Taking a look at Caliber, The Wealth Development Company in 2015 reveals an organization with more than 35 full-time employees in Scottsdale alone, a vast real estate portfolio, 20 percent-plus returns in at least one of its funds, recognition in the top 10 percent of Inc. 5000’s 2014 fastest growing companies list and a C-level executive recently recognized as one of Arizona’s 35 Entrepreneurs Under 35.
“We are successful because Caliber puts its investors’ interests first,” said Jennifer Schrader, Caliber co-founder and COO. “Investors get paid first, Caliber gets paid second.”
Considering Caliber’s enviable investor returns derived from management of $150 million in commercial office buildings, hotels, single- and multi-family properties, it’s hard to imagine that there was a time when the company had only one investor and a few young entrepreneurs primed to find opportunities within the rubble of Arizona’s late-2000s real estate market.
“Forging ahead with no playbook or backing from financial institutions, we made a conscious effort to stand out from the crowd and do things differently,” Schrader said. “While others chose the short-term approach and focused on one area of the market, we didn’t get caught in the hype. We chose to diversify.”
Caliber’s first pivotal diversification occurred two years in, when the company stepped up from single-family homes to a higher asset class by purchasing its first larger residential community in south Scottsdale.
Caliber purchased the property below market value, rebranded it, remodeled, created an on-site property management division and re-leased the units, creating a higher income stream.
“The community was branded Scottsdale Commons and changed our company’s dynamic,” she said. “This success prompted us to keep expanding into commercial-grade properties.”
After Scottsdale Commons, Schrader and her colleagues came to the realization that the next step was developing Caliber into a full-service real estate company. “This was a huge undertaking, yet it allowed us to grow our own capabilities and become highly efficient in the process, with a greater rate of return on investment (ROI).”
In addition to paying investors first and diversification, Schrader points to transparency as a key to Caliber’s explosive success. The idea was really cemented at Caliber’s inception in 2009, with many investors still reeling from the tattered (and once considered nearly invincible) real estate market.
“Skeptical investors wanted complete transparency in order to gain trust. We continue that complete transparency philosophy today. We have an open book policy where all questions can be posed. All financials are available for viewing by investors,” Schrader said.
While reiterating that she’s not an accountant or financial adviser, she does offer some advice for other entrepreneurs hoping to mimic her success.
First, “hire and retain incredible people, especially if that means hiring someone with more experience than you.” Arizona business owners cite finding a qualified workforce as their #1 challenge in expanding their businesses.
Second, she encourages entrepreneurs to push beyond their comfort zones by keeping up with the latest technologies and even public speaking opportunities.
Third, entrepreneurs should give back and give more, whether it is via a charitable organization or even spending time with one employee going through a tough time.
Her final points of advice for business success involve being keenly aware of up-to-the-second shifts in your industry and responding appropriately.
• Know when trends are changing when purchasing real estate and especially in the design and remodel of properties.
• Know the right time to exit or change a business strategy, ideally when it is no longer advantageous.
• Find employees and business partners that complement your efforts.
• Know when it is time to put your ego aside and work together to achieve success.
Schrader’s summation of her company’s success reveals a very pragmatic approach to business. Hire good people, respond to change and stay connected.
“We don’t want to get into a trend late in the process,” she said. “We look for the next trend to be on the leading edge – and not the bleeding edge.”
– Written by Josh Coddington, marketing and communications manager