NEXT Opportunity Award
The NEXT Opportunity Award recognizes up to four CDFIs per year that present compelling strategies for expanding geographic and/or product coverage. The total pool of $8.25 million includes $7.5 million in low-cost, long-term debt and $750,000 in unrestricted grant funding.
Prospective applicants should demonstrate high capacity, strong financial performance, and a high level of readiness to implement their plan. The applicant’s expansion strategy should be on track to implement within six months of receiving an award.
Applicants must have at least $5 million in assets and can apply for award amounts up to 10% of their total assets.
Congratulations to the 2012 Awardees, Clearinghouse CDFI, Corporation for Supportive Housing, and Primary Care Development Corporation.
The application round for 2013 NEXT Opportunity Awards is now closed. Winners will be announced in September.
2013 Timeline
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Applications Open
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February 1 |
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Conference Calls for Applicants |
February 7, 1:00 PM EDT February 19, 1:00 PM EDT
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Applications Close
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March 18, 5:00 PM EDT |
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Evaluation Period
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March-July |
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Selection Committee Meetings with Finalists |
July 24
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Awardees Notified |
TBA
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Wells Fargo NEXT Awards Celebration
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October 16, 2013 at OFN’s conference in Philadelphia, PA
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Applicants for the NEXT Opportunity Award must meet certain eligibility requirements. Below is a summary.
General Notes
- CDFIs do not need to be a Member of OFN to apply for the NEXT Awards.
- CDFIs cannot apply for both the NEXT Seed Capital Award and the NEXT Opportunity Award in the same year as they require different stages of development for an applicant’s expansion strategy.
- The CDFIs that won a large NEXT Award in 2007–2011 or a NEXT Opportunity Award in 2012 may not apply for the Wells Fargo NEXT Awards in 2012–2016.
- CDFIs that are awarded the NEXT Seed Capital Award in one year may apply in future years for the NEXT Opportunity Award.
2013 Eligibility Requirements
1. Charitable Purpose
Applicant is a US tax-exempt organization with a current 501(c)(3) determination letter from the Internal Revenue Service. An organization without this tax status may be eligible if it is a U.S. Treasury CDFI Fund certified CDFI. Native CDFIs that are CDFI Fund certified must not be tribally controlled.
2. Community Development Mission & Impact
Applicant has a primary mission of community development and strives to have a positive impact on low-income, low-wealth, and other disadvantaged people and communities.
3. Finance-based Strategy
Applicant is a private non-governmental financial intermediary that uses financing as an integral part of its community development strategy.
4. Three Years of Financing Experience to Achieve a Community Development Mission
5. Audited Financial Statements for 3 Years
If the applicant is a credit union, a 5300 report can not substitute for an audited financial statement.
6. Discipline and Performance
Applicant is currently in compliance with all financial covenants, reporting requirements, and performance obligations stipulated by public, private, and philanthropic providers of capital and grant support.
7. Current Plan
Applicant is operating under a business plan or strategic plan that was written or updated within the last five years.
8. Total Assets More Than $5 Million
9. OFN’s Goals
Applicant affirms Opportunity Finance Network’s goal to ensure that low-income, low-wealth and other disadvantaged people and communities have access to affordable, responsible financial products and services.
2013 Selection Criteria
1. Rationale for Expansion
A clear analysis of the unmet market need that applicant plans to address with geographic and/or product coverage strategy, including why current sources of capital are not sufficient.
2. Coverage Strategy
A compelling financing strategy to expand geographic market and/or product coverage which must be in process or ready to implement within six months of receiving an award.
3. Use of Funds
A compelling use of funds that demonstrates how the applicant will use the NEXT Opportunity Award to advance the applicant’s coverage strategy in ways that otherwise would not be possible. Applicants must specify award amount requested.
4. Impact
A credible and compelling analysis of projected impact from applicant’s coverage strategy over a 3-5 year time horizon.
5. Readiness
A strong management team, partners, and other resources in place or planned to execute its coverage strategy.
6. Financial Strength and Performance
Strong financial performance and risk management, dedicated staff, and a sound business model that positions the organization for sustained growth, innovation, and success.
The Selection Committees include senior executives from Wells Fargo, the MacArthur Foundation, and The Kresge Foundation, as well as highly regarded CDFI leaders and experts in banking, philanthropy, economics, and advocacy. This distinguished and diverse group of experts brings a wide range of expertise and perspectives to the process of selecting the Wells Fargo NEXT Award recipients. Specifically, they will assess the qualifications and merits of the applicants relative to the selection criteria, conduct in-person interviews with finalists, and select the award recipients.
2012 NEXT Opportunity Award Committee
Note: The 2013 Selection Committee is still being formed.
Alison Beck Yonas
Vice President of Finance
Latino Community Credit Union
Joe Neri
Chief Executive Officer
IFF
Anthony Berkley
Program and Portfolio Officer
Mission Driven Investing
W.K. Kellogg Foundation
Mark Pinsky
President & CEO
Opportunity Finance Network
Jim Bildner
Board Member
The Kresge Foundation
Debra Schwartz
Director, Program-related Investments
John D. and Catherine T. MacArthur Foundation
Kimberlee Cornett
Director, Social Investment Practice
The Kresge Foundation
Eileen Stenerson
Senior Vice President, Community Lending and Investment
Wells Fargo
Lot Diaz
Vice President, Housing and Community Development
National Council of La Raza
Megan Teare
Senior Vice President
Wells Fargo Community Lending and Investment
Lesley Eckstein
Executive Vice President and Group Head
Wells Fargo
David Wood
Adjunct Lecturer in Public Policy
Director, Initiative for Responsible Investment
Hauser Center for Nonprofit Organizations
Can I apply for a NEXT Opportunity and NEXT Seed Capital Award?
CDFIs cannot apply for both the NEXT Seed Capital Award and the NEXT Opportunity Award in the same year as they require different stages of development for an applicant’s expansion strategy.
I know that an organization is not eligible to apply for both the NEXT Opportunity and NEXT Seed Capital awards. Can two affiliated but legally separate organizations apply? Both are CDFIs—a community development credit union and 501(c)(3) nonprofit.
Two affiliated organizations that are separate legal entities can apply for the NEXT Opportunity Award and the NEXT Seed Capital Award as long as each is a 501(c)(3) and/or CDFI Fund Certified.
Can my NEXT Awards strategy be an asset-building program or IDA program that does not include a lending component?
In 2012 and 2013, the NEXT Awards' programmatic focus is on expanding geographic and product coverage. Your CDFIs strategy can include other strategies, but must also include a lending or investing component.
Does my organization have to be a 501(c)(3) to apply?
An organization must be tax-exempt under Section 501(c)(3) of the Internal Revenue Service code or certified by the CDFI Fund to be eligible to apply for a Wells Fargo NEXT Award.
My CDFI won a million dollar NEXT Award. Are we eligible to apply for the NEXT Opportunity Award?
The CDFIs that won $5.5 or $2.75 million dollar NEXT Awards in 2007–2011 may not apply for the NEXT Awards in 2012–2016. CDFIs that won $25,000 NEXT Awards are eligible to apply.
Can CDFIs submit a co-application with another CDFI?
CDFIs cannot submit a co-application. One CDFI must apply and if applying for the NEXT Opportunity Award must have assets greater than $5 million. However, a CDFI can mention in its proposal how it plans to partner with another CDFI in its CDFI coverage strategy.
If an organization doesn’t have audited financials, can it still apply for the NEXT Awards?
For the NEXT Opportunity Award, three years of audits are required. NCUA 5300 financial reports for credit unions will not be accepted for the NEXT Opportunity Award.
If my organization receives an award, will I be notified before the OFN Conference?
Yes, Awardees for the NEXT Opportunity Award and the Award for the NEXT Seed Capital Award will be notified before the OFN conference.
Can the debt portion of the NEXT Opportunity Award be structured as a subordinated loan?
No, the loan must be a senior, unsecured loan to the CDFI applicant.
Is a tribal entity eligible for a Wells Fargo NEXT Award? My organization is an LLC organized under the Tribe.
A Native CDFI is eligible to apply if it is a separate organization from the Tribe and the Tribe does not have any form of control over the CDFI. The Native CDFI must satisfy all other Eligibility Requirements.
Does my organization have to be CARS™-rated to be eligible to apply?
Applicants do not have to be CARS™-rated to apply. Winners of the NEXT Opportunity Award may be required to get a CARS™ Rating if they do not already have one, subject to CARS™ having the capacity to rate your organizational type.
We anticipate that we will be out of compliance with one of our quarterly financial covenants with one institutional investor for the period ending 3/31/12. We intend to ask for a waiver in writing from the institutional investor for the covenant non-compliance. If we get a written waiver, will we be eligible to apply for the NEXT Award?
If you have received a written waiver from your investor, you are in compliance and are eligible to apply for the NEXT Award. Please forward the written waiver to info@nextawards.org.
My organization is in the process of being CARS-rated for the first time. Do I need to provide all of the documents as part of my application?
A CDFIs final CARS report must be available by the application deadline or you must provide all of the requested documents as part of your application.
Is there a specific time period within which the debt portion of the award must be drawn down; and does it need to be drawn down in full, or can it be drawn down incrementally over a period of time?
The grant and loan portion of the award are closed and disbursed at the same time. The awards are closed and disbursed within three months of receiving the commitment.