcript
Transcription is done by an AI software. While technology is an incredible tool to automate this process, there will be misspellings and typos that might accompany it. Please keep that in mind as you work through it.
Joseph Honescko: Have you ever been bit by the church parking lot deal? You know the situation. A well-meaning believer with access to capital wants to support another well-meaning believer with a business idea, since they worship alongside each other on Sundays. The investor feels that it would be right to help the prospective entrepreneur out. So they shake hands and agree to work together. And that's about when the problems start to arise. Without proper expectations, setting agreement upon terms, due diligence, strategy, planning and execution, the business fails and the investor loses money. These situations are often far too familiar amongst faith driven investors, so much so that many have separated themselves from investing in these risky early stage ventures, which makes it difficult for these potentially impactful businesses to find the funding they need to survive. So what if innovative investors could redeem this type of investing? Today, on a special episode of marks on the markets, Richard and Luke are joined by Patrick Farrell, the co-founder of Potomac Angel capital. The group connects like minded investors with mission driven entrepreneurs for mutual financial benefit, lasting impact and meaningful relationships. In this episode, Patrick is going to dive into the unique opportunities and challenges that come with angel investing. He and Luke will also highlight some of the specific market trends to be aware of. For anyone thinking about early stage investing. You're listening to the Faith Driven Investor podcast. Let's get started.
Rusty Rueff: Hey everyone! All opinions expressed on this podcast, including the team and guests, are solely their opinions. Host and guests may maintain positions in the companies of securities discussed, and this podcast is for informational purposes only and should not be relied upon as specific investment advice for any individual or organization. Thanks for listening.
Richard Cunningham: Well, hello and welcome everyone to the Faith Driven Investor podcast. We are grateful you are tuning in from wherever you get your podcast from. If you were not with us in our most recent recording, I am Richard Cunningham, I'm on staff with FDI and I have the great privilege. I don't know if it's a good thing or a bad thing. Luke Roush of taking over the hosting roles in this next season of the FDI podcast, and the heart behind it, is we want to get you and John Coleman and Henry Kaestner out of the host seat and into that kind of expert analysis, color commentary seat. John Coleman last week said, hey, this is a coup. And he wasn't very happy about it. I haven't gotten the opportunity to publicly comment on this yet. So here's your opportunity before we welcome our man, Patrick Farrell to the show.
Luke Roush: Hey, have you this is a major upgrade, major upgrade to have Richard Cunningham in that seat. Let's go buddy.
Richard Cunningham: Man, I just I wholeheartedly disagree, but your words are kind. Today is going to be a lot of fun. We've got a very close friend, leader in the faith driven investing landscape, and our buddy Patrick Farrell, newest resident to my hometown of Austin, Texas, which I'm particularly excited about joining us today, talking about kind of in the series that we're doing post FDI conference, where we zoom in on particular stories that we shared in the 2024 FDI conference back in January, Potomac Angel capital being one of those. And the work Patrick's doing leading that charge. So we're gonna get to hear from that. But then today's also a unique marks in the market podcast. So we've got Luke and Patrick also providing some insights on, you know, what is relevant to this conversation being early stage investing, direct investing, Luke and their work out of the sovereign venture funds, Patrick and his work with Potomac Angel capital. So you'll get a little bit of market commentary as well as we think about this conversation with Patrick Farrell. Welcome to the show, man. Grateful you are here. How's it going.
Patrick Farrell: Man? It's great to be here just about 75 yards from where you're sitting, Richard says. Super fun to be live from Austin, Texas. And man, been a fan of the podcast for years, so it's such a joy to be on it.
Richard Cunningham: May. We're pumped to have you here. So let's dive right in. Patrick Potomac, Angel capital. The story was told at the very end of the FDI conference, this incredible representation of what it looks like for faith driven investors to get in the game. For those who couldn't join us for the FDI conference, maybe give us a little kind of response and commentary of what it was like to have that story told in the FDI conference, but also catch those up who maybe might not be familiar with the work of Potomac and what you guys are doing.
Patrick Farrell: Yeah. Well, I mean, it's one thing to be sort of living that story day to day, but then to see it on video production and, you know, broadcast across hundreds of cities with such a blessing. But I found myself kind of sitting there at the watch party here in Austin going, man, guys are really up to something. And obviously I know that because I'm living it. But it really struck me just to see it up there and just to be humbled by how God has been building this thing and that I'm along for the ride. So that was so awesome to have it featured on the conference. Yeah. So a little bit of background, Potomac Angel capital. We're an angel network based out of Washington, DC. We invest in mission driven founders from mostly in the United States, but also some internationally. And all of our investors are based in DC. They're all faith driven investors, and we're doing early stage angel investing. And so our our angel investors are part of a group that invest together in these early stage companies. And we're investing really for three things. One is for meaningful impact. So these companies that we're investing in, our mission oriented and really participating in God's redemption of all things we're looking for. Founders are open to relationship. We want to walk alongside founders for the tumultuous journey that is entrepreneurship. And then obviously, we want to look for we're looking for financial upside. So we want to make sure that these ventures are providing profits and returns to their investors. And so we've been doing that for a couple of years now, and it's been super fun to kind of engage in that space.
Luke Roush: One of the things that we talk a lot about, Patrick, is this idea that it's not a bad thing to be wrong for like 95% of investors are entrepreneurs, as long as you're the absolute right thing for the other 5%. And some of what came through, I think, in your video is, you know, a real filtration of, hey, we want to be known for being different and having a different approach in terms of how we engage on both sides of the ledger, maybe speak a little bit more of that just in terms of like a real niche that you have carved out, feel like God's called you into.
Patrick Farrell: Yeah. Great point Luke. I mean, I think part of it is we're going to be doing excellent deals. So that's the foundation being excellent investors. Part of what we're up to. We're not making any concessions there. But ultimately what we're saying is at the end of the day, what we want it to be is like a facilitator of relationships, relationships between the entrepreneurs and investors, relationships between entrepreneurs and entrepreneurs, investors and investors, and ultimately facilitating the relationships between all those stakeholders and God the Father, the son, and the Holy Spirit. And so there's like this relational focus. And so we. Specifically and intentionally structured our processes, our conversations, the way in which we're engaging with founders to say, hey, relationships are going to be at the center and at the core of this thing. And if you're open to that and you want us around for the ride good, if you're not, that's okay. But we're probably not a great fit for you. And so we'll do things like be really transparent in some of our feedback, where we know a lot of our peers are a little bit more hesitant to do that for a number of good reasons. We'll make sure that we're trying to bless entrepreneurs in our feedback as well, where we'll support them even if we don't invest in them. Really just trying to create that sort of relational focus. And that's really what's built a community on top of the deal flow that's been so powerful to see and how it's blessed the DC area.
Richard Cunningham: I love it. Well, Patrick, one of the things we talked about and we talk about often here on the podcast, but both just broadly across kind of the faith driven ecosystem, is this concept of getting in the game. And for investors everywhere, kind of wherever the Lord is uniquely positioned them. Hey, what does it look like for you specifically to get in the game? I think we've got two great exemplars here, represented in both of you and what, you know, Luke, the work of Sovereigns Capital and what you guys are doing. And Patrick, what you guys are doing to Potomac Angel capital in the opportunity you're offering for investors in DC and coming soon to Austin, I think, is what you're going to get into a little bit later on the opportunity to get in the game, maybe kind of from a definitional standpoint here. I think people here, early stage investing, they hear angel investing, they hear venture investing. And a lot of these terms start to mean the same things to people. Would you both kind of maybe distinguish your approaches, what makes them unique, and maybe just educate a little bit about, hey, venture investing out of a fund what sovereigns is doing along with other venture capital funds, angel investing, and kind of this community oriented approach through Potomac and take us to school a little bit guys.
Patrick Farrell: Yeah, for sure. Well, I'll start Luke. And then you could kind of add some color on the fun side. Typically when, you know, early stage companies are starting to raise capital, oftentimes they're a little bit too early stage, a little bit too risky for institutional capital. And so what ends up happening is they have to go to family and friends or high net worth individuals, folks that they're in relationships with or folks like us, angel networks to try to raise that sort of really early capital. So typically we're working behind companies when they're just getting to market, just building their team and really getting behind them and hoping to and not only see them take it all the way through exit or acquisition or IPO or through profitability, but also hoping to get in and kind of create that bridge between where they are right now and where an institutional investor can get behind them. And so typically we're writing smaller checks in a fund would. Right. We're taking a little bit more of a minority position. We're investing on instruments that are facilitated to make the deals run faster. So there's not a ton of legal. And we're really jumping in early early stage with these entrepreneurs. And then hopefully if we've made a good bet the company grows and as well. And then a firm like sovereigns is able to kind of hop in and provide some more fuel to the fire. So that's where I'd kind of create the bridge to you Luke.
Luke Roush: Yeah. You know, I think that the red thread that runs through everything that we do is really centered on leadership. And our view is that, you know, faith driven cultures are not just created, but also stewarded and perpetuated over time by the right leadership team that continues to make that a priority and really living out, you know, what does it look like to love your neighbor in and through a company? We have tremendous influence. And, you know, in a lot of ways, Patrick, you've got even more influence as an early, early stage investor. Maybe one of the first, you know, checks into the business, and that comes with an incredible amount of influence. And that influence can be shepherded, for better or worse. So capital equals influence and that influence. If you find not just alignment around the what we're doing, but also why and how we're doing it, there's real power in that. And I think that that creates an environment where the entrepreneur feels more free to be able to share, not just on like, hey, this great thing happened or that great thing happened, but also, hey, here's some challenges, here's some real struggles that we're having because it's not just about the what, it's also the why and, the how. And so for our work, you know, we're looking for companies that have demonstrated product market fit. They have some number of customers that are already coming in the door. And we're looking to, you know, find individuals, leaders that we believe in, the vision that they're casting. They understand the problem they're trying to solve. There's enough of a market fit validation to feel like, all right, this isn't just a total flier napkin. And then, you know, but both of us, you know, an area where I think both of us can find a lot of commonality is patience. It almost always takes longer and takes more money than you think it's going to take. And also just that, you know, hey, great companies are usually built over, you know, a decade or more. And so this idea of kind of quick in and out or, you know, pulling up a plan every ten days to figure out whether the roots are growing is not a great way of keeping track of businesses. You got to be able to let that stuff, you know, ride a little bit and be patient. So I think that's how we fit together.
Patrick Farrell: Yeah, as Luke said like this is a long game that we're playing. We're not investing in really liquid assets. These are companies that are growing and scaling and hoping that, you know, within 5 to 7, sometimes even ten years to provide an exit to investors. So we're thinking about the long term redemptive impact and upside financially, which means that for our investors, they have to be willing to kind of weather that long period of time without having that sort of liquid option. And they also have to understand that at our stage, it's a very risky game. We're talking about a point in time where there's no guarantees that companies are successful, but that's also what makes it really, really fun and makes it really, really valuable to walk alongside entrepreneurs, because that process is such a roller coaster and can be so emotionally stressful and puts stress on their families. And so we want to walk alongside for that journey because they got to make it out of the early stages. They're going to get to the later stage. And so yeah, just wanted to add some color on that Luke because I think, as you.
Luke Roush: Well know, it's like, you know, a lot of times people will say, you know, it takes a village to raise children, but if you really want to build, you know, an angel portfolio of investments, it's probably going to take more than just you. Right. And so I get pinged all the time by hey, would you look at this deal for me? Tell me if you think it might be a good angel. Deal. And my response is always, well, you know, how many angel deals have you done or do you expect to do? Because if you really want to build a portfolio of angel deals, because of the risk in the timeframe that you described, Patrick, you got to be prepared to write 15 or 20 or 30 checks, and the likelihood that you individually can diligence that many different types of companies that are likely to come across your plate, it's very low. That's going to be much better done in community with other people, where you can rely on one another and a close knit circle of trust and rely on the strengths of the group. And that's that's what you guys have really leveraged, I think.
Patrick Farrell: Yeah. Luke, we're going to have to get you out there doing the sales pitch for me at some point, because that's exactly right. It's really about the community doing deals in community, reduces the risk for the investor, but also just having somebody else to get eyes on, having me and my team around to help diligence the opportunity to help filter those opportunities. Man, it just makes doing it so much easier. And so yeah, 100% with you on that one.
Luke Roush: Yeah. And it's like after you write a check. Right. So like we always kind of laugh when firms will put out these press releases of like, hey, we wrote a check, right. That's awesome. Like, it takes a lot of work to originate a deal, to diligence a deal, and then actually, like structure a transaction and wire the money over. But like a lot of the hard work, particularly in this early stage of venture investing, is still ahead of you. And so it's not, you know, something to be celebrated with, like, hey, we raised all this capital or we invested all this capital. What's really to be celebrated is how do you walk alongside, you know, the team, as you said, it's a lonely journey and the work of actually monitoring performance and being able to help founding teams look around the corner and like what's coming next. You know, you, Patrick and the folks that you have a chance to work with and invest with, you know, you guys have a lot of pattern recognition collectively amongst the group. So helping founders kind of look around that corner and figure out what's coming. I mean, it's extraordinary intelligence that founders are able to bring in through having the right investor pool.
Patrick Farrell: Yeah, yeah, 100%. And especially since, like a lot of the folks in our group are either entrepreneurs that are like in long term businesses that are just cash flowing in their investing out of that, or they're former entrepreneurs who have had an exit or multiple exits like they've been there, done that. And that sort of experience is huge when you're walking around, you know, trying to help a founder look behind the next curtain or the next stage of growth is just having somebody who's been there. So that's a huge value that we bring to the table as well.
Richard Cunningham: Love it man. You guys, I could just put a quarter in and watch you go. This is great. We need to realize that the NPS score of the FDI podcast will be a lot higher the less we hear the Richard Cunningham voice. So, hey, while we're talking maybe methodology and kind of, you know, some of the uniqueness, nuances and similarities between angel investing, venture investing, maybe give us some color on just what you guys are seeing right now, some trends, commentary in the markets. I know, I mean, on a public markets front, we're potentially about to close here recording this on Leap Day. Just so everyone's oriented of where we are February 29th, 2024. We're about to close with maybe S&P 500 and Dow Jones being up the highest they've been as a first two months start to the year since pre-COVID levels. So stock market kind of persists on that. We've been down a couple of days this week having a positive start to the year, but maybe bring us down to the earlier stages in the venture kind of sandbox fellows, and give us some kind of what you're seeing.
Patrick Farrell: Yeah. Well, especially it was almost a year ago when SVB collapsed and that was I think, a marker in the market for us because 2022, I think if you look at the data, was a record high in terms of valuations, money pouring into the early stage, and all of a sudden SVB collapses, market starts to take a turn. And we saw a lot of companies that typically would have moved quickly to institutional capital end up going back to angels and kind of re raising and trying to kind of weather that storm. And so also and we had this kind of flood of deal flow, flood of quality entrepreneurs because all that institutional capital sort of dry up. And so we've seen in the last year or so just a ton of high quality, amazing deals. And our investors are starting to be like, man, we've got an opportunity cost. We cannot invest in everything. And so. Subsequently because so much of supply, maybe if you were to use it in a sort of economics term, has flooded into the angel stage. We've consequently seen valuations come down a little bit in a later end of last year, early end of this year. But now I think that the market is starting to open back up a little bit. Capital is flowing a little bit easier, and some of those entrepreneurs that are in that kind of middle ground are starting to be able to raise capital, which is awesome, because that's what we want companies to be able to kind of increase and improve in stage and kind of grow and of course with their timelines. But it's been a flood of interest and the angel stage that we didn't quite anticipate, and that's coincided with Potomac Angel capitals brand. And just the fact that we're doing deals has also kind of gotten out there a little bit. So some of that might be intertwined. But yeah, we've seen a lot of folks coming out of the pandemic starting businesses hitting that Angel stage right around now. And so it's been really fun to see what folks are innovating on out there. But Luke, just curious if you agree with that, what you've seen on your end.
Luke Roush: Yeah, no, I do. I think when you start a firm deal, flow is at first it's harder than it should be just because people don't know who you are and at times you don't even know who you are. You're kind of figuring out you're building the plane or building the car while you're running it. I think later it actually is almost easier than it should be because there's a recognition of the brand and there's a recognition of the relationship that you built with founders and with your investors. And so the more differentiated you are, the quicker you can build that differentiation and really attract deal flow. And so this is why, you know, a handful of firms in Silicon Valley that have really built expertise, whether it's fintech or whether it's AI or whether it's software as a service. And then once you kind of have that reputation, then everybody's kind of coming to you. And I think on an angel stage basis that's done more locally, regionally than it is, like monolithically in a market, like a Silicon Valley or Boston or someplace like that. So I think that is actually encouraging. Should be encouraging to founders everywhere that you've got an opportunity to you don't have to get on a plane and go out to Northern California to be able to attract early stage capital. There are groups that are more local, regional trust based, with real deep roots in a market. And that's what you guys are doing. I think what we've seen in terms of deal flow is because some of the funds that were investing, you know, five, six, seven, eight, even ten years ago, the public markets effectively shut down. So some of the companies that grew up during that period and would be responsible kind of counted for to be able to return capital back to the original investors, which would create an kind of virtuous cycle of them. Redeploying all of that liquidity in the public markets has kind of gotten locked up or at least put on hold. And then, you know, when you think about M&A transaction volume, right, the two major ways for a company that is one of your investee or one of our investee to exit is either go public or get bought in. The M&A volume over the last 18 months has been really, really slow. We are seeing that start to change. But I think that over the last year or so, that has resulted in a lot of companies that are needing funding in some of the pockets that they might have gone to for that funding are still kind of waiting to get liquid on their stuff from 5 to 10 years ago. So it's a long road and there are kind of like ebbs and flows and deal flow based on things that are entirely outside of a founder's control. So I think I agree with what you shared.
Richard Cunningham: Good words. Thank you both. Yeah, I'm looking at an e y study right now. And it said in 2023, venture funding kind of accumulated at $140 billion, which was low and down from already declining levels in 2022. And there's projections that 2024 might be a sub $100 billion in kind of total venture funding type year. So Luke, that sentiment you have about just what's taking place in the public markets, though, we're seeing that IPO market and kind of engine ramp back up. There's still kind of interest in the hangover that trickles all the way back down all the way to the you know, even the pre-seed and seed levels that you two play at. All right I want to kind of make a transition here. You are an incredibly humble dude. I love your vulnerability and transparency. If anyone you haven't heard the Patrick Farrell story, you need to watch the Potomac Angel capital video because you just you get to see his heart shine through. You also get to see his just wicked awesome parents, Paul and Leonard. Just special people that are in DC. Some of the founding investors alongside friends like Bill and Dana Wichterman at Potomac. But Patrick maybe in humility, there's some cautions out there about angel investing. Like, you know, there's the famous line of like, I've been burned by the church parking lot deal. But just because we share the same faith, people, you know, walked into a deal with, you know, poor expectations around terms and people get burned and lose a lot of money. It's highly illiquid. So you have to view it. And, you know, you guys are hitting on this earlier just in terms of full blown asset allocation. And there is also this thought to is, you know, Proverbs 15:22, while there's great wisdom in a multitude of counselors and angel investing situations, can get a play where there's groupthink and more people around a deal actually isn't helpful. It just slows down the process. People aren't actually willing to talk honestly about maybe what's going on there. So maybe in just humility, talk a little bit about this. Some of the things you're seeing, some of the pitfalls for people to be aware of when it comes to. Angel investing. There may be honestly, some of the rebuttals or different ways you guys are trying to kind of counteract some of these thoughts as well.
Patrick Farrell: Yeah, 100%. I mean, where my mind goes to first is a lot of entrepreneurs experience angel networks as highly unprofessional, hard to get a hold of. Take a really long time to invest. And so the way we've really fought that is just by me and my co-founder, Mike. With the time that he has putting all of our weight behind the network. So that is my full time thing. And that allows me to do is just try to be excellent as to how we set up our processes or systems. A lot of my job is running around trying to get in touch with people, bringing people into the fold, kind of, to use a colloquial term, herding cats. And so if you're willing to put that sort of work in, you can really make an angel network run efficiently and effectively and really be founder friendly in that process. So we do our best, but that also doesn't always cover some of the downsides of an angel network. The angel investors are spending their own time, precious time from their family or from their day job to engage in investing. And when things get busy, it's typically not going to be a priority. So sometimes things can slip in terms of timelines. Obviously, one of the things that can be pretty difficult to is just when founders are looking for checks that are going to want to come within, like a certain time frame, sometimes it's hard to meet those timeframes. And so we've seen a multitude of things. And you mentioned groupthink. I think Potomac Angel capital, we do it better than most by trying to encourage lively debate, different opinions on certain things, and making sure that all of our investors kind of get heard when we're having discussions about deals. But by and large, you know, sometimes there are folks in network, they're just coming up to speed on angel investing and somebody with a lot of clout, a lot of experience at the table will say, hey, I don't like this deal. I think I'm out. And they'll feel maybe insecure about their interest in a deal or moving forward. And that can kind of circulate throughout a network. So, you know, we're not immune to groupthink, even though we're believers, even though we're trying to do this in a really redemptive way. That is certainly a downside to the structure. And we know that. So really for us, it's just about being as transparent and effective communicators with entrepreneurs as we can. So we blessing them throughout the process. So we're not setting unrealistic expectations and just encouraging and educating our investors on some of the pitfalls of our structure and process so that they can be thinking through it and be acting in accordance with the Kingdom as we're doing our work together as well.
Luke Roush: There are two things I mentioned real quick. One is just the importance, and Patrick nailed it on communication. You know, it's okay if you gotta communicate bad news, but just make sure you communicate the bad news. Don't just kind of sit on it. You know, we tell our team is that in the absence of communication, everybody assumes the worst. And so if it's going to be another two weeks, call people and tell them, hey, it's going to be another two weeks. And I know you wanted to happen yesterday, but we got two weeks, you know. And so that way at least they know where they stand. And and then the other thing I think is really, really important is, you know, a lot of the bad stories that go around about angel investors or venture capitalists or private equity folks is where people will substitute getting to the right price on a deal with terms. And so there's a lot of structure on the deal. And certainly the saying in Silicon Valley is I'll let you set the price. Just let me set the terms. And what that means is that, like, you know, you can overcome a lot of things. And but what happened, you know, just to make sure that entrepreneurs aren't confused about this, newer investors, you know, what structure is doing is it's creating situations where the interest of the investor and the entrepreneur are maybe not totally aligned. Sometimes structure can be used to create alignment, but sometimes it can be used to basically give a higher price, but then create situations where there's potential for a win lose. And so I feel pretty strongly that the earlier you're investing, the more clean you want term sheets to be, and not just trying to overcome poorly negotiated price points with structure that creates a lot of strife downstream.
Patrick Farrell: Yeah. And I would even say at our stage look like with our limited resources and time, sometimes if we get like an 80 page, you know, lunch purchase with all sorts of terms in it. Yeah. Here's some of our investors off, even though we're going to do the work to kind of run through that. And like our best, it can definitely scare folks off for sure.
Luke Roush: I agree.
Richard Cunningham: All right, gents, I want to close with this. And kind of our final topic that we're going to wade into is Patrick, you're clearly here in Austin, as we just talked about. Potomac, though, started in Washington, D.C. you've got this flourishing healthy network there, and you might be able to correct me on some of the particulars, but 14 deals done already with something like 20 members. So, you know, be sure to brag a little bit on all that's taking place there and the Lord allowed you guys to accomplish and the early life of Potomac. But hey, what's God doing in your story? What's he teaching you in his word? You're now here in Austin, Texas, so there's clearly some kind of physical work taking place as he's taking you to a new location. And then Luke would love for you to also chime in of just like, hey man, what's the Lord teaching his word? What's he showing you right now? And encourage those that are listening on the Faith Driven Investor podcast.
Patrick Farrell: Yeah, well, this is what's really fun for me is just to kind of share stories about how God is moving in this space. So obviously we started Potomac Angel Capital in January 2022. In D.C., a really heightened focus on locality and investors faith driven investors in community Together in person, which created a really unique blend and allowed us, especially with me putting all of my time behind it, allowed us to kind of accelerate quickly and start doing deals fast. That alongside just a very willing group of investors who were partnering with God and listening to him and saying, yeah, we want to invest in these companies. So it was super fun to watch. It kind of really blow up in the first year. And then after that first year, we started talking to folks in our networks, folks that we knew, and they started to say like, hey, you guys have got something kind of unique in D.C. there's some awesome angel networks out there, but you guys have kind of taken a different approach, a different model. We wonder if your model would work well in other cities. And so we started to explore that. And like any good entrepreneurs, me and my business partner, Mike Grubbs, came down to South by Southwest last year in Austin, just to do some market validation to figure out whether there was some demand down here for this, for the people wanted it, whether there was anything like what we had in D.C. here in Austin. And literally the first day in my quiet time here in Austin, I just felt like God was inviting me to move here, which for me was an incredibly impractical thing to think that you're hearing from God. Mainly because I've been in DC for ten years. I've grown up in the area. I left for college and then came back. All of my investors were in DC. I had deep community church roots, all of it. And God's like, let's go to Austin where I don't know very many people. And Richard, we were kind of acquaintances before then, but I didn't have very many relationships in Austin. And so what that did is it kicked off sort of a discernment process with some of the people that were holding me accountable, walking with me in my life, and turned out that everyone was thumbs up, even my parents who were sad to see me go. We're like, I think this is what God's doing. And so I came down here in the fall to Austin, moved to Austin full time. I still go back to DC about a week, a month just to manage the relationships and all the good stuff that God is doing at Potomac Angel capital, and that's still my day job. But I'm down here creating relationships, casting vision, hoping to plant a new network of investors down here with a similar ethos to Potomac in local community faith driven. What does it look like to do this thing together here for the good of the city of Austin? And then obviously all the companies that we're founding and walking alongside. And so that's kind of created this is sort of an adventure for me down here in Austin, just following Jesus on every next step, letting him lead the way. And man, it's been really, really fun. And so, Richard, as you know, we're co-hosting pitch event and panel next weekend at South by Southwest Sunday service, which is going to be unbelievable opportunity, such a huge conference, but also just to to put faith in the marketplace on display. And Richard's going to be joining us on a panel for that particular event. So that's super fun. But just see what is up to here in Austin. And I'm droning because it's so exciting. But man, this city is really, really taking off. God is doing some awesome things, moving some great people here. And so it's been really fun to just be on this adventure, with Jesus so far.
Luke Roush: That's great. Yeah, I think for me, I'm just going to pump like one book that I got and I've been going through, same as ever that's written by Morgan Housel. And it's just, you know, the tagline is a guide to what never changes. And that takes me to Hebrews 13 eight. Jesus Christ is the same yesterday and today and forever. And so I think that there's a whole bunch of things in business, in the marketplace that, you know, we somehow kind of like discover a new every 5 or 10 years or so. But the reality is that the fingerprints of kind of lessons learned that we should be applying to the work that we do every day are all over the last 100 or 200 years. But the only thing that really is consistent throughout all of human history and will always be true, is what is the character and nature of God, and who is the Son Jesus Christ? And what is the relationship that His Son wants to have with each of us, because he loves us all equally. And so anyways, I'm excited about that. Appreciate the opportunity, Patrick, to have you on, to hear your wisdom and just, the work that you guys are doing with Potomac Angel, it's awesome. It's inspiring. And, I think we need more organizations like it. And, super excited to see how God uses you, not just in the DC area, but also down in, the great state of Texas.
Patrick Farrell: Yeah, for sure. And this will be my plug to say thanks to you, Luke and you, Richard, for the work they are doing at sovereigns and FDI that are really paving the way for folks like me to step up and say, hey, I got this idea. I think that can fit in this in this faith driven ecosystem. And so it's been inspiring to follow y'all's lead. And I appreciate all the work you're doing.
Richard Cunningham: Awesome. Well, Patrick Farrell Luke Roush, what a joy to get to do this. Friends. We will catch you next time.