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March 2016 Learn. Join. Lead.

Looking Ahead: The Future of the CDFI Industry
Last Call to Join Us for Advocacy Day
Public Policy: OFN Briefs Capitol Hill on Importance of Appropriations
Spotlight on Local Enterprise Assistance Fund (LEAF)
In Other News


Looking Ahead: The Future of the CDFI Industry CDFI Futures Report Cover

Is your business model evolving? What are your sources of capital, and how should they change? What lies ahead for the CDFI industry? These are just a few of the questions raised in OFN's new study CDFI Futures: An Industry at a Crossroads.

In 2015, OFN commissioned two studies: The first, 20 Years of Opportunity Finance 1994–2013: An Analysis of Trends and Growth, looked back at CDFI industry growth and transformation. CDFI Futures, released this week, builds on that analysis and asks probing questions about what the CDFI industry might look like in the next 20 years.

Jeremy Nowak, president of J Nowak Associates, was selected to author the paper. "Jeremy was a pioneer in the CDFI industry, and we wanted to tap into his public policy and financial systems insights to stimulate deeply thoughtful conversation around the future of the CDFI industry," said Donna Fabiani, Executive Vice President of Knowledge Sharing at OFN. "We are in, as the paper sites, an inflection period, and the choices we make going forward will shape not just the industry but the communities we serve."

Jeremy spoke to us about takeaways from the paper. Here is an excerpt. Further reading will be available on CDFI Connect.

Jeremy, the new report centers on the present inflection point for the CDFI industry. How have we grappled with previous inflection points and what do you see as the greatest opportunities and challenges within this current inflection point?

(JN): This is a transactional, practitioner-led industry. That is its strength and from where its integrity derives. I think most change-making happens on the ground and then diffuses outward. Most of the collective action has been oriented toward public policy changes. A challenge now is to enable more research and development opportunities where product development can be prototyped and growth assumptions can be tested and challenged.

Who are the most important capital market players for the future of CDFI capitalization?

(JN): There are several important players besides the public sector and banks: the new impact investors many of which are family offices and private endowments, the bond market for CDFIs that are now investment grade rated, and finally pension funds although that will be the biggest lift.

The report introduces a CDFI Capacity Score™. The CDFI Capacity Score™ puts an emphasis not on a CDFI's size, but its ability to efficiently raise capital, deploy loans, and sustain its operations. Should this change the industry's view of capacity building?

(JN): There is nothing wrong with growing a large organization: scale can be important as long as size translates into impact and organizational sustainability. But it is also necessary to understand that CDFIs include scores of capable organizations that are not large but yet are quite effective. Thus we may have more deployment capacity than we recognize. The industry is not just undercapitalized, it is under-networked. The right capital delivery networks and deployment systems will increase the deployment of capital, particularly to many rural areas and smaller cities, where the largest CDFIs have less presence and where many community banks are struggling.

How can the report's findings help individual CDFIs?

I would hope that the report is a way for a board and senior staff to think about their organization within the broader context of a movement and a history and to ask questions about options going forward.

What thoughts should CDFIs keep in mind as they consider the results of the study?

(JN): I think there are three things to keep in mind. First, we need to appreciate what we have done as an industry, but understand the limits to the current “fuel” for growth. Traditionally that fuel has been grants and bank loans. Like any fuel, that one has its limits. So the next thing to consider is what is the new fuel? Secondly, there is a significant demand today on the part of holders of capital to identify ways to have a social impact through their investments. We have a great opportunity to engage with the impact-investing world. Finally, especially in terms of consumer financial services and small business lending, there is the rise of new technology platforms, which are fundamentally changing the way financial services are delivered. This transition is dramatic and we have to determine if and how we adapt.

We invite you to read the full report and then take it to the next step. Follow and join in on the conversation on Twitter with #CDFIfutures.

CDFI Futures was made possible by a generous grant from the Citi Foundation.

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Last Call to Join Us for Advocacy Day

OFN in the capital Logo

Advocacy Day is the one day each year where the CDFI industry goes in force to advocate for appropriations. No matter where you are located or how large your CDFI is, your voice matters, so join us!

Every year, Advocacy Day gets bigger and better, and 2016 is no exception. For the first time ever, the Southeast regional meeting coincides with Advocacy Day, creating more opportunities to learn, network, and make an impact for the CDFI Industry.

Here is a quick glance at the jam-packed, two-day agenda:

May 24

  • Network with peers at OFN's Southeast Regional Meeting
  • Gain insights with specialized Advocacy Day training (immediately following the regional meeting)
  • Rub shoulders colleagues and Hill staffers alike at the Congressional Awards Reception

May 25

  • Start the day with breakfast as you team up with your peers
  • Go as one voice to Capitol Hill! Expect a day filled with meetings and opportunities to share your CDFIs impact.

Registration for Advocacy Day closes March 31. So make sure you register, book your room, submit your data to the CDFI Coverage Map, and update your Member Profile.

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Public Policy: OFN Briefs Capitol Hill on Importance of Appropriations Capitol Hill Meeting Room

On February 25, OFN hosted a briefing on Capitol Hill for congressional staffers. The panel comprised of local CDFI practitioners and borrowers, including Lori Chatman, President of Enterprise Community Loan Fund and Chair of OFN’s Board; Marla Bilonick, Executive Director of the Latino Economic Development Center (LEDC); Eric Jones, Project Manager at H Street Community Development Corporation, an Enterprise borrower; and Gabriela Febres, co-owner of Arepa Zone, a DC based food truck and restaurant started with a loan from LEDC. They discussed how CDFIs leverage CDFI Fund appropriations to amplify the impact of these funds in under-resourced urban, rural, and Native communities nationwide. Over 60 congressional staffers from House and Senate offices from both sides of the aisle engaged with the panelists, asking insightful questions about CDFI funding. This briefing provided OFN with an opportunity communicate our policy goals, including CDFI Fund appropriations for FY 2017 to $245.9 million and to secure $1 billion in guarantee authority for the Bond Guarantee Program.

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Spotlight on Local Enterprise Assistance Fund (LEAF)

Spotlight Image

Though the New Orleans Food Co-op opened its doors in late 2011, its journey began at the turn of the century. For NOFC, the idea started as a buying club: consumers pooling their purchasing power to access high quality food at lower prices. Plans for opening a store in 2005 were well underway when Hurricane Katrina hit. The devastating hurricane only added to the community's need for a good grocery store, as the entire city of New Orleans became a food desert. Many grocery stores in the area closed, and many of the co-op members relocated. Despite these added challenges, the co-op persevered and, in 2011, finally achieved its dream of opening a physical store.

Despite a successful opening, NOFC faced start-up challenges. It began undercapitalized and struggled to finance the co-op's desired improvements to the store. By 2015, the co-op had only one fully functional check-out lane, was low on cash, and needed exterior maintenance—the parking lot in particular. LEAF donated more than $6,000 to the co-op for technical assistance to help the board and management improve the operations of the co-op. LEAF then financed the parking lot improvements, equipment, and a new sign. LEAF worked with the store to create a matching loan campaign, ultimately matching $70,000 in loans from the store’s 3,800 member-owners, providing the co-op with a total of $140,000 to improve the business.

"LEAF provided a very compelling story for owners to invest in the co-op, so we can do more great work in our community," said Lori Burge, NOFC's General Manager.

Learn more about LEAF here.

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In Other News

Peer Networking in Your Neighborhood

Photo from Event

Regional meetings connect OFN Members, other CDFIs, banks, foundations, and industry stakeholders for a day of peer exchange and training. These one-day events help CDFIs expand access to responsible financial products and services in disinvested communities. This year we will see you in Brunswick, ME; Washington, DC; and Los Angeles, CA! Mark your calendars now and stay tuned for agenda information.

  • Northeast Regional Meeting
    • Wednesday April 27, 2016
    • Coastal Enterprises, Inc. (CEI) Office
    • 30 Federal Street, Brunswick, ME 04011

  • Southeast Regional Meeting
    • Tuesday May 24, 2016
    • Renaissance Washington, DC Downtown Hotel
    • 999 9th Street NW, Washington, DC 20001

  • Western Regional Meeting
    • Wednesday June 29, 2016
    • Federal Reserve Bank of San Francisco, Los Angeles Branch
    • 950 S Grand Avenue, Los Angeles, CA 90015

OFN Regional Meetings are made possible by the generous support of Capital One.

Small Business Lenders: Book Your Hotel Now!

Small Business Finance Forum

The 2016 Small Business Finance Forum is quickly approaching. Taking place June 8–9 at the Fairmont Hotel in Chicago, IL, this year's event includes a first-ever partnership with the Small Business Administration to include the SBA Microloan Training as part of the program.

OFN's annual Small Business Finance Forum is the place to explore the rapidly changing world of small business finance with CDFIs and other mission-driven small business lenders and their partners. Mark your calendars and book your hotel today, as rooms fill up quickly. Registration opens in April.

Fundamentals of the Opportunity Finance Industry

Earn a certificate in Community Development Finance! Jointly offered by the Carsey School of Public Policy at the University of New Hampshire and OFN. Piloted in 2014, the Fundamentals of the Opportunity Finance Industry Certificate in Community Development Finance will take place in three locations over the next 15 months. Enrollment is open for the June 27–29 course in Durham, NH and the September 12–14 course in Seattle, WA. Limited scholarships are available.

Fundamentals in the Opportunity Finance Industry Logo

Calendar at a Glance

Where and when to connect with OFN and gain industry insights this spring:

  • Tuesday March 22 at 2:00 PM ET—Customer Acquisition Webinar. Register today.
  • Thursday March 24 at 2:00PM ET—Building a Value Proposition Webinar. Register today.
  • Tuesday April 5 at 2:00 PM ET—Fundraising Strategies for your CDFI. Register today.
  • Thursday April 14 at 2:00 PM ET—Customer Acquisition and Retention. Register today.
  • Wednesday April 27 in Brunswick, ME—Northeast Regional Meeting. Mark your calendar!
  • Thursday, May 5 at 2:00PM ET—Lending Life Cycle Part One: Finding Existing Barriers to Loan Growth. Register today.
  • Tuesday, May 24 in Washington, DC—Southeast Regional Meeting. Mark your calendar!
  • Tuesday, May 24 at 5:30PM ET in Washington, DC—Congressional Awards Reception.
  • Wednesday, May 25 in Washington, DC—Advocacy Day. Register now!
  • Thursday, May 26 at 2:00PM ET—Lending Life Cycle Part Two: Lending Life Cycle and Technology. Register today.

CDFI Connect Logo

OFN has been your source of daily news for the CDFI Industry for three years with CDFI Connect. We are still publishing daily news at cdficonnect.org. Coming soon—enhanced content, original voices, and a new online experience.

Check your inbox on Fridays for the Weekly Digest with the most popular and most shared stories of the week.

Have news to share or ideas about what you want to see featured? Send your stories and commentary to Lindsay Li, senior associate, strategic communications.

OFN's Job Bank

Are you looking for a job in the opportunity finance field or is your CDFI hiring? OFN's online Job Bank lists positions with CDFIs across the country, including open positions at OFN—such as our opening for a Project and Membership Engagement Manager. We encourage CDFIs to post their positions, and we urge job seekers to check the list regularly. Wherever you are, the OFN Job Bank helps CDFIs and talented professionals connect.

Hiring Interns this summer? Post opportunities on the CDFI Industry Internship Bank!

Internships are great opportunities for students to become CDFI ambassadors and gain hands-on experience while also helping CDFIs increase capacity and engage in special projects. If your CDFI is looking to hire interns this summer, don’t forget to post internship opportunities on OFN's CDFI Industry Internship Bank!

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ABOUT

Opportunity Finance Network® (OFN) is the national network of Community Development Financial Institutions (CDFIs)—private financial institutions that are 100% dedicated to delivering responsible, affordable lending to help low-income, low-wealth, and other disadvantaged people and communities join the economic mainstream.


CONTACT

Opportunity Finance Network
620 Chestnut Street, Suite 572 | Philadelphia, PA 19106
P 215.923.4754 | F 215.923.4755 | ofn.org


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ABOUT

Opportunity Finance Network® (OFN) is the national network of Community Development Financial Institutions (CDFIs)—private financial institutions that are 100% dedicated to delivering responsible, affordable lending to help low-income, low-wealth, and other disadvantaged people and communities join the economic mainstream.

CONTACT

Opportunity Finance Network
620 Chestnut Street, Suite 572
Philadelphia, PA 19106
P 215.923.4754
F 215.923.4755
ofn.org

CONNECT

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linkedIn vimeo
CDB-L Opportunities