Welcome. My name is Jerry Chasen, and I’m the Vice President of The Alliance for Global Good. The Alliance’s mission is to increase the efficiency, effectiveness and sustainability of nonprofits focused on solving global crises, so it’s no challenge to see how this fund helps to effect our mission. On behalf of the Alliance’s founder, NC philanthropist Leonard Kaplan, and our president & CEO, David Brand, I’m pleased and honored to welcome everyone to today’s call. We have a great deal to cover this morning, and I won’t take much time, but I’d be remiss if I didn’t acknowledge at the start the tremendous work done by Susan Raymond, Sophie Morrison, and the rest of the team at Changing Our World, in supporting the Alliance by designing and helpping to effect this first round of grants. Thank you.
The Fund leadership on the call reflects a diverse and appropriate background for the fund and its administration. The business background of David Brand, Alliance President, provides boots on the ground expertise in the realities of a sustainable business environment. Rod Nichols’ background has placed him squarely in the environment of innovation and evolution particularly from a scientific perspective. Susan Raymond’s international and philanthropic expertise are the ideal background for this globally focused initiative.
This statement of the Innovation Fund’s purpose both explains what results the Alliance seeks with this fund, and highlights the subjects that are the focus of most of the questions that we’ll cover this morning.
Our timetable is relatively straightforward. After the proposals have been submitted, they will be reviewed by staff for both compliance and basic content. Those proposals meeting the stated criteria will be forwarded to three independent, outside reviewers, who will complete their review by August 1. Notification of the results of the initial review will be shared no later than August 15. The xx to yy finalists selected will be invited to present their proposal in detail and orally to a Review Board comprised of additional independent outside advisors, AFGG executives and selected Innovation Fund investors. To be clear—this presentation is required for funding Presentations will be in NY, on Sept. 19 and 20, 2012. Announcement of the grant recipients will be made on or around October 1.
The individuals acting as Round One Reviewers again reflect a diverse and appropriate background for the fund. Dr. Adelman’s background in Global Development, Mr. Bendis’s focus on innovation, and Mr. Bugg-Levine’s experience in impact investments add tremendous depth to the evaluation effort and we are most fortunate to have their participation.
Our call today will first address those questions which we received prior to the posted deadline of 5pm last Thursday, June 7. It will focus on 4 key subject areas, another that is sort of a grabbag, and time permitted, we will address those questions that were submitted after that deadline. Let me add also that today’s presentation will be posted on the Alliance Website today after the call. In addition, additional questions can be submitted by email to innovation@AFGG.orgthrough 5 pm (ET) Wednesday June13. Written response to these and the other questions not included in this presentation will be posted on the Alliance Website by 5 pm on Friday, June 15. With that, let me introduce Susan Raymond, who will guide usthru the questions and answers.
Innovation fund call v1 ppt 5
Innovation Fund Alliance for Global GoodRound One Request for Proposals Questions and Answers
Innovation Fund leadership on this call• David Brand: Chief Operating Officer, AFGG 35 year business experience; AFGG start-up co-founder.• Jerry Chasen, Esq.: Vice President, AFGG LL.M. in Estate Planning—philanthropic advisor and counselor; Founder of the Advisors Project; Chair Community Projects Fund Distribution Committee, Miami Foundation• Rodney W. Nichols: Senior Advisor to AFGG Past President, New York Academy of Sciences, and past VP and Executive VP of Rockefeller University• Susan Raymond, Ph.D.: Executive Vice President, Changing Our World, Inc. Design leader for Innovation Fund; experience at USAID and World Bank in program/loan design and execution; extensively published on philanthropic strategy 2
Purpose of Innovation FundAFGG has created the Innovation Fund to enablemedium-sized U.S.-based nonprofits engaged in globalissues of health, education, environment, poverty, andworld relations to begin to develop mission-relevantsocial finance mechanisms as part of their approach bothto their own revenue needs and to the sustainability ofprograms that address the mission and problem-solvingprograms of the nonprofit. 3
Process for Round One• RFP Available May 30• Submission of Proposal June 27• Review Completed August 1• Notification of Finalists By August 15• Concept Detail Pitches September 19-20• Grant Announcements October 1 4
Round One Reviewers• Dr. Carol Adelman Senior Fellow and Director of the Center for Global Prosperity of the Hudson Institute; former Assistant Administrator of USAID. Dr.P.H. from Johns Hopkins University.• Richard Bendis Founding President and CEO of Innovation America (IA); President and CEO at BioHealth Innovation Inc.; Member of the White House U.S. Innovation Partnership Advisory Task Force.• Antony Bugg-Levine CEO Nonprofit Finance Fund; former Managing Director at the Rockefeller Foundation; Board Chair of the Global Impact Investing Network. 5
Structure of Q&A• Revenue Criteria• Program Content and Geography• Application Process• Grant Award• Other• Additional questions keyed in on prompt from presentation. 6
Question 1Could you clarify the revenue size of eligiblenonprofits? The Innovation Fund seeks to strengthen nonprofits that, on average for the last five years, have had annual revenue below $20 million and have been revenue stable. We understand that there are differences across years and understand that there may be a 10% divergence above that $20 million level (e.g., $2 million higher), but that is our target range. 8
Question 2Is there a minimum revenue size? No. We care deeply about big ideas, even if the organization is small. The review will, however, carefully examine evidence of the viability of the proposal in terms of capacity to execute. 9
Question 3Can an Institute of a University apply if its revenue iswithin the acceptable range although the University isnot, and if the Institute is not a separate 501(c)3? Yes. However, we would want to see that the Institute is operated, in effect, as a wholly owned subsidiary with programmatic independence. This also applies to very large nonprofits which have internal subsidiaries or members that are, in effect, independent, even if they do not hold a separate 501(c)3 status. 10
Question 4Are there categories of revenue that can be deductedfrom the total revenue size, e.g., revenue that ispassed through for rebates or the monetized value ofin-kind donations? The Fund agrees that two categories of revenue can be subtracted from total revenue in determining eligibility: • the monetized value of in-kind contributions • contributions to dedicated scholarship funds Other financial structure exceptions will be dealt with on a case-by-case basis via email inquiry until June 15. Answers will be circulated. 11
Question 5In terms of innovation, must this be in the area ofearnings, or does innovation in the investment ofassets qualify? The goal of the Fund is to promote innovation in the development of sustainable revenue sources. Therefore, innovation in the use of assets to meet revenue and mission needs qualifies as innovation for purposes of the application. 12
Question 6Can an organization less than 10 years old apply? The 10 year requirement is a safe harbor to focus on organizations that are not start-up. If the applicant can demonstrate stability and program maturity in less than ten years, and has five years of stable revenue (as is also required), then the application will be considered. 14
Question 7What do you mean by “global”? Are theregeographic areas outside the United States that willnot be considered? Are there preferred sites? We will not fund any activity that is in a nation on the U.S. Treasury boycott list. There are no other geographic preferences. 15
Question 8Can proposals be for programs within the UnitedStates? No. The program actions and effects must be abroad. However, program management and administration can, but does not have to, be in the United States. Moreover, a partnership of a U.S. nonprofit with domestic programs and a U.S. nonprofit with international programs for an overseas initiative using the capacities of both is well within the intent of the Fund. 16
Question 9Must the program be within one of the areas, or canit be across areas? The Innovation Fund looks extremely favorably on programs and strategies that are purposefully and deeply inter-sectoral. 17
Question 10Please discuss more fully how advanced an initiativemust be to qualify for the competition. The proposal should indicate the expected time frame for implementation of the proposal. Ideally, the Fund would anticipate the innovation would be implemented within 6 – 12 months of the grantee’s receipt of funds. 18
Question 11Are there restrictions on the use of funds? Regarding various categories • Market research can be funded if it is at-market end-stage to finalize a strategy or product that is revenue diversifying. However, the Fund is focused on getting previously designed ideas to market. Therefore, preliminary market research would likely not be funded. • See RFP for the restrictions on salary allocations. • Funds can be used to pay consultants or professional advisors. Again, the distinction is at the go-to-market phase. 19
Question 12Does this have to be a new funding stream, or can itbe an improvement to, or scale up of, an existinginnovation or a new application or version of anexisting innovation? Adaptations or expansions of existing innovations are within the interest areas of the Fund. 20
Question 13Can the innovation be focused on programs orpolicies, rather than on finance or revenue? No. The focus is on revenue diversification and stabilization through strategies that are outside of traditional charitable philanthropy. 21
Question 14What are the reporting requirements andtimeframes? Brief letter reports will be due on a quarterly basis. However, the Fund expects to be in regular contact with its grantees to learn from, and disseminate, what works and what doesn’t. 22
Question 15How specific does the quantitative measure ofimpact have to be? We leave this up to the applicant. Not all results can be called “impacts” especially where problems are extremely complex. However, assessment of proposals will consider both how an organization defines “results” and the quality of that data. 23
Question 16Must the proposal be submitted through the web-based system? Yes. 25
Question 17Are audited financial statements required? Can theybe submitted before the oral pitch if that coincideswith the fiscal year? Many small organizations donot have these, but do have full Form 990 taxsubmissions. Where there is an audited financial statement, the Fund requires the submission of the most recent one, regardless of fiscal year. Where there is no audited statement submitted, if the proposal gets to the pitch stage, the financial statements will be vetted more thoroughly and any financial issues arising may result in withdrawal of the invitation to pitch. 26
Question 18How much detail is required relative to past studiesof innovation market and viability? Should studies beattached? Studies can be summarized such that the reviewers can determine how close to implementation the innovation is. 27
Question 19Are third party recommendations accepted? Yes, if they are embedded in the proposal (taking into account limitations on length of answers). They are not required in the proposal stage. Of course, oral pitch content can include as many endorsements as desired. The critical element at all stages is the quality and evidence relative to the initiative. 28
Question 20Is the oral pitch required? Yes. It must be attended by senior executives as described in the RFP. Travel expenses will not be defrayed by the Fund. If long distances for primary executives are an impediment, the Fund will discuss alternatives (e.g., skype), but demonstration of the commitment of executives and boards are required. 29
Question 21What is the minimum and maximum grant size? There is no minimum. The maximum grant for Round One is $60,000. 31
Question 22How many organizations do you expect will submitfunding requests and how many grants will beawarded? From this Round One cycle, no fewer than 3 grants will be made. As this is the inaugural grant cycle, there is no precedent from which to predict a likely number of applicants. 32
Question 23What is the timeline for grant disbursement? Howlong is the proposal for? A proposal should outline the applicant’s optimum timeline for receipt of funds. We are prepared to provide three quarters of the amount funded when the grant is made. The final quarter of funding will be available at the start of the sixth month after the grant award, but shall be tied to the organization’s receipt of its matching funds. 33
Question 24Are there restrictions on partnerships with for-profit organizations? No. In fact, we would favor those in which the Fund is leveraged by financial participation by such a partner. 35
Question 25Can an organization submit a proposal to help otherawardees scale their programs based on theirgrants? No. The funds are for direct initiative execution. 36
Question 26What is the time commitment for the mentoringnetwork? This has not been specified. Round One awardees would not be asked to be mentors until Round Three. We would seek the guidance of Round One awardees on the design of the program. 37
Additional Questions Please key in any additional questions now.Questions and answers reviewed on today’s call will be posted on the website. Additional questions can be submitted by email through 5 pm (ET) Wednesday June, 13. 38