In this webinar, Kim Guimond presents a Qualified Opportunity Zone Business that is producing a cutting edge wood alternative.

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Webinar Highlights

• Overview of Modern Mill’s product and mission.
• Technical summary of the innovative ACRE product.
• Summary of some existing ACRE installations.
• Overview of the market opportunity.
• Environmental impact and competitive advantages of ACRE.
• Live Q&A with OZ Pitch Day attendees.

Industry Spotlight: Modern Mill

Modern Mill is pioneering a new generation of building materials so the world can create a more sustainable future. The company is bringing fresh innovation to the building materials industry, and new inspiration to the design community—and doing it all right from the heart of Mississippi.

Learn More About Modern Mill

• Visit Modern-Mill.com

Webinar Transcript

Jimmy: Kim has a 20-minute presentation on Modern Mill. It’s an operating business located in an Opportunity Zone in Fernwood, Mississippi. If you have any questions for Kim, please use the Q&A tool in your Zoom toolbar, and Kim, without further ado, the stage is yours for the next 20 minutes.

Kim: So, good afternoon, everyone. I’m Kim, as Jimmy mentioned. I’m so excited to be here today to introduce you to Modern Mill. For those of you who might be looking for a deep dive into our financials, we can set up one-on-one calls with you separately. But today, my job is to tell you the story about Modern Mill, and our amazing new building material product, called ACRE.

Okay. So, at Modern Mill, we are a team on a mission to stem deforestation with our product, ACRE. ACRE is a wood alternative that is more durable, more sustainable, and more beautiful than any other on the market today. ACRE is made from upcycled rice hulls, which, Jimmy mentioned, we live and work in Mississippi, and the rice hulls actually come right from the area, from Mississippi. And we truck them over, and we blend them and we create this amazing resin that we then transform into building material products that many of you are familiar with: siding, decking, trim boards, porch flooring, and sheet goods. The product that we make, ACRE, is extremely low-maintenance, and it’s a gorgeous alternative to traditional wood products.

In addition to making this beautiful product, we are a great way for all of us to come together to fulfill the vision of Opportunity Zones, in a very tangible, meaningful way. So, we’re inspired to take care of people, the people in our community, from the rice grinders, to the folks that work with us, to all of our customers. We’re inspired to spur economic development in the region and quality job creation in this very rural part of our country, that needs this opportunity the most. And we believe that we can do both of these things, and really show the world that profits and purpose can coexist, in a really great way, and drive amazing results. And for us, that means everything that we do begins with a sense of responsibility, and holding ourselves to this high standard around the three things that you see here: people, innovation, and the planet.

Every day, we put people first. We care deeply about the people who are creating our anchor products. We pay a living wage. We offer comprehensive healthcare for our employees and their families, and we offer ways to save and create wealth. We focus every day on having an environment that people can come to work to that’s safe, where they’re treated with respect, and given every opportunity to achieve their highest potential. We care as deeply about the planet, and every day that we go to work to make ACRE or sell ACRE, or talk to homeowners or distributors and contractors about ACRE, we’re doing this with the singular goal of ending deforestation, particularly of these treasured old-growth hardwood trees that we all love, like Ipe, cedar, and tea, which, ACRE, our product, I’ll talk about more in just a minute, can easily mimic.

And lastly, ACRE’s a beginning. It’s not an end. We are never gonna stop seeking ways to create more groundbreaking product and bring more innovation into the building materials space, which is so desperately needed and wanted, for such a long time. So we’re really committed to this idea of bringing products that are more durable, more beautiful, and more sustainable than anything on the market today.

So, our product, ACRE, what is it? It’s a sustainable alternative to wood, that we like to say it offers all of the benefits and conveniences of composite, so it’s waterproof, weatherproof, pest-proof, rot-proof, but it has all the warmth and beauty and workability of wood. So, if you were here with me, you could see it, or you could see this amazing grain that can be stained, which is extremely unique, and it requires no special tools or training to work with. So, if your installers, or if you were hiring installers for your own home or contractors for your own home, this is actually easier on their tools than wood, and it requires no other training. If you know how to work with wood, you can work with ACRE.

And this fact, that it’s indistinguishable to real wood, we think that’s really important, because for such a long time, so many of us can agree that, we’ve all been seeking a substitute for wood, but most of the substitutes on the market came with just too high of a cost. They were aesthetically unpleasing, they were too expensive, they didn’t perform well in the field. And what makes ACRE unique is that for the first time, you can really have a product that’s a substitute for wood in nearly every application except structural. And this is internal, and this is external. In addition to this, like, gorgeous product that we offer, our sustainability qualities are really unmatched. So, we make this tree-free building material, or wood alternative. We upcycle tons of rice hulls to make ACRE. And rice hull is a agricultural byproduct of the rice food production process, that would normally sit in a landfill. We pull that up out of the ground to make our product. We operate in a zero-waste manufacturing environment, and the product itself is 100% recyclable, which makes ACRE a key contributor to the circular economy, which is so important for so many of us today.

This slide here is a heavy-duty slide. It’s an executive summary of many of our accomplishments, and we can make this available to you after today’s call. What I wanted to just point out here is that, in just a few short years, the remarkable progress that we’ve been able make. So, you know, we opened our doors in 2019, to build the factory. In 2020, we were testing product and selling our first product in the middle of the pandemic. In 2021, we were really off to the races. So, in this short period of, this short window, we completed our first manufacturing facility, we validated ACRE’s go-to-market strategy and created a lot of sales momentum, which led to a national footprint of distributors and dealers. We’ve won coveted awards, like Fast Company’s “Most Innovative Company,” and Fast Company’s “World-Changing Idea,” and trade awards as well, like Green Builder’s “Product of the Year” for our siding.

And since there’s nothing better than third-party validation, I’ll point you to this quote from Jack Stevenson, who’s the president of seven Mid-Cape Home Centers on Cape Cod, here in Massachusetts, where I am today. And he’s a 40-year industry veteran in the lumber space, and he says that, “ACRE is the most successful and the fastest adoption” of any product, new product launch that they’ve had. And our two-step distributor in the region tells us, he loves tell us, that every customer who has bought a truckload of ACRE has bought another one. So, repeat business because, we have learned, very excitedly, and we’re excited about this because it was always our goal, that ACRE is not just another trim or siding or decking product on the marketplace. It’s the most loved building material product, or trim, siding, decking product on the marketplace. And this is, we see this every day from the press, that we’ve been recognized for awards we’ve won, and most certainly, what we’re most grateful for is customer feedback like this.

Because seeing is believing, I put some photos in here for you, a little ACRE eye candy. So, from the top left, there’s partnerships that we’ve done with large brands, in this case, Heineken, who looked to show their sustainable leadership. In this case, Heineken was creating, at Formula One games and stadiums across the country, looking to create a greener bar, a bar that was made from upcycled material or recycled material. So, all that wood that you see, or wood-like product that you see, is actually ACRE which was CNC’ed to create this beautiful installation. Throughout the rest of this page here, you can see ACRE on people’s homes, and siding, decking, internal, in cabinetry, fencing, furniture, and so much more.

And this slide here gives us a little bit more color into what makes ACRE such a loved material. So, ACRE is, really, it offers the benefits of wood and composites without the downsides on either one. You know, so, you have this warmth and beauty of wood, without the strain on the environment, and without the high maintenance. You have waterproof, weatherproof, don’t really need to change it out, limited lifetime warranty, all the, you know, the things, the ease and convenience you’re looking for from a composite, you get all that, but you don’t have the plastic-y feel, or something that’s uncomfortable underfoot, or just, kind of, you know, from an installer perspective, unpleasant to work with, you know, that ACRE is an organic product, so you’re not inhaling harmful dust, or your skin’s not being irritated. It’s strong, and lightweight, and easy to work with on the job site. And that part of the customer experience has been one of the biggest drivers of ACRE being recommended over and over again, from contractors to homeowners, and, you know, homeowners to contractors up the chain, for the sustainability qualities.

From a market perspective, you know, we’re very excited about what we see. We’ve got this incredible, innovative, stable material, that’s not gonna rot. It’s got this beautiful, natural grain that can mimic some of the most prized species of wood, like Ipe. It’s durable. It can be used inside and for exterior applications. So, it kind of is a perfect material, and it really begs the question of, you know, why now would anyone choose to build with wood? And this is, the incredible opportunity that we have now, to replace wood in so many verticals, because, unlike our competitors, many of our competitors, we don’t just participate in one vertical. We’re not just outdoor living. We’re not just siding. We really can go where wood can go, except for structural applications. So, we’re already capitalizing on this conversion from wood to other, better, more environmentally-friendly, more beautiful materials in the market. And we see that ACRE kind of winning in that most-loved category, in three primary categories today: decking, siding, and trim. And we know that because we’ve doubled our sales every year in these three categories, with repeat customers.

Other reasons we’re really excited about this is that the composite market, in some ways, is just beginning. It’s growing 25% each year, and we believe ACRE is uniquely poised to meet today’s purchase drivers and consumer preferences. So, you know, being that it’s suitable for all of these types of uses, ACRE, our sheet goods, can really be a canvas for nearly every kind of wood application, so, cabinetry, furniture. Many large manufacturers are looking at ACRE to replace their wood component of their products in fencing, flooring, or something, with ACRE for these sustainability points that I talked to you about. ACRE is available at a reasonable price point, so you’re getting a product that’s luxurious in many ways, but at a very accessible price point, which thrills us to make this not a barrier to entry, and make it available to as many homeowners and industrial design complexes as we can.

The low-maintenance aspects of ACRE that I talked to you about really make it a no-brainer when you consider the cost of maintenance bills, and lowering your lifetime repair costs, or replacement costs, those kinds of things. And customer advocacy is just super high for a product like ACRE, or this space in general, as, you know, people across the board, from installers, homeowners, architects, builders, are very motivated to create a more sustainable world. And, you know, our distributor and dealer customers win too, you know, not just for those altruistic pieces of this opportunity, but because they have a hit product, and really are enjoying sales. You know, kind of getting all the tailwinds from these trends and market opportunities that we’re talking about.

Another important thing to think about is that nearly every government organization, you know, you see this at the COP26 events every year, have made some sort of net zero or deforestation pledge. And if there has ever been any criticism that I’ve heard from some of those events, is folks looking around for a real, ready-now, practical solution to end deforestation. And, you know, we’re really proud to say that ACRE is that. It is ready now, it is a practical solution that’s a substitute that people don’t mind taking, because it’s so beautiful, because it works like wood, because you can stain it, because if you change the color, wanna change the color of your house in a couple years, you can paint right over it. You don’t have to tear down a factory-installed, limited paint choice, that kind of thing. And we love keeping track of it. So, we track it in, you know, this little tracker that we have, of the acres of rainforest that we’ve preserved, which is how we got our name, kind of the double entendre there in that meaning, the tons of rice hulls that we’ve upcycled, and all the work that we do at our factory to build it and continue to improve upon it, with smart manufacturing, closed-looped water systems, and also, just, you know, being here and manufacturing and made in the USA, feels really great for all the work we’re doing in our community.

Got some summary slides here, but I think we talked about most of these today, you know, that we’re not really just selling another trim, decking, siding product. We’re selling innovation. We’ve created a lifestyle brand out of a building material product, in a space that you don’t usually see so much brand affinity and enthusiasm. We have unmatched sustainability qualities. The economic sector that we are living in, you know, or that we live in in many different types of environments, ACRE is poised to succeed. So, for now, for example, if folks are hanging on to their low-interest mortgages, and not going anywhere, they’re likely going to repair or continue to improve their outdoor and indoor spaces, and ACRE’s right there, as a ready, available material to do that, and feel good doing that with.

I think example that makes us stand out, that we talked about today, is that we’re not trying to sort of outcompete another composite on fringe features and benefits. We see wood as our primary competitor. And that’s today’s gold standard, and that’s the majority of the market, and if we can disrupt that, we have such a clear competitive advantage. And, you know, we wouldn’t be anything without the people who are doing this, and so, you know, Modern Mill has a founding team of really experienced folks. I get to be the chief marketing officer, so, you know, establishing our brand, and getting to talk to folks like you about it. And we’ve got many talented folks, and a team of folks who are used to working in entrepreneurial environments, who have had tremendous success, who really believe in hiring the best, comparing ourselves to the best, being really focused, holding ourselves accountable, and creating exceptional customer and employee experiences.

Got a little timeline here. Don’t really like to look back. Like to look forward, but the incredible performance in such a condensed time frame really is worth celebrating. And I think some of those highlights, you know, in 2020, which was a difficult year for all of us, being able to create a factory from the ground up, I think, really showcases our operational excellence. We’ve created more than 100 jobs in a Qualified Opportunity Zone. We are a Qualified Opportunity Fund, which is why we’re here today talking to you about it, and that’s something we take to heart. We really are making a difference for people who live and work in this community. And that’s one of the reasons that I get up every day with a lot of, and the team that I work with, we get up every day to do this and to serve these folks, and to see the community around us changing and growing.

And we’ve also been able to introduce new products every year, you know, from our sheet goods in 2020, when we were just getting going, to decking and trim boards in 2021, to shiplap siding, batten siding and porch flooring in 2022, and we’ve got a pipeline full of products that are coming to market, as well as our sheet goods, which I mentioned are both a canvas for DIYers, or for, you know, people to do wall panels, or a host of innovative designs with, or for large OEMs to take on as their raw material, and create their beautiful products with: fencing, marine, the possibilities are endless. And, as well as the recognition that we’ve won, both from brands who have wanted to partner with us, and trade publications and retail publications as well.

I spoke about our vast geographical reach, and I think this is just, again, another proof point of the success we’ve had in our sales to date, which is that you can pretty much go into any part of the country today and find, and ask for ACRE products, and find it for…your projects or your contractors can find that. We’re adding to this every day, with really well-known distributors, who are tremendous sales partners for us. And we stand ready with product and marketing support to support them in getting ACRE into as many hands as possible, so we can save as many trees as possible, and create as many amazing, quality jobs as possible.

Again, another unique factor that you don’t typically see in the building materials space is really amazing, esteemed brands choosing to partner, or choosing ACRE, for their projects and to showcase their sustainability efforts. So, I spoke to you about the Heineken story. Chipotle, last year, was launching all-electric, net-zero restaurants, and I don’t know if you can see that little black-and-white image back there, but that’s ACRE. They really, of course, love the story that one of their key ingredients is rice, and ACRE’s made from rice, and so we are a showcase of artwork in their stores, as well as siding. Omni came to us for a slightly different reason. Their historic collection requires something that looked as much like wood as they could find. So they… But, you know, a hotel has a lot of traffic, and a lot of people, and a lot of wear and tear, so they were looking for a composite, and ACRE, in this case, was selected for how closely it mirrors wood, as well as the sustainable story. And we’ve also been recognized on the trade front too, with folks like Dean Sharp, of the podcast “The House Whisperer,” who has never used a composite, and never featured a composite on the show before ACRE. And I don’t think he’d mind me telling you that he is doing some personal projects with it, and has been a huge fan. You can check that out in his archives.

It’s just a glimpse of the industry of awards and recognition. And that’s kind of, you know, what I wanted to share with you today about Modern Mill, and about our product, ACRE. I wanna invite all of you to be part of our journey and part of our story, and part of really fulfilling this vision that we all had for Opportunity Zones, which was, beyond some of the personal economic benefits, to really creating economic growth for communities and people who need it the most, and we’re not going to stop until we’re sure we’ve done everything we can to improve the lives of the folks that we work with in Fernwood, Mississippi, and help them achieve their highest potential, while doing great things for the planet, and hopefully, folks like you who come along for the ride.

Jimmy: That’s awesome. Tremendous presentation. A lot of positive response in the chat, in the Q&A here, and in my private message group, here right now, with some of my colleagues. Really impactful, both environmentally and socially. We got a couple of questions here. First of all, Audrey chimes in a couple times. Audrey says, “Hey, as a homeowner, our deck is currently KDAT, but recently was considering Trex for the cocktail rails, but I hadn’t heard of ACRE. Thanks.” So, maybe you’ve got a potential customer there. And Audrey also asked, “It appears to be a great product, however, is it fade-resistant?” What do you say about that, Kim?

Kim: Did you say fade? Was that the question?

Jimmy: Fade. Is it fade-resistant, the product?

Kim: Fade-resistant. So, you might see that ACRE… You could see some light fading, but what ACRE will not do is gray. So, if you happen to, I think it is Audrey, if you happen to live in New England, like I do, we love teak up here. But you see, it grays and silvers and cracks. And ACRE won’t do that. But there may be some light fading, but a lot of that can be prevented with a clearcoat, which we would recommend anyway, because it will just make cleaning easier. So, if you have a deck made of ACRE, and you are like me, and you have a little red wine or something, you know, you wanna be able to clean it easily. And so, we’d love for you to do a little clearcoat on that, and that should help with any fading as well.

Jimmy: There’s your contact information. [email protected]. Please do reach out.

Kim: And the website’s also modern-mill.com, and yeah, be thrilled to talk to any of you.

Jimmy: Perfect. Can you speak, just, I don’t know, 30 seconds or less… I know you probably can’t do it in that amount of time, but do your best. What’s the investment opportunity here? You talked a lot about the product and the company and the impact, but if someone writes you a check to invest in the Qualified Opportunity Zone Fund or business, what are they getting, exactly?

Kim: So, we’re about to start our series C. And so, what I would love to do, if it’s okay, is ask folks for a private meeting with our CEO, who’s amazing, and is more passionate than anyone I know about ACRE, and would be thrilled to talk to you about it. But our next raise, just to give you the highlight of it, what it’s really focused on, is, as you can see, we’ve been growing very quickly, and we need to create more capacity, to meet demand. So we’re looking at a second location, is the primary use of those funds. And we’d be happy to take you through those opportunities, and we would really love for y’all to be a part of it.

Jimmy: Perfect. That’s impressive. Great-looking company you have there. This is my first introduction to it. I’m impressed. And yeah, please do reach out to Kim if you’d like to schedule time to meet with her and the Modern Mill CEO about their next funding round, Opportunity Zone investment. There aren’t a lot like this one, that are operating business-focused, so the vast majority of our deals that we present on these events are real estate, but really cool to see an operating business like this one. Kim, we’re at time. Really appreciate you spending some time with myself and my audience today. Thank you so much. Take care.

Kim: All right. Thank you all.