Case Studies: Due Diligence, Performance Monitoring, and Impact Evaluation for Asset Owners
The Rockefeller Foundation
Godeke Consulting has recently completed an engagement assisting The Rockefeller Foundation with the transition of its PRI portfolio from one team to another. This assignment included a wide range of activities from day-to-day management of the global, multi-asset class portfolio (due diligence, origination, execution, systems, and monitoring) to onboarding the new team on operational and strategic issues in order to create a firm platform for growth of the portfolio under new leadership at Rockefeller.
The Educational Foundation of America
Godeke Consulting worked with the board and investment committee of this family foundation with a long history of social investing to optimize the governance, performance and functioning of its relationship with its investment advisor through a portfolio review and a series of facilitated investment committee and board conversations.
Bill & Melinda Gates Foundation
The Gates Foundation’s Education and Investment teams wanted to develop a guarantee structure to support the facility needs of high-performing charter schools. These schools had not been able to access the tax-exempt bond market due to the financial crisis and the lack of credit insurance in the market. We were engaged to undertake an extensive due diligence of national CDFIs active in the charter school finance sector to determine the appropriate partners and structures for the program. The resulting $40 million guarantee was one of the first times that Gates used its endowment to support its program activities.
The Robin Hood Foundation and F.B. Heron Foundation
The Robin Hood Foundation and F.B. Heron Foundation co-invested with other foundations and the City of New York to capitalize a $32 million guarantee facility to support the lending activities of the New York City Acquisition Fund. This fund’s purpose is to provide pre-development capital to affordable and low-income housing developers on more favorable and flexible terms than is currently available in the market, and to expand the developers’ capacity to assemble parcels for new development and to preserve existing affordable housing. The Fund is expected to create or preserve approximately 30,000 units of low-income and affordable housing over 10 years. The Fund’s credit enhancement will also encourage private sector lenders to fund loans at higher debt levels and lower pricing. Godeke Consulting was engaged by Robin Hood and the F.B. Heron Foundation to complete initial due diligence of their investments into the Fund and to help establish metrics for ongoing monitoring of their investments.
New Hampshire Endowment for Health
The New Hampshire Endowment for Health is a $60 million healthcare conversion foundation that wanted to develop a working capital fund for community-based health centers in its state. These centers provide care to a population that is either underinsured or not insured. Medicaid and/or Medicare reimbursement from government can take as long as 120 days. Due to poor economic conditions, normal lines of credit (such as local community banks) had become constrained. As a result, the foundation put in place a working capital fund that could provide short-term lines of credit while waiting for slow but earned revenue to arrive. We worked with the Endowment for Health to develop a request for proposal and then led the due diligence and selection of CDFIs to manage the fund. We also worked with the Endowment to structure its program-related investment into the intermediary.
The Altman Foundation
Godeke Consulting worked as a third-party due diligence provider to the Altman Foundation on a range of PRI investments including supportive housing loan funds, evergreen loan funds for nonprofits and historical preservation loan funds. We met with the investees, reviewed documentation and term sheets, and prepared investment memos for the foundation’s investment committee. We provided independent assessment to Altman to supplement its staff’s ability to execute impact investing opportunities.
The MacArthur Foundation
Through its State and Local Housing Preservation Leaders awards, the MacArthur Foundation provided $35 million in multi-year grants and program-related investments to state and local governments that demonstrated outstanding leadership through promising, high impact approaches to preserving and improving affordable rental housing. Godeke Consulting provided due diligence of the structured funds proposed by several of the cities and states in the competition, including Los Angeles, Florida, Maryland, Virginia and St. Louis.
Robert Wood Johnson Foundation
The Robert Wood Johnson Foundation’s (RWJ) mission is to improve the health and health care of all Americans. One of RWJ’s grantees is Playworks, a nonprofit headquartered in California that improves children’s health and well-being by increasing opportunities for physical activity during recess in low-income public schools. Godeke Consulting worked with RWJ to create a PRI loan guarantee that allowed Playworks to access working capital financing from OneCalifornia Bank, a CDFI, to expand nationally. Playworks required the working capital to pay for its expenses such as hiring prior to the school year when it receives payment from the school systems it serves.
Educational Foundation Pay-For-Success Design
Godeke Consulting was engaged by a national educational foundation to design an innovative pay-for-success financing structure to support a youth workforce development program for high opportunity youth in several cities in the U.S. We structured specific models around the success payments and explored potential corporate and public funding sources as a way to scale this highly effective workforce development model.