Dear Opportunity Finance Advocate,

The opportunity finance movement aligns capital with justice. It is composed of mission-driven

community development financial institutions (CDFIs) working across America in low-income, low-

wealth, and other disadvantaged communities to provide greater economic opportunity and access.

We believe everyone deserves an opportunity and that justice for all begins with opportunity for all.

The enclosed information packet includes background material on the opportunity finance industry

and Opportunity Finance Network (OFN), the leading national CDFI network. CDFIs, part of the

growing opportunity finance movement, offer countless pathways for students, professors, and

administrators to work side by side in aligning capital with social, economic, and political justice. In

this packet, there is a wealth of resources about all things opportunity finance, including a sample

OFN Member CDFI profile, inspirational success stories about CDFI borrowers, and industry career

placement information.

Students and professors may be particularly interested in the model case study provided in this

packet. Here, students can work with their peers and professors to discuss real-life issues impacting

disadvantaged communities and the innovative ways CDFIs find solutions and bring opportunity to

those challenges.

Further opportunities for jobs and internships in the industry are also available in the packet—a

valuable resource for students and career counselors alike.

After reading this packet, we ask you to join us. If you are a…

Student: talk to other students about the opportunity finance movement. Utilize the case

studies in your classes and clubs. Check out the many job and internship opportunities.

Professor: encourage students to become more involved in the opportunity finance

movement. Use the case study as a starting point to introduce students to existing strategies

that help align capital with social, political, and economic justice. Contact Beth Lipson,

Executive Vice President of Strategic Initiatives, at blipson@ofn.org for more information or

with questions.

Career Counselor: advise students of all majors on the different opportunities for students

to work in this industry. Contact Tamara Frye, Senior Associate of Human Resources, at

tfrye@ofn.org for more information.

University Administrator/Trustees: consider investment and/or partnership opportunities

with CDFIs. Contact Fran Lutz, Chief Financial Officer, at flutz@ofn.org for more information.

We thank you for your interest in the opportunity finance movement and your desire to help align

capital with justice. Please do not hesitate to contact us with any further questions.

Sincerely,

Opportunity Finance Network

Community development financial institutions (CDFIs) are 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.

CDFIs are opportunity investors. We create opportunities and provide resources to help people

act in the best interests of their communities, themselves, and future generations. By financing

community businesses- including small businesses, microenterprises, nonprofit organizations,

commercial real estate, and affordable housing- CDFIs spark job growth and retention in hard-to-

serve markets across the nation.

CDFIs are active across the United States, and finance diverse projects, such as charter schools

in California, affordable housing developments in Chicago, community health centers in New York,

and rural fisheries in Maine. In addition to financial assistance, CDFIs provide technical assistance

in areas like business planning.

As the industry grows, there are new and endless ways to become involved in opportunity finance.

In this packet, you will find further information about Opportunity Finance Network, CDFIs, job and

internship opportunities, a list of available resources, and sample case studies about real issues

that CDFIs face. We encourage everyone, students and professors alike, to take advantage of these

resources and learn more about opportunity finance, its impact, and the role that you can play.

The Opportunity Finance IndusTry

LEARN

JOIN

LEAD

About the Opportunity Finance Movement

597,011 jobs created or retained through small business

and microenterprise

961,909affordable housing units constructed or renovated

9,976community service

organizations financed

LEARN

JOIN

LEAD

In Providing Opportunity. For All.

impact:

Be a part of aligning capital with justice in underserved communities.

Students: spread the word about opportunity finance to your peers and check out the many jobs and internships available.

Professors and educators: contact Beth Lipson, Executive Vice President of Strategic Initiatives, at blipson@ofn.org for more information about introducing opportunity finance to the classroom.

For more information on career opportunities at Opportunity Finance Network, contact Tamara Frye, Senior Associate of Human Resources at tfrye@ofn.org.

If you are interested in investment opportunities in CDFIs, contact Fran Lutz, Chief Financial Officer, at flutz@ofn.org for more information.

OFN is the leading national network of CDFIs investing in opportunities that benefit low-income, low-wealth, and other disadvantaged communities

across America. OFN partners across the public and private sector – with foundations, banks, corporations, and government agencies—to provide

innovative solutions and to scale capital into larger investments. OFN offers industry-leading advocacy as well as financing, consulting, research

and marketing support for CDFIs and their partners.

OFN Members are performance-oriented, responsible investors that finance community businesses, spark job growth in the areas that need it

most, and deliver both sound financial returns and real changes for people and communities. OFN Members have originated more than $33 billion

in financing in the last 30 years in urban, rural, and Native communities.

LEARN

JOIN

LEAD the Charge.

About Opportunity Finance Network

Opportunity finance professionals utilize quantitative, analytic, business, and

technical skills to generate a tremendous social impact. Learn more about this

$40 billion industry, its impact, and career opportunities for students.

Innovative Market-Based Financial SolutionsThe opportunity finance industry is one of the most innovative and effective forms of social enterprise. It provides capital and financial services that

benefit low-income and low-wealth people—building homes, schools, small businesses, and community facilities; creating jobs; opening new markets;

and helping people join the economic mainstream. The opportunity finance industry includes more than 800 mission-driven Community Development

Financial Institutions (CDFIs) and their partners working across the United States.

CDFIs are private-sector financial intermediaries that serve low-income, low-wealth, and other disadvantaged communities. Combining innovation and

determination, Opportunity Finance Network (OFN) Member CDFIs have invested more than $33 billion in the last 30 years in urban, rural, and Native

markets.

Performance-Oriented LendersIn the current financial markets, mainstream lenders have tightened credit for all but the most qualified borrowers. CDFIs address this gap by providing

flexible, market-driven products to consumers, developers, and small businesses that are shut out of the financial mainstream.

Yet CDFIs apply financial rigor and discipline in lending to underserved markets. As a result, most CDFIs are profitable (but not profit maximizing). CDFIs

have historically maintained a net charge off ratio of just 1.1%, which is comparable to the rate for FDIC-insured institutions.

Interested in a Career in the Opportunity Finance Industry?

Responsive to Community NeedsThe opportunity finance industry is diverse. Individual CDFIs focus on the unique market conditions of the communities in which they operate. In FY

2013, CDFI end-borrowers and beneficiaries were 61% minority, 48% female, and 74% low-income. The cumulative impact of the OFN network includes:

Career OpportunitiesCareer opportunities within the CDFI Industry are available in the following areas:

n Lending and Investing

n Technical Assistance and Consulting to Borrowers

n Development and Capitalization

n Advocacy and Research

n Finance and Administration

n Marketing and Communications

A career in the opportunity finance industry provides an opportunity to:

n Have an Impact—Employees of CDFIs can see the tangible impact they create in local communities. The work they do creates businesses, jobs,

stable homeownership, and community services among populations overlooked by traditional financial institutions.

n Develop Tangible and Portable Skills—Career opportunities within the opportunity finance industry provide high-level, hands-on experience

with financial analysis, consulting, communications, community organizing, coalition building, and more. CDFI professionals are in high demand in

geographies across the country, from Boston to Birmingham to the Bay Area.

n Establish a Network—CDFIs are an integral part of the opportunity finance industry, and are significant players that work closely with public

sector, private sector, nonprofit, and foundation partners including the U.S. Treasury Department, Goldman Sachs, Bank of America, and the

Ford Foundation. Building relationships with organizations such as these is a critical activity in many types of CDFI careers—from lending to

development to advocacy.

ResourcesFind industry news and resources at www.ofn.org. OFN is the leading network of more than 200 performance-based CDFIs that deliver responsible

lending to help low-wealth and low-income communities join the economic mainstream.

n Find a local CDFI that may have available job or internship opportunities using OFN’s CDFI locator.

n Join the Community Development Banking Listserv the go-to resource for employers and recruiters to post job and internship openings.

n Find a Job by searching OFN’s Industry Job Bank.

597,001 961,909 9,976Jobs created or maintained via small

business and microenterpriseAffordable housing units constructed or renovated

Community service organizations financed

2012 OFN Member survey data.

Chi Ishobak, Inc. is a Certified Native Community Development Financial Institution. Established

in 2009 as a 501(c)(3) non-profit corporation in Michigan, it serves the citizens of the Pokagon

Band of Potawatomi Indians, a federally-recognized Indian tribe located in Michigan and

Indiana. Chi Ishobak’s mission is to provide economically-disadvantaged tribal citizens with

access to affordable capital for business loans and individual financial development through

collaborative and education-oriented lending services, while practicing responsible lending in

order to protect loan capital for future generations of tribal citizens.

Chi Ishobak’s financial products consist of: a commercial loan program, which provides capital

to tribal entrepreneurs for small-business start-up and expansion, and a consumer loan

program, which provides capital to tribal citizens to purchase automobiles and to build/repair

credit. Its developmental services consist of the financial wellness program, small business

development assistance, and an individual development program.

Chi Ishobakwww.chiishobak.org

Success Story: Bicycle Tatooing, LLC, South Bend, IN

David Martin is an extremely talented artist whose dream was to own his own business. In 2012,

with the support of the Common Council of Downtown South Bend, Indiana and local institutions,

he incorporated Bicycle Tattooing, LLC. However, David’s personal investments were not enough

to finance a new business. David approached Chi Ishobak for financing, and it provided the

remainder of Bicycle’s start-up financing, enabling David to finish his build-out and receive

approval from the City of South Bend and the Health Department. Bicycle Tattooing is the only

high-end custom tattoo gallery in the area, and is now booked well in advance.

Financial and Social Impact

n Total amount disbursed for small businesses:

$333,000

n Total amount disbursed for transportation and

credit-building: $280,000

n Total loans originated: 50

n Jobs created: 15

n Consumer debt eliminated: $23,000

415 E. Prairie Ronde St.

Dowagiac, MI 49047

P: 269.783.4157

E: sean.winters@chiishobak.org

Contact

Opportunity Finance Network Member Profile

We Believe In Opportunity. For All. OFN.ORG

Willapa Hills Cheese Produces Natural and Preservative-Free Goods

Stephen and Amy Hueffed always knew they wanted to start a family together. What they decided after they were

married was that they wanted to start a business together, as well.

The couple had different professional backgrounds—Stephen was in youth ministry and Amy in alternative

medicine- but both were passionate about cheese and dairy farming.

So in 2005, the Hueffeds established Willapa Hills Cheese on a farmstead in southwest Washington. The family-

operated dairy farm and cheese producer focused on sheep and cow’s milk cheeses, and artisanal spreads.

Due to a changing economy and consumer demand, Stephen and Amy knew that to sustain their business long-

term, they had to expand production. However, this kind of growth required working capital that the Hueffeds

didn’t have.

The couple explored financing options, but traditional lenders were unable to provide a loan to the new, unproven

business. A local referral group, SlowMoney NW, connected them to CDFI Craft3. Craft3 saw Stephen and Amy’s

passion, determination, and the quality of their award-winning products. It also believed in Willapa Hills’

commitment to sustainable agriculture and conservation.

In November 2013, Craft3 provided Stephen and Amy with $75,000 for working capital and equipment purchase,

which allowed Willapa Hills to boost production of their natural and preservative-free products.

Case Study Primer

Opportunity Finance Network is the leading national network of community development

financial institutions (CDFIs) investing in opportunities that benefit low-income, low-wealth,

and other disadvantaged communities across America. We’ve prepared a real-life CDFI case

study for use in multiple settings to highlight typical work in the industry that helps

eliminate poverty and align capital with justice.

Purpose of a Case Study:

Case studies provide students and professionals the opportunity to apply their knowledge to

develop solutions for realistic, complex problems. They allow for individuals to explore real-

world issues experienced in the workforce. Case studies can also be used in case

competitions and case walk-throughs.

In case competitions, teams compete to identify solutions to problems and present in front

of a panel of judges. Prizes for top teams include monetary rewards, accelerated interviews,

or the opportunity to implement their solutions. A case walkthrough contains many of the

same elements of a case competition, but is used more for instructive purposes, with

facilitators assisting the teams in developing a solution.

Practical Uses for a Case Study:

1. Classroom Settings

a. Challenge students to critically analyze a situation

b. Generate classroom discussions

c. Teach students about common issues in an industry or field of study

2. Club Activities

a. Provide a unique look into an industry

b. Foster collaborative and team-based activities

3. Career Development

a. Conduct a case walkthrough

b. Promote analytical skills needed in workforce

UpLift Solutions CDFI Case Study:

The UpLift Solutions case study shows how a New Jersey-based CDFI designed and created

a lending policy to support its newly launched lending programs, aimed at eradicating food

deserts and ensuring access to fresh, affordable food in underprivileged communities.

Organizing Your Own Case Walkthrough or Competition

1. Leverage Your Connections

a. School officials and campus club leaders

b. Co-sponsor with local businesses

2. Bring in Local Expertise

a. Contact a local CDFI to help with the case study

3. Create Tangible Benefits

a. Icebreakers, food, engaging activities

b. Networking with local employers

Case Walk-Through: UpLift Solutions, Inc.

Organization Overview:

UpLift Solutions (UpLift) is a New Jersey-based, national nonprofit organization that provides lending

and development assistance programs to underserved communities and businesses to help

eradicate food deserts in America. UpLift supports food businesses, government agencies,

and nonprofits to create sustainable, healthy environments for low-income, underserved

communities. UpLift Solutions believes full service supermarkets in underprivileged

communities can become the anchor to fulfill many community needs and ensure consistent

access to fresh, affordable food while creating and maintaining local jobs. UpLift Solutions

implements its programs across the country by creating entrepreneurial strategies that

empower communities while benefiting all stakeholders involved.

In order to build a sustainable supermarket development model, UpLift endorses three

“bottom lines:”

● Business Profitability

● Community Wellness

● Environmental Sustainability

Current Organizational Profile:

● Founded: 2008

● Type of CDFI: Non-Depository Loan Fund

● Target Market: Grocery stores in underserved communities

● Types of Lending: Small Business

● Loan Products: Predevelopment, Term, Mortgage, and Community

Facilities Loans ● Asset Size: $790,463 (FYE 2013)

● No. of Employees: ~15

● Website: upliftsolutions.org

Situation:

UpLift Solutions has a strong history of in-depth development services to grocery stores

seeking to serve customers in food desert areas. It is interested in strengthening its

relationship with developers and grocery store owners by providing lending to complement

its existing development services. UpLift recognizes the need and demand for grocery store

financing in underserved communities and establishes a strong loan pipeline from its

development services work.

By providing capital, UpLift will better position itself to become a U.S. Department of

Treasury certified CDFI and have a greater impact in its community by coupling

development services with unique financial products, tailored to the needs of grocery

businesses.

UpLift’s senior management team realized that before it could scale up the capacity of its

financial services department and introduce new lending programs, it needed strong credit

and lending policies and procedures in place. To date, UpLift has no loan policies or

procedures.

You have been hired as a consultant to help assist UpLift Solutions in developing

its loan policies and procedures.

Discussion Questions:

1. What initial process and steps do you propose to design and implement an

appropriate loan policy for UpLift Solutions?

2. What factors should you consider in underwriting a loan in the grocery store

industry? What information would you need to review and understand?

3. What elements, parameters, and requirements should UpLift include in a loan policy?

4. How would a loan policy affect different UpLift stakeholders? Funders and investors?

Potential borrowers? What specific aspects of the loan policy are relevant to them?

5. As a mission-driven lender, what social impact criteria should UpLift consider in its

lending?

Answer Key – Discussion Topics

Question #1: Actual Process Implemented by UpLift Solutions

● UpLift hired a consultant and received technical assistance and training on the

important attributes of an effective lending program.

● UpLift and its loan policy consultant spoke with people involved in grocery store

lending to understand industry specific risks, opportunities, and impact.

● The consultant interviewed UpLift senior staff (CFO; lending manager) to understand

the proposed loan program goals, UpLift’s risk parameters, and their proposed

lending products.

● UpLift reviewed loan policies drafted by the consultant to ensure the loan policies

align with its mission, UpLift’s risk parameters, and the needs of its community.

Question #2: Factors to Consider in Underwriting to the Food Industry

Any strong loan underwriting process reviews and analyzes the five “Cs” of credit:

character, collateral, capacity, capital, and conditions.

Character

o Grocery store operator and/or owner, developer (if construction)

Collateral

o Assets that the borrower can pledge as security for the loan

Capacity

o Borrower’s corporate and owner’s personal credit record and their ability to

repay the loan (financial budget, financial analysis, and financial projections)

o Business plan review and analysis

o Consider loan-to-value, debt-service coverage ratios, and other financial

performance ratios

Capital

o Any capital/equity the borrower intends to inject in the project to serve as

financial cushion

o Any existing or additional financing to support the project that can be

subordinated to UpLift’s proposed loan

Conditions

o Interest rate, terms and conditions of loan that are acceptable for both the

borrower and CDFI

o Industry and local market analysis

o Site visit to assess grocery store layout, presentation, cleanliness, and

availability of products

Question #3: Parameters in Loan Policy / Main Elements of Loan Policy

General Loan Requirements

Fit with Mission

o How to ensure it caters to low-income communities

o How can UpLift meet its mission with its proposed loan products offered

Underwriting criteria and process

Community demographic information / Outcomes

Loan Approval Process / Authority

Who approves loans?

Is there a loan committee or lending staff loan approval process?

What types and loan amounts go to Board of Directors for approval?

How and when can loan policy exceptions be approved? By whom?

Potential Concentration Limits

Maximum loan size

Maximum loans to a borrower

Maximum for a particular type of loan

Loan Reporting and Credit Files

Adequate and timely collection of financial information to assess borrower status

Regular loan monitoring and performance review of loan health and status

Regular in-person borrower visits

Risk Rating System and Loan Loss Reserves

Numerical risk rating system that relates to loan loss reserves

Determine a loan loss reserve requirement for each loan or group of loans

Process and Reporting for Problem or Past Due Loans

Implementation of special review and monitoring process for loans with past due

payments or loans experiencing financial difficulties

Question #4: Impact of Loan Policy on Different UpLift Stakeholders

Funders/Investors

Investors that make loans to UpLift need to know that their loans are safe and will be

repaid on time.

UpLift must have procedures in place to evaluate, monitor, and mitigate the risks of

its lending programs.

● Investors/Funders want to understand the impact of UpLift’s loans to its borrowers

and communities served, as well as how UpLift ensures its lending meets its mission.

Potential Borrowers

Potential borrowers want to make sure that the terms and conditions of UpLift’s loans

will work for them, and the borrowing process is timely and reasonable. They may

consider the following factors

o Terms and interest rate of loans

o Maximum loan amount

o Flexibility of underwriting criteria

o Underwriting process

o Borrower reporting requirements

o Collateral pledge requirements

Question #5: Social Impact Criteria to Consider

Job creation (full-time equivalents)

Quality of jobs created (benefits, overtime pay, etc.)

Fresh food accessibility

Fresh food access in severely distressed areas

Environmental sustainability of operations

Resources

Browse the resources below and find even more at ofn.org

CDFI Locator:

Find a CDFI near you and get in touch with today’s leading CDFIs:

ofn.org/cdfi-locator

OFN Internships:

Learn about the exciting opportunities offered through OFN’s Intern Program:

ofn.org/internships

Industry Job Bank:

Learn about different careers in the opportunity finance industry:

ofn.org/job-bank

CDFI Connect:

Receive trending CDFI news and updates, directly on your Smartphone:

cdficonnect.org/

Social Media:

Follow us on the sites below and stay up-to-date on OFN-related news:

Our Twitter handles are @oppfinance and @CDFI_Connect.