A Black-run investment firm bets on Black travel: ‘We wanted to add a layer of intentionality’ | Entrepreneurs | The Guardian

In the year since the Guardian profiled William Huston, the founder and chief investment officer of Bay Street Capital Holdings, a California-based wealth-management firm that invests in the stock market along with a portfolio of small, minority-owned businesses, the US market has undergone great volatility. The S&P 500 index peaked in the first week of 2022, but by mid-October had dipped 26.7%. Meanwhile, Huston’s firm’s portfolio has maintained its valuation of $85m (£70m), and its staff of 16 has not had to downsize.

Huston chalks up his company’s health to one specific pivot. His firm has been doubling down on an untapped and underserved segment of the US economy: Black-owned travel holdings. “Black travelers in America spend $109bn (£90bn) on leisure travel annually, and only $1bn (£831m) goes to Black-owned hotels,” he said of the disparity besetting the US travel industry. Black-owned hotels make up 0.8% of the 58,000 hotels in the US. Less than 1% of the money that all African Americans spend on leisure travel ends up with Black-owned properties.

With its establishment of Resthaven Properties, a portfolio of members-only boutique hotels, Bay Street Capital Holdings is betting big on travelers’ desire to support minority owners and visit properties whose values chime with their own. According to marketing firm Bluestone PIM, more than half of millennials prefer to shop at stores that reflect their priorities, and a similar survey conducted by Survey Monkey showed that 73% of Gen Zers across different age groups said it is very important that they patronize brands with values similar to those they hold. Huston, who grew up in small-town Alabama and now has over 20 stamps on his passport, is betting on modern-minded travelers with socially conscientious leanings booking at his Black-owned properties.

Hospitality holdings now constitute 20% of Bay Street’s portfolio. There’s a luxury rental in Venice Beach, California, that’s popular with influencers and entertainment industry workers and forthcoming resorts in the trendy destinations of Portugal and the ski getaway of Lake Tahoe. Bay Street Capital Holdings has also developed Unified, an app that connects influencers to travel properties, all in the name of publicizing new destinations to new audiences. “We wanted to add a layer of intentionality to the business,” Huston said from his Fremont, California, home office, whose walls are decorated with a colorful assortment of guitars and drawings created by his two-year-old son. “We’re never going to compete with Marriott, but in five years people will know about us. And they will know the names of some of the other hotels that we don’t own but we support, and that’s just as impactful.”

William Huston smiles while wearing a gray suit and dark-colored tie.

You founded Bay Street Capital Holdings in 2018. Where did the idea come from?

It all began a decade earlier, when I was a sophomore in college and I started a call center in the Philippines. You see, I grew up in a town called Harvest, Alabama, and I was a classically trained piano player. My parents were teachers and made no money. I was a freshman at Georgia Tech when my dad became disabled, so our family income was suddenly a lot less that it had been when he was working as a school principal. I dropped out to qualify for in-state tuition because if you had residency and were working, you could go to school basically for free. The business I founded actually came out of a crisis.

And your solution was to open a call center?

It wasn’t as if I had this master plan– – it was more like I had a problem. I had a lot of hubris, though, and that was my business idea. I’d read The 4-Hour Workweek by Tim Ferriss. I figured if I could work four hours a week, then I could also be in school and making money without working. I hired one person in the Philippines and soon I had hired a bunch of her friends. Soon there were 12. I was in Georgia, going to financial advisers, saying: “Hey, you need clients. I have a call center. We’ll call the clients. They’ll come to you and they’ll use your services.”

Why did you make the switch to start your own fund in 2018?

I started to have this crisis of conscience where a lot of my employees and I were always sick because we were working at odd hours. A lot of people were having miscarriages. I didn’t like this lifestyle that relied on people working hours that were not natural. So I started over, with a smaller call center in El Salvador, and I registered for an LLC. The team was working for my own fund, not other people’s companies. We’re not calling thousands of people a day like we were doing before. They’re entirely focused on the investment group.

And what’s the biggest difference between Bay Street and typical wealth-management funds?

Everybody deserves a financial plan and financial guidance regardless of how much money they already have. We have $1,000 (£830) as a minimum billing– – or a fee– – but we don’t have a minimum amount of investment.

What percentage of your investors are diverse?

The majority of our clients are Indian or Chinese or women or LGBTQ. And then a portion of them are Black. And that makes sense because when you look at the pie chart of where the wealth is, Black people are not the ones who have discretionary income that they would be able to use for investing.

How are you working to change that from within?

Our pivot to luxury properties aligns with our desire to grow Black wealth. We’ve launched a platform that allows people to search for properties in an intentional way, so it stipulates which ones are women-owned or which ones are LGBTQ+ or which one is owned by a person of color. Airbnb does something similar for 20%, but our rate is 15%.

You’re a huge traveler. Where do you wish you could revisit?

I really love the Meteora monasteries in Greece. It’s one of the most beautiful places – they built these monasteries on top of the rocks. And Singapore is one of my favorite places. It’s a brand-new city and there’s a beautiful layout of buildings. It feels intentional and holistic. You don’t often get a sense of that when you’re in a city.