Investing With Integrity - Mike Kern
Our guest in this episode is Mike Kern. He is the President and Chief Executive Officer of Crossmark Global Investments and its related entities. A position he has held since May of 2015. Mike is responsible for the overall leadership of the firm.
Crossmark Global Investments is a faith-based firm that creates, manages, and distributes values-based investment strategies that equip financial intermediaries and their clients to go further by aligning their wealth with their passions and convictions. For over 30 years, the firm has delivered uniquely constructed products based on its proprietary, disciplined, and repeatable process.
Founded in 1987, the firm is headquartered in Houston, Texas.
For more information visit: www.crossmarkglobal.com.
Transcript
Investing with Integrity Podcast
Episode 004
Mike Kern – Crossmark Global
Jeff Talarico (:Welcome to the Investing with Integrity podcast. My name is Jeff Talarico I am your host. Our guest today is Mike Kern. Since 2015, he has served as the president and chief executive officer of Crossmark Global Investments. This is where he serves them and the related firms in everything that they do with the overall leadership of the company. Mike is a graduate of Wayne State University, where he obtained his bachelor's degree in finance and business economics. He also holds a chartered financial analyst designation, which means he's a lot smarter than I am, and is a member of the CFA Institute. Prior to joining Crossmark, he served as president of the financial advisory firm of Stout Recess Ross, which he joined in 1996 as an analyst. One of the coolest things about Mike is his devotion that he has to philanthropic activities. He says that they are his passion. And I'm looking excited to hear about some of that a little bit, Mike. He currently serves as chairman of the board of the-board of directors of both the Embrace the Truth and City Serve International. And in his spare time, as if that's not enough, he advises several churches throughout the country on financial matters. Mike, along with his wife, Amanda, and their four children call Houston, Texas, home. So without further ado, let me welcome Mike Kern to the podcast. Mike, thanks for joining us today.
Michael L. Kern, III, CFA (:Jeff, it's just a real pleasure to be here. I have to tell you, I agreed with everything you said except one thing, and that's that I'm smarter than you. I don't know about that.
Jeff Talarico (:Well, thanks for being here with us today, Mike. You know, one of the fun things about doing this podcast is I know most of my guests personally and having them on board with us and understanding why we do what we do for your firm as well as mine, it's just really good for the kingdom of God to get together and be able to do these kinds of things. So I'm gonna ask you the same question, the first question I ask every guest that I bring on the show, what is something interesting about you that most people don't know?
Michael L. Kern, III, CFA (:Well, that's a great question. So I'm a fairly adventurous person. I've been skydiving, I've been scuba diving, I've been paragliding. And this year for my 50th birthday, my wife and I, we hiked and summited Mount Kilimanjaro. So that's something that we just got back from Tanzania doing. And so, yeah, just a terrific experience.
Jeff Talarico (:Pretty impressive, Mike. That's something really, really cool to do. So let me ask you, let's talk about the financial services industry, how you got started, why you chose this, and kind of wrap up everything you're doing as of now.
Michael L. Kern, III, CFA (:Yeah, so I've been in financial services industry for quite a long time. You mentioned that I started at a firm called Stout Riches Ross. And that firm was a, and still is a valuation and investment banking and litigation support firm. So I started right out of college, loved it. It was a small firm, about 15 people. By the time I left, we grew to a hundred million in revenue. We had offices all around the country, had opened some offices internationally as well. And, from there then joined Crossmark Global Investments, where I've been for the last eight and a half years. It's just been a terrific ride and just excited to be at the firm and involved in this industry. This faith-based financial industry is just a real wonderful profession to be a part of.
Jeff Talarico (:So tell us a little bit about why that's so different from being in the secular side, because you were there for a long time too, right?
Michael L. Kern, III, CFA (:I was 19 years in a secular firm. And so I'll just tell you a little bit about, you know, migrating from that to Crossmark. So as I mentioned, we were on track to hit 100 million in revenue the last year that I was at Stout. And it was a goal that we had articulated about 10 years prior to that. And so that particular year, I just began to lose grace, you know, for being in the secular environment. So...
I spent four days in a log cabin in the woods with my Bible and my worship music and just asked the Lord, what do you want from me? You know, here I am. We've had a lot of success at the organization and of course a lot of wonderful friends and came home from that trip and told my wife, I said, I'm going to leave the firm. And she said to me, yeah, I know you are. I said, well, I just bawled my eyes out for four days, you know, two boxes of tissue seeking God, you know, so.
But it was good to have that confirmation from a Godly wife. So, um, so yeah, so joined Crossmark and at the time Crossmark was not really a faith-based organization. Um, I took it over from the founder of the firm. Uh, the firm had been acquired by a nonprofit called assembly of God, financial solutions out of Springfield, Missouri. And my mandate was really to change the culture of the firm and to grow the firm. And so that's what we've been doing over the last several years is exactly that.
And we've transitioned now from being a secular organization to a faith-based firm. And it's been quite a journey.
Jeff Talarico (:Now, I know the backstory of that. And you kind of took the mission statement, the vision statement of this firm, and you just added a word or two to it to change the whole culture. You want to discuss that a little bit?
Michael L. Kern, III, CFA (:We did. Yeah, we did. And so I would tell you, we didn't do that right away. If we had, it would have been a firm of one. So it was a process. In order to change the culture of an organization, you really have to change people. And so we had a number of unpleasant conversations in the early days with people that really didn't share the values that I wanted our firm to articulate.
And so along the way though, God just continued to bring such tremendous talent to us. And people that were not only experienced at what they were doing in this business, but people that really had a passion and a heartbeat for serving the Lord and doing it together with other people that have that same passion. And so we finally did get to the point where I was able to say, hey, we're going to put this on our website. We are now going to be called a faith-based firm that creates, manages, and distributes.
faith-based and values-based investment strategies. And so at that point in time, most of the folks were already on board with that. So we did have one individual that shortly after we put that on the website, he elected to move on and that's fine, a great individual, but what we were looking for was to have people that really believed in what we were doing and were like-minded. And so what I have found, Jeff, is that the more you tell people what you stand for, the more you will attract similar people towards you.
Jeff Talarico (:Yeah, I don't disagree with that at all. The same thing happened with me and my firm with facing clients. When I chose to strictly go into this BRI space, this faith-based investment space, I was a little concerned, but I had to really put my trust in God. This is what he convicted me of, this is how I felt, and it has been a blessing ever since, which of course leads to this podcast and being able to join with my friends and explain what this faith-based journey in financial services really is. So why don't you go ahead and tell us that statement so they can hear this because I think it's absolutely beautiful.
Michael L. Kern, III, CFA (:Yeah, well, so Crossmark Global Investments is a faith-based firm that creates, manages and distributes values-based investment strategies. And really at the Core Jeff, we believe that everything that you do in your life can be lived in harmony with your values, including your investments. So we go through life, we try to follow the 10 commandments, we don't steal, we don't cheat, we don't, you know, all of those things. But what about our money?
Are we using our money in a way that is God-honoring? And that's really what we try to help our clients do.
Jeff Talarico (:So what does that look like then for Crossmark?
Michael L. Kern, III, CFA (:Yeah, so today we have a number of different investment strategies. We run the full gamut from active to passive strategies, equity, fixed income balance. I mean, we're really covering the entire capital market spectrum. And at the end of the day, where we really shine is helping our clients articulate what their values are. So we don't really come along and prescribe the person's values, our client's values. We try to suss that out, you know, from them to say, what is it that you value?
And how can then we create a portfolio of securities that aligns with your values? And so, I mean, that's the fun part. In this, one of the things that I've seen about the Christian world, you hear people say, well, I go to this church, and somebody says, well, I go to this church, and somebody likes the loud music, somebody likes the quiet music, somebody likes the long biblical preaching, some like the more kind of just oratory style, whatever.
Are we serving God? If we're all serving God, then let's serve God and let's express that in the way that is unique to us that God has created us to be. And so that's what we try to do with our clients is what are the things that you value? What are your particular passions? Let's make sure that your investments are aligned with that. And that's the fun part of this job.
Jeff Talarico (:You know, and you're so true with that. There are so many parts of Christianity that people want to argue about and fight about instead of the unity. What makes us a Christian and a community? And I love how you guys are doing that at Crossmark. That's really cool. Now I've had like Art Alley on the show with Timothy Plan, kind of like the father of this BRI, and Timothy Plan does things a little, I'm sorry.
Michael L. Kern, III, CFA (:Absolutely. We probably wouldn't be here without Art. We probably wouldn't be here without Art Alley. We owe him a great debt of gratitude for the early work that he pioneered in this space, for sure.
Jeff Talarico (:He really did and it was really fun having him on the show because there were some things we talked about that I didn't know and I actually thought I knew Art. So it was pretty enlightening to me as well. What I'd like to do though is the guests that have heard him already on the show, they talk about doing a lot of exclusionary screening. And I know that that's not Crossmark's focus. And my promise and commitment to my audience was to give them all the different sides of this. So that's why I use you personally in some of our portfolios that I manage but your take on it is a little bit different than theirs. So why don't you explain some of that.
Michael L. Kern, III, CFA (:Yeah, so our process really is rooted and grounded in an objective approach. So everything that we do, we wanna make sure that we can apply it consistently across the entire universe of securities. So it's objective, it's verifiable, it's quantifiable, so that's what we're looking for. So our approach, particularly with respect to the mutual funds that we offer really is...is grounded in kind of that quantitative scientific approach. So when we look at companies, what we're looking at is how a company makes its money. As opposed to some of our other players in our space, which I have a lot of respect for. They do it based on how they spend their money. Ours is about how does a company make its money? What is the thrust of that organization doing? So we have various screens and that are pretty common in our space, but alcohol, gambling, tobacco, mature content, life ethics. So we're talking about abortions, abortifacients, stem cell research, things like that. So we're evaluating the companies based on how they operate. Why do they exist? And that's how we do our screening.
Jeff Talarico (:That is different, which is commendable though, because I think we all are different in our approach to a lot of things when it comes to the Bible, our interpretation, our theology. But to have this and have another player in the field is something great for all of our clients, not just yours, not just mine, but anyone who plays in this arena of faith-based investing, biblically responsible type investing. So.
Michael L. Kern, III, CFA (:Well, and Jeff, as you know, let's just interject here. So we've had a proliferation of investment products in this space that are available to financial advisors. And one of the things that I really love about being in the faith-based community is this idea of co-opetition. So we would say that we compete with other financial or other asset management firms, and we do, but we also cooperate with them. Again, getting to this idea that we're all here trying to build the kingdom of God, serve the Lord.
The way that they do it has a little different flavor than the way we do it, and that's okay. And so my wife and I, we actually moved to the other side of town here in Houston, and it was too far to go to our old church. So we went to a new church, and we were invited to sit down in the second row. So we sat down in the second row, and as I said, I turned 50 this year, so I'm now on the older side, I suppose. But we sat in the second row, and the music was really loud, and...
The people were bouncing up and down. And I looked at my wife, I said, I don't think I'm cool enough to sit in the second row. So we now sit in the fourth row, but it's the fourth row from the back and it's perfect for us. But we need those second row people. We need the people that are in the back. We need the older, the younger. God created this diversity for us. And that is what I love about this asset management space with the Christian and faith-based community. There are so many options out there today. There isn't a one size fits all anymore. And I think that the competition that we have between us really serves to serve our clients in an even greater capacity. So it's just a lot of fun.
Jeff Talarico (:Well, because you brought up cooperation, I'm going to go a whole different direction than the question I was going to ask. My understanding is that you participated with another firm, Eventide, when they had the CEOs all together in Boston to discuss this space and how we can all cooperate together and be harmonious with the same type of values-based mission. Now, how was that? You were there, correct?
Michael L. Kern, III, CFA (:I was, and it was actually our second gathering. The first gathering was in Houston at our office and we had just a terrific time of fellowship, the CEOs getting together and kind of getting to know each other even on a more personal level. So, but yeah, it's fun to get together with other like-minded individuals, people that are leading an organization, going through the same struggles that I'm going through as a leader of Crossmark. You know, praying with each other. It really is a terrific group of people. And, you know, so again, it gets back to this idea of co-opetition. We really like to collaborate and collectively say, how can we serve this community to a greater degree? And I think that's a really special thing.
Jeff Talarico (:Other industries do that. They get together, some of them have what's called 20 groups where all these owners get together, but their main focus is about making profit. Yours, it sounds like, and again, I've spoken to another CEO that was there, it's totally different. It's about, like you said, how can we serve? And I truly think that's the differentiator between other money management houses and those that are focused on values, morals, ethics. And again, I commend you guys for doing this.
Michael L. Kern, III, CFA (:Yeah, you know, I was thinking the other day, Jeff, about Rosa Parks in particular. You know, she grew up in the South, but ended up living in Detroit for many, many years. And, you know, you look around the city of Detroit, there's Rosa Parks Boulevard. You know, there's a movie based on Rosa Parks. There's a stamp that came out earlier this year from the post office about Rosa Parks. And, and we honor her for what she did. Right. She didn't give up her seat on the bus and she became kind of that symbol of for equality and freedom, which was so needed. But the thing that really made that stand move forward, that whole movement move forward, was unity in the community. And it's a biblical mandate. When we get together in unity, we are strong. And so that's, again, that's what we're trying to do as leaders of these faith-based asset management firms, is we recognize that by ourselves, yeah, we can do some great things. CrossMark is doing some wonderful things, okay? But together, man, we can really take some ground for the Lord and again, serve our clients.
Jeff Talarico (:That's awesome because I mean, it is. We are supposed to be together, work together in cooperation, in unity as you put it. And that's a great example. Rosa Parks, phenomenal for that. And I think you grew up in Detroit, didn't you?
Michael L. Kern, III, CFA (:I did, I did and moved to Houston about 12 years ago and haven't shoveled snow since.
Jeff Talarico (:There you go. All right. So let me go back to my questions that I had. You know, in this podcast, our tagline is wisdom over worth, principles over profit, morals over money, and integrity over it all. Now, I sent that to you a while back, and when you first read that, did that resonate at all with you? And if so, what did it mean?
Michael L. Kern, III, CFA (:Yeah, absolutely. I will tell you, my first thought when I read that was, you're presenting choices, right? Wisdom over wealth. Which one are you going to pursue? And I just, my mind took me back to the Gospels, where I believe it was Jesus' Sermon on the Mount in Matthew chapter seven, where he says, narrow is the way that leads to righteousness and wide is the gate that leads to destruction. And so it's about choices. And we even see it in the Old Testament too. I mean, Joshua took a stand. He said, choose this day whom you will serve. But as for me and my house, we will serve the Lord. So you've got it in the Old Testament, you've got it in the New Testament from Jesus. And here we have it from Reverend Jeff Talarico, also giving us an option, giving us choices. And so. That was kind of my first thought of, you know, well, which one are we going to choose? Which is the better path? Which is the path that leads to life and leads to righteousness? You know, and so that was my initial thought. I love the title. I love the tagline.
Jeff Talarico (:Thank you. Thank you. It was a lot of prayer coming up with something that I felt would resonate with people, because it is a choice, you know? And one of my favorite parts of Scripture is when Moses in Deuteronomy says, choose life. We should always choose life. Words, the words we speak, our attitudes towards others, either they're tree of life living or they're the tree of the knowledge of good and evil living.
Michael L. Kern, III, CFA (:Mm-hmm.
Jeff Talarico (:I much rather live out of the tree of life because it's fun. We can have conversations without tearing each other apart. We can be civil with each other. So that's part of why we do what we do. And there are some that don't want this type of investing and I honor that. I may not be the right advisor for them and I'm not afraid to tell them that. So this is a different type of investing. I'm not gonna change my thoughts and my beliefs just to get assets under management. Because to me, that's not what it's about. It's about being able to serve those that feel and truly want to do better with what they have.
Michael L. Kern, III, CFA (:You know, not to jump ahead, Jeff, but one of the questions that you did send me in advance was about this, the difference between the returns that you can expect to get from a faith-based portfolio versus a non-faith-based portfolio. And first of all, I'll say that I think that idea has been debunked over recent years. You do not have to give up performance to have your investments align with your values. But I think the bigger question is, OK, well, let's assume that you did. OK, so.
All right, what do you choose then? And again, I think it comes back to, well, what is your theology? What do you believe about God? Do you believe that we live on this earth for 80, 85, maybe 90 years and that's it? Or do we have an eternity that we're looking for? And is God a faithful God? Does he do what he says he's going to do? You know, are the promises in the Bible for us and for all of eternity? And so, you know, we see all of these contradictions in the Bible. Things like, the apostle Paul says, When I'm weak, then I am strong. You know, Jesus said, If you give up your life, you'll find it. But if you hold your life, you know, you're going to lose it. There's a great proverb that I love. It says, There is he that scatters and yet increases, while he that withholds tends to poverty. So we see these dichotomies in scripture. And I just, I came back to this question of, what if we did have to give up?
investment returns for doing it God's way. You know, won't we be blessed for that? Won't God reward us? If we are really believing that God is a God of truth and that he's going to do what he says he's going to do, then okay, even if I do have to give up some return on this life, won't I get a greater return in the life to come? And so I was thinking about that.
you know, the other day when you sent me these questions. And again, you don't have to give up return, but it's almost not even the right question any longer. It's more a question about what is the condition of your heart and what do you believe God is saying? And is he a true God?
Jeff Talarico (:Well, folks, you've been listening to the Investing with Integrity podcast. That's enough said. No, I'm just teasing. We, uh, that's great. That's a great response, Mike. And I'm glad you did that. So yeah, there are some things that we'll fine tune and get a different way to ask that question. But a lot of people it's on their, it's on their mind. I've had many discussions with my Christian brothers and, in, in one of them specifically, I told him I was changing my practice and going full force into faith-based investing and his first response was, you won't make as much money for your clients. This is a Christian that we go to church with, we're members of the same group. And I had to just say, it's not about the money. It's about doing what's right. And that's where, you know, morals, integrity, that all plays into that, into that statement that I've made. So thanks for bringing that up. I appreciate that. So let's talk a little bit about your philanthropic ideas and things that you do, that has a lot to do with generosity and stewardship, would you agree?
Michael L. Kern, III, CFA (:Oh, absolutely. You know, I think as we think about kind of our money, you know, I like to think about it from cradle to grave, you know. And so, you know, people think about, well, I'm going to make my money in a God honoring way, you know, not going to cheat people. I'm going to do what I said I'm going to do, charge reasonable prices and all of that. I think, you know, most of your listeners probably would subscribe to that thinking, you know, and then you get to the next stage, which is, well, how am I going to invest my money while I have it. And obviously that's where Crossmark comes into play and some of our other faith-based partners that are out there. And then that last piece is, well how am I going to give my money away? What am I going to do with it that is honoring the Lord? And so to me, it's living a life that does all three of those and not leaving any one of them out. I think you need to do all three. Earn your money in a God-honoring way. Manage it in a God-honoring way. And give it away in a God-honoring way.
And so yeah, I'm involved in a couple of different ministry organizations that are just doing tremendous work all around the world. And it really, it really is life giving to me to be able to participate in some of those things.
Jeff Talarico (:So tell us a little bit about them. Let your listener, or let our listeners know who these organizations are.
Michael L. Kern, III, CFA (:Yeah, so the first one, so I have one smaller and one larger ministry. So the smaller one is called Embrace the Truth, and it's an apologetics organization founded by a gentleman named Abdu Murray. I've known Abdu for probably 25 years. Just a wonderful, articulate, intelligent man of God. And he has just a way of crafting an argument based from scripture that answers people's questions in just a way that...
I'm not gifted that way. So Abdi was a former litigator and was an attorney trying cases in court. And so now he's answering the toughest questions that society throws at him today. It's really amazing. So that's the first one, embrace the truth. The second group is called CityServe International. And so we exist to really make the local church the hero. And what we are doing is equipping the local church with
with supplies. We've got also 10 initiatives around scripture in terms of serving the poor, the needy, the prisoner, the widow, the orphan, the hungry, the nation of Israel, which as you know is a huge topic today. And so that ministry is doing work all around the world through our network of churches of all kinds of denominations and stripes. And so we just crossed over the $1 billion mark in terms of
Jeff Talarico (:Wow.
Michael L. Kern, III, CFA (:gifts in kind given away and distributed through the local church. So what we want to do is make that pastor and make that local church the hero because they're there in the community. You know, and this is the bride of Christ. I've said to other people, I said, if you want to, if you want to get my blessing, then treat my wife right. If you want to get God's blessing, treat the church right. That's his bride. And so that's what we do with CityServe is attempt to build that network and that community.
Jeff Talarico (:that and I think that is well needed. There are so many churches that are struggling just to even make ends meet sometimes because people they're just not there. Not the right people I should say. There's a lot that just go and unfortunately want to take advantage of things that or whatever services might be there but they don't really contribute any other way. And I think churches as a whole if If churches could do and were funded properly through proper tithing, and I believe in tithing, we wouldn't need a welfare system in our country. The churches could do what the churches should always have done, take care of orphans, take care of widows, take care of those that are in need. That is a commendable thing you're doing, Mike. I appreciate you doing that.
Michael L. Kern, III, CFA (:You know, just to share a quick story about CityServe in particular. So last year I had the opportunity to travel to Ukraine and obviously see the devastation that's taking place there, the atrocities, the war crimes. And again, it's this idea of the church is there. You know, I flew in, we visited some churches, we had bombs dropping around us literally as we were there, but these are the people that are staying there. These are the real heroes of the faith the modern day heroes of the faith. And to be able to resource them and to provide encouragement to them is again what we do at CityServe. And again, I get a little choked up when I start to think about these heroes, these pastors in Ukraine that are just continuing to serve the Lord in just difficult situations. And of course now we're pivoting and adding to that, you know, the situation in Israel which is pretty devastating as well. But the Church of God will withstand. Jesus said upon this rock, "'I will build my church and the gates of hell will not prevail against it.'" And that's what we need to be supporting is the things that God is supporting.
Jeff Talarico (:Absolutely. Amen, Mike, I'll tell you. So speaking of that, so you've got this, you've got yourself out here serving others, and you're also the leader of an organization. Do you ever have conflict between the two? And if so, what do you personally do to overcome some of that?
Michael L. Kern, III, CFA (:I would say the only conflict is the pull on my time. There's only 24 hours in the day, right? And the work that we're doing at Crossmark is really important and the work that I'm supporting in these other organizations is really important. So it's really about balancing that and that can be difficult, can be very difficult. But what I will say is at Crossmark, that the appeal of being at Crossmark is that we do a lot of these things through our firm.
And so it's not really picking one over the other. It's really kind of integrating them together in a cohesive life. And again, it gets back to what I said before about the way we make our money, the way we manage our money, the way we spend our money. It's building all of that together, that it's not one or the other or two out of three. It's all at the same time. And so I believe that God has called people to be in business because it's their ministry. I remember when I was younger, I thought the only way to serve the Lord was to be a pastor or to be a missionary to Africa because that's how I was raised. I mean, you could be a missionary somewhere else, but if it wasn't to Africa, you know, you weren't really serving the Lord. And so I struggled with that in my early days because I loved business and I was having great success at Stout. And there came a time when the Lord just showed me that he has gifted me in the area of business and he's going to use that gift for his kingdom.
I'm not a pastor today because they love people to such a great degree and I don't have it. I don't know how they do it. They just have patience and love for people that is a gift, right? It's God's gift to them to enable them to do that. But God's gifted me in a different way. And so no matter what profession you're in, God has his men and women doing his work. And particularly in this business, in the financial services business,
We've seen just a proliferation of people that are actually standing up like you, to say, this is what I'm going to do. I'm a Christian, God's called me to this. This is my passion. This is my gifting, my professional gifting. I've got something to share, something to contribute to the community, and I'm going to do it in a God-honoring way.
Jeff Talarico (:And for me myself, I mean, he's actually called me into both. So you know, I'm a bivocational because I'm I also pastor a church. So having that heart for doing right, or not only the people that I serve here, but also the people in church, it's, it is different. And it is a calling, as you pointed out, and
Michael L. Kern, III, CFA (:Mm-hmm.
Jeff Talarico (:Mike, you're only 50. You know, I'm almost 60. So there could be a time soon he calls you to become that pastor, because I think we all are. I think we all are pastors in different ways. You're called a leader at work. Well, you're really pastoring these people. You're shepherding those that are there with you. So you are still doing it. It's just not on Sunday mornings behind a pulpit. You're doing it every day at work. And that, again, totally different way, but you are still doing that. So don't count yourself out. So...
Michael L. Kern, III, CFA (:That's right.
Michael L. Kern, III, CFA (:That's right.
Jeff Talarico (:I'm just going to bring this up because it was exciting to me and I had done business with you prior to this, but even afterwards it was even more exciting. You guys brought on someone who was definitely known in the secular world for being an incredible mind when it comes to stock picking and investing. And that's Bob Doll and he is a phenomenal believer in Christ. I've seen him at several kingdom advisor conferences. But you guys...
Michael L. Kern, III, CFA (:Mm-hmm.
Jeff Talarico (:You got him there. You wanna talk a little bit about that? And I am gonna see if he'll be a guest sometime on the show, but go ahead.
Michael L. Kern, III, CFA (:Yeah, I'm sure I could convince him. So yeah, Bob has been just a wonderful addition to the firm and really representative of the types of people that God has brought because we have, we have Bob's in their own little areas, right? But with Bob in particular, I got introduced to him through a mutual friend and began talking with him. And this is when he was at Nuveen.
And I said, hey, why don't we create a new product together? You know, we'll have you sub-advise it through your firm, but it'll be one of our steward funds. And so we went pretty far down the path, creating a new strategy. And Bob called me one day and he said, Mike, I really hate to tell you this, but I've been told that I can't continue forward. And he said, I told him it's, you know, we've spent a lot of time on it and it's not gonna look good, you know, but nonetheless, this is what I'm being told. And I said it in the moment, I said, Bob, we all are under authority. So if that's what your boss says, that's what your boss says. And I just, in the moment, I said, I guess the only thing for you to do then is to leave that firm and come and join us and we'll do it together. And so fast forward a couple of months, I received a call from him, we began talking. And of course, you know, Bob, he could have gone wherever he wanted to go in the faith-based community or not faith-based community. And he loved the vision that
that we articulated, what we had already built. He felt like he could add to what we were doing and kind of accelerate our pace. And so he joined and it's just been a wonderful partnership with him. As well liked as he is in the community, he's beloved within our firm as well.
Jeff Talarico (:Good.
Jeff Talarico (:Well, he's just jovial. I mean, it's Bob. You can walk up to him at a conference and he'll shake your hand and he'll remember who you are. That's the cool thing about him. He's just, he's honest and he's real. And I think that in this community of faith-based advisors, faith-based firms, we are a community. I mean, I have conversations with people on LinkedIn all the time that even though we compete, we don't compete. We're...
We're like you said before, we're cooperating together. I don't know the exact word you used. I really loved it. I'm gonna have to steal it from you, but that's what we should be doing. There you go. I like that. So with regulations are always changing. Do you, how do you view this industry over the next five, 10 years?
Michael L. Kern, III, CFA (:Co-opetition. Yeah, co-opetition, yeah.
Michael L. Kern, III, CFA (:So you had to bring up the regulations, huh? It was going so well. Look, every industry has regulations. I think the financial services industry, we have more than our fair share. And so certainly, yes, the pronouncements coming down from the SEC and the things that FINRA are doing obviously impact us pretty tremendously. I don't see it going away. It's a cost of doing business. Clearly, there's some value.
Jeff Talarico (:Yeah, just a little bit.
Michael L. Kern, III, CFA (:in having regulations, we want to keep the bad actors out. But it's a challenge. And I think one of the real kind of casualties of the regulatory environment ramping up so much is that some firms are just not going to be able to make it. Some of these things that we're required to do on a day-to-day basis really add cost into the system. And so that's the challenge. Some of these smaller players are gonna have a tough time.
So I do think going forward, we'll see some more consolidation just in general in our industry, the smaller players being consolidated together. But I'm not so sure I see that necessarily within our faith-based community. I think that the faith-based community is a smaller group. They've been around for a while. And again, this idea that we kind of look out for each other.
And we value having choices, allowing our clients to have choices. But it definitely, it's a topic that we've spent quite a bit of time at our firm talking about. How do we build out these systems that were being required and imposed upon us? It's a challenge.
Jeff Talarico (:Well, I appreciate your input on that because I think it is something that always evolves. I mean, it's why we have locks on doors. It's to keep, you know, honest people honest. That's what they say. So, good. I'm glad you agree with us on that. So let me ask you the last couple questions and then we'll let you get on with your Friday afternoon because we are recording this on a Friday. If you had a conversation with three people, dead or alive, who would they be and why?
Michael L. Kern, III, CFA (:So that was, of all the questions that you sent to me, that was the one that stumped me the most. And I thought, well, you know, as a Christian, of course I should say Jesus or the apostle Paul or Moses, you know, cause wouldn't that be fantastic? But it sounded a little too trite. So where I landed, Jeff, is I would like to have a conversation with my ancestors. Great grandparents, great, great grandparents.
You know, early last year, my mother passed. She had stage four cancer. She was diagnosed on December 26th and passed on January 6th. So it was very, very short. And so it's been almost two years now. But one of the things that I got from my mom, from her things was a number of Bibles that she had. My mom would read the Bible all the way through every year, different versions. And so...
I picked out one that I knew was special to her, and I brought it home with me. And began thinking about, well, wouldn't it be cool to actually display this Bible and not just put it up on the shelf? And so I ended up getting a shadow box and I had my mom's Bible. And then I asked my dad for his Bible. He's still alive, but he's got other Bibles he can read. Give me the one that I want today, dad, right? So I had my mom and my dad's Bible together in a shadow box.
Then I have my grandma and grandpa's Bible in a shadow box. And my grandfather was Italian, his Bible is Italian. And then I have a great grandma and a great grandpa. And I have their Bibles in a shadow box. And then on my wife's side, I have her mom and her dad's Bibles in a shadow box. And they all hang on the wall in my office at home. And I'm just so, I feel just so blessed at the heritage that I have, the Christian heritage that has been bestowed upon me.
Jeff Talarico (:Wow.
Michael L. Kern, III, CFA (:So when you asked that question, I thought, you know, I'd love to go back and talk to my great grandparents. You know, how did God work in your life? You know, because it certainly has impacted me today in ways that I don't even know. So that's my answer for you, Jeff.
Jeff Talarico (:What a story, Mike, that is awesome. And again, I haven't had anyone answer that. I love that because I think that the more we know about where we came from, the better our future is gonna be not only for us, but for our children and our children's children. So we can continue on that type of legacy. All right, so then the last question is real easy. What didn't I ask you that you're dying to say?
Michael L. Kern, III, CFA (:Oh boy, that's a good one. I think we've covered a lot of terrific topics. We've talked about the industry, we've covered cross-mark, a little bit about my history, a little bit about your history and what you're doing, being bivocational. So I guess I would just say, Jeff, that I'm super excited about this industry. And one of the lessons that I've learned kind of transforming cross-mark from a secular firm to a faith-based firm is this idea that as a faith-based firm, we should expect that God goes with us. You know, so for those financial advisors that are listening today, that are kind of on the fence of, you know, should I convert my practice to being faith-based and offer faith-based investments? You know, I would encourage you today, do it. God is gonna go with you. He's going with us. And we should expect him then to be involved. You know, we talked about Bob Doll joining our firm. And again, we've got others that are like him. God brought them here.
God is involved at CrossMark and because of that, we know that we have great days ahead. Certainly not all sunshine and roses, we're gonna have challenges, but with the Lord with us, we're going to be successful. So that's what I would leave your listeners with today is be encouraged by that. Take a step of faith and know that God goes with you.
Jeff Talarico (:Mike, that's awesome. Thanks for your time today. I greatly appreciate it. I know that we had a couple of challenges making some things happen here and I'm so glad we were able to get together and finally be able to talk. And I got your input on this industry of faith-based investing, which is what we find passion in and enjoy that. So you've been listening to the Investing with Integrity podcast with our guest, Mike Kern with CrossMart Global Investments.
Come back and tune in again, first and third Wednesdays of every month. We'll have another show for you. Mike, thanks again for being here and God bless.
Michael L. Kern, III, CFA (:Thank you, Jeff. It's been a real pleasure and a lot of fun. Take care.
Jeff Talarico (:Bye-bye.
