By @Newton, August 18, 2016
Charles Knight III put down the book, "Speculator" by Doug Casey. First released in 2016, it was sold as fiction but had more truth in it than most would believe. The hero of the book was named Charles Knight and he was based on Charles' grandfather. Sitting quietly and reading the book in 2050, Charles had stopped reading to take a phone call.
The call was from the T'sou-ke First Nations Chief. Things were going smoothly this year with the deep water shellfish farm. August was an important time for growth and harvest. They raised some of the trays up closer to the surface to encourage fast growth for immediate harvest, but lowered other trays deeper in the ocean to delay growth and harvest. The First Nations were becoming effective contract farmers for the operation based on crown land just outside Sooke on Southern Vancouver Island. Three years in and he had spent one-hundred thousand dollars on capital for the project. It earned thirty thousand dollars of revenue and fifteen thousand in profit per year. Conservatively, the business was worth one-hundred and fifty thousand now.
It was a quick call. The end was the best part be cause it went off-script. Charles had learned a lot from his grand father and was bringing his most powerful thoughts to bear on the Chief. They had been going back and forth for months about how to get more ownership of the business for the people of the Nation. Charles was on the verge of figuring it out and the Chief was ready to spend other people's money on the idea.
Charles said something about expanding at the extensive margin, rather than the intensive one. The Chief said "Yes," but then paused before he said "I don't understand what that means." Charles started to explain how they would be starting a new line of business rather than scaling-up the existing one when he realized all of that was going to happen behind the scenes, as far as the First Nation was concerned. The Chief would see an increase in the number of people working on the project. It was hard work, handling trays of oysters growing underwater on docks close to shore, but it was honest and close to nature. People working was critical for his success as Chief of the relatively small Nation.
Charles stopped and started again. "I would like to start a new corporate entity with you. I do not need any ownership in it. I will provide contracts to operate several new farms to you through this company. Please can we meet with government people to ensure that the equity in this company is fairly distributed amongst members of your Nation?" The rest of the conversation flowed smoothly from this setup. A couple minutes later, Charles had a green light from the Chief to advance the deal with his new, foreign partner.
Somehow, Charles met a Chinese man who was involved in aquaculture in China. They quickly bonded over how quick, cheap, and easy it was to get a shellfish license on government land in BC. The man was initially interested in applying for licenses to farm all areas in Southern Vancouver Island that hadn't been staked yet. Charles wasn't quite ready for that idea, and he talked him down to just funding some expansion with Charles' existing farm operation. Hence, the conversation with the Chief. Charles negotiated a deal that would bring in professional managers to work with the First Nation. They would also play nicely with the Chinese community in BC that dominated parts of the shellfish industry.
For Charles, this was a big change. It meant he could go after crazy ideas -- like applying for shellfish farming permits on large swathes of government land in BC. Much of the best areas had been taken long ago and held onto tightly, and there was little trade for permits in any secondary markets. A few real estate brokers made even fewer deals. Charles had met distressed sellers who sold profitable farms cheaply, but had not had enough capital to act on the opportunities. Now that he had found one partner, he was on the hunt for more. Someone who could see the potential benefits of bringing sophisticated resources to bear on an underserved industry.
He went out to the lookout over the cliff by his house. He could see the small boat coming back to shore after the morning visit to the docks that held the oyster trays in the ocean. The Olympic mountain range in the distance, the rolling hills behind him, and the cool westerly wind distracted him. His thoughts wandered. He decided he would invite his new Chinese partner to this location for a ceremony with the First Nation to negotiate and secure their agreement.
Charles was in way over his head. "I wish there was someone from the government to help me deal with this new Chinese guy. Could get messy, but I said the same thing about working with the T'sou-ke. Hmmm… What a day," He said to himself.
He thought back to the stories of his grandfather, who had gotten himself into it many times. Somehow he seemed to survive it all and thrive. Between the books on his life and recorded conversations with the man, Charles figured he had enough to guide him through anything. He had the map, it was up to him to use it.
