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Through the Looking Glass – Investment Themes to Watch in 2022

The world has been riding the COVID-19 rollercoaster for the past two years. Similar to Alice’s adventures in Through the Looking Glass, the twists and turns of the pandemic have been reflected in our everyday life and the investment world. Financial markets have experienced extreme highs and lows as the market digested economic data and expectations about COVID-19 cases and incoming variants. Even the map of S&P 500 levels mimics a roller coaster you might see at your favorite theme park. Despite the economic and social volatility over the past two years, the S&P 500 returned more than 26% in 2021.

Graph of S&P 500 levels January 2020 – December 2021

So where will Alice go next in the looking glass? Specifically, what should investors be reflecting on as we look towards 2022? With this in mind, we have identified a few opportunities as well as some things to watch in the investing world in the upcoming year. More details will be provided on these topics in the upcoming months however investors should be aware of these opportunities and market risks as we start the year.



One of the greatest market concerns early on in 2022 is rising inflation levels. From food in the grocery stores to gas at the station, the price of everything is going up. The U.S. Labor Department recently reported that consumer prices rose 7% in December 2021 from the price level in December 2020. This comes after November 2021 consumer prices rose 6.8%.  A Wall Street Journal survey showed that respondents believe inflation levels will come down gradually in 2022 as a Federal Reserve interest rate hike is expected in early 2022 in response to inflation well above its 2% target and a low unemployment rate of 3.9%. Survey respondents also are projecting economic growth to slow in 2022 to a 3.3% increase in GDP which is significantly lower than their October expectations of 4.2%. As a result of these economic drivers, investors are flocking to real assets such as farmland, commodities, and precious metals.  Commodities, including energy, and precious metals are the top-performing sectors so far in 2022. Nationally, farmland experienced a 7% increase in values in 2021, and agricultural commodities and farmland are projected to continue rising in 2022. If you are interested in investing in farmland coupled with tax benefits, learn more on Promised Land’s website.

Wall Street Journal Survey Report

The Next Gold Rush


The rise in inflation expectations also has some investors seeking protection in physical assets such as Gold. Gold is another asset that has been known to offer investors inflation hedging potential however the volatility in the COVID-19 pandemic caused great volatility in the gold market in 2022. Based on our Q4 data, gold was down close to 4% year to date in 2021 but was up 5% in the fourth quarter of 2022, demonstrating increased interest in the asset class with rising inflation concerns. Some investors think gold will start to shine in 2022 as the market digests negative real yields in the face of potential runaway inflation numbers. Analysts from Australian Bank, ANZ, expect gold prices to rally in the first half of 2022 but will come back down later in the year after the expected interest rate hike from the Federal Reserve. Meanwhile, another historical catalyst for gold, geopolitical risks, are on the rise in Ukraine and Russia, Taiwan and China, and domestically due to COVID-19 policies.  While the jury is still out on whether the next gold rush will emerge, it is an investment theme we are keeping our eye on going into 2022.

Image from the Gold Rush of 1849. Will we see history repeating itself in 2022?


While the economic results of the COVID-19 pandemic have some investors looking backward to seek inflation protection, others are wondering if a cryptocurrency investment has a portfolio role in the investing looking glass. Crypto has had a varied history and is known to be one of the most volatile assets.  However, its use as an alternative store of value and currency (“digital gold”) has been attractive for some investors seeking shelter from potential Federal Reserve money printing and other monetary policies supportive of risk assets. The cryptocurrency market has started 2022 on poor footing with Bitcoin falling more than 7%  on January 21st. This comes after global concerns from emerging regulations on cryptocurrencies in Russia, one of the largest crypto-mining markets. Will this rocky start send Bitcoin tumbling down into a digital mineshaft? Goldman Sachs remains optimistic about Bitcoin’s potential, citing that it thinks the price could double in the next five years, stealing some of gold’s luster in the process. The crypto story will continue to unfold in 2022 and we will be keeping watch with “laser eyes.”

Environmental, Social, and Governance (ESG) Investing

Every day, more and more investors want their investments to not only grow in profitability but also spark positive change in the world around them. The demand for environmental, social, and governance (ESG) investing grew substantially in 2020 with a record 140% increase in investment funds going towards ESG investments. In 2021, investor demand grew further with companies across the planet trying to meet investor preferences through sustainable business practices and policy actions to reduce their carbon footprint. Northern Trust Corporation’s ESG index fund (Ticker: ESG) which invests in large-cap companies promoting sustainability and social governance is up more than 14% from January 2021 to January 2022, with its outlook looking strong. Its $186 million assets under management include a diverse mix of industries such as technology, health care, and renewable energy. As young millennial investors enter the stock market, many believe impact investing will be at the forefront of their minds and their pocketbooks. ESG investing is paving the way for new roads in the market such as carbon investing, green bonds, and clean energy development. We plan to discuss this topic further in the coming months and provide opportunities to put your dollars to work for a more sustainable planet.

Grow your wallet and your planet with ESG Investing

The Looking Glass

“It’s a great huge game of chess that’s being played – all over the world- if this is the world at all you know” – Lewis Carroll in Through the Looking Glass. These words of Carroll from more than 150 years ago still hold in life, especially in the geopolitical and investing realms. From inflation and interest rate concerns to safe-haven capital flows to gold and ethically directed demand for ESG investments, investors must actively survey the chessboard and potentially modify the strategy to win the game. 2022 is sure to challenge us tactically with blockades, decoying, and double attacks. Servant Financial will use a stable, yet flexible looking glass by investing your capital with integrity, compassion, and experience. Follow us as we reflect on these and other topics in the coming year.

Rural Broadband: An Investment in Connectivity

Author’s Note

“Growing up on a farm in rural Illinois, access to internet was always a hinderance in my family’s household. The screeching sound of the dialup internet starting up was all too familiar until about 7 years ago when my family was finally able to have WIFI connectivity (wireless local area network). Even then, video streaming was still out of the question, and it would take several minutes to send an email. When my brother and I moved home in March of 2020 because of the COVID-19 pandemic, we were both finishing up graduate school then both had to start jobs working remotely in May. We needed to coordinate Zoom calls because we would easily overload the WIFI network if both of us were on one at the same time.  Even then, our internet would crash at least once a day. This is a familiar story for many rural American households that has been heightened as millions of Americans began working or learning from home due to the pandemic. Investment in broadband coverage is something that I happen to find very important if we are to be socially responsible investors.” – Ailie Elmore

Current Status of Rural Broadband

The need for digital interaction is increasingly becoming a necessity for people around the world. From working remotely, learning virtually, telehealth appointments with providers, and accessing other essential goods and services through E-commerce, the world has never been quite this connected. However, that isn’t quite true for all Americans. 22.3% of rural Americans and 27.7% of Americans in tribal areas still lack basic broadband coverage. The Federal Communications Commission (FCC) defines broadband as 25 megabits per second (mb/s) of download speed and 3 megabits per second (mb/s) of upload speed, however this continues to evolve with technological advances. For reference, the size of this article is roughly 1 megabyte which would take around .32 seconds to download with an internet speed of 25mb/s.

Unfortunately, many rural communities have been left behind in this technological advancement which has not only cost the United States socially, but economically as well. For example, many jobs have moved to remote work due to the COVID-19 pandemic, and companies have realized they can cut down on costs by not having employees come into a physical building. McKinsey estimates that remote work offerings will continue to grow as a result of the pandemic which could mean more job opportunities for those living in rural areas. However, improved access to jobs traditionally performed in an office setting only increases the demand for rural broadband connectivity.

Broadband Subscription by County in the United States.

Last month, we focused on education technology advancements that are reshaping the way we learn. However, 12 million school-aged children are left without broadband access in their home, inhibiting virtual learning potential. The COVID-19 pandemic shed light on this as these children were left without broadly available resources to complete their schoolwork. Likewise, remote employment has also been one of the positive outcomes of the pandemic, however the rural workforce struggles to keep up with the connectivity needs for video conferencing, transferring files, or collaborating virtually. The need for a digital infrastructure exists however the upfront costs for providers to initially invest becomes a tough pill to swallow. The initial cost to create a fiber network costs around $80,000 per mile which makes it difficult for companies to recoup their investment in rural areas where the population per square mile is much lower. This cost alone has disincentivized many major providers from investing in high-speed internet in rural areas.

The United States government has worked to spark growth in rural broadband through investing in broadband infrastructure. $47.3 billion was invested from 2009 through 2017 in this industry, and the USDA has invested heavily in programs, loans, and grants for rural connectivity infrastructure. In August of 2021, Agriculture Secretary Tom Vilsack announced $167 million in capital deployment for 12 states lacking access to high-speed internet in rural areas. “Broadband internet is the new electricity. It is necessary for Americans to do their jobs, to participate equally in school learning and health care, and to stay connected.” – Secretary Vilsack.

However, is this enough to bring rural America up to speed? In an analysis performed Deloitte on behalf of the USDA, they estimated an investment totaling between $130 billion and $150 billion would be needed to fully support rural broadband coverage and ensure high speed access. The U.S. government’s targeted, minimalist approach to rural broadband has left the door open for private companies to capitalize on this investment opportunity.

The Potential Economic Impact of Rural Broadband in the United States

While the need for rural broadband is apparent, it begs the question what kind of impact could investment in this space have? The USDA projects that if rural broadband enhancement was realized to its full potential, then it would boast an additional $18 billion of annual economic improvements in the United Sates. Furthermore, $1 billion in additional e-commerce sales would occur if broadband coverage was equivalent in rural areas to that of urban regions. Not only would rural broadband access improve the economic environment, but would also improve the quality of life for rural Americans. 60% of Americans who live more than 70 minutes from a physician do not have internet coverage that can handle telehealth visits. Additionally, lack of broadband inhibits peoples’ ability to connect digitally to sources of entertainment, knowledge, and social interaction.

A revitalization of rural communities could also occur if people are able to have the comforts of an urban digital infrastructure anywhere in the country from improved access to rural broadband. Improved rural internet connectivity could give people the capability to work remotely and more affordably live anywhere in America. The COVID-19 pandemic has already sparked a movement away from cities to the suburbs. Adequate investment in rural broadband could drive that movement even further away from metropolitan areas to the ex-burbs and towards the pristine, scenic mountains of Colorado, the beautiful deserts of New Mexico, or amber waves of grain of Iowa.

Not only would investment in broadband help the everyday person in rural America, but it could have substantial benefits to the agriculture industry, the lifeblood of many rural communities. Like many industries, technological advancements in agriculture have pushed the industry into digital integration. Precision agriculture has had substantial impacts on the productivity and efficiency of U.S. food production which has been driven by the farmer’s ability to connect to a digital universe. Currently, broadband is giving farmers access to a wide array of digital technologies, but the USDA projects that $47-$65 billion (Table 2 below) could be added in gross benefit to the economy if the full potential of broadband, and the digital landscape was reached in America’s heartland.

The impact rural broadband could have on the U.S. Agricultural Economy

Row-crop farming operations have more widely adopted precision agriculture technology but there is still room for improvement in broadband infrastructure for livestock and specialty crop production. An investment in digital infrastructure could reap substantial environmental benefits as the USDA projects an 80% reduction in chemical application and up to 50% reduction in water usage as a result of precision agriculture. The World Economic Forum estimates that if just 15-25% of farms adopted precision agriculture technology then by 2030 there could be a 15% decline in greenhouse gas emissions and a 20% decline in water usage. A reduction in water consumption like this could provide 64.4 billion gallons of water additionally to Americans every day. Achievement of these kinds of broad-based outcomes would be major milestones across many of the United Nation’s 17 sustainable development goals, particularly 2) Zero Hunger, 3) Good Health & Wellbeing, 6) Clean Water & Sanitation, 8) Decent Work & Economic Growth, 11) Sustainable Cities & Communities, and 12) Responsible Consumption & Production.

Investment in Rural Broadband

In addition to the U.S. government making targeted investments in rural broadband, many private industries are also taking part in the broadband rollout only where investment is economically viable. Cellular-based internet providers such as AT&T and Verizon offer rural broadband coverage, but internet speeds are still troublesome for many consumers. There has also been a push to deploy fiber optic internet infrastructure by several private companies. However, this option is questionable economically for lower density communities with cost estimates of up to $80,000 per mile for broadband lines. The Federal Communications Commission offers assistance through the Alternate Connect America Model to private companies building fiber infrastructure in underserved areas. Unfortunately, this assistance is again targeted as the program is usually only available for very remote areas. As a result, private investment in rural broadband is economically constrained and limited in its scope and effectiveness.

A potential champion for rural broadband deployment has recently emerged in the founder of Tesla, Elon Musk. Through his company, SpaceX, he is revolutionizing the way that internet is provided in a capital intensive, winner-take-all approach. Using low-orbit satellites that are closer to earth than standard satellites, SpaceX has launched a program called Starlink that can provide internet service at triple or quadruple standard “high speed” internet. Currently, Starlink can provide between 80Mbps and 150Mpbs in download speeds and 30Mbps of upload speeds which is close to 6 times the definition for rural broadband mentioned earlier. Starlink advertises it will be able to provide its broadband coverage to anywhere in the world.  While there is an initial consumer setup cost of $499 for a satellite and router then a monthly fee of $99, Starlink is a highly, attractive alternative to many Americans yearning for faster internet.  The estimated payback on setup costs for a rural broadband subscriber at $150 per month is about 10 to 12 months.  Musk said in May 2021 that the company had received more than 500,000 pre-orders for Starlink service.

Starlink has deployed more than 800 satellites thus far and says it still plans to launch 12,000 satellites costing around $10 billion to provide high speed internet to the masses.

Opportunities for Investment

As an industry that is experiencing rapid growth and is likely to continue to do so, rural broadband could be attractive for investors seeking to deploy capital in a socially responsible space. An investment in broadband coverage could take a variety of shapes as there are many players in the telecommunications industry. An investment in Starlink could be a particularly attractive long-term investment given its unique ability to provide high speed internet around the globe.  The resulting business moat achieved through Starlink’s highly capital intensive ($10 billion) business plan could boast substantial returns in the future if Starlink is successful in establishing their low orbit satellite network and achieve subscriber goals.  It is unlikely that another competitor will emerge with the boldness to spend $10 billion or more to compete.  A publicly available Starlink would be an intriguing pure play on the rollout and associated societal and economic benefits of rural broadband deployment.

Musk has not announced a target date for the IPO for Starlink yet, but it is projected to come in the near future.  In advance of a potential Starlink IPO, the First Trust Index NextG ETF – NXTG offers a broadly diversified play on the digitization of rural communities across the globe.  NXTG’s strategy is to invest in public companies applying substantial resources to the research, development, and application of fifth generation (“5G”) and next generation digital cellular technologies within two sub-themes of 5G: infrastructure & hardware and telecommunications service providers.  5G infrastructure & hardware consists of data center REITs, cell tower REITs, equipment manufacturers, network testing, validation equipment, software companies, and mobile phone manufacturers.  Telecommunications service providers consist of companies that operate the mobile cellular and wireless communication networks that offer access to 5G networks.

Our expectation is that NXTG would likely capitalize on a Starlink IPO when it becomes available. Currently, NXTG’s current holdings include companies developing digital technology such as Apple, Nvidia, HCL technologies, and NEC Global. NXTG’s 1 year return is just over 33% and has just over $1 billion in assets with exposure domestically and in foreign markets.

The deployment of rural broadband has the potential to provide for lasting economic and societal benefits that touch a variety of industries and rural communities left behind in the digitalization of commerce and social interaction. From an improvement in agricultural production and sustainability, to better access to health care and education, an investment in rural broadband will widely benefit mankind economically and socially and potentially achieve clients’ investing with purpose goals and objectives.

What is Education Technology?

Chalkboards, pencil sharpeners, and slide projectors: all represent old school educational tools. Today these low tech devices are being rapidly replaced by virtual reality, white boards that can record what is written, and most importantly, computers. The locus of education has quite literally changed, from a physical lecture hall to a virtual classroom in the cloud. Leading this revolution is education technology, also known as “EdTech.” Education technology combines information technology and computer software with a wide array of educational methods to foster learning and student growth. Combining tools like virtual reality and artificial intelligence with other forms of media like podcasts and instructional videos, Ed Tech is re-shaping the way people learn from ages 2 and up. The COVID-19 pandemic spurred growth within this sector and has some wondering whether this trend will continue post pandemic.

Spurred Growth from COVID-19 Pandemic

1.2 billion children around the world went from sitting in classrooms to sitting behind a computer in April of 2020. A new wave of e-learning, which uses computer assisted teaching to educate, persisted throughout school districts. Prior to the COVID-19 pandemic, online resources such as Coursera and Kaplan existed but were not as widely adopted. As teachers navigated e-learning, students and parents had to take a more self-taught approach to learning. E-learning offered students more flexibility in their learning environment and gave them opportunities to seek out more widely available resources in the digital world. As a result of COVID-19, researchers are projecting a $70 Billion increase in the e-learning investments in the next five years.

Major Players in Education Technology

There are a variety of interlocking participants within the education technology market. The government has been involved in the space since 1994 with the creation of the Office of Educational Technology within the Goals 2000 Educate America Act. As part of the United States Department of Education, it works to develop policy, media tools, and digital infrastructure to support education technology for K-12 learners. Prior, to COVID-19 there was little funding available to build an e-learning infrastructure and even post pandemic, resources are scarce particularly in rural or lower income areas.

Private industry has been eating up the opportunity to build out an education technology infrastructure and flourished even further during the pandemic. Experts predict by 2025 that there will be more than 100 publicly traded companies listed as an education or training companies with market cap’s greater than $1 billion. The ability for these companies to create cost-effective technology that can be integrated into a classroom setting or at home will be crucial to their growth. Companies such as Course Hero and Coursera help students learn a variety of subject matters such as calculus and biology through online courses and interactive platforms. Other companies such as Wondrium have capitalized on the fact that millions of Americans of all ages are seeking continuous learning experiences by offering courses in traditional university level topics such as history, economics, psychology, etc. as well as special interest topics like food, music, travel, and many more.

Education and training companies are projected to continue increased market cap growth.

While some traditional learning institutions may fight the education technology boom, many more public universities are embracing new ways of instruction and learning. For example, the University of Illinois at Urbana-Champaign has been at the forefront of investing in technology for classrooms and e-learning. In particular, through the Center for Innovation in Teaching and Learning, investments in eTexts have been made to integrate classrooms with online media. Craig Lemoine, the Director of the Financial Planning Program at Illinois, has worked to build 3 personal finance eTexts that not only can be used for student courses but eventually can be sold to private individuals or companies. “The final product matched our goal… High quality from authorship to final digital product, accessible across any number of learning styles,” said Dr. Lemoine.

Investment Opportunities in Education Technology

The market for education technology reached close to $75 billion in 2019 and is projected to grow at a 20% annual rate to $319 billion by 2027. In 2020 alone, $2.2 billion in venture and private equity capital was raised for U.S. education technology startups focused in augmented reality, artificial intelligence, and online course development. Block chain technology integration is also expected to drive innovation and investment in education technology as the academic world seeks better options for safeguarding student records and performing analytics.

Hardware development in EdTech dominants the market.

While the United States and other countries have embraced investment in education technology, it has not been as well received in China. In July of 2021, China announced regulations that banned companies from making a profit in the education sector. Particularly, companies offering tutoring services must be registered as non-profit. This caused many Chinese EdTech companies’ share prices to plummet. Domestically, investment in education technology continues to boom with no signs of similar government heavy-handed prohibition on for-profit business models.

There are a variety of options for investing in the nascent EdTech sector whether that is by investing directly in listed companies in the sector such as Chegg,Inc. (NYSE: CHGG) or Kahoot (Oslo: (KAHOT.OL). Note neither CHGG or KAHOT has yet achieved profitability.  Another new, more diversified approach to publicly listed investment vehicles in this space is Global X Education ETF – EDUT, first listed on the NASDAQ on 7/10/21. EDUT seeks to invest in companies providing products and services that facilitate education, including online learning and publishing educational content, as well as those involved in early childhood education, higher education, and professional education. This ETF’s top holdings are major players in EdTech such as Chegg, Pearson, and Zoom. As a newer ETF, EDUT has only $8 million under management today.  We will continue to monitor EDUT progress as a thematic investment possibility in education technology.

Future Implications and Growth Potential

As a challenger to traditional learning, EdTech has some people questioning if it will replace traditional learning methods. We believe EdTech will aid and augment traditional learning rather than replace it by creating more collaborative and productive learning environments that increase student engagement while increasing educator efficiency. EdTech is geared towards creating a more accessible environment for students to learn. However, many of EdTech’s benefits are highly dependent on a student’s ability to access this technology through broadband networks. Shockingly, 22.3% of rural Americans and 27.7% of Americans in tribal lands lack even basic broadband coverage.

We believe there is a high correlation between Opportunity Zones (low income communities), food deserts, and educational deserts. In the coming months, we plan to explore this overlap and devise purposeful investment strategies to improve the lives of children and families across the country. Check back next month for an in-depth analysis on investing in broadband and the opportunities it could present.

Food: from Farm to Future

Personal technology devices. Online delivery services. Life insurance. Even gas and oil… Technically speaking, all of these items and services are optional; although we might not enjoy the resulting lifestyle changes, we could live without them.

What isn’t optional? Food.

Two major consequences derive from our dependence on food and agriculture. First, food and agriculture are enduring markets. Though perhaps not as lucrative or thrilling as Big Tech investing, agriculture and farmland are not going away any time soon. Historically, the farmland market has been generally resistant to market fluctuations of boom and bust economic cycles. Farmland is an alternative investment, like traditional real estate in office or multifamily buildings, that provides unique opportunities for diversifying investment portfolios given its low correlation to traditional stock and bond portfolios. Today, however, there are limited options in public, liquid securities markets to invest in farmland.

Secondly, food is non-negotiable for human survival. Therefore, as a species, we have a philanthropic responsibility to ensure that all people have reliable access to nutritious food. Investing in agriculture, food distribution, and land improvement is not only economically rational but ethically impactful.

Food Security

World hunger— the phrase often conjures images of malnourished residents of Third-World countries. Tragically, hunger is a major issue not only in developing countries but even in highly industrialized nations. 1 in 9 Americans suffers from food insecurity, defined by the USDA as “limited or uncertain access to adequate food.” This means that 26 million adults and 11 million children lack reliable access to nutritious food in the US alone. Those figures suggest systemic problems and perhaps endemically poor allocation of an abundant resource.

COVID-19 has only worsened the food insecurity crisis. Northwestern researchers estimate that 23% of all American households and 30% of US households with children experienced food insecurity in the past year. In a nation where annual food waste in family households totals 54 billion pounds, manufacturers and restaurants throw away 52 billion pounds of food, and 20 billion pounds of food grown is left to decay in farm fields, food waste and insecurity are unacceptable byproducts of inefficiencies in our modern, technologically advanced society.

An illustration of annual food waste in America


The issue, clearly, is not an inadequate supply of food; the US produces enough food to nourish every single American. Instead, distribution is the primary challenge: how do we ensure that food is efficiently and compassionately apportioned? To solve this question, we must first understand food flow networks.

Food Flow Networks

Food flow networks, or interconnected food supply chains, map the often winding and unpredictable path that food travels from farm to table. Certain foods follow a straightforward route—milk, for instance, is first bottled, then pasteurized. Afterwards, it is shipped to distribution centers and then transported to supermarkets. The same milk, however, could take a more circuitous path, perhaps being converted into cheese, powdered milk, or yogurt. Each of these dairy products could be packaged and distributed alone or as an ingredient in other processed foods.

Food flow networks not only outline the steps in the distribution process but also consider geography. Where food is produced, the distance it travels, and where it ends up are critical logistical elements to maximizing food security.

Food Production

The top ten crop-producing states are California, Iowa, Nebraska, Texas, Minnesota, Illinois, Kansas, Wisconsin, North Carolina, and Indiana. Together, they account for nearly 55% of US crop sales. This concentration reflects these state’s weather and topographical endowments and the trend toward larger farms—as the size of the average American farm increases, the total number of farms has been decreasing. Consequently, the percentage of farmland operated by small-scale farms is decreasing. The graph below illustrates the evolution over time from small, primarily subsistence farms to larger, primarily industrial farms.

Size and number of farms from 1850 to 2019

US policy safeguards the strategic aspects of our nation’s food supply and so may favor large, wealthy farms over their smaller counterparts. According to the Heritage Foundation, commercial farms, 10% of all farms in the US, received 73% of commodity payments and 83% of crop insurance indemnities in 2016. Small family farms, the remaining 90% of US farms, received only 27% of commodity payments and 17% of crop insurance indemnities that same year.

Farm concentration is highly controversial. Supporters assert that industrial agriculture increases efficiency and output. Critics from across the political spectrum, however, argue that industrial farming impoverishes rural communities, damages the environment, and harms consumers.

This controversy should be viewed in light of facts rather than emotional appeals and generalizations.  Despite its imperfections, the modern agriculture system certainly has improved in efficiency and output. According to John Deere, 83 hours of labor and 2.5 acres of land were required to produce 100 bushels of corn in 1850. As of 2016, only 2 hours of labor and 0.6 acres of land were necessary. Moreover, despite concerns about environmental harm from farming, recent technological advances allow farmers to decrease pesticide, fertilizer, land, and water usage. Sustainable and organic farming technology, still a budding field, benefits environmental and community health and lowers food prices for consumers.  More on this nascent, sustainably-focused competition to industrialized farming may appear in future articles.

Food Processing

After food is harvested, it is taken to be processed. Like farming, food processing is growing more concentrated. Food processing facilities, largely located in California, New York, and Texas, are increasing in size, while food processing companies are likewise consolidating.

Companies also increasingly employ vertical integration, the practice of controlling multiple steps in the food production process. For instance, a beef company might own cattle-breeding facilities, feed mills, slaughterhouses, and processing plants. Once again, consolidation and integration are controversial and complex trends. Much like other U.S. sectors such as healthcare, certain elements of the U.S. agricultural and food chain have pursued efficiency and have concentrated operations to such an extent that the system has no redundancies and lacks resiliency should their operations be disrupted.

The COVID pandemic illustrates these difficulties. When just a few large groups lead the agriculture and production markets, a disturbance in any producer disrupts the food supply for many consumers. Thus, COVID outbreaks in meat-processing plants forced farmers to euthanize 2 million chickens and 300,000-800,000 pigs, while variations in consumer demand left the food supply chain spluttering. To avoid future food supply disruptions, the food network of the future must balance efficiency and redundancy, large industrial farms to promote food security in commodity-type products like corn, soy and wheat and small, niche community farms for organic or fresh “farm to table” quality products like fresh vegetables, fruit, and nuts.


Finally, food flow networks culminate with distribution to consumers. Numerous factors influence food distribution. Businesses consider not only population and location but socio-economic conditions as well. Consequently, low-income and sparsely populated areas face unreliable food supplies. According to Feeding America, 64% of the least food secure counties face exceptional poverty. Regionally, rural counties are disproportionately food insecure, and the South is the least food secure area. Significant racial disparities also exist, with minorities facing food insecurity at alarming rates.

Rural versus urban and regional food insecurity in America

Many highly food-insecure areas are categorized by the USDA as “food deserts,” places where adequate, nutritious food is not readily accessible. NPR reports that 19 million Americans live in food deserts. Several large grocers and retailers, such as Walmart and dollar stores, have attempted to fill this gap. The chains’ entrance into food-insecure areas, however, is controversial—these large companies can undercut local grocers, causing more concentration in the local food market. Meanwhile, dollar stores, with appealing price tags (though high unit costs), generally supply processed foods rather than nutritious produce. Unfortunately, the prevalence of processed foods reinforces the tragic link between poverty and obesity.

Strategies and Solutions

Opportunities to combat food insecurity exist at all levels of the food flow network. Servant Financial is presently focusing its resources on potential investment opportunities in a “barbell” of impact. First, we are investing in productivity improvements at the start of the food chain on the farm. Second, we are exploring innovative investments in food distribution infrastructure to serve those communities with the greatest food insecurity: food deserts. We believe this two-part investment approach will improve food production and ultimately mitigate the effects of poverty and food insecurity at the consumer level.

Farmland Improvement

Farmland improvement targets the very roots of the food flow network. Investing in farmland enhances food quality and supply as well as human and environmental wellbeing. As noted above, farms are rapidly consolidating—large, industrial farms are gobbling up their smaller counterparts. The economics of highly mechanized farming and the need for scale to spread the fixed cost of the equipment over more acreage make it very difficult for very small farms (sub 100 acres) to succeed unless they simply become a farmland owner and lease the farm to a scaled operator.  This behind-the-scenes operational consolidation has been occurring across multi-generational landholding and farm-operating families for decades.

Investing in farmland in Qualified Opportunity Zones (QOZ) seeks to improve the productive capacity of farmland and create jobs and economic benefits to rural American communities.  QOZs are designated economically-challenged regions in which investment is encouraged by preferential tax treatment. Investors can defer capital gains taxes rolled into a QOZ until the earlier of 2026 or as long as they hold the investment.  Additionally, investors benefit from a 10% exclusion of the capital gain deferred if they maintain the investment for at least five years.  Further, if the taxpayer holds a QOZ investment for 10 years there is a permanent exclusion on the appreciation of their investment.

Farmland improvement in QOZs revitalizes small farms in struggling regions. Investments take various forms, from improving water drainage, to building new grain storage, to enhancing irrigation systems, to improving soil quality, to developing renewable power generators and adjacent energy storage. Ultimately, these investments impact farmers, who benefit from farming productivity improvements and increased profits; laborers, who experience greater job security; and consumers, who have more reliable access to locally-grown food. Indeed, the benefits continue, as investing in farmland in QOZs may even be supportive of sustainable and organic farming practices.  Stay tuned for more information on Promised Land Opportunity Zone Fund I, LLC’s farmland investment activities and its strategic alliance with Farmland Partners.

Food Banks and Pantries

Food banks and pantries address hunger directly by serving food-insecure families. Food banks are depositories that store large quantities of food. Items are transported from food banks to food pantries, local centers generally run by community-based not-for-profits which distribute food to individuals.

Most items in food banks and pantries are donated by individuals and businesses. Farms, restaurants, and grocery stores often have more food than they can sell. By redirecting this supply to food banks, businesses not only nourish our communities but combat the massive systemic food waste outlined earlier. Federal programs, too, supply food banks by purchasing items from farmers. In 2020, such USDA programs provided 1.7 billion meals. Finally, food banks and pantries can purchase food themselves with donated money.

Despite their noble goal, food banks do face some criticism. Because they are often volunteer-run, food banks usually operate on a limited schedule. Reliant on donations, many food banks offer a limited selection, often lacking in fresh dairy and produce. The overall quantity and variety of food available at food banks can be low. Yet another dilemma is the stigma surrounding food pantries: many people who utilize food pantries experience feelings of shame and alienation and complain of unpleasant atmospheres. Unfortunately, this stigma discourages food bank use. A 2018 study among food-insecure college students revealed that stigma was the main obstacle to food pantry utilization.

In spite of these drawbacks, food bank use increased during the pandemic. Along with unemployment rates, the demand for food banks and pantries soared. Since March 2020, distribution by US food banks has grown by about 55%. Sadly, nearly 40% of food pantry patrons at the beginning of the pandemic were first-time users.

Increasing demand as well as criticisms of food pantries provide opportunities for improvement. One especially creative pantry network is the Greater Chicago Food Depository, or GCFD. GCFD recently provided grants to community not-for-profits to open four new pantries, which, when complete, will resemble traditional grocery stores. GCFD aims to facilitate the creation of pantries more responsive to community needs and desires. For instance, one community-based not-for-profit working with GCFD plans to accept feedback on food selection and to implement an online order and delivery service.

Patrons visit a GCFD food pantry during the pandemic

GCFD wants the pantries to be more than food distributors. They envision a pantry that is also a community center. Patrons will be able to enjoy a cup of coffee; participate in exercise, cooking, nutrition, and budgeting classes; send their children to extracurricular programs; and shop for food in one convenient, attractive space. Visiting these revitalized food pantries will not be dreary: it will be uplifting.

One successful, large scale community-based food security operation with limited publicity are the 138 bishop’s storehouses run by the Mormon Church.  The bishop’s storehouse system is a network of church-owned and -operated commodity resource centers. They function much like cashierless retail grocery stores, such as Amazon Go, but with a philanthropic wrinkle: goods cannot be bought at storehouses. Instead, they are distributed to needy individuals under the direction of church leaders.

The storehouses stock basic food and essential household items, produced largely from Mormon-owned agricultural properties, canneries, and light-manu­facturing operations. The entire system is vertically integrated from farming and harvesting through processing and distribution.

Needy recipients are invited to work or render service in various ways in exchange for goods.   This reciprocal exchange helps maintain the personal dignity and responsibility of the recipients, who do not view the food solely as a handout. All storehouse work is performed by volunteers.  The contribution of time, talents, and financial resources sustains the storehouse and the fabric of the community at large.

Yet another instance of innovation is Feeding America’s free-market approach to improving the efficiency of food distribution to its network of food banks and pantries.  Previously, Feeding America treated all food as interchangeable from an allocation and distribution perspective. Shipments to individual food banks were measured by weight rather than by nutritional variety and composition. Hindered by this defective central planning, Feeding America struggled to allocate food rationally and fairly. For instance, Feeding America sent loads of potatoes to Idaho food pantries, where locally-grown potatoes were bountiful. Meanwhile, food pantries in Alaska, short on potatoes, received an excessive supply of pickles.

Seeking to improve, Feeding America consulted University of Chicago economist Canice Prendergast. Prendergast realized that Feeding America’s central planning was hampering their efforts. The large, central organization lacked specific, local knowledge about the supplies and needs of individual food banks. To address this issue, Prendergast advocated a free-market approach to resource allocation. Feeding America created its own internal currency; the neediest food banks receive the largest amounts of “money,” while better-off food banks receive less currency. Using this money, individual food banks bid for shipments of food on an online platform. Food banks can also save up their money so they can bid more aggressively on particularly needed items. For instance, a bank might save its shares to purchase a large supply of peanut butter, a valuable food pantry favorite. Meanwhile, the prices of fresh produce and dairy generally stay lower because these perishable goods must be used immediately. Using this system, food banks in Feeding America’s network receive supplies that they and their customers desire and need.

Volunteering is not the only means of revolutionizing food pantries. With reimagination comes the opportunity for investment.  Long-term, low-interest loans allow nonprofits to open or improve food banks and pantries. Investors can also give short-term bridge loans, or grants much like GCFD, to provide nonprofits with much-needed capital to improve their infrastructure. These investments can be risky but rewarding: food pantries ultimately improve the health and wellbeing of our communities.

To win the battle against malnutrition and food insecurity, we must address both food production and distribution. Investing in farmland improvements and community-based food storehouses are just two possible areas of innovation in the food network that we are cultivating. The ultimate purpose of investing in farms and food distribution is not in the production and consumption functions but in sustaining the future of humanity.  Contact Servant Financial to learn more about investing with purpose in food and agriculture.

Investing With Purpose in 2021



At Servant Financial, our mission is to help you invest with purpose, but what does that mean? Everyone has different purposes and dreams in life to achieve fulfillment and happiness. We’re here to help you define yours and to find the investments that align with your unique values and preferences.

Whatever your purpose may be, there is likely an investment that will align with that goal and help you achieve it. Whether you want to create more financial security for your family, support your local community, save for retirement, or protect the environment, there are several investment opportunities to help you do so. Here are 5 purposeful investments that we believe will be trending this year and beyond:

1) ESG Investments

ESG stands for environmental, social, governance. ESG criteria are a way of assessing potential investments. These criteria evaluate a company’s environmental impact, its relationship with its employees, and its overall effect on the community in which it is located. 

As described in our previous blog “Investing With Purpose,” ESG mandates account for one out of every four dollars under professional management in the United States, and one out of every two dollars in Europe. ESG is most popular among millennials, women, and high-net-worth individuals. 95% of millennials surveyed by Morgan Stanley in 2019 expressed interest in sustainable investing and 90% want to tailor their investments to their impact goals derived from personal values and beliefs. 

ESG investing came of age in 2020, and millennials will continue to drive socially responsible investing trends in 2021 and for decades to come. Investments that satisfy ESG criteria can guide your decisions, making it easier for you to have confidence that your investments align with your purpose.

2) Alternative Investments 

Alternative investments are a great way to create an investment portfolio that reflects your values. While traditional investments in stocks and bonds can provide a core component of a well diversified portfolio, a traditional 60/40 portfolio (equity/bonds) will simply not provide the same level of diversification as a portfolio that includes alternative investments.

Types of alternative investments include real estate, infrastructure, commodities, precious metals and alternative currencies. One alternative investment that Servant has recently pursued is U.S. farmland.  

Farmland has proven to be a unique asset class that has historically delivered superior risk-adjusted returns and enhanced portfolio diversification. According to the TIAA Center for Farmland Research data, U.S. farmland has delivered annualized returns of 12.2% with volatility of 7% for the 48-year period ended December, 2018.  These risk-adjusted returns were superior to any other major asset class.  

Furthermore, TIAA data indicates that farmland has displayed negative or low correlation to other major asset classes. Farmland performance has historically been most correlated with broad inflation indices.

Servant Financial’s research of farmland and Opportunity Zone tax legislation culminated recently in a strategic alliance announced on January 21, 2021 with the farmland industry’s leading REIT, Farmland Partners.

Alternative investments like farmland or Bitcoin can open the door to non-correlated markets with different return and risk profiles which may better align with your goals and preferences. Alternative investments are also a great way to supplement your traditional investments in order to build more robust and personalized portfolios.

3) Essential Businesses 

Essential businesses have been and continue to be great investments, particularly in periods of economic uncertainty.  In the post-COVID-19 world, Servant Financial has been focused on three essentials for human existence: (1) people need to eat; (2) people need a place to live; and (3) people need energy sources to fuel their homes and transportation.

However, what businesses are deemed “essential” are constantly changing, particularly as human interactions become increasingly digital. In the modern era, we think of additional essential business like work-from-home technology solutions and delivery services, both of which hold strong and purposeful investment opportunities.

Our initial exploration into the essential business theme was in the agricultural space with work in U.S. farmland.  Other essential industries  that we foresee opportunities in and will continue to explore are non-traditional, more transient and spacious housing; renewable energy and carbon sequestration techniques; and continued digitization of human exchanges.

4) Inflation Hedges 

A common objective for all investors, both young and old, is to protect the buying power of their savings and investments from losing value to inflation. Whenever inflation rises faster than the growth and income of an investment, an investor loses real buying power.  This universal investment purpose is heightened in the current low interest rate environment with the 10-year U.S Treasury yielding just 1.1% and inflation running close to 2%.  

Under these circumstances, investors are increasingly seeking inflation hedges to replace or supplement the fixed income portion of their portfolios. Inflation hedges are investments that tend to move in tandem with inflation, such as commodities and real estate. Commodities and real estate are typically costly to produce or construct. As the cost of production increases in the form of labor and capital inputs, commodity and real estate prices must rise to make it economic for the miners and developers to continue production.

This purposeful repositioning of portfolios with inflation hedges is becoming a virtual imperative in 2021.  We believe that the Federal Reserve under Jerome Powell and the U.S. Treasury Department under Secretary Janet Yellen have effectively been merged into a single government enterprise intent on releasing the beast of inflation.  After its latest policy meeting, Chairman Powell statedFrankly, we welcome somewhat higher inflation. The kind of troubling inflation that people like me grew up with seems far away and unlikely.” 

Signs everywhere suggest markets are rotating into inflation hedges with gold up 24% and Bitcoin (digital gold) up 273% in 2020; both outperformed every other major asset class. Commodities are also reviving after a 10-year bear market. Natural resources like agriculture, energy and metals are setting up for an extended 1970s-like run that seems more likely than Chairman Powell intimated.

5) Education 

In 2020, education was drastically transformed as schools and universities were forced to adopt online-learning approaches in the post-COVID world.  Much like the virus accelerated the work-from-home and business digitization trends, it  accelerated the digitization and decentralization trends toward distance learning.   

These trends will be highly disruptive to the highly centralized and structured educational networks established at the grade school, high school, college, and university levels over the past few hundred years.  Online learning, digital classrooms, and alternative universities are becoming more popular and more desirable than traditional schools in many consumers’ minds. We see these trends accelerating.

Education is always a purposeful investment, and now, there will be more opportunities than ever to get involved with  the transformational and highly scalable  future of education either as a student or an investor.

Each of these 5 investment trends for 2021 contains many and varied investment opportunities, giving you the freedom to pursue your specific needs, values, and preferences.  We believe that investing with purpose is largely about the future. Consider: how would you like to see the world and humanity transformed for the better? Investing with your eyes fixated in the rearview mirror may feel safe and comfortable, but will that approach prove foolhardy in the long run? Your purpose is a vision for the future; your investments should target and advance that purpose. 

Purposeful investing creates a more meaningful connection between investors and their life goals and passions. Financial goals and life goals can be one and the same. Purposeful investing is the best way to create harmony between financial needs and your dreams for fulfillment, happiness, and achieving your life’s purpose. 

Contact us today to learn more about investing with purpose and the opportunities that Servant Financial can help you discover on your life journey.

Invigorating Our Mission — Re-Designing Our Website and Re-Visiting Our Values



Servant Financial Ltd. recently decided it was time to update our website. Since our initial website launch, we have consistently provided trustworthy investment advice. However, just like investment trends and approaches change over time, so has Servant Financial. We wanted to tangibly show those evolutionary and innovative aspects. A newly designed website is exactly what we needed. We soon recognized that this new website was a chance to not only invigorate our digital presence but to refocus on our purpose or raison d’etre.

When designing our website, there were three things that we wanted to make incredibly clear about who we are—integrity, compassion, and experience. These three words define Servant Financial’s mission and always have. They are what set us apart from other financial advisors. With this new website, that mission is at the forefront. We are excited to share it with you.


We want to take this opportunity not only to introduce our new website but to reintroduce ourselves and redefine our mission. Here is what integrity, compassion, and experience mean to us:

Integrity means finding our success within yours. Our goals are aligned with your goals and when you succeed, so do we. Integrity is also part of being a registered investment advisor. Unlike investment brokers, who act as salesmen, selling investment products for commissions, investment advisors provide fee-based services, providing a more transparent and trustworthy business model.  We have no hidden agendas, no small print. When we say that “your success is our success,” we truly mean it.

Compassion means making sure that you invest with purpose. Whether your purpose is to support your family, financial goals, or the environment, we make sure your investments align with your unique values and preferences. We do this by getting to know you, first and foremost, so that we understand your goals and create an investment strategy that’s a fit for you. That strategy may include ETFs (Exchange Traded Funds), ESG investments (Environmental, Social, and Governance), or alternative investments. Our portfolio recommendation will always incorporate your unique purposes and preferences.

Experience means you can trust us to guide you through your investment journey and help you reach your financial and life goals. Our years of finance experience together with access to innovative investment tools and products allow us to confidently guide you to the achievement of your goals. You have the vision, we have the tools to make that vision a reality.


As the founder of Servant Financial, I strive to live out these three qualities in my professional and personal life. I have found great satisfaction in doing so. That’s why I wanted to share this update with you and thank you for elevating our success. I understand how much you value your family, career, and community.  We share those traditional values. They are the bedrock of a purposeful and wonderful life.  As your investment advisor, I’ll make sure your values and purpose are the beating heart of your investment portfolio.


To learn more about the Servant Financial team, and what we do, please explore our brand new website and watch this video


Together, let’s invest with purpose!