Co-founder and partner | Perpetuate Capital

Brandt Brereton is co-founder and partner of Perpetuate Capital. Perpetuate is a structured equity fund that marries Christian capital providers with Christian business owners seeking liquidity or growth capital and who also want to ensure the independence and ministry legacy of the business remains unchanged during and subsequent to their involvement.  

Prior to his participation in Perpetuate Capital, Brandt served as the President of Brereton, Hanley & Co., Inc. a boutique investment bank in Silicon Valley he founded in 1995 that advises middle market companies on M&A, Private Equity and Employee Stock Ownership (ESOP) / Employee Share Ownership Trust (ESOT) transactions.

God benched Brandt from investment banking two-thirds of the way through his thirty-year business career, and he became a senior executive of City Team Ministries International for two years. He was released back into investment banking after the Lord acutely focused him on His agenda for the world, infusing a renewed passion for educating Christian business owners on the ESOP sale alternative in order to perpetuate ministry supported by those client businesses.

With an equal depth and breadth of experience across the three most common liquidity events and leveraged finance generally, Brandt offers comparative education, advice and execution to owners struggling with the tension that exists between perpetuating the ministry impact of the business and the need for it to receive outside capital for either shareholder liquidity or growth.  

Brandt earned a BA in Finance from San Jose State University and has attended executive education courses at Harvard Business School.

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CONTRIBUTIONS TO FAITH DRIVEN ENTREPRENEUR

This article is the first of the 2020 CEF Whitepapers that we are posting. For more information on the Christian Economic Forum, please visit their website here.

— by Alan Barnhart

The concept for the Kingdom Companies Group came from the journey that Katherine and I have experienced in our attempt to operate a business as stewards for the Most High God. As fallen creatures we have done so imperfectly and have learned lessons through our failures.

Barnhart Crane and Rigging Co. started in 1986. Prior to starting the company, we had engaged the Bible for guidance and we found extensive material there. It led us to adopt the following commitments prior to starting the company:

1. God is the Owner. We are stewards with no claims of ownership.

2. Money is dangerous. There is a human tendency to be greedy, to serve money, to hoard, to claim rights to earthly possessions. To counteract these pitfalls, we committed to a limited lifestyle and to see company profits as the property of God’s Kingdom.

3. Shared stewardship—we engaged believers in our company to hold us accountable and to join us in the process of distributing company profits.

Initially, the ownership commitment was not legally binding; however, in 2008 we embraced a legal structure that allowed us to transfer 99% of the ownership interest in the company to a charitable trust and the remaining 1% (with all voting rights) to a Voting Trust that is also owned by a charitable organization but is controlled by a Board of Trustees. This structure has provided the following benefits:

1. A permanent ownership structure less subject to a lifespan or individual human frailties.

2. A vehicle for succession of the stewardship of the company without taxes or the dangerous transfer of wealth to a person. This has reduced our anxiety about succession planning.

3. A substantially reduced tax burden.

4. A Kingdom purpose that is permanent and clear to all current and future stewards.

Our Owner has allowed us to experience freedom and joy as we have endeavored to be faithful stewards for the last 34 years. People have heard our story and some have desired to structure their companies in a similar way. We have joined together with a few of these people to form the Kingdom Companies Group. The following describes each KCG company:

Expectations

• Owned by a charitable trust

• Controlled by a Board of Trustees

• Limited salary with incentives

• Profit invested in Kingdom charities—35%+

Elements

• Profitable and growing

• Long-term focus (as opposed to prepping for a sale)

• People development

• Healthy culture

• Local care teams

• GROVE Invitation—GROVE is the team that develops the Kingdom investment strategies (charitable giving)

• Quality compensation/benefits

Benefits for participants

• Succession plan including emergency response plan

• Board of Trustees to prevent mission drift

• Accountability and counsel from the KCG Council

• Shared talent

• Capital

• Reduced taxes—<8% federal (current tax law)

• Possible shared services (back office, legal, etc.)

• Decision-making process for Kingdom investments—GROVE

• Eternal Rewards

Kingdom Companies Group Structure

The charitable trusts that hold the primary ownership (99%) of each entity do not provide oversight. They hold the stock and if a company is sold, they will receive the proceeds. Those proceeds cannot go back to the original owner or to any individual. They are charitable funds and the trusts exist to channel funds to ministries. The GROVE group or a similar designee can provide “advice” as to the ministries to be funded and the advice will be followed in most cases.

The voting rights for each entity reside in a Voting Trust. The Voting Trust is controlled by a Board of Trustees. The Board of Trustees:

• Represent the owner

• Monitor progress and results

• Install and remove the Board of Directors

• Approve compensation plans

• Guard the mission

• Provide guidance

• Confirm the appointment of each CEO

Each company has a Board of Directors that appoint the CEO and oversee and approve corporate activities. Each company also has a Senior Leadership Team with following functions:

• Run the business units

• Define and implement strategy

• Develop a talent pool

• Ensure ministry to and through team members

Kingdom Companies Council

In addition to common control through the Board of Trustees, the companies are connected through a group we call the KCG Council, which is not a legal entity but more of a roundtable. It is made up of CEOs of each major company plus a few at-large positions. The Council provides informal accountability and guidance. We meet quarterly and topics include:

• Acquisitions

• Culture

• Strategy/implementation/annual plan

• Ministry/care teams

• Current challenges

A role of the Council is to facilitate talent and resource development and allocation. Several key team members have moved temporarily or permanently from one company in the group to another. While legally we are completely separate companies, we are in essence under common ownership in that God is the ultimate Owner of each company.  

Disclaimer: The Kingdom Companies Group is in its early stages. We have been operating a “Kingdom-owned” company for 12 years but only added the second company in January of 2019. Two additional companies joined in late 2019. This is all very new. We have already experienced some struggles as one of the companies that joined had substantial challenges. We are not currently recruiting other companies to join our KCG. All current companies are in a similar industry (industrial contracting). As we get our systems in place and work out the kinks, we may expand and broaden. More likely, we will encourage others to form their own groups around sectors, geographies and/or relationships.

The thought of “giving away” your company seems absurd to most owners. We see it differently. Everything we have has come from God; we have a temporary stewardship whether we acknowledge that or not. Jesus warned us many times about the dangers of wealth and power. As John 10:10 says, our enemy can and will use earthly wealth and power to kill, steal and destroy. Jesus came to set us free and give us abundant life. Luke 12 and I Timothy 6 and many other passages contain dire warnings. Christians are not immune from the danger, especially successful businesspeople. In an effort to thwart the enemy and maximize our contribution to the body of Christ, we should heed the warnings and take preventative measures—for our sake and for those who will come after us.  

I rewatched the Lord of the Rings movies recently and was struck by two concepts. The powerful hold that power (and by extension wealth) can have on us (the Ring) and the benefit of having others on our journey. Frodo could not have done it without Sam and the Company. Relinquishing control can be brutally difficult. Bilbo struggled. It cost Frodo his finger. A band of brothers and sisters can make a huge difference; accountability is a valuable asset. The Kingdom Companies Group provides accountability and access to the wisdom of fellow stewards 

I am not recruiting you into the KCG but I would encourage you consider an ownership structure for your company or assets that addresses the danger of wealth and power and to do so with others who are on a similar journey.  

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[ Photo by You X Ventures on Unsplash ]

While our annual conference looked a little different this year, we were blessed to have guests from around the world share their insight and encouragement with faith driven entrepreneurs at every stage of life. We were challenged and empowered to think deeper about a range of entrepreneurship-related topics ranging from heart posture to purpose to measuring returns. Here are some of our top lessons and challenges from this year’s conference:

Mark Sears

“As faith-based entrepreneurs, we have a different destination and a different definition of success on the journey and a different strategy for how we’re going to get there.”

Pete Ochs

“Is your purpose for being in business to maximize financial value or to be a catalyst for flourishing?” 

Andy Crouch

“Authority is any time that you have capacity for meaningful action.”

Jay Jakub

“The purpose of business is not to create profit. The purpose of business is to create profitable solutions to the problems of people on the planet, not to profit by creating problems for people on the planet.” 

Andy Mills

“When we’re deeply abiding in Christ, we have the ability to stand up, to address things going on in the world, to have an impact on the world, to be Christians who are salt and light, the way we are called to be.” 

David Morken

“Excellence for the sake of excellence can really be a dangerous objective.” 

Lecrae

“When you’re performing for acceptance, that’s not faith. Faith is when you can be honest and transparent and say, ‘God, I don’t have what it takes. I need you to do it because I don’t have what it takes.”

Trae Stephens

“If God has called us into His redemption project, but hasn’t told us the specifics of the timing, then we must work earnestly with the belief that what we do will not be useless.” 

Pete Ochs

“Desperate people do desperate things and one of the most desperate things we do is innovate.” 

Casey Crawford

“You better have faith because you’re in for a fight.” 

Mark Sears

“Even more dangerous than sirens and temptations in the water is simply the natural current that pulls almost every business toward the worldly destination of maximizing the bottom line and shareholder value.” 

Ron Blue

“We have an opportunity to speak to the wealthiest culture that has ever existed and say, ‘God’s Word works under all circumstances, for everybody, for all time.’” 

Efosa Ojomo

“You don’t fix poverty by trying to fix poverty. Instead, you fix poverty by creating prosperity.”

Brian Fikkert

“The good life is when we use our bodies, our souls, our relationships…to fulfill our callings as priests and kings.”

Jessica Kim

“WE are missing out on a lot of amazing opportunities to build incredible, redemptive ventures because of this posturing in the beginning.”

Jeff Haanen

“Emphasize the Fall with the powerful and Creation with the vulnerable.” 

Pete Ochs

“The greatest change was our mindset. We didn’t focus on what we didn’t have, we focused on what we did have.” 

Trae Stephens

“If you can answer complicated questions about your business model but not about why you believe what you believe about eternity, you might have some work on your priorities to do.”

Vic Ho

“When I am feeling anxiety or stress over some outcome, I really am putting myself in a preposterous, hubris-driven situation.” 

Reuben Coulter

“How can we respond to the challenges of our world, share the gospel, and see God’s kingdom advance in our generation?” 

Recent articles

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[ Photo by Headway on Unsplash ]

We continue to count down the Top 100 Books for Faith Driven Entrepreneurs with…

Every Good Endeavor

by Tim Keller

With deep conviction and often surprising advice, Keller shows readers that biblical wisdom is immensely relevant to our questions about work today. In fact, the Christian view of work—that we work to serve others, not ourselves—can provide the foundation of a thriving professional and balanced personal life. Keller shows how excellence, integrity, discipline, creativity, and passion in the workplace can help others and even be considered acts of worship—not just of self-interest.

If you’ve been around our podcast, you know that we have the utmost respect for Tim and his wisdom in this conversation. You can hear Tim Keller talk about faith, work, and identity in his podcast with FDE.

Click on the book cover to check out the Reviews and Purchase at Amazon

by C12 Group & Lara Casey

CEO of Cultivate What Matters and C12 Member Lara Casey-Isaacson, shares her story of re-focusing sights and energy to grow things that matter and realizing when it’s time to prune to truly flourish. The feedback and wise counsel of her C12 Peer Advisory Group was instrumental in helping her discover the impact potential of her business.

by Alex Hoffer

As a type-A, twenty-first-century, faith-driven entrepreneur, there is a single word I turn to that consistently evokes enthusiasm throughout my soul. That word is discipline. 

In my own words, I define discipline as true effort and hard work in the context of overall goal setting and performance of action. On a more personal level, discipline has become an indispensable characteristic of my daily and weekly routines, and foundational to my way of life. 

Discipline drives my embrace of the rigor of my role as the Chief Revenue Officer of a leading U.S. manufacturing company. It shapes the vision I have for myself as a loving husband and engaged father. Furthermore — and perhaps most importantly— it concentrates my commitment in my walk with Jesus. Through daily Bible reading, prayer, and serving others, I have experienced the splendor of His word. 

Life is good. God is good. So what was I missing amid the dedicated time blocks designed and structured by art and discipline of doing? The nudge into further exploration of this question came during a session with my Executive Coach. He observed, “Alex, you are soul sick. You have become a ‘human doing’ and are trying to do enough stuff to feel good enough as a husband, dad, and business leader.” 

Why was he suggesting that I pursue less? 

The Christian thinker Henri Nouwen once wrote that “in spiritual life, the word discipline means the effort to create some space in which God can act.” Amidst my 5:00am mornings, Bible reading, podcasts, books, writing, one-on-ones with direct reports, committing to tucking my kids into bed each night alongside my wife, I left no time to “be still and know that [God is] God” (Psalm 46:10). To be honest, I even subconsciously argued with that scripture, which in hindsight was demonstrative of the depth of my dependence on “doing.”  

It was in this search for more that I came across the work of Pete Scazzero about emotional health and the two forgotten disciplines: solitude and fasting. 

In my truest type-A fashion, I scheduled time in my calendar to set aside a four-hour block away from work to be in solitude. I also decided to fast from food starting at 6 p.m. the night before. I made my first appointment to reintroduce myself to the disciplines of solitude and fasting — and boy did I hesitate. I came close to convincing myself otherwise.

By the time the first hour settled in, I still felt strange. Am I allowed to check my email? As the minutes turned into an hour, something inside me began to change. By the second hour, I wrote this line in my journal: “Rest is a complete trust in God’s faithfulness.” There it was. All my routine, rigor, planning, and discipline, was leading to a false sense of trust in myself, not God. This reminded me that in the wilderness Jesus answered the devil’s temptations by saying, “Man shall not live on bread alone,” and “worship the Lord your God and serve him only” (Luke 4:4,8). My sojourn to fasting and solitude had reminded me that I was whole in Christ alone.

There are countless other lessons this experience taught me, but the lesson I want to leave you with is the truth I was reminded of in solitude: all of our disciplines of “doing” aren’t always the surest way to will not lead to healthy relationships with Jesus and others. Like Mary, we need to create space to sit and marvel at our Lord’s feet (Luke 10:39). It is only when we are whole in Christ that we can be our best selves for those we lead and love.

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[ Photo by Thao Le Hoang on Unsplash ]