Val Lee, co-founder of Manifest, transitioned to entrepreneurship after over a decade in management consulting at Deloitte, where he focused on economics and business. He realized his increasing draw to entrepreneurial projects, which large consulting firms are not structured to support, necessitating a "decompression period" to rewire his brain from high-pressure deliverables to long-term learning and strategic thinking.

Manifest's core mission is to unlock access to private equity real estate investment via blockchain, originating from an exploration of value creation in the crypto space. With his co-founder Nathan, Val focused on homes as a significant area for value creation. Their product allows homeowners to sell a portion of their home's value for cash, with investors sharing in the property's growth, rather than receiving interest. This model uniquely creates an alignment of interest between the occupant and investor, differing from traditional rental businesses that often have conflicting incentives.

For other founders, Val emphasizes that fundraising is about "finding someone who's already convinced" by your venture's thesis, rather than trying to persuade them. This strategy involves thorough pre-research on VCs and leveraging AI tools like ChatGPT to identify aligned investors and tailor pitches to resonate with their existing investment theses. Manifest's approach to capital utilization focuses on sequencing business activities to reduce risk as much as possible for each dollar spent, viewing risk reduction as direct value creation for investors. Their current primary risk is securing initial seed capital for the real estate fund to acquire assets. While having a core team of four, Val views their team broadly to include over 40 individuals, comprising partners, advisors, and vendors, underscoring the "it takes a village" approach crucial for startup success.

Key Takeaways

• Strategic Shift from Consulting to Entrepreneurship: Val's transition from over a decade in management consulting to co-founding Manifest highlights the importance of a "decompression period" for founders. This period allows for rewiring the brain from constant deliverables and high-pressure activities to a focus on long-term learning and strategic thinking, which is essential for identifying and pursuing entrepreneurial opportunities that major consulting firms often cannot support due to their business model.

• Innovative Value Creation in Real Estate through Aligned Incentives: Manifest's core value proposition is to unlock access to private equity real estate investment via blockchain. They do this through Home Equity Investments (HEIs), a relatively new product that allows homeowners to sell a portion of their home's value for cash, with investors being repaid based on the home's value growth. This model uniquely creates an alignment of interest between the occupant (who cares about property quality and financial results) and the investor, avoiding the conflict often seen in traditional rental businesses and expanding the dream of homeownership.

• Optimized Fundraising Strategy: Finding "Convinced" Investors and Leveraging AI: A crucial lesson in fundraising is that it's less about convincing someone and more about finding an investor who is "already convinced" by your venture's underlying thesis. This necessitates thorough pre-research into VCs' past investments and leveraging software tools to identify aligned firms, prioritize outreach, and tailor pitches with relevant talking points, thereby accelerating the fundraising process and making conversations more productive.

• Risk Reduction as the Core of Value Creation: Manifest strategically utilizes capital by sequencing business activities to reduce risk as much as possible for each dollar spent. This approach views risk reduction as direct value creation for investors, as successfully mitigating risks directly increases the perceived value and readiness of the business for scaling.

Chapter Summary

(00:01:04) Introduction & Personal Balance: Val Lee, Manifest co-founder, shares his improv passion for focus and stress relief. He discusses his pivot from 11 years at Deloitte consulting, emphasizing a "decompression period" for entrepreneurial thinking.

(00:06:58) Manifest's Core Innovation: Manifest uses blockchain for private equity real estate through Home Equity Investments (HEIs). This unique model aligns homeowner and investor incentives, unlike traditional rentals.

(00:11:17) Market & Product Specifics: HEIs repay investors based on home value growth. Manifest targets liquid markets, avoiding environmental risks like floodplains for stability.

(00:14:33) Optimized Fundraising Approach: Val emphasizes finding "already convinced" investors via thorough pre-research and leveraging AI (e.g., ChatGPT) to identify aligned VCs and tailor pitches efficiently.

(00:19:07) Capital Allocation & Risk Reduction: Manifest uses capital to reduce risk "for the next dollar spent," equating risk reduction to direct value creation. They're building necessary tech for their unique real estate fund.

(00:25:51) Addressing Key Challenges: The main current risk is securing initial seed capital for the fund. Val manages personal stress and anxiety through consistent daily journaling and improv practice.

Books Mentioned in this Episode

The Body Keeps the Score by Bessel van der Kolk

https://www.amazon.com/Body-Keeps-Score-Healing-Trauma/dp/0143127748

You Are the One You've Been Waiting For by Richard Schwartz

https://www.amazon.com/You-Youve-Been-Waiting-Relationships/dp/1683643623

Like War by P. W. Singer and Emerson T. Brooking

https://www.amazon.com/LikeWar-Weaponization-P-W-Singer/dp/1328695743

Resources:

Manifest Finance

https://manifest.finance

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Please note that information provided in the podcast is for informational and educational purposes only and is not a recommendation to take any particular action, nor an offer or solicitation to buy or sell any securities or services presented. It is not investment advice. Brio360 does not provide legal or tax advice.