Last week, DWH traveled to Portland, Oregon to attend the 37th Annual Native American Finance Officers Association (NAFOA) Conference. The NAFOA conference provides attendees with opportunities to “engage directly with tribal leaders, professionals, and influential federal agencies about economic and financial issues facing Indian Country.” (nafoa.org). Attendance at this conference is crucial for DWH because our majority shareholder is Waséyabek Development Company, LLC (WDC), the economic development arm of the Nottawaseppi Huron Band of the Potowatomi. The conference is a chance to not only connect with members of our Tribe, but to also meet other Tribal members throughout the nation and share our experiences working in economic development.
The two-day event was packed with sessions, panel presentations and cultural activities for attendees. DWH Managing Director (and former WDC Board Vice Chair) Clayton Vanderpool participated in a panel that focused on how to create a foundation for a Tribal Economic Development Company (EDC) that would set it up for future success.
WDC and DWH are proponents of following the Harvard model as a best practice when it comes to creating stability for a Tribal EDC. This structure coupled with a consistent and open communication schedule will help create stability for the EDC and ensure the Tribe’s mission, vision and values are being maintained.
Key Points in Creating a Tribal EDC:
1) Before making any investments, a Tribal EDC needs to define what it IS and what it is NOT. Examples would be deciding if it wants to invest in startups, act as venture capital firm, make passive or private equity investments, or pursue an SBA 8(a) certification and provide products and services to the federal government. It must also determine funding sources and resources it is comfortable using.
2) Tribes need to define a decision-making process and the various levels of authority for the EDC’s subsidiaries, CEO, and Board of Directors. Ultimately it will need to decide at what point the Tribal Council’s and/or Board’s approval will be required on transactions or strategic decisions.
3) The EDC needs to take the investment parameters and funding resources and generate a financial model showing return and risk scenarios. The purpose of this model will be to ensure the investment philosophy and resources available will create a return that meets the Board and Tribal Council’s expectations. If the model and the results do not meet expectations, then one (or even all three) of the inputs (investment criteria, funding/resources and expectations), will need to change to ultimately create strategic alignment throughout the organization.
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