E43: Building a Portfolio for Stewardship: Public and Private Market Strategies

In this episode, Eric Scovill is joined by financial advisor Andrew Barlow to discuss biblical investment strategies and portfolio construction. Andrew shares his background in entrepreneurship and tech startups, and how he now focuses on championing biblical financial stewardship through companies like HIS Kingdom Resources. 

Here are some topics from today’s discussion:

• Andrew's background in homeschooling, entrepreneurship, and faith-based businesses
• What it means to be a biblically responsible investor
• How to build a portfolio for stewardship
• Biblically responsible investing principles and actively managed portfolios 
• HIS Kingdom Resources private equity fund and impact-focused investment criteria

Episode Highlights:

[13:48] What It Means to Be a Biblically Responsible Investor

Being a biblically responsible investor means screening potential investments to ensure they align with biblical values and do not violate key ethical principles. Some of the criteria Andrew mentioned that Kingdom Resources uses include:

• Avoiding companies involved in activities like abortion, pornography, or human rights violations.
• Seeking out companies that are Christian-owned and operated or have a mission/products that further biblical goals and kingdom impact.
• Examining a company's practices and policies across environmental, social, and governance issues from a Christian worldview.

The goal is to invest in businesses that are ethically and morally sound according to scriptural teachings, rather than simply maximizing returns regardless of alignment with faith. It's about integrating biblical stewardship principles into investment decisions and portfolio composition.

[16:22] Building a Portfolio for Stewardship

Andrew discusses the importance of comprehensive financial planning to understand a client's unique situation, goals, and risk tolerance. For a client in their 50s, he recommends constructing a portfolio that balances growth potential with downside protection. This involves diversifying across asset classes like equities, fixed income, and alternatives to reduce volatility. Within equities, he advocates an actively managed approach that implements strategies like trailing stops to limit losses if positions move against them. Non-correlated assets such as real estate and private equity are also discussed as ways to provide portfolio diversification. Andrew stresses considering the client's time horizon and liquidity needs to determine an appropriate asset allocation that achieves their objectives in a risk-conscious manner.

[24:56] Investing for Kingdom Impact through Private Equity

Andrew outlines HIS Kingdom Resources private equity fund, which only considers companies that are both Christian-owned and operated, as well as having a mission or products that are aligned with furthering biblical goals and kingdom work. Each potential investment is thoroughly vetted to ensure it meets these stringent criteria. The fund also targets a minimum 10x return on investments to demonstrate that prioritizing faith-based screening does not require concessionary financial returns. Any profits are then strategically reinvested into amplifying kingdom impact through initiatives like Bible distribution, fighting human trafficking, and supporting pro-life efforts. By taking an active ownership role with board seats in its portfolio companies, HIS Kingdom Resources provides backing, resources, and community to help Christian entrepreneurs thrive in their work and multiply their transformational impact on the world, all while uniting the body of Christ in business.

Resources Mentioned:

HIS Kingdom Resources