Social Impact Investor of the Year: How Oparo Social Delivers Supported Housing at Scale

Adam (00:41.783)
Hello, hello, hello. And welcome to the ESG In Property Podcast. You're here with Adam Hines, the co-founder of LifeProven Real Estate Advisory. And thank you very, very much for being a loyal listener and tuning in for another fabulous episode. And for those that are new to the podcast and the show,

We are dedicated to giving you access to the world's most innovative and ambitious real estate leaders. So we interview the visionaries who are doing things amazing and they consistently outperform industry averages by maximizing their environmental, social and financial impact. And today we have a very, very inspiring episode with Toby Wilde, the founder of Oparo Group and Oparo Social.

Toby and Oparo recently won Social Housing Investor of the Year Award in the UK and has a really incredible background story being a founding partner of sprift.com, which is one of the UK's largest centralized property data platforms. So Toby, very excited to have you on the show and a very warm welcome.

Toby (02:00.984)
Thank you very much for having me. I've been listening to your podcast a while now. I like it. It's nice to hear other people going through the same struggles and having the same motivations to align, having a positive impact on the communities in which we live with, with actually, like you said, real estate outcomes, pensioners invest in them. yeah, it's a joy to be here.

Adam (02:29.485)
Hmm. Toby, I'd like to start by rewinding the clock, if that's okay. And before we sort of get into a pyro and what you're currently doing, the listeners always quite enjoy hearing about how you sort of first fell in love with real estate and became passionate about it. So what was the catalyst, in your sort of background and your past that really inspired you to pursue a career in real estate?

Toby (02:59.522)
I was blessed to grow up in a family that is real estate through and through. know, multi-generational. My dad built up a construction company out of scrap metal yard in the 1950s through to the 1990s. My dad had built up the largest independent construction company in South of England.

Adam (03:06.241)
Hmm.

Toby (03:26.19)
He had one the first regulated real estate funds under the BES scheme called Oxford Residential Properties. He had H &E Engineers, was, I came back since the 30s, WH Dawes, which did massive infrastructure products. So my family business, the Milne Group, I was brought up around that. So my mum was running the fund, so I was brought up with her buying those single family residential homes from the 80s to the 90s. I was brought up by my dad, again.

I get dropped off by my dad at school, public schools in the Range Rover because that was the image that a property developer had to have. And then get picked up by my granddad in a rusted old transit van and I get taken onto the building sites. I hang out with the builders. So I think I'm a little bit different in terms of...

You know, it's like that Kipling poem, you know, if you can talk to a king, you lose your common touch, you know. I'm comfortable personally in any scenario. I'm happy on building sites, hanging out builders. I'm happy talking to politicians. I'm happy in the boardroom of banks. Like, for me it's... But when it comes down to what I actually enjoy, my favourite day is actually my partner's come and stand there, know. My CEO came with me, my new CEO, disappointed new CEO came with me.

on site once, he's like, actually, Toby's the, I've never seen him happier when he's walking around the building site. So I like bricks and mortar. And then if you can tie that with something, know, passion or some social good as well, then you know, you don't have to be in business to make money. It's like, you need to make money. Some people aren't necessarily motivated by flash things. There's a golder, I find myself in that camp.

Adam (05:18.349)
Toby, is it fair to say from that, I suppose your background, it's very people focused by the sounds of it. Would you say that you get life energy from social interaction with people from all walks of life and give you different perspectives?

Toby (05:35.062)
Yeah, I'd definitely say so. I'd definitely say so. like... Yeah, I mean it's... It's enjoyable to spend time with people with different interests who challenge you, who challenge your beliefs, challenge your way of thinking. And we just realise that, yeah, we're all relatively similar but we all have very different experiences and life objectives and life motivations. So yeah, I... Yeah, I enjoy that side of it. I enjoy speaking to people.

Adam (06:05.923)
I'm going to loop back to that a little bit later on, I think just from a listener's perspective, I think that's going to be one of that we sort of identify as one of your superpowers is the social side of it. And engaging with so many different stakeholders for so many different years being raised in the real estate environment has given you probably quite a unique perspective from lots of different people. And then that then helps you connect more dots as to the evolution of

the solutions that you provide because you're thinking about way more people than just one specific stakeholder. You're thinking about an entire community. So I'm going to loop back to that later, but I have a sneaking suspicion that's going to be one of your sort of superpowers for a pyro and how you operate from a cultural perspective. But one thing I'd like to just tease out whilst we're on the topic of your past is it right to give the listeners.

a quick overview of your sort of career journey up until the founding of Oparo. And what I really want to understand and dig into is how the sort of your previous professional experiences helped shape your worldview and your sort of philosophy for the founding of the business.

Toby (07:20.59)
Sure, so let's go back to when I was five years old when my career started. I joke because I was on site from the age of five. But I suppose my career in real estate truly started when I was 12. My dad, as I said, I went to some good schools, some well-regarded schools in Britain. But then during when I was 12, on my term holiday, my dad was knocking down a car.

Adam (07:35.713)
Yeah.

Toby (07:49.646)
car parts factory and building a row of terraced houses there in the city centre of Oxford. And my job was to climb on the metal shelving and, because was the only one nimble enough and small enough and light enough, so I'd climb on the shelving and I'd be unbolting it from lying on it while it collapsed, know, collapsing a corner around myself. So working under my granddad and then sweeping up at the end of the day, mid-drinking teas. The only man to ever fire me is actually my father, so he'd fire me.

Adam (08:18.787)
You

Toby (08:20.346)
Apparently, yeah, it's like a very Victorian attitude, right? It's like, ooh, you know, we hired him because his fingers could get in between the looms, but he wasn't pulling out the string fast enough, you know? Like, all right, you know, that kind of approach, bless him. it's, know, the only man to have ever followed me. Told me that ethos of, you know, jump and be pushed. Yeah, it's, I know, Jakey, I mean, that's not, it's true, it's not a joke, but it's...

Adam (08:41.089)
Yeah, that's it.

Toby (08:48.678)
Comedy aside, I left school with very little qualifications. I got into real estate brokerage. I worked at some independents and some corporates like John Hollingsworth, which is now Dexter's, and McKinley, Falkirk and Hayward. I moved into sales and lettings post the global financial crisis. So I learned more on that side of things. I learned that you can't sell to people who don't want to buy, right?

There's no point being pushy. You have a product that either serves a purpose and is good fit or it isn't. It's square peg round holes. If there's any budding real estate people or brokers out there, the one line I haven't used was, what do you think? How does it compare to the other ones you've seen? If people say it's good, then say do you want to put forward an offer? If it's not, then you know to leave them alone because they'll still answer your phone calls when you need them to and you've got something that is good for them. Nobody likes a pushy salesperson.

So I did that and then I set up my own lettings and management business with a couple of mates. moved, so I had about 1500 units under management. I got offered from, offered to buy it by two FTSE listed, FTSE 250 and AIM listed companies. Didn't sold out to a partner in the end, but that was absolutely decimated by the admin fee ban of, you know, when they banned letting fee admin fee. I was going to get, anyway, to really make any money doing it.

From that point onwards I got into development with my family, development consultants, he did some small stuff myself and then was approached by a guy who had this concept of a full service history for your home which became Sprift so I was helping with the product development of that from the view of an estate agent and a developer and what data would be useful and try and roll it out to the market. It was a concept way ahead of its time in credit to it. It's still going, it's a very good business in its own right.

like it powers on the markets, advanced data capacities and things I think now. So it's a good business, I think it's got like 10, 15,000 paid users, so I might take my hat off to them for their resilience. You know, it comes down to the fact of...

Toby (11:03.19)
You are only an idea ahead of your time if you can't last enough in the market to catch up. But ultimately, you know, I wasn't in control of that business and for me it's lot easier with my personality to run things. So myself and my long-term friend, Paul, who's the CTO, we moved to do direct real estate investment using technology, data-driven. Started to look at what we could do in the market and realized that...

Ultimately, it's nice to have a business, but also it's nice to have something more than money and have something better. Anyone can build houses, especially if you're well capitalised and you can afford to wait. It rolls back to being ahead of your time. In real estate, you'll never lose money if you can take a 10-year view. That's the famous old adage. But in reality, you can take a view on that. But even to build social housing now with a 10-year view, if you don't do it

with competitive advantage like technology and a resilience that's beyond elasticity, it's resilience of steel, one might say. Then ultimately you can end up in a really bad financial position because it is so under-capitalized and there's so many inherent legacy issues surrounding the funding of...

especially private in landlords or private investors trying to deliver social housing with a social purpose. So that's been my career to date. I'm highly dyslexic, very ADHD and I'm unemployable. I'm unemployable so I have to find a way of doing it for myself and finding a way that I enjoy and one that motivates me and one that's my family.

Go and make a living somehow.

Adam (13:01.741)
So Toby, think what's really unique here, and just so you understand, I suppose, my role in this conversation, both from an intrigued perspective from myself, but also for the listeners is to tease out where there's some unique points to learn how your way of thinking and your day-to-day behaviors are helping inform what you're now doing and what others can learn from that. And I think.

What's really interesting about your past and your sort of career pathway is that from a very young age, you've had lots of diverse experiences through the real estate, full investment life cycle with different people and different stages. you touched on, obviously when you were young, growing up on in construction sites, et cetera. So you have a very in-depth understanding of the construction process as well with your family doing developments and development consultancy. So.

Now I'm presuming you're probably going through funding, planning, design stages, et cetera, building out, exiting assets. And also you mentioned with sales and lettings, so very customer service focused, very different proposition in how you communicate and the activities through a lettings agency. But it's very obviously.

Yeah. Customer focused heavy, and then adding in the technology element as another diverse experience just puts such a diverse range of insights that then give you a very, very unique perspective compared to others who've just been doing a single service or single focus for a very long period of time. So I think I'm going to assume that when we get into sort of the depths of the business, what you're doing and how you're doing it.

a lot of those themes will come up as to inspirations as to how and why you're doing things. And then that as a result is why you're having outsized impact for your business. So is it all right now we sort of transition into Oparo group and Oparo social. Can you give an overview of what the businesses do and who you do it for just so people understand everything about the company?

Toby (15:22.168)
Sure, so Apparo Group is a technology company at its heart that has unique and proprietary technology that monitors hundreds of millions of data points looking for idiosyncrasies within the market to deliver housing. It was originally launched to do PRS housing and around that time I was approached by a housing association who asked me to be on their board.

I said you don't want me on your board, quite frankly, but it's not helping anyway. They started talking to me about supported housing and the challenges with facing new-build housing and the grant money available and things like this. I dug down into the profile of the people who live in these supported housing units. It's people just like you or I or anyone who's fallen from grace or who has a challenge in life.

Whether that's neurodiversity being a special education being an SEM as it were You know being you someone in recovery or being someone who's been you know rough sleeping or someone's being disowned by their family from their sexuality or someone dealing with a physical or mental health crisis ex-army you know so a lot of people running away from domestic violence situations and you know I'm not a socialist right, but I believe that there should be a certain empathy and

compassion in this world where we help and forgive each other, And ultimately, my sister, my dad set up, when my dad moves away from real estate, he set up a charity for my sister called Ruskin Mill Education Trust, which is a Steiner-based education system for special education needs. And you know, look at my sister who's non-verbal autistic, speaks very little, I should say.

She didn't have the correct type of housing when she came out of this college and it's a shame because I think she could have had a lot more of an independent life if she had have had that sort of soft touch embrace by the local community. So it really spoke to me in terms of potentially finally using our technology.

Toby (17:41.874)
you know, taking Skynet as it were and turning it to something that could, rather than giving us such a competitive advantage, actually allow us to unlock opportunities where we still have the same return profile, same risk profile as we would as a private developer, or looking in the middle or premium end of the market to somebody who could deliver stuff that other people couldn't. So unlocking opportunities for social housing.

So the Parasocial One was launched, which was a joint, was a collaboration basically. We built a portfolio for a former hedge fund, who were the investment side of things in terms of capital raising and all of that. And my old schoolmate Jack from XP Property in terms of delivery of the assets, construction, architecture. And our role was managing the housing associations and sourcing the opportunities.

You don't know what you don't know until it's too late and dealing with housing associations is a difficulty. This is prior to the Home Read scandal, this is prior to guilt rates things. So the avant-garde to go into this space at an institutional scale, think we're probably one of the last men standing and we've done very well to try and help our hedge fund and protect their investment and help our partners protect their investment.

But it's been a great sacrifice to be honest with you. We've not scaled as much as we could have if we would have focused on PRS or, know, like there was an incident a couple of years ago with the insolvency of the Housing Association we working with. We took the decision to pause the cap raise to do another 75 million worth of assets to protect a 50 million or 35 million at that time portfolio in the first place,

So it's, yeah, it's, I know I've put that down to a lot of people, just piled into things that I research in them enough. you say superpowers, people, it's, I find people very frustrating, very frustrating, especially today, to be honest with you. But I think reality, my superpower is probably, you know, being sort of neurodiverse, is I sit there,

Toby (20:00.878)
I read everything. I read everything. I have a very boring life. But I read everything and I join the dots together and that's how we help create this product. And you have institutions out there and you know, I'm reading their debt and I'm meeting them and they're pitching something they're raising more than me. I'm like, well your advertising isn't correct. Like, it's not. And I mean this, you know, this has come home to roost. There's a lot of public spread pressed about, you know, a couple of these entities. But I'm like, what you're saying isn't true. Like, have you not read the documents? And they're like, eh.

I don't seem to care, that's the big thing as well. Sorry, that's quite long-winded, I apologise.

Adam (20:38.691)
Sorry, muted myself. It's okay to touch on a Pyro Social. Just explain the split between a Pyro Group and a Pyro Social and how those two interface.

Toby (20:50.222)
Sure. So Parasocial is effectively a brand of supported housing where we sort of do the quality control. We fund the housing association, we source the assets. We do that in partnership with institutions to deploy capital into that. So effectively we have Parasocial One, is as I said a joint venture between us and three other parties. And our role is you know like...

technically, although I still love going to building sites and would be there every week anyway, was not the construction, not the delivery, not the planning applications, all that jazz. Because to be frank with you, I don't have the patience for it in terms of the planning side of things, the architecture side of things. I don't have the organization or the patience. But yeah, it's partnering with people to deliver long-term stable income.

you know, on long-term FRI leases subsidised or discounted effectively to, you know, local housing allowance, which is how the market, the way in Britain how we peg what affordable housing is, is then paid by local government through a housing association. They provide services on top which they charge for in order to try and get outcomes for people where they can, you know, move on from the position of crisis, as I mentioned earlier.

into a position of employment, education, long-term, stable housing, appropriate healthcare. it's, know, research shows that it saves the taxpayer about 54 pence in the pound for every person housed in there as well. But also it's a human, it's a direct human touch, you know. Like, you meet these people who are living in the buildings and hearing their stories, you know. And as I said, it could be any one of us that's in that situation and, you know, it's...

It's nice to think on a nightly basis in London there's hundreds of people who are currently sleeping with a roof above their head who otherwise wouldn't be if it weren't for a Paris social. So I think there's a lot to be said for the collaboration we had. yeah, moving forward we're looking to roll that out with more parties and we're also looking to launch more of a private housing thing for our technologies is leading to both. But we've got eight years of track record and you know what?

Toby (23:14.03)
You know the most valuable thing in life in my opinion? Common theme. It's the only thing that has to be learned, it can't be taught. And it's coming a real buzzword. It's resilience, know, it's resilience. My dad calls me the bouncy ball. He's like, I've never met anyone like you. goes, every day, it's just like, know, every day with you there's something. It's a challenge, it's a struggle, there's people telling you you're not gonna do it, you can't do it, blah, blah, blah, blah. You you're in meetings all the time.

Adam (23:16.653)
Go for it.

Adam (23:26.051)
Hmm.

Toby (23:42.318)
life's a struggle, but he's like, nothing, no one's ever gonna stop you. You literally just bounce back, it's horrible. And I'm like, But resilience is it. I have to a big part of that onto the people around me, my partners who've never lost faith in the vision. I'm a vision guy and I need people around me for execution. Without executors, I'd be nothing. So, yeah.

Adam (23:57.923)
Yeah.

Adam (24:08.533)
I, we could go down this rabbit hole, but I'm going to actually come back to that in a minute. Cause I want to just tease out. Going back one step, you at the introduction to apparel, you said it's effectively a technology company and you're, you're basically analyzing and auditing a lot of data points. And that is helping you to, I suppose, deliver.

and identify opportunities that others may miss. it all right to expand on what does that actually mean? What are you doing? What are you tracking? What are you identifying? How does that actually work?

Toby (24:47.998)
Sure. I kind of forget we're a technology company to be honest with you because I'm so focused on the social housing side of things.

Adam (24:54.915)
And that in itself is incredibly unique. And that I think from a listener's perspective, that one I understand, what does that actually mean in real world terms of day-to-day activities? What is a difference between a vanilla investment real estate company compared to what you are doing in your day-to-day? What are the key differences?

Toby (25:18.104)
So track record, years worth of track record in the space and years of... Yeah, I'm talking about technology, sorry. I should have been clear, apologies. So there's a lot of people out there who are trying to mimic a Harrow. It's got more and more prevalent recently. I see people out there claiming to be us and all the time.

Adam (25:28.033)
Meaning more around the technology infrastructure. Right, okay, okay.

Toby (25:43.79)
You know, it's the way the market will go. It's what I predicted eight, 10 years ago. So it's not understanding. Again, you're never ahead of your time if you can wait. But we built all the technology out to effectively monitor the whole market based on on-market and off-market opportunities, identifying subtle interactions between 500 million data points with a view to the prediction of the likelihood of sale of that asset using...

I mean, I've been delved too far into the tech. That's my partner's thing. Then we also built out a platform to manage the construction processes, to sort of systemize it, because our big thing is buying back council housing or converting existing buildings. And then, you know, we successfully arrayed or partnered with an organization, raised 500 million for new-build social housing a few years ago. And it's all about that whole life cycle from our data identifying and opportunity to the guys in their office using the technology to manage the...

the build out, the predictions, the forecasting of cost, all of this can be updated in real time. And then also it goes over the tenant pieces of remote asset management. So we have two platforms in one. So then it rolls out to be enhancing the resident experience, tenant communication platforms, IoT devices and monitoring of environmental data. With a view to improving life cycle, the life experience of the resident, reducing maintenance cost.

and just protecting communities in the bad. You can flag antisocial behaviour or flag condensation, dampen mould, become it before it comes a big issue. All of this stuff is vital. So think ultimately as real estate operators become more and more technology aware, then I think a lot more of this will come out there.

But I looked at what was in the market. Well, there's nothing in the market when we launched. There's only, I'd say, maybe two, three legitimate credit, maybe half a dozen now, legitimate rivals. But a lot of the stuff that's out there, I'll give you one example. One government data set, which is freely available. It's a core building block to what we do. And people reference it, and I see it in other people's decks now that they're gonna try and do something similar.

Toby (28:05.678)
And I'm like, well, you haven't even figured out that data set's all wrong. Like, you know, it took six months using fuzzy logic and the CTO, literally the CTO, not even like a junior, going through there, fixing all the data line by line. And you couldn't effectively bypass that because it's, you if you set multiple people on it, those trip up on each other. So it's six months. Like, that's the cost of, you know, a lot of money just to fix something that's freely available.

And if you don't do it, then it's that old adage of garbage in, garbage out. But effectively our technology is most useful when we have capital to deploy, right? So where we've been going, know, when we're going to a raise right now, and once that's successful, then, you know, it will become my life again. And we've sat there looking at the screen, just, you know, geeking out over the properties. Like, oh yeah, I can get eight units in there, or oh, that's like, I'll 20, I'll get four stories, you know, whatever. You know, I enjoy that side of things, but it's...

Yeah, it's, when you don't have customers, i.e. you don't have people to subscribe to your platform or whatever, which I don't and I don't want and it really is frustrating because people just contact me all the time asking, know, I'm a biotech assistant. You don't, we're not, that's not our business. But yeah, it's frustrating when you have such, you know, you've got like, you know, it's like having a super car in the garage and not having the petrol to drive it.

sometimes this feels like, know, and it's, so then again, you know, it's kind of something to look forward to as well, because I know once I do all this boring stuff of getting the rays done, then ultimately I've got to start doing what I love, which is analyzing and deploying property and actually, you know, helping communities in which we all live, right?

Adam (29:54.627)
Absolutely. And I think that's testament to you securing and winning social housing investor of the year last year at the backend of last year. So one of the key themes on your website was around wellness, focus, supported homes. And just hearing you talk around your sort of technology stack. If we just go to the operational stage for a moment and you mentioned that your technology is

helping provide a platform for enhanced resident experience and the monitoring of, I suppose, internal environments. By the sound of it, you're tracking things like humidity, temperature, those sorts of things. Out of curiosity, how does your technology stack? I'm not trying to push you to release any IP, but is this, what is the, how are you connecting the wellness-focused supported homes with the award that you've won for being social housing investor of the year and with a clear, obviously, social impact element?

With then your technology for resident experience and the actual physical environment. How does all that work?

Toby (31:06.666)
So I think the specific reference you're mentioning on our website is actually focused on the interior design. So it's nothing to do with technology. The technology platform we built for remote asset management was built principally for the PRS investment we were going to start doing, which is how we started. And then it was meant to be rolled out into the 500 million portfolio, something we were bringing to the table.

Adam (31:17.101)
Okay.

Adam (31:25.112)
Mmm.

Toby (31:34.062)
because we already built and owned all of the tech, so it's something that they were looking to for us to bring in and start installing in every unit of new building. So there's no correlation directly between that now because the supported housing, there's not much of a need for it because you've got supported housing, have a support worker who's there, they're there, inspecting the building, you get one support worker for every 15 residents.

So they get FaceTime of hours, two to four hours each every week. So they're inspecting the buildings, actually dealing with that. So growing forward, it will be very good because it helps us scale this en masse. So effectively, rather than looking at the big competitors like the guys at Greystar or people like that doing fantastic stuff, but have to do it on a certain critical mass, is using our technology, we are effectively looking to do.

smaller schemes where there's less competition in the market, where historic gig has been, but looking at building it all together or welding it all together through technology. So that's why it's vital because if you own a thousand blocks of 10 to 40 flats, then you don't effectively want to, the oversight of that. mean, Warren Buffett once said, right, if I could buy a hundred thousand homes, I'd do it. I just can't actually do it. You can't manage it.

That's where the technology comes in. It takes away that opportunity for forgetting a building. It's a ridiculous thing, right? And it's difficult for people in the real estate to say, how can you forget you own a building? But there comes a point that you do. Someone says to you in a dress, what's that? You're like, building? You're like, oh yeah, sorry. And that's someone who actually visits them. I've got partners, I swear to you. You could tell them, them, you could sit there and run through eight.

If you did a quiz with them and you had 10 real names and 10 fake names of streets and said, right, so tell me how many units on this street that you own, right? I'm pretty sure some of them will be like, oh, I think the other one's 10 units. And they'll be like, hmm, that's interesting, because that street's in Rhodesia or whatever, or Zimbabwe, I guess it is now, I don't know. I'm just throwing a random place out there if you understand what I mean. But you know, it's like, that has the capacity to help, right? And who's the people who suffer when you forget a building isn't there or don't maintain it properly or don't deal with an antisocial behaviour, you know?

Toby (33:53.204)
It's the people living there, the residents. But what we are focused on is a cookie cutter approach. So we outsource labor to subcontractors, but if you're building in a paro home, it's got a paro product. That's it. Because the housing associations and us agree a mandate beforehand in terms of design, and it has to fit that mold. So effectively they can have one maintenance guy who's got a, you

We like to buy container loads of plywood, right? Because if you buy a container load of 9mm double V grade birch plywood, which is more durable, better quality, and it goes underneath the flooring, it's just, you know, lasts longer than OSB, you know, it's just sort of a lavalier. But anyway, point being, it's, you if you buy it en masse, can, you know, the price comes down, if I was to buy it from a contractor, they charge me 68 pounds per square foot, a square meter, and I pay nine pounds wholesale. You LG flooring, I get.

I buy that by the container load or pallet load and again wholesale prices. But it's got 30 year lifetime, it's the best quality, it's really nice in the foot. But it's all about neutral pallets, well designed spaces, using effectively optimising colour pallet, furniture, layout to try and make it durable but also make it an enabling environment where it's not overwhelming for people with mental health issues.

There's a lot of people, I mean like like the colours of walls, like you know don't notice it but you don't think you notice it. But I've noticed marked changes in family members when you've had them stay in units with know magnolia walls rather than sort of like off grey, know like eggshell. Like this stuff actually has a huge impact. It's about psychologically informed environments, focused on wellness and enabling spaces. Because if you don't feel comfortable and relaxed in yourself, then you can't do it.

Plus also it's the policy of like, you're moving in there and it's a neutral eggshell palette, nice durable furniture, nothing to agree just, but it's like warm, but it's a fine line between warm and enabling and cold, right? And it has to juggle. So we have an interior design who specializes in this for the mandates and then actually sourcing furniture products because we donate all of that and it's keeping a cost. But then also it's like, you know, it's your room ultimately, it's your flat.

Toby (36:16.014)
So, you know, if you want to decorate it, by all means, decorate it. We went with the housing association to do a courtly inspection, talking to one resident, and they painted like two of the walls like a dark brown, and they've got their own curtains up, and they've put down a nice rug, they've changed the sofa out. My missus was loving it, because she's an interior designer as well. And she's like, this is actually what people need to be doing. Like, it's your space, make it your home, you know? If you're there for 12 to 24 months.

you should have the right to paint it, know, should have the right to put your own stuff in. So it's about, I think that's what, sorry, I've gone on down a really long explanation on quite a simple question, but it's a bit nuanced, sorry.

Adam (36:57.495)
When no it sounds incredibly empowering.

giving people a platform that is focused on them and prioritizing their mental and physical health over a long period of time for while they're with you, whether 12, 24, 36 months. And within that, I think there's sort of two elements to it. The first is protecting their mental and physical health. I can, so it's effectively like a primary preventative healthcare.

environment where the, the interior design and the fit out and the furniture and the colors, et cetera, is being defined to prevent mental health, deterioration from the things that are most likely to cause it. And then the added layers of your technology or around your senses and what you're monitoring. Hopefully and potentially is then adding additional layers where you've

you've protected their physical and mental health at a start point and you've had and beyond just housing them. And then you're giving them a platform to actually then improve upon that, through time. And I think that is incredibly empowering. And by the sounds of it, that that's going to be a fundamental footing for people to build their lives from. that must

That must be incredibly rewarding for you and the team to sort of, as you mentioned, you've, you've seen that you've physically seen and witnessed the transition of people after moving in because of both the design and the operational infrastructure that you have set. that's, that has shifted people's lives in an, a more positive direction as a result of those decisions.

Toby (38:52.354)
Absolutely. Yeah. Yeah. Yeah. And that's what drives me. what motivates me. I like seeing this. know, investors are interested in double digit returns. Yeah. And yeah, I do double digit returns. You know, I make no jokes about that. You compare me to a lot of the other PRS funds out there, PRS investors, etc., etc. Yeah, I'm on a par with them, right? I make no bones about it. I'm still, we are capitalists, ultimately, who believe in supporting people.

Adam (38:58.103)
Mmm.

Toby (39:21.74)
But there is a difference between being an idealist and being on a, I'm trying to think, I mean I consider what I do a mission, but it's not, sorry it is, but it's.

There's a difference between being a zealot and being somebody who's on a mission who actually realizes market realities, right? So, you know, I deliver double-digit returns. It's as simple as that. It's in terms of, you know, yield on cost and also forecast IRRs upon exit of portfolios, right? So, but ultimately, that should not come at the sacrifice of the people living in the building. And ultimately, it should also not come, you know, if you can do it, I'll go.

country's in trouble, right? We can all accept that financially and this is not, I'm not blaming this government or any current government or even the necessarily previous ones, right? And I have no political leanings, I don't care. I really don't care. Like, I'm not red, I'm not blue, I'm not yellow, I'm not green, I'm not brown, I'm not orange. I don't care as long as people actually do some good and they're trying to do some good. And I'm not letting common sense stand in the way of humans, right? So that's why I'm not very big on...

all my buildings environmental friendliness and you and I have discussed previously, you know, socialized about, in preference, which I really enjoyed, but in terms of like, me personally, my view is there's so much human suffering out there that I don't have the right or the time to care about things outside my wheelhouse. I don't care about the transitions in that zero. I don't care about, you know.

a myriad of other things that could be seen as ESG or social investment. And that's not to say they don't have their value, but for me, I focus on the human element. Yeah, all my buildings naturally get higher EPC ratings because that's just part of course of what happens, but it's not my driver. My driver is helping the government not get into more debt, which ultimately, every time we have a decline in GDP, it means a direct increase in suicide rates, and unfortunately, it's...

Toby (41:29.55)
guys like my mates, know, it's the 25 to 40 year old men now who, you know, are killing themselves in droves and it's terrible. So I try and do something that delivers social housing with the sort of support of government income and it's not government backed income, it's government supported income. There's a mechanism with housing associations for insolvency to protect the housing and protect the investors. But doing it at a rate where the government can afford it, it's not. But ultimately, who are the government? They're us, right? They represent our money.

and they're in debt, you know, and it's getting worse. So if we don't try and help them and just don't think that the big government can bail us out all the time, then where are we gonna get it, right? So, you know, if I can deliver double-digit return to investors, so I satisfy the people who ultimately invest in this kind of stuff, which is pensioners, ultimately, or people in their pensions, right? So you've gotta bear it down to who the ultimate customer is there. It's people walking around the street who want to know they're gonna retire and come for 30 years from now or whatever.

You've got the people in the buildings who just don't want to sleep on the street. You've got us as taxpayers who don't want to overpay for something because market economics mean that we have too much of a social care budget in this country, but you can't turn your back on people. it's, yeah, I'm really focused on, like you said, dealing with all those stakeholders, and it's not. There's a lot of complexity to it, and there's a lot of thinking, and there's a lot of, yeah, it's.

I'm not a flawless person, I'm deeply flawed as we all are, but ultimately I think there's an opportunity for people who want to be an impact in the ESG and investing space to do more with themselves, or more for themselves and more for their communities. It all depends on your motivations. I'm not motivated by expensive things. Sorry. Another rant. It's a bit of a therapy session, but I apologise.

Adam (43:17.931)
Hmm. No, this is, this is, I'm, I'm enjoying it. I'm, I'm, I'm party to this therapy session is it's, I love, I love the depth and complexity of your thoughts and I hate to keep coming back to it, but you're obviously very, very thoughtful. And then any topic that you, that interests you, that you, that gives you curiosity.

I can very easily tell that you go deep into that and you want to have a first principles understanding of that to create a foundation and a platform for you to then build from. And I'd like to just ask, I want to do this very quickly, Toby, if that's all right. When I first met you, I was really inspired by your personal values and it was very obvious how much you truly care.

And how much you personally sacrifice for your mission and what drives you and gets you out of bed. And I want to just explore those quickly. Cause I think from a listener's perspective, this is really, really valuable. Just understanding more about you as an individual and then how that then flows into the business and the activities that you do as a business. So I've jotted down over time, some things that you've said to me that really caught my ear. And I thought that's very unique. And I just.

If you could give a sorta 30 second response to each one of these, just expanding on what that means to you, that would be really helpful and really insightful. So the first one that you spoke about, and you've also added to it on this podcast, you told me when we first met character, curiosity, and commitment can overcome anything. And you also mentioned this podcast resilience and the ability to bounce back. So I presume they're probably quite interlinked, but character curiosity and commitment.

can overcome anything.

Toby (45:14.83)
think I specifically referring to employees, what I for in employees. I don't care on people's backgrounds. It doesn't faze me. I don't care if you went to the best university in the world. I don't care if you didn't finish school. You can't put a price on character. ultimately, some of the best hires I've ever been have been on paper the worst and some of the worst hires have been the best on paper. I think that was more tied into it.

Adam (45:18.113)
You were, that's correct.

Toby (45:44.61)
Judge the man, not their CV.

Adam (45:48.355)
strong. Love that. You said that you were excited by doing things others can't do.

Toby (45:58.35)
Yeah, I mean that ties into my ego. I'm motivated by building big things, right? I grew up in a family where dad inherited, lost in 1100, wheelbarrow and spade, and he turned it into the biggest construction company in the south of England. Lost it all, unfortunately, which is why there's nothing for me to take over, but he taught me that principle, and I have a motivation to build something big.

Adam (46:12.951)
Hmm.

Toby (46:28.27)
I think ultimately it's something admirable or there's something in the business. If you can do something that others can't, then you're doing something worth doing.

Adam (46:41.7)
that's very, very nice. You said a couple of times, and I really like this and would like you to expand upon it, that you genuinely care. And I think that comes across so strongly in the way you talk about experiences and people. Expand upon that, you genuinely care.

Toby (47:04.174)
I think, as I said, think any one of us can fall from grace and I think any one of us can need the embrace of society. And if you don't have a loving, supporting family or you don't have a family of means, where can you go? I've met people who are very good careers and have had a health issue, got cancer or had a mental health breakdown or things like that, and they end up in our units. And these are, it's like...

It's people, right? At the end of the day. There's like, you know, cut us, we all bleed red. It's, um... And ultimately it's, you know, it's...

Toby (47:46.252)
I'm trying not to sound pious, but there's been a lot of sacrifice from me and my partners to keep this business going. We've never sold a load of shares in our business. 90 % of it's still owned by family, friends, and the founders. We've tried to keep, but we don't ride two horses. But it's only down to the satan, i.e., the real estate investors, the priority, and then the trickle down from the dividends and stuff to our things. But everyone's invested a very low market cap, and they've been very patient with us because they believe in us. I'm trying not to sound pious.

But ultimately, it's only still going strong. Bear in mind the hurdles we've had in the market and things outside our control because all of us care. We all believe in the mission. You see it every time you leave the house. I'm gonna walk out my door now and I'll see 10 homeless people and I'll walk to the office, which is only five minutes away. So it's, you know, how can you not care?

Adam (48:40.163)
Strong words to sign us off with. As a last question and a completely optional answer, do you have any final thoughts or advice for our listeners? You've left a lot out there, so don't worry if you don't. But if you do, the mic is yours.

Toby (48:58.738)
I think people think I'm in a worse position, or I'm a doomsayer than I am, because I'm quite forthright and quite honest. I don't have a filter, right? Which is not, you know, makes you somewhat uninvestable sometimes. It really frustrates me. You see people out there and they're raising big money and they're faking neurodiversity. Whereas actually true neurodivergent people, we aren't that far, oh sorry, I was about to swear, I almost got a whole podcast and I just caught it. I swear like a true po-

People hate it because I swear non-stop, but truly divergent people, if I were normal, it would be so much easier to raise money. And I don't know, badly raising money, don't get me wrong. But I don't want people to leave this podcast and think that being in impact investing is a life of sacrifice. It's a life you can do good. Me being a bit weird doesn't help, not being too open.

in terms of palatable, but I think my final message would be this is a big market, the world is a big place, there's people everywhere who need help and need someone or something or some business that can actually start looking at societal problems, put aside all of the irrelevant rubbish we focus on in our lives and just go like...

Let's just try and help each other, know, each other. And I mean all of us. It's, it's, you know, it's.

If we don't have bonds together in our society and what feels like technology is tearing us apart, then we have little hope for the future, is my view. So the more we can engage with each other, the more we can share ideas, the more open we can be, and the more we can actually run businesses focused on trying to do some good in whatever field or remit you try to, then that can only be a good thing. But in reality, we've seen what's happened from people hoarding wealth and I don't particularly think it's a good thing. think it's... yeah. Purpose should come before profit.

Adam (51:03.437)
What a sign off. Toby, thank you very, very, very much for your time. Thank you very much for you and your team's amazing work that you're doing as the world needs a lot more of this. So thank you again for being a guest. My hero.

Toby (51:05.39)
Thank

Toby (51:21.678)
Thank you so much for having me, I've really enjoyed it.

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