Awarepreneurs interview - Lawrence Chavez

Welcome to AwarePreneurs, the world's longest running social entrepreneur podcast. If you could take a moment and hit subscribe and do a review on your favorite podcast app, it helps our guests help more social entrepreneurs. Thank you so much. Today our guest is Lawrence Chavez and our topic is Scarcity, Abundance and New Mexico's Permanent Bond. Lawrence is a passionate innovator focused on meaningful innovation. He has been on both sides of the table and understands the demands of both the investor and the needs of the founder. Most recently a CEO and founder of Everyday Context. Previously, Lawrence co founded Lotus Leaf Coatings, an advanced materials company, in 2011.

Prior to 2011, he served as a Venture partner with Flywheel Ventures and managed the New Mexico Gap Fund 1, a seed investment fund. As well as serving as interim CFO was Astria Semiconductor. Lawrence also served on the boards of ABQID Fund 1 and Arrowhead Innovation Fund, both focused on seed and early stage investing in New Mexico. Lawrence, welcome to the show.

Thank you, Paul. I'm glad to be here.

As we were talking about in your bio, you've been both an entrepreneur and an investor, both sides, for many years. How does that dual lens shape how you think about New Mexico's economy in general and the permanent bond in particular, which we're going to get into?

So and again, I've been around joined the New Mexico Angels in 2004, so over 20 years ago. And so I've been in this space for a while and I've seen a lot of stuff and the way that shapes my view of what's going on in New Mexico is New Mexico is a challenging environment to raise capital. As a startup founder, it's a challenging environment for businesses in general. We can talk about that in a little bit. So I think from the investor side of things, investors need to recognize and understand that in many cases New Mexico founders are in a different place than founders might be elsewhere around the country. And so part of that is that empathy and understanding of those founders, but also a responsibility on the part of the state and the broader community to help nurture and educate and bring up those founders. And I think we've done a decent job of that, but we could do so much more.

Your brother, who is also a significant player in this space, has talked about sometimes there's a product market disconnect between what VCs who aren't investors, who aren't familiar with New Mexico are looking for in terms of investable startups and what's actually, you know, coming up through our ranks. We're a rural state historically haven't had as robust an ecosystem as many other places. And now VCs are starting to look at New Mexico, get excited about it, but we're still, you know, navigating that gap. Is that fair to say?

That's fair to say. So a couple things is number one, not all VCs are equal. And what I mean by that is they focus on different things. There's life science VCs, there's deep tech VCs, there's cleantech VCs, there's VCs for consumer products. So when a founder and entrepreneur is looking at those, those type of looking for funding, not all VCs are the same. If you're a consumer products company, you're not going to a deep tech vc. Or if you do, then you're going to get a quick no. So understand that you need to focus your efforts on the flip side of that.

As we look at recruiting VCs, we need to recruit VCs to New Mexico that matches the stage and thesis of New Mexico companies. And I think there's been a disconnect in that in the past. We try to get, you know, large VCs that, you know, whose minimum funding round is $30 million. And then you have a bunch of companies that are presented to them that need a million, 2 million to get to the next stage. They're never going to get funding from those VCs. So we need to, as a state and a community, be better about that product market fit. What is the product? The product is the New Mexico companies and how do we present those to the outside world?

Great. So we're going to get into some of the issues about the permanent bond and what some of the exciting developments and some of the disconnects here and some of you are thinking about how we might change that. Before we do that, not all of our listeners know anything about New Mexico. I happen to be here. I love this place. You're here. There's a lot of awesome people here. But for somebody who doesn't really know New Mexico's economy, we're going to be referencing it a lot.

What would you want somebody who's not as familiar with our economy to have some background to understand the rest of this conversation?

So New Mexico is a unique place. I mean, the one thing that I'd like to share with everybody, particularly those outside of the state, is, you know, I've been doing this background research about why New Mexico is different. And actually there are some people out there who propose that there are different regions of the country that behave differently because of the way that they were founded. So I believe that is, that is a true statement. So New York, you know, founded by the Dutch in the 1600s, is a trader class. And that has been the story of New York ever since then. Even though the Dutch were ran out, you know, 50 years later and, you know, became an English colony. It was very different than the English colonies in Massachusetts, which have a different type of thing, which are different from the colonies that that landed in the central coast of the eastern United States, so on and so forth.

What that means for New Mexico is New Mexico was for a large part of recent history we'll talk about from the 1500s was part of Spain and then Mexico. It was only 150, 160 years ago that New Mexico became part of the United States. And so the legacy conditions of how people behave in the communities and the ruling class in New Mexico is different. And I want to point out one thing is, you know, there's the swath of southwest United States from California down to Texas that still has that same, you know, base history with, with Spain and then Mexico. But New Mexico is uniquely the only state where the center of power, that being Santa Fe, the center of government, has been consistent throughout that time. California, it's Sacramento. Texas, it's Austin. Phoenix, I mean Arizona, you know, it's not the Tucsons.

Phoenix is very different than Tucson. So it's like we live in this different environment, Colorado, which the reach of Mexico reached up or Spain reached up in the Colorado, that is so different than it ever was. New Mexico is uniquely this one place in the United States that has this legacy government that has existed since the 1500s. Yeah.

So we're going to get into the permanent fund now. I do want to say to our listeners, we did a whole episode with Representative Andrea Romero, episode 354. There's a link there, so we're going to reference it. But if you want to do a deeper dive. It's been a whole 55 minutes just with Andrea. She gave us from a representatives insider. She's also an investor and a startup founder. So we've got a great resource for you.

So if you're like, wait, wait, wait, I want more. It's already there. I'll put a link in the show notes. That being said, Lawrence, for those who don't know, what is the permanent fund and how is it right now as we record this in July, Almost August of 2025, how is it functioning right.

Here, right now, so the New Mexico Permanent Fund, quick history was actually started. There's, it's multiple funds and there's two primary funds. The land grant fund, which was started before we were even a state, and the Severance tax Permanent Fund, which was started in 1973, basically way back when before we were state. The federal government said, you know, we want you guys to be self sufficient, so you guys need to have this permanent fund where you can utilize resources to put into this permanent fund as a state. And so it was a negligible amount, didn't mean much. And then as we were generating a huge amount of revenue from oil and extractive industries, not just oil and natural gas back then, just copper, uranium mining was huge. Those land leases and other rights to that land would go into this severance tax permanent fund. So the severance tax permanent fund is a separate fund and this is the largest of them.

And still there's an enormous amount of money coming in to. And so when I say the permanent fund, it's a conglomeration of a number of funds. Those two largest representing, you know, 95, 99% of it. And it's managed by the New Mexico State Investment Council, which was put in place in 1957 by a constitutional amendment. Basically it manages those funds. So these funds have been around for, depends on the fund over a hundred years. The seven sex permit fund has been around, you know, over 50 years. And the concept has always been, you know, put these funds for future generations.

There's been a couple different ways it's looked at to secure economic future and economic security in the future. There's been a couple ways to look at it, but it's always been putting these funds into a investment vehicle that's managed by the state. And again, they put that in bonds, stocks, diversified alternative investments. So anything that a typical fund of that type, which couple points, New Mexico has the third largest permanent fund in the United States behind Alaska and Texas, and the 24th largest sovereign. Well, it's permanent fund, sovereign wealth funded, kind of the same thing, 24th largest in the world. So it's not like we're a poor state. We are an extremely rich state with a poverty mindset and the inability to access these funds to move our future forward.

I have an episode in the Can Go Live on Tuesday with Representative Meredith Dixon, and we're talking about some of the energy work that she's been doing. She let me know, I knew it was over $60 billion at least as of that recording three weeks ago or two weeks ago, she let me know. $67 billion at the time of that from a pretty reliable source. So. And the other thing I would say is for those of you who are listening and don't know, New Mexico is a relatively rural state. So we have 2.4 million people in the entire state. Ish. And a sovereign wealth fund of 67 billion.

That's not million billion dollars. And you do the math. That's a pretty substantial. It's one of the larger sovereign wealth funds per capita that the world has ever seen.

Yes, it's huge. And in my, the articles that I referenced, which were started before the end of the fiscal year, which I think ends in June, it was 57 billion. And I think the number, and I could be wrong, could be 67, but 63 billion. Who's counting?

Somewhere well over. Well over 60 billion.

We're talking that it's growing billions of dollars a year and it's projected to be over $100 billion, depending on who you talk to, around $100 billion by the end of the decade. It's like, that's totally insane. And you know, we can go into the details of it, but the vast majority of that money is invested elsewhere. It's not invested in Mexico. And there's a reason for that. And I think we should change that reason, because I don't. I think the New Mexico sic is doing their job well. The problem is we haven't asked them to do anything different.

Yeah. So one of your key points, you were touching on it there, but I want to dig a little deeper, Lawrence, is that this fund is growing rapidly per capita, one of the largest the world has ever seen. And yet many New Mexicans, when you talk to people on the ground, are just not feeling the benefits of that growth. What do you think's causing that disconnect? This vast resource? And yet the average New Mexican, a lot of people here don't even know it exists, let alone aren't seeing any benefit from it.

Yes. And I'm going to throw my brother under the bus here. And I don't want to throw him under the bus because not. And not the brother that we're talking about. This is another brother. I have a large family. So my other brother, you know, is retired deputy chief of police, has worked for federal law enforcement agencies, has a master's from unm. He was completely unaware that there was a New Mexico Permanent Fund and that these funds exist.

And that is the weird thing that's, to me, was the most surprising thing is I've talked to Scores of people. Since this point in time, there's a lot of people just go, I didn't even know we had this. So that's number one. There's just a total lack of awareness that we have this asset. It's like if your parents had, you know, a couple million dollar is in the bank and you just existed on your day to day as though, you know, they were just earning their income and paying things out and all of a sudden you realize your parents were actually rich. A little bit different here. We're actually rich as a state, we're hugely rich. And we just don't see the benefit of that.

And the reason being is the structure of the permanent funds are invested in a certain way that is supposed to benefit future generations of New Mexico. Yeah, when that was set up, that was 50, 100 years ago, depending on the fund. My argument is that the future generation is the generation today. And again, it's not my generation because by the time the benefits of these investments roll out, I won't be involved.

That's one of your key points. And I'll put a link to the various segments. Listeners, you can read Lawrence's writing, highly encouraged. It sparked a lot of conversation. That's actually how we got here. So I'll put a link, link to those LinkedIn articles. One of your key points is, Lawrence, you said at some point the future is now. At some point the future is now.

Right. It's great that we've been investing for 100 years and thank you, leadership in New Mexico, 100 years ago and 50 years ago for cultivating this resource and stewarding it. Well, I would agree it's been stewarded well, though very conservatively, for the benefit of the future. And when you look at the suffering that's happening now in New Mexico, people struggle. We're losing a lot of talent. A lot of our best young people move out of state because if you're really capable, it's hard to find the opportunities that you'd like to have or if you went to another hub. Right. So you say at some point the future is now.

What do you mean by that? And why are you kind of nudging, pushing on the logic of this long term only strategy?

Well, so the reason I say the future is now is practically speaking, if you're always investing for your future generation, then you will never reap the rewards of that. No generation will be because there will always be a future generation. And the other part of that, let's go back to why the future is now. Is the Permanent Fund is getting to the stage where it is so enormous and has so much possibilities that we could utilize that money to change the trajectory of our state. So quite simply, one of the arguments against using the Permanent Fund is these extractive industries, oil and natural gas. The Permian Basin is going to run out of oil and so we won't have this income coming in. Okay, fair enough argument. I don't disagree with that.

I don't disagree with that as a principal argument, but it stops there. My argument is the fund is so enormous that we could invest that money into infrastructure, education. So by infrastructure I mean physical infrastructure, water infrastructure, energy infrastructure to support the growth of future business. We could invest in businesses themselves, both businesses that start here and also recruiting and bringing in businesses. We need to invest in education. So we have a world class education system so that people who move here go, yeah, I want to move there because I want to raise my kids there. Not I don't want to move there because I don't want to raise my kids there. So that's what I mean, why the future is now.

We could invest this in a way that we don't have to just wait until oil runs out and exist on the funds and investment from that. We can create an environment where we're generating enough revenue as a state because we are pro business, pro opportunity, such that the revenues from that are meaningful and can totally replace that which we get from oil and natural gas.

And you have some pretty specific recommendations in your writings, like, all right, it's a 60 plus billion dollar fund. You're not saying we should take all of it and spend it tomorrow. Right? Like talk to us about what are some of your suggestions as you're thinking about how to leverage this in the exact way you're talking about.

So first off, I'm not talking about pull it out, invest it tomorrow. So one of the other objections is we don't want to raid the permanent fund for short term needs. So actually there's some constitutional, constitutional amendment that was passed in the 80s regarding that. I'm not talking about short term needs, I'm talking about changing the long term landscape. So the, the again, I don't know exactly what we invest would invest in. I freely admit that there are smart people out there, that this is a process that will evolve in terms of things we need to invest in. But what it systemically means is rather than have a $60 billion fund, let's use the 60, just this round number, $60 billion today that we take part of that, and I mean a significant part of that 50%. And then let the other part grow so we can utilize later on.

I'm not talking about utilizing the whole amount. And again, even if we took 30 today, it's growing to 100 billion in the near future. Maybe some of that growth's not there. Maybe it's an extra 30. And so it's 60 billion in a few years and we invest 30 billion elsewhere. But we then look strategically and holistically at what would be a, you know, a 20 year goal, 25 year goal. I'm throwing out this again, I've just been throwing this out. But by 2050, let's imagine that New Mexico is top 10 in income in the country.

So right now we're 44th, $66,000 per capita. Colorado is 10th. That's $90,000 per capita. Just imagine if on today's dollars, New Mexico had a GDP and per capita income of $90,000, we'd be rejoicing in the street. But we're afraid. I don't even think we know that we're capable of it. So the idea is to take this huge amount of money, invest it in a holistic list of things. Education, infrastructure, and then infrastructure across the board, invested in capital, invested in businesses, small businesses, large businesses, rural businesses, city business.

And I apologize, I didn't turn off my phone. So in all those things, being able to, being able to invest that money in such a way that we're able to generate other income so that we're not reliant on the permanent fund.

Love it. And this was part of the reason, I think it got so much traction and sparked so much conversation both in person. We were both at an event last night and people were talking about it in the networking circles that I was in online. Right. It was bringing an innovative, really bold. You're pointing in a bold direction in a state, as you said, that has a history of scarcity. To talk about that scarcity and how it's baked in our systems, how do you think we begin shifting that mindset not just one by one, but also institutionally? Like how do we get our leaders, how do we get our institutions to start saying, okay, we can be respectful of the history, New Mexico's a desert. Back when you're living in an agricultural, you know, reality.

Water had to be. It was very precious. Right. There were certain resources that have been scarce in New Mexico and that served us. I would, I would argue. Right. And you're arguing, I think we're in a new era. That we can honor what New Mexico has been and how resourceful people have been.

But it's also time to let some of that go. How do we do that both on an individual level and also institutionally so.

Great question. I would argue that Arizona has the same legacy. Now, remember, Arizona and New Mexico were both New Mexico Territory until 1863 when they split the two territories. And then we became states within weeks or months of each other. And our trajectory has been wildly different and we deal with the same issues. We deal with rural communities, disparate communities with different population bases. We deal with water shortages. We deal with a number of those issues.

Yet Arizona has had a different path and trajectory in large part, I believe, because of their pro growth strategies and their willingness to recruit businesses there particularly, there was a couple key segments of Post World War II and in the 1970s, when there's just like the significant change between New Mexico and Arizona's trajectory, we can, I mean, we, all we have to do is look and see that it's been done in a community like ours. The problem is we have the scarcity mindset. We think that again, just for the listeners, the scarcity mindset is quite simply there are limited resources and if you do better, then I'm going to do worse. So. And it manifests itself in all sorts of ways. You can see this in the government when somebody makes a proposal, you know, we should invest, you know, you know, you know, a quarter million dollars in the Santa Fe business incubator and somebody else is going, why do they get a quarter million dollars? And I, I mean, yeah, quarter million dollars. And I don't. It's that, well, there'll be another program that we can implement over here.

Let's focus on bringing everybody up and just. We create these. This is another thing that kind of frustrates me. We create these programs that are all encompassing, that have to include every community in New Mexico. And so they're so diluted and watered down that they don't do anything. They're ineffectual. So we need to think differently about our behaviors and how we deploy that capital in a way that's effective and grows our communities.

In part two, you propose that we could generate a better return for future generations by investing in some key strategic sectors right now. What would a high roi, future focused portfolio for New Mexico look like? Like, how should we be, where should we be leaning in?

So I have to be a little careful here because I'm not sure I know the exact answer. And I think that thinking through the solution. Let's start with a goal. What is that goal? By 2050, we're going to be a top 10, top 10 GDP state and then work our way back because the risk comes here is, should we invest in venture capital or early stage companies? Yes, but we don't have the infrastructure to support those companies as they grow, so they leave the state. So let's think through the critical paths of all those things and get some smart people around the table and then map that out and say, okay, we need to invest in this first before we invest in those companies so that those companies have the ability to stay here and we can keep those companies growing. So I'm not going to, I'm going to be careful because I don't want to propose a specific solution because it might be the wrong solution. However, I do know that by doing nothing, we will continue to languish in the 40s in terms of economically, in all other metrics.

What I think I hear you saying, which I really like, Lawrence, is like, let's set some big goals. Let's become a top 10 per capita GDP state, and let's reverse engineer and find some of the obstacles, some of the places where we're losing. People certainly had this conversation with a lot of startup founders here. Like, it's great place in many ways for early stage, but then you hit a certain place and you're either trying to get folks to invest here, it's harder to find talent, have a certain, you know, quality at a certain scale as you're scaling. There's just a bunch of things that founders hit here. Let's fix that. And rather than say it's about this industry or this one investment vehicle, so let's reverse engineer in a holistic way. Is that fair to say?

Fair enough. So I had a, I, I've met with this, this, this woman a few times. Her name is not Nancy Conrad. She's new to Santa Fe. So Nancy is the wife of the former astronaut Pete Conrad, who was the third person to walk on the moon. Third man to walk on the moon. And she decided to move to Santa Fe. And she's, you know, this dynamic woman who has a nonprofit honoring her late husband focused on stem.

And she's dismayed at New Mexico. She's excited to be here. She used to live in New Mexico as well. She's dismayed at the way we do things here. But we were talking through, okay, what did, what did they do to get a man on the moon? They had a goal. This was an amazingly Lofty goal, by the way. So, and then they worked backwards and said, what are the systems that need to be done in order to do that? And then they built out those systems. And so part of that systems was the rocket system, part of that system was the landing system, part of that system was the launch system.

And so these were disparate systems that were built and manufactured elsewhere. You had to have recovery system, you had to have all these other things that were built into that. And they didn't start by saying, let's build a rocket. They said, let's land someone on the moon and let's work backwards. How big of a rocket do we need? What are the systems? What are the elements that need to be done in that? And so I think we need a similar type of mindset. Big vision, like you said, reverse engineer that backwards and say, these are the steps that need to be taken to really change our trajectory. And right now we just do one off. I was going to.

We just do one off stuff and we think that it's going to make a difference and maybe it makes a smidgen of a difference, but we need something bigger and bolder in order to change our trajectory. And I don't see anything that we're doing that's going to move us from 44 economically into anything much higher.

I love that you're inviting us to the moon and look at the moon. That's awesome. So let's do this. I have a bunch more questions for you and I want to hear about some of the things that you've been talking to people since you've been writing the article, a bit more about some of the other reference points that we might learn from other states that are doing some big things. And also what happens if we stay on our current trajectory, which I hope we don't do. A few more questions like that. But first I want to take a quick break and hear a word from our sponsor. Are you feeling stuck growing your impact business? A lot of founders I work with hit the same three roadblocks.

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And Lawrence, you've mentioned a couple of examples of folks you think have done this. Well, Arizona being one. There's some other states that you mentioned in some of your writings, folks who are investing very aggressively. States like Texas, states like Maryland, like how are they making bigger bets if we can say that? And some of the examples again that you might highlight for us as a state to that not all states are as risk averse as historically New Mexico has been. And what are some examples you think some states who have made some bigger bets and you think we can learn from them?

Yes. So the one thing I want to respect and understand, again, New Mexico is different. Our culture is different. We can't just go pick something that another state has done and do the same thing. We have to look at that as a guideline, as a template of something that worked and say how could we make that work in New Mexico? Because all too often the idea is, well, we need to do what Texas did or we need to do what Colorado did. And maybe we do need to do something similar, but we need to respect and understand that New Mexico is a different state with a different mindset. We need to change our mindset, number one. But we also need to not try and just implement it one to one, because then those don't work either.

But there are some good examples. So I've talked to some folks in the economic development area that talk about what Arizona has done with their economic development programs. A couple things is one is making big bets on technology. Arizona was not very much farther ahead of us in the 90s on venture capital. Yet they made huge investments and most of it private, not state, but they had the access to the resources to do that, to set up things through the universities to incentivize and encourage the venture capital that goes there. So they have a public private economic development partnership so that the economic development arm of Arizona is not beholden to the whims of a given administration. So that's one of our problems that we have here in New Mexico, a new administration comes in, whether it's the city or state and doesn't like the name of the previous one. And they change it whether they don't even look to see whether it works or not.

They're just like, oh, it wasn't part of what we're doing here. And so we need to think long term. Again, if you trying to get to the moon in 2050, you can't change everything you do on every administration. It's just not an effective long term strategy and it has hurt the United States in general and I think it hurts us as a state. So we should look at public private partnerships. We should look at changing how we do our economic development such that we can create a long term strategic plan and then have the wherewithal to implement it over time through different administrations. Yeah, you might change it, as any startup will do. They'll iterate and they'll work on changing that.

So we can't be afraid of that either. But we also can't just change it because somebody else is new sitting in the office. Then we also need to think about doing bold investments. So in the two articles, the two things I talk about are there's some very cool people in New Mexico that are working on this program called Space Valley, which is the idea of creating a space community from Colorado down to southern Texas and creating this initiative to help recruit and bring companies involved in space to New Mexico. Great initiative, awesome effort, but the problem is limited funding. Texas created a state. The Texas State Space Commission, I think could be a different name, but I think that's it. And put in $425 million.

It's not like we can't do it. We have 425, we have 57 or $63 billion.

40.

400 and 400 million dollars to invest in a space initiative would be a drop in the bucket of that. So we have the capital to do that. Recently, New Mexico put out a RFP for a Quantum Venture studio. It's $25 million. Again, standalone, $25 million sounds great, but if you look at the. And again, I'm not going to say I'm a Quantum expert, because I'm definitely not. But in talking to people that are experts, Quantum is very expensive, number one. So $25 million is not a significant amount of money for doing anything in Quantum.

And then relative to what other states are committing to, Maryland, I believe put in a billion dollars to. They want their state to be the Quantum leader in the United States. Texas Created again another one of these commissions. They haven't funded it, but the idea is to match Maryland's billion dollars. And even some leaders in Texas, some people within the quantum industry in Texas are going, you know, Texas better get this done quick otherwise they're going to be behind and they're talking about investing a billion dollars. And then Illinois, $500 billion. Colorado, I think it's done an investment of $100 million and then parlayed that into an additional $500 million in private equity and venture capital investing. So these other states are putting in a bold move to.

And these are long term programs. New Mexico's $25 million investment was a one year allocation. So no sustainability. So we need to think bigger and we, and we need to try and do better. And I'm gonna. You mentioned you had Meredith on and I give Meredith all the credit in the world. She put out the, she pushed for that $25 million. And to be clear, she pushed for a lot more.

She pushed for the big vision thing unfortunately within the state, $25 million what was allocated. So I know some of the legislatures out there, the people in the legislature are working hard, but they're working against this mindset and we need to change our mindset. So maybe we could get $400 million into Quantum. That would be meaningful. That would be awesome.

Yeah. So we did an episode with Bryce from Space Valley Foundation. I'll put a link to that in the show notes if anybody's curious about that. And one of the things I'm thinking about as I'm hearing you talk, Lawrence, is that sort of assessment of where is New Mexico have strengths. Like for instance, you know, you talk to somebody like Bryce or you talk to somebody in space here New Mexico has a real opportunity. We have all the major space players are in New Mexico. It's easier to get a rocket from like we should test something or do a shoot off into space for you know, it could take two years in other states and here it happens much more quickly. We're a rural state and we have all the players in one place.

So if you need to get a rocket off the ground, that's why Space Force is here and SpaceX and Virgin Galactic and everybody has a presence here because you can actually get stuff off the ground here quicker than many other places. But when you look at the infrastructure and how much we're investing to build on that, that's a place where the investment and the opportunity, there's a myth, right? If you talk to knowledgeable people Quantum is another example. Cleantech is another example. Like we're doing small one time bets like you gave such a great example of Quantum without saying, hey, we're going to really plant our flag in a couple of key industries and invest in such a significant way that New Mexico just comes out of the gate so strong that it would be really hard for anybody to catch up. We have those opportunities before us and I am very blessed in getting to talk to people who are leading those opportunities. And many of them are saying the same thing. We are starting to make bets, but they're small one time and slow. And we have other places in the world, whether it's another state or we live in a global economy.

Give me a whole other, you know, region or a whole other country that is not going small, not betting, you know, small amounts. And they're doing it long term. And so these distributed, not very robust, not well connected, not long term investments that we are making. It's both the size but also the mindset we're making them with. Is that fair to say?

That's definitely fair to say. So going back to the articles and the catalyst of all this is, and I've been looking into this concept of scarcity in New Mexico and how we stack up against our states for a while. But I was at a the Competitive Council, which is a nation national organization, they do events around the country and they had one in Santa Fe at the beginning of May and I couldn't go to the first day, I wish I would have because I would have gotten more context. But I was there on the second day and basically the Competitiveness council had all these major players in New Mexico from the labs, universities, different programs, Space Valley was there and they were talking about just what you said, all the opportunities we have in New Mexico and how we should capitalize on those opportunities. And then one of them, Dale Decker, who's a local business leader and has been talking about utilizing the permanent fund for years. So to be clear, I'm a voice that's come along in this conversation and I think timing is important. The fund is so big that the, you know, people are now starting to talk. But Dale said something about it's a rainy day fund, it's raining, we should use it.

And somebody on the panel chastised Dale and said, oh Dale, you've been trying to get your hands on those funds for years. And you know, I wanted to stand up, I didn't because I have some self control and just say what the are you talking about? You know, we have such a wonderful state. And I was sitting there right before that, reminiscing back to, I don't know, it was probably 2010, 2011, sitting in a similar conference where the people from the universities and national labs and state government were talking about all the wonderful things that New Mexico had to offer the industries of the future. And the biggest one at the time was cleantech and how we were going to become a clean tech leader. We didn't invest in it significantly. Do we have some clean tech companies here? Yes, but we're not a national leader in clean tech, not by any stretch of the imagination. And we missed an opportunity then. And my concern is, and the reason, the catalyst for the thing is, I'm afraid that 15 years from now, in 2040, I'm going to go back to one of these events and I'm going to sit and listen to all the people in the state talk about the great opportunities New Mexico have in the future of all these other things.

And we're not going to do any of it. We're going to continue to languish. So my argument, my voice, what I'm trying to put out, is unless we step up in a big way, we'll just be continuing talking about this for the rest of our lives.

So that's stepping up. Lawrence. So I've known your family for many years. Hi, Genevieve. At least 20 years, I think we've been friends, your sister. And you've been working in, just doing great work in New Mexico startup and as an investor for decades now, I haven't seen you be as vocal as public about some of these issues that. Fair to say, like something is.

Yeah, well, very fair to say. The change is, you know. You know, I've been. I've been doing startups and most of it was internally focused. And in 2023, I had to shut down the most recent one, which was everyday contacts, not a fun experience. Took some time off, traveled with my wife and, you know, in doing that and exploring, you know, what the possible future was, it's like I really want to New Mexico to be different and I don't see us doing that. And so it was just an opportunity for me to step up. You know, I.

There's this concept of the circles of influence. You start with yourself and then your family and, you know, then your extended family and your community and you go out from there. And so for much of my professional life, it's been focused and kind of went in. It's been community focused, but still within the startup community. Abqid, I was on the board. That wasn't, that was a volunteer thing. Arrowhead Innovation Fund, volunteer for some other organizations as well. So it's been what I was focused on a smaller community.

And so for me it was just an opportunity to stand up and say, look, the emperor has no clothes. We can talk about this stuff until we're blue in the face, but unless we change the way we do things, then I'm going to be sitting in another conference in 15 years and just cringing at, you know, how we missed out on two other opportunities and what's going to make this difference. So let's make it different.

Well, I really appreciate you speaking up and part of the reason I wanted to have you on the show is to say, like, you're not alone. I hope you have some sense of, you've got some backing and some people that are very knowledgeable in the startup world are. Your message has hit home and catalyzed a community of folks that are saying, hey, again, we don't have all the answers, but you're. Lawrence is putting his finger on some key issues. And let's not just let it be a one person show here. This is a community that needs some more support and needs more engagement and needs our leadership to be paying more closely attention to the folks who are actually building things here and not just consultants, academics or folks who are running a fund that got set up under very different scenario than what we're seeing in the startup world in New Mexico in 2025. Right. So just appreciate you speaking up.

Well, thank you very much. And, and I encourage those people who disagree to reach out. And that's, I mean, I've done two articles. My third article is going to be about the objections to utilizing the permanent fund. And my point of doing that is one is to give a voice to those people who are opposed to this because I think, think they need to be listened to as well. But also the best arguments are the ones that can stand up to scrutiny. And so I want to throw that out there and say, you know, there are people who legitimately believe that we shouldn't do this and talk about overcoming those objections. Because I, I believe, I don't believe that any of those objections benefit New Mexico in the long term.

They keep us where we are.

So we've talked quite a bit, your personal journey of kind of stepping into abundance, being willing to be more bold, at least publicly. I think we've made some suggestions for government leaders, like how that might work. The idea of like all Right. Let's have some conversation. Look, Bolder, reverse engineer. Two other groups I'd like to get your thinking about. One is one of the seats you've sat in for many, many years now is in the investor seat. How can investors who either are in New Mexico already or the growing number of folks who are interested in New Mexico, they hear about the permanent fund, they're hearing about some of the unique things.

And we do have strength here. I don't want to downplay those. I think we have strength and opportunities here, even in cleantech, as the co founder of NM Climate, that we still have some incredible opportunities. And so we have investors both already in the ecosystem and some are on the outside trying to figure out how they might get in. How can somebody sitting in the investor seat be a part of this conversation? Have respectful and yet bold conversations as it relates to the issues you're talking about.

So what I would hope that every investor that's out there that's interested in New Mexico, and I've talked to some investors that are like, I'm interested in getting money from the State Investment Council. So how do I do that? Do you have any connections? So I don't know that they want to list. They don't want my referral. But you know what I would ask the investors is to be honest, don't look at the State Investment Council as an opportunity to get funds. Say you'll invest into Mexico and don't. And what I mean by that is, you know, there are challenges with investing in New Mexico. I get it. But if an investor from outside the state comes in and they want money from the state and says, we'll invest into Mexico, and if anybody out there has any different data than this, I would love it.

But the New Mexico cannot contractually obligate an investor to invest in New Mexico because they're LP in part of a bunch of LPs. So in New Mexico takes a position as part of a fund, they'll give, I think, a max 10%. So there's 90% other LPs that they have a fiduciary responsibility to all those LPs to invest in the best deals, period, not invest in the best deals in New Mexico. So most of these investors, and if again, we've done this in the past, New Mexico had a venture capital investment program Since I think 1998 or something like that. And a lot of investors would come here and they would say they want to invest in New Mexico and they wouldn't because they couldn't find A deal. Are there deals getting done by investors? Yes. I don't want to say they're not at a micro level that's happening, but at a macro level, it's not consistent with the investment that we say is coming into Mexico. So what I would ask the investors is just be honest.

Don't tell us you're going to invest in Mexico. Don't say you're going to connect with New Mexico and then not. Because there are a number of investors who have raised capital and haven't. And I'm going to call out Vamos Ventures on the good side here. They took money from the state, said they'd be in the state. Now they just got money. So they haven't done any investments. But they've showed up.

I mean, over the past few months they've been here, they did their entire team off site here. They've met with a bunch of entrepreneurs, they connected with people from the labs. I want to give them some kudos because they're doing in a one thing that most of the investors that raise money from the state don't do. And that's be present. And there's a couple others that are out there that are working on it. But again, those are the macros and many times the exceptions. If I went on the State Investment Council website, looked at the list of investments that have been made over the past three or four years and then tried to identify how many times those investors were in New Mexico, I think I would have a hard time getting beyond three or four of the probably 15 that we're done. So it's happening on a micro level, but it's not happening on a macro level.

And we need to have needs to be systemic. And so people need to step up, be present and invest in New Mexico or at least be here to start and then hopefully Invest into Mexico.

100%. Yeah. I call it take the money and run, right?

Yes.

We've got a lot of VCs who take the money and run. And likewise, the event we were at last night was a happy hour sponsored by Vamos Ventures. And I had the honor of interviewing Maya Trujillo, who works for Vamos Ventures and is the representative for Vamos in New Mexico. And they also just brought on Christian Slough, who is an advisor on our advisory board to NM Climate as their scout in New Mexico. So, yeah, Vamos has been great. They're on the ground meeting people, sponsoring happy hours, have a person on the ground who's from here and helping them source deals. So yeah, Vamos is awesome. And I'll put a link to the episode of Maya Trujillo talking about their great work.

Two of their key impact theses, their investment theses, our underrepresented founders and climate tech, clean tech. So huge, huge fan of Amos.

And again, I want to say one thing. I'm not going to criticize those, those outside investors for taking money from the state and not investing in Mexico. They have a fiduciary responsibility to invest in the best deals possible. However, don't say you're going to invest into Mexico and don't that's the thing.

That we never see you again.

Literally, that's the thing that's issued. Which is why one of the things I think we need to change is we need to change the program so the SIC is measured on their return profile that they get. Okay, so I'm using this as a Jeff Apodaca analogy, but I've used it as well is if you think about the state has or any individual, they have money, they have it in a bank. So that's their operating capital and then they have a retirement fund, their four way or their IRA and that's, that's, you know, managed by somebody else. The SIC is managing our money. And like a re, like any money manager, they're measured by their return profile. And there's a number of, you know, reports on how New Mexico does compared to other sovereign wealth funds. So there's no incentive for them to do anything that might be too risky to benefit New Mexico because it might impact the return profile.

And again, I'm not going to trash the SIC because the SIC is doing what they're doing. It is on the people of New Mexico, it's on our legislature and our governor to say that's our money. We would like it to be used in a different way. And so all I'm proposing is that we look at that money as the people of New Mexico's money and that we think about investing and some of those investments would be higher risk, hopefully higher return. But as again, I'm going to use another term. Dale said we need a return on an opportunity as well. Right now we're not even investing ourselves to get an opportunity. So it's not about the pure monetary thing that will come with time.

I mean, we need to step up and we need to make some huge bets. Some of those bets won't pay off. But if those bets don't pay off and they're managed by an investment fund that has a conservative portfolio metric, they're not going to do those bets. So the state of New Mexico has to step up and say, we need to pull part of that money out and we need to invest it in a way that is meaningful, that is going to hit our target. And again, I'm throwing out that top 10 target. It could be something else. We could have come up with something else, but right now we don't have anything. We're just like, thank God for Mississippi.

Yes. So lastly, I want to get your thinking on Lawrence. What about the entrepreneurs who are listening to the show, care about this issue, are either again, in New Mexico or looking about what's going on here and considering moving their company here? I get to talk to more and more folks who are saying, well, something interesting is happening here. I wonder if I should move my startup or move my company in New Mexico. How can entrepreneurs get involved in advocating for the kinds of things you're talking about?

Well, I think so. One of the things we need to do is we need to come together and speak with a common voice. And I'm trying to figure that out. TechTalks is a great opportunity to do that. So I appreciate you for putting the organization together and it might be one of the vehicles. There's the New Mexico Startup Alliance. There's some other organizations out there that are working on this. But get within the community.

Get connected to organizations that are within the community, like yours. And let's start having these conversations with our state legislature. We expect our leadership to do that which they need to, but they're not going to do anything that we're not going to expect them to do. So if we're silent, then nothing's going to change. So for the entrepreneurs coming here, get connected. It's a great community. There's a lot of wonderful people who, again, at a micro level, are working very hard to change our dynamics. What I'm hoping to do and where I'm trying to speak out is at that macro level, how can we facilitate those resources to take what all these great entrepreneurs are doing and put some critical mass behind it? How do we, you know, we're the state of the atomic bomb, the first one.

So that was all about critical mass. Uranium by itself doesn't do squat until you get critical mass. So our startup community is making some good strides. But until we get critical mass, what critical mass look like, I think that's something we need to work on, but funding is a huge part of it. So let's utilize this amazing asset we have at the state to help create that critical Mass, not only in our startup community, but also within, you know, there's a lot of, you know, small, I would say mom and pop businesses here in the state that can't get capital, so they can't grow anyway just because of access to capital. We could change that dynamic for a lot of those, a lot of those rural communities just by changing the way we provide access to capital. And again, we have $57 billion. There's ways to incentivize banks to look and get those loans for those small communities as well.

So again, holistic viewpoint, startup community, entrepreneurs that need to come together, the small business community outside of that need to come together. Tell your state legislatures. Actually, I've been. The other thing I've been quite surprised about and pleasantly surprised about how easy it is to talk to your state legislature if you only ask so they want to listen. They really do. I think even though I've been a big proponent of changing to professional legislature, it's not because I don't think our current state legislature has the wrong heart. They just don't have the right time, they don't have the resources, they don't have the tools. And so sometimes they get.

The only people they can listen to is lobbyists because they don't have the time outside of that. And that's not in our best, best interest. We need an informed legislature that can meet on a regular basis. The governor is about to call a special session. Say what you will about the special session. What we need is a state legislature that is available 24 7. So we don't need to call a special session so that we can tackle these problems rather than once a year. Imagine you're a startup company and you meet in February and you make your strategic plan.

And then in August something is different and you go, well, you know, we're gonna have, we'll figure that out in February. We have to meet in February. It. It to me, that's insane. Yeah. So, yeah, I, I just. What I want is New Mexicans to realize that we can change. Scarcity mindset is real.

I have it. I freely admit that I fight against it every day. But the way you overcome that is with an abundance mindset, thinking big, thinking about opportunity. And so what I want to encourage is the rest of the state and the people within New Mexico is to realize we can do better because we have the resources to do better.

Absolutely. Lawrence, I could hang out with you all day, but you're busy. Our listeners are busy. I want to be respectful of your time. If there's something you were hoping to get to that we haven't gotten to yet, or there's something you want to leave our listeners with as we start to say goodbye? What would that be?

I think the only thing I'd like to leave is you have a voice. We have a small state. You know, they talk about six degrees of separation in the state of New Mexico. It's one, maybe two. So share this, share this message that we have this amazing asset and ask your legislature or ask your community to step up and say, what are we really doing with this permanent fund? This now $63 billion is it how is it helping our state? And it's, it's doing, I don't want to be too negative. It's doing what it's been asked to do, but it could do so much more. Ask your state legislature. What can we do more to change the trajectory of our state?

Lawrence, if somebody wanted to get a hold of you, find out more or input their feedback into this conversation, what would be a good way for them to do that?

So you can use my website. I have a website. Fortunately, I got Lawrence travis.com a long time ago. I never really used it until now, but they can just go to my website, put a contact me and reach out. So I'd love to, I'd love to get feedback on this. Love to hear your voice. If you have an opposition to this, I'd love to hear that too. I'm not, I don't want people just to say, yes, yes, yes.

I want to understand what the oppositions to this, what the challenges are. Because until you know what those challenges are, you don't know how you can overcome them.

Lawrence, thank you so much for being on the show today and for all the good work you're doing.

Thank you, Paul. Appreciate it.

So listeners, if this episode stirred something in you, you're saying, yeah, this makes a lot of sense. Going to ask you to please share it. We'll link to Lawrence's full article series on LinkedIn and some of the resources we mentioned. All that will be in the show notes. Also want to remind you that if you're ready to develop a bold strategy for your own business, whether you're navigating uncertainty or stepping into something new, you can learn more about my strategy sessions@paul zalazer.com until next time, please keep working for positive impact and letting your values guide your actions.