Welcome to Drumbeats, the must -listen -to podcast
which explains why Indigenous partnerships are
the key to securing successful outcomes in natural
resource and infrastructure investment in Canada.
I'm Mark McNack, and with me is my co -host,
Rob Brandt. And this is our second podcast in
a two -part conversation with Jeffrey Sear, founder
and managing partner of the Raven Indigenous
Outcome Funds, the team pioneering outcomes -based
financing in Indigenous communities. In our first
podcast, Jeff took us inside the origin of Indigenous
outcomes financing and showed how Raven raised
tens of millions of dollars, delivered community
-led projects, and kept investors coming back.
Today we go further. Jeff breaks down what makes
Raven fundamentally different from other outcomes
funds around the world, where the biggest investment
opportunities are emerging in the Canadian Indigenous
economy, and why international capital, from
the US to Europe to Asia is now knocking to get
in. If part one proves the model can scale, the
second episode explores the next wave of measurable
impact. Let's dive back in. Outcome -based finance
obviously has some precedence internationally
in the US and I think Australia as well. And
of course, London is a home for impact investing.
What makes Raven different? Yeah, look, I think
leadership in England and Denmark and make -home
capital in the States. So Bridges, the Denmark
stuff on type 2 diabetes, which we also have
one investment that will be ready to go early
this year, and make -home capital States and
Bridges in the UK have funds. Why is this different?
I think it's the way that we center community.
And we look at the community priorities and develop
with them what the intervention is. Because it's
not always straightforward. First of all, each
community is different. And so you need to be
cognizant of what assets they already have and
what assets they need to bring as part of the
investment to make it happen. That community
-centered part is... Probably what saves all
the investments at the end of the day. Because
investments always get into little hiccups and
barriers and bumps. And it's your relationship
with the community and the community's desire
to lead it and see it forward. That's the thing
that sees the investment through to the end of
the day. The second thing is we don't let the
capital determine what the investment is. And
sometimes in some outcomes -based funding we've
seen, especially in one -off projects around
the world, the capital is telling you what they're
going to do. And here's the issue I can sometimes
get into with government commissioned outcomes
contracts, which the UK does a lot of as well.
I think it does great things. But I think the
responsiveness and building resilience in communities
where we need to be globally, economic structures,
that sort of thing we've seen through COVID and
financial crisis and trade war crisis, whatever
you want to name, that community resilience is
really important. So it's a different way of
doing it and it's a different way of valuing
the outcomes. From an Indigenous perspective,
like maybe it's, this is why we led them. If
they want to start with elders homes, yeah, do
that. That's important for a number of reasons.
So responsive listening, putting the management
capacity in the community, supporting that, leaving
it there is really critical for us. And we're
not seeking extractive returns. So there's a
limit to what you can do with outcomes financing,
and I think what you should do in terms of your
return profile for investors. Don't get into
this if you want to be driving Lamborghinis at
the end of the day. This is not that sort of
financing place. But you can do a lot of impact
and community through it, and investors can get
a decent return. And we can talk about how the
return, I think, works for investors, if you
want. How I think it's, in my experience, as
to where that's going. Sure. Let's talk about
that. That would be great. Yeah. And this is
learning by experience because when we first
did this, I wasn't sure how investors would respond.
Right. But as we went through it and, you know,
the due diligence process with investors, exhausting
as that can be, the investors themselves started
to respond to it because they want to put it
in their portfolio. And they needed to know a
way to think about it. Like, what asset class
is it really? Like, they're trying to structure
into things that they know, right? And it kind
of breaks some of those models. Yes, absolutely.
Right? How do we fit it in the box? Yeah. And
so what it turns out, it was the CIO somewhere
who said this to me, I can't remember, said,
well, you know what? It looks and acts and feels
like a fixed income instrument. Yeah. If you're
getting your return in five years. And it's a
5 % to 7 % return profile that looks and feels
like a fixed income product. And of course, we
secure the outcomes purchasing before we do the
contract, before we do the work and the investment.
So then you've decreased the risk profile on
it. This, I think, has appealed in a time of...
Uncertain liquidity in VC and PE, it's appealed
to the investor class in a way that I didn't
really anticipate at first. I thought maybe I
was Pollyannish. I thought the impact would appeal.
But as you start getting into the investment
discussions, it's both. You needed both, right?
And I think also it's a unique, like indigenous
investment vehicles are few and far between.
You know, if you're not doing resource extraction
or infrastructure, like... big infrastructure
builds, how many indigenous investment vehicles
are there to you? So I think that's, and like
I said, we picked up momentum from the institutional
class in the last four or five months. And I
think getting to the final close is not going
to be as difficult as I thought, potentially,
a year ago. So because the interest is very high,
a lot of it coming out of the US, frankly. And
I think it would appeal to European investors
as well. If you think about it like a fixed income
product in an indigenous space, it makes good
sense. It makes good sense because you're frontline
on climate change, like you're frontline adaptation
work. And I think that gets people excited. There's
room in the fund. I know there's investors. If
there's the robs of the world listening to this
podcast and they want to get involved, our website,
ravenoutcomesfunds .com or jeff at ravenoutcomesfunds
.com. I'm happy to give up my email address.
Not my phone number today, but the email address.
And folks can just reach out. And we have a couple
European investors. We have a slew of American
and Canadian investors involved. I was going
to ask if you've had interest already from overseas.
Yeah, from Switzerland and Germany in particular.
But I am also, you know, it's expensive to run
around the world and get in front of investors,
which is why podcasts like this are. So like
the exposure is important because people don't
know what they don't know. And we're a very small
firm. So, you know, to advertise is tricky. And
there's a lot of competition for capital. And
if you're not AI, you know, competition for capital
is tough, right? these days. But you've got a
really unique structure, maybe a unicorn. If
you're able to combine impact with security and
a secured return, that's a hard product to beat.
And I know there are some limits, you said, on
what you can do, but there's endless demand,
I would have thought, in Canada for that kind
of investing. Yeah, I think people are becoming
aware of it, to your point. And I mean, we haven't
had the fund out like it's just over a year.
It got a little slowed down, the fundraise, I
think for a couple of reasons. We're all aware
of these things coming south of the border, which
made a whole bunch of investors just pause for
a bit, not make certain decisions, which is exactly
what happened when I was raising funds during
COVID. Which is exactly what happens during financial
crisis. You just pause. The money still wants
to find a home and still wants to earn on itself.
So at the end of the day, it's started to open
up. And I think people are looking for a different
type of investment that feels solid. What other
kinds of projects do you see in the pipeline?
Yeah. So one of the big ones that we have, it's
very well developed. We're just waiting to...
complete the outcomes purchaser sign. It's a
type 2 diabetes remediation initiative. And we've
been working on it for a number of years. And
so this actually sat with our foundation for
a while because it needed to develop because
type 2 diabetes outcomes are a little more complicated.
But the science isn't. The science has actually
been well known for 50 years. And we now know
that Ozempic won't solve the problem. of type
2 diabetes. It can assist. It's just a tool in
the toolkit. But what you really need to do is
change behaviors and change access. So where
diabetes programs have failed is that they're
not culturally built by the community to be executed
in the community and owned by, which is what
we did with Wasagamak First Nation, a northern
Manitoba First Nation. The rates of diabetes
in those communities, in our communities, are
extraordinary. They're bad in mainstream society.
They're three to five times as bad in indigenous
society. Yes, I recall that. And if you're under
the age of 25 and you're a First Nations person,
you have an 80 % chance of being type 2 diabetic
in your lifetime now. The costs for that are
extraordinary. So in the communities, this is
the former, it's called the Assinio Nation now,
but it's the former Island Lake region of Manitoba,
northern Island Lake regions, where you need
lots of data on this stuff. These are very data
-centric models, yeah. We know that this year,
approximately 99 .95 % of people will be diagnosed
with type 2 diabetes, newly diagnosed. That represents
$25 million of cost to the healthcare system.
Those 90, there's 1600 other people with that
to have to do these communities, by the way.
And every year you'll add 90 more. And those
numbers are not going down. They're increasing
and they're getting into younger populations.
So when you stand back and if you think of systems
investing or systems thinking, if you want to
do it that way, that driver far outstrips clean
energy and adaptation. It is such a massive cost
driver. And you know, healthcare systems can
barely keep up and indigenous people. Especially
remote indigenous people not getting service
anyways. So this project, which we call the Mino
-Yawan type 2 diabetes reduction, which means
living the good life, is very specific training
and teaching. We work with Western University.
We built curriculum and program, employing local
people to be life coaches, as I think the shortest
word to it. I don't know if it's a great word,
because it's about culture, food, diet. exercise,
the intermixing of that, and mental health on
top of it, right? And so it puts together a three
- to four -year package that will reduce type
2 diabetes in a couple hundred people in that
community and save radical amounts of money just
by managing diabetes to stay where it is. Never
mind bring it down. Just get it stuck in place
for a minute here and not drive up costs. And
so that's one of the projects. We're working
on solar. We're working now on air source heat
pumps. We are looking at a very interesting biochar,
if you know what biochar is. It's taking organic
waste, so food waste from municipalities, organic
waste, organic waste from forestry and agriculture.
And you turn it into char. It's not by burning.
It's by actually a condensing process. So it
turns into fur line. So we're looking at something
there that looks interesting. So we get approached
with a lot of different things. We have to make
the outcomes argument for our fund, which, and
some of this stuff is very easy to do. So our
investment thesis is to increase the well -being
of Indigenous people and Mother Earth. We put
those into the mix, and there's a lot of things
that we can do that are really interesting. And
we're also looking at scaling, and we're talking
to the Kearney federal government about scaling
our work on outcomes -based finance for the government
as a whole to start thinking differently about
how it uses public dollars. So we're kind of
trying to move the market to where we can have
much larger funds and much larger investments.
I think, though, that the investments will not
be like... $200 million. There'll be a series
of $5 to $10 million ones that work at the community
level, but there's just a lot more of them. And
you'll get that impact that way. So it's kind
of scale by breadth as opposed to by depth is
where I think it goes. Because that big money
is out there on infrastructure, as we know. There's
lots of big spending there, so we don't need
to be there. Right. And coming back to the outcomes,
the security of the outcomes is because you're
consolidating. federal and provincial programs
that are designed to serve one person at a time,
but you're able to go and put together and say,
how do we take this program and scale it? And
that's how you get your guaranteed return. Is
that correct? Yeah. And I don't like to use a
guarantee, but I like to say as an outcomes purchaser,
based on us doing our work well and verifying
the outcome, guarantee is too much, a step too
far for me. And for them, I'm sure. The way that
that works is three ways, though, just to be
clear. One, we either guarantee the outcomes
purchase on an individual investment. We're going
to do 50 houses here. We're going to do solar.
We're going to do retrofits. And you get the
government department to sign an outcomes contract
with you and they'll repay Raven, blah, blah,
blah. The second one at scale is both CMHC and
Efficiency Manitoba really want to see this work
for Ford. So they pooled capital with us. 20
million, 10 million pools that we can just draw
on. Which is great because it gives the security
of we can keep the investment train going, right?
You can just keep doing the disk. Right. And
that's because your reputation, because you've
delivered for them. So now you're a trusted partner.
And the process is like, it's very transparent.
Like if you get into our data room, you'll see
our process. And the third way to do this is
through a much larger sort of what I call a macro.
which is what we're trying to do with the federal
government now. Let's get on a macro scale. We
don't need to hold the capital at Raven. In fact,
it's better if they do to some degree. Let's
say you do half a billion dollars. Federal government
puts us in a red -circled fund. They keep the
money. But they agree to buy outcomes on a contract
-by -contract basis, sort of centralized, agree
to buy the outcomes. And then you've market built.
at that point right so it's not just raven doing
it such as raven outcomes out there it's joe
blow here they're non -indigenous of course can
do it you know um which is where you want to
go so that to answer your question mark the kind
of there's three kind of methods towards it that
seem to work really exciting what a great thing
to wake up to every day oh how am i going to
save the world and Help the Indigenous communities,
right? That's a great way to start your day.
Yeah, I don't know if I wake up every day thinking
that. Mostly I'm like, huh, what about that investment
memo? Where's that at? The typical stuff people
worry about. Yes. Is that taking up your full
time, Jeff, these days? Did I read you traveled
maybe to the Vatican? I don't know how recent
that was. Yeah, yeah. Tell us about that. Yeah,
I had met the Pope, the new Pope. The Vatican,
that was in October, November last year. So my
second time there, the Vatican has something
called the Laudato Si, which is the former Pope
Francis wrote about how do you invest for people
and planet, like for common people and planet.
He was trying to move. Not only Catholic institutions,
but religious faith -based investors, which is,
by the way, a massive pool of capital globally.
Very massive. From Islam to Judaism to Christianity.
There's a big pool of capital out there. Towards
investing differently. That includes the impact
investing space in particular, right? Because
you're looking for impact. That isn't just a
return. And this past fall was the new Pope.
Pope Leo's sort of affirmation and kind of refining
that and kind of building that out. So what they
were looking for is, I guess, innovative solutions
to getting that impact globally. And of course,
there's a history between Indigenous people and
the church that I think, you know, good hearts
and good minds at the Vatican are seeking to
address. I mean, institutions like that don't
move. awfully quick, but they are moving. So
I was invited along with others, a couple other
Canadians who were there, but lots of people
globally who are looking for new. And we were
there to kind of share our experience and where
we thought it could go. Fantastic. Great honor
and great opportunity to be speaking. As you
said, they move slowly, but they do move. And
Earth is obviously, Very important. We all live
here. There's nowhere else we're going. Yeah,
yeah. And like some tech evangelists, I don't
think we're quickly going to populate other planets.
Maybe one day. We'll see who takes them over
first. Yeah, I think there's an alignment globally
that we understand, I think, from the investor
community to a degree that... We have one planet.
It's a limited planet, and we need to find ways
to work within those boundaries. I think we're
doing a small part of that, trying to do a small
part in that. I'd like to see the institutional
capital in some of it. ESG investing is a thing.
I don't always think it's as detailed as it could
be, as robust as it could be. But moving towards
it. I mean, people may be a little shocked about
the sort of incoming trade war and what's that
done to certain investment theses out there.
But I think folks haven't let go of the idea
that you can invest for good and still get returns
in a better way. So I don't think that's going
anywhere. It may not be talked about as much,
but it's not going anywhere as far as I can tell.
But people can prove me wrong. I mean, I think
this is south of the border. There's many things
I guess you don't talk about anymore, but all
things pass. And for the rest of the world, it's
still very important. And what you're talking
about and the issues you've raised about community
and power to communities and how do you give
control and that's happening everywhere, including
in the UK. You know, how do we get the whole
country going? So what you're saying has a lot
of relevance for just... outcome funds in the
uk and what they're trying to do and shift communities
yeah outcomes fund in the uk have some very cool
investments by the way yes they're all over yes
they're very interesting yeah in a global gathering
like that uh jeff did you come away uh where
did you think canada sat in the global world
of whether it's impact investing or the indigenous
economy generally I think in the Indigenous economy,
as to that one's birth, I'm closer to it. Canada's
definitely ahead of the curve in a lot of areas.
I think, why is that? Relationship of Indigenous
peoples, hard -fought relationships, we stand
on the shoulders of giants, our ancestors. When
you talk about legal decisions, Supreme Court
decisions, Truth and Reconciliation Commission,
stuff in the Constitution. and then when yeah
i would say it's a decade ago or more i can't
put a firm finger on it when indigenous people
are moving from surviving to thriving into that
space and then just when we originally did raven
capital the first we were the first globally
which i didn't know at the time i'm a little
shocked because canada is not the home for really
big capital you know what i mean so but i've
seen it take up globally after the fact. There's
not a lot, but there's been some that's occurred.
So I think Canada has a leadership side on the
Indigenous economy because of the importance
that that plays in the social fabric of Canada,
too. And I think folks like yourselves and others
said, yeah, we should be doing more. And it's
a black mark on our history. And it's only good
for all of us if Indigenous people in Canada
do well. Economically, socially, spiritually,
whatever we want to think about. And good for
the planet. Globally, though, There's been some
interesting moves afoot. There's been some innovative
stuff coming out of the U .S. in pockets, Indigenous
-wise in pockets. So you take New Mexico, that
area, take Portland, that area, take south of
the Great Lakes, Minneapolis. There's some very
interesting funds like the Indian Collective,
OUISTA, CDFI. You take these things that are
going on there and they're starting to move the
markers. They're not interesting. Globally. Not
as much. New Zealand has some interesting, but
they approached us. And I think I'm heading to
Australia in March by invitation to speak to
a group on things a little differently. On the
global economy, which is your broad question,
how do you think Canada sits? I think respected
in the global economy and pragmatic about certain
things. I don't know if we're seen as risk takers.
And the way that, this is me just musing here
openly on a podcast, take a grain of salt. But
I think we have a lot to share and to bring forward
globally. And I think the more investment we
invite from Europe, Asia, like you take Singapore
and you take... you know uh dubai you take the
big in london the big financial centers and the
more investment we bring into canada the more
exchange of ideas we have i think the better
the better we're going to be for it and the more
we can share and learn for example i didn't know
that qatar was one of the biggest owners of canadian
ports that's really interesting when you start
thinking about how mixed we are globally in these
things. I don't know. I don't even think I came
close to answering that question, Rob, but do
with it what you know. No, no. Your perspective
is, yeah, it's certainly in line with our experience.
And it's individuals like yourself, leaders,
Indigenous leaders that I think make the Canadian
space unique. So thank you for all. We're trying
to drive things. You do. Yeah. Yes. I think I'd
be really interested to hear what your viewers,
listeners, have to think or say. If there's people
who are interested, super open to having conversations,
super opening to do a follow -up if that's required,
if people want to dig into it. Our website is
really instructive. It's newly done just the
last year, and it's kind of helpful to get your
head around it. But I think Outcomes Finance
is another tool in the toolkit of addressing
socioeconomic inequalities. redistributing power,
redistributing wealth, so we get better outcomes
for society. So that's where I kind of leave
it there. Yes. Okay. Well, we have had good conversations
over here and are having conversations with the
Impact Investment Institute and other groups
here who are really interested in becoming aware.
As you said, there's not the same degree of awareness
one would think of what you're doing and others.
Given it's such a home for green finance and
ESG and these other issues, the city's starting
to take a look and think, okay, we need to be
doing something. With the change in leadership
in Canada, the change in leadership south of
the border, it's a whole new world. It's these
common values that will drive those who want
to remain fighting together in the good fight.
to make every community, every country and our
part of the world that much better. So I think
there's a huge opportunity. Hopefully we'll have
you come over to the summit this year. It's the
third annual summit. I think you'd find there's
a lot of useful conversations. It's been great
to meet you, Jeff. Great conversation. Well,
Jeff's here, founding and managing partner of
the Raven Indigenous Outcomes Funds. Thanks so
much for your time. As I said before, thanks
so much for all you do. Innovate and make a real
impact to Indigenous communities around Canada.
Yawan. Yeah. Marcy Chow. Thank you both. Thanks
for the invitation. Thank you, Jeff. Thank you
to Jeffrey Sear for sharing his insights with
us. And thank you for viewing and listening.
Mark your calendars for the upcoming 2026 Summit
taking place on the 8th of April. Be sure to
share, subscribe, and leave a review on your
favorite podcast channel. Thanks for listening
to Drumbeats. Until next time.