Jumpstart Our Business Startups Act

And what's crazy about this as well is...

Back in 2012, there was this thing called the Jobs Act pushed through so that it was meant to open up capital markets to more people, but it had a subtle change that meant that private companies...

It used to be that private companies over a certain size would have to report their actual revenues.

They'd have to file like a public company.

I was recruited as a fundraiser.

I raised funds for different companies that Jobs Act allowed new companies to essentially raise capital.

I was really, really good at it.

Kind of one of those idiot savant things, right? I have a couple of things I'm really good at and that's it.

Our core competency is using those programs and hopefully using them better than other people do, more in the four corners of the legislation, the spirit of the legislation, and hopefully better in terms of financial structuring.

And because we've done that, I mean, going back to the 2010 Jobs Act, when we were using Jobs Act programs to invest in the lowest income parts of Detroit, it got the attention of the U.S. Treasury Department that these tools they used were working really well for us in Detroit and they wanted to learn

more.

I got a call from Treasury Secretary Jacob Lew's chief of staff back in 2013, no, 2014, saying, hey, the Treasury Secretary wants to come and meet you in Detroit.

And, you know, what I'd say is that, you know, even though everything is political these days, you know, anyone who is working in Treasury or HUD who is looking to do you know, to use these programs better, you know, it's coming from the right place.

I mean, these are these are public service professionals who want to know how do we create more housing units? How do we create more jobs in underserved areas? How do we do these things better? So it's it's given a unique perspective.

And then Fast forward to 2017 when the Tax Cuts and Jobs Act was passed by Congress.

I mean, that created Opportunity Zones 1.0. That was the first part of the program.

Absolutely.

And to be fair, you know, when we first started the company 25 years ago, there wasn't the idea of reggae out there because that came 10 years ago through the Jobs Act.

So in our first 10 years of operation, going from a dorm room startup to profitability, we did raise traditional money from venture capitalists, private equity firms, high net worth people through what we would call the regulation de-financing, the very traditional form.

And the reason, gosh, it was back in sort of now maybe eight years ago, we did our first reggae where we raised $20 million.

So that's positive.

But then coupled in the fact that we had in 2012, the JOBS Act change, right? And this space of syndication and capital raising and all this stuff,

really

started.

And I originally... joined CIM with the mandate of kind of starting and scaling the credit platform.

And then in 2017, when the Jobs Act was passed and the Opportunity Zone legislation was put into place, I was asked to start our Opportunity Zone platform.

So did that happen? until 2024, did a brief stint at a developer out of Utah as a CEO.

And then I got a call from Robert and the folks at CIM saying, hey, you know, this opportunity zone thing that you were working on all those years, it is now permanent.

Can you talk about how CIM is involved in QOZs, not just from the traditional developer perspective, but also, you know, looking at investing in deals that might need some recapitalizations, things of that nature.

Like how is CIM looking at the existing QOZ front? And then obviously we're changing into the next phase starting on January 1st, 2027.

But talk about all the iterations that you've been involved in, you know, since this did pass with the JOBS Act years ago.

Yeah, and maybe just a quick backdrop on what is the program? What is the intent behind it? Why does it exist? And so back in 2017, as part of the JOBS Act, it was originally put in place.

In terms of preparation from an ECM perspective, what really is important is to start the S-1 process and the diligence process, which you're already doing on the M&A side.

I think the JOBS Act changed how people use the dual track process in the past, which was You used to file an S-1, it was always public, and people would be able to look at the S-1 and decide, do I want to buy this company? Is it actually going to go public instead of going down the sale route? And now with the confidential filing, that information isn't necessarily readily available for most companies.

But I do think that filing an S-1 even if it's confidential and showing the market that you are willing to go down that path and you've announced to the world, because even though the filing itself is confidential, everybody puts out a press release saying that we filed confidentially.

They just don't release the contents of the filing.