RockStep Capital President Andy Weiner introduced the world to the RockStep Hometown America Fund I on The Fort with Chris Powers earlier this week. By announcing RockStep’s newest retail investment strategy on one of the most influential real estate entrepreneurship podcasts, Weiner is doing more than sharing a new business venture with potential investors.
"We are leveraging our expertise in the retail investment space in new ways. I don’t know if there is a more appropriate or exciting way to do that than by sitting down and talking with Chris. I brought my A game because he is a heavy hitter, and I know investors listen to him."
Chris and Andy talked about RockStep’s history, the Fund initiative, and Chris really dug into why Andy thinks investment in the shopping center sector will be a great way to build generational wealth over the next several years.
Here are five key excerpts from the podcast. You can click here to listen to the whole show, which you should. It’s a banger.
Why Andy Created the RockStep Hometown America Fund
“The world is changing. The cadence, the timing of acquisition has gotten faster. It used to be that you had two to three months to look at a deal, think about it, underwrite it, visit it, come up with a strategy, work on your debt. Now you have three weeks. And so you have to underwrite it. You have to look at it. You have to come up with a strategy, but you don't have time to do a syndication.”
Malls vs eCommerce
“One of the things that is very apparent for retail is the issue with a pure play, with somebody who only has a website, is that the cost of customer acquisition of new customer acquisition is really inexpensive in the infancy of your company.”
“But as you want to grow, you have to buy customers. You have to pay for Google search ads, et cetera. And the cost of acquiring customers goes so high that it becomes unprofitable. And so what they have found is that the lowest cost way to make money, of getting new customers and protecting your brand and protecting your existing customers is having bricks and mortar.”
“And that's why pure plays like Amazon, they're opening stores. Other pure plays are opening stores as well.”
The Importance of “HomeTown” investors
“If we don't get local investors in on our deal, we won't buy the deal, okay? So we're the only one in the country that will require local investment as part of our due diligence. Local business leaders join us, and we do that to reduce risk. Local business leaders who care about their community allow us to invest with somebody whose mission is our mission…to make these communities better by bringing capital and expertise to assets that actually affect quality of life.”
The RockStep Way and the RockSteps
“I created the RockStep Way nine years ago. I brought in our leadership team and I said, you know, ‘What are the rules here?’ Okay, what are the rules? I had an advisor help me. We put about a hundred ideas down. We spent all day doing this. And then I narrowed it down to 30 that I felt more represented my core. And then I narrowed it down to 25, and I started looking at the wording and the wording is really, really important.”
What’s in a name? Everything
“Let me tell you first about the word 'RockStep.' What is a rock step? So rock step is not a word in the dictionary, but it is a dance move, and most dancers know what a rock step is. So when you rock step on count seven and eight, you switch directions. You're rock stepping. So as a company, our goal is to be nimble. To be light on our feet, to listen to the music in the industry, and when there's a problem to be able to switch directions. So even though it's not a word in the dictionary, everyone at RockStep knows that it's a verb.”
Click here to listen to the rest of the podcast.
Andy Weiner, President of RockStep Capital, started RockStep Capital Corporation in 1996. Weiner has built or acquired over 9 million square feet of shopping centers throughout the United States.
