Small Businesses Survive-Adapt-Thrive with Cook Inlet Lending Center

Sacha Adorno

This year’s Native CDFI Awards honored two Native CDFIs for their unique approaches to helping Native-owned small businesses during the COVID-19 pandemic. Cook Inlet Lending Center (CILC) received the Native CDFI Catalyst Award and Black Hills Community Loan Center (BHCLF) received the Native CDFI Seed Capital Award.

Native communities have suffered a disproportionate burden of COVID-19 illness, with cases among American Indian and Alaska Natives 3.5 times higher than non-Hispanic whites in 23 states. Native CDFIs like CILC and BHCLF have been critical resources for these communities during the health and related economic crisis. 

In Alaska, CILC has developed a business stabilization strategy—Survive-Adapt-Thrive—to help Anchorage small businesses survive economic crisis, in this case the COVID-19 economic fallout. The strategy’s innovative combination of flexible financial relief products and technical assistance responds to the moment by providing access to affordable capital that small businesses need immediately as well as longerterm.

CILC will use its $100,000 Native Catalyst Award grant to build the staff capacity required to successfully implement its strategy. Watch Jeff Tickle, general manager, Cook Inlet Lending Center, and Carol Gore, president/CEO, Cook Inlet Housing Authority, accept the 2020 Native CDFI Catalyst Award at the OFN 2020 Annual Conference.

Jeff answered a few questions for us about the CDFI’s approach to financing justice.

CILC was founded as a homeownership organization by Cook Inlet Housing Authority (CIHA). How did you evolve to small business financing?

CIHA founded CILC in 2001 to serve low- to moderate-income households in Alaska’s Cook Inlet region. The mission was to increase homeownership among Alaska Natives and low- to moderate-income homebuyers.

Since then, our growth has been twofold. On the homeownership side, we started from a place of compassion, offering forgiveness type loans and deferred type mortgages. We moved to a place of sustainability, offering principal and interest loans in the form of second mortgages for down payment assistance.

We began offering these loans, pairing the approach with grants along with education focused on resources and tools important to home ownership.  

Understanding we had become a go-to resource for homeownership, we also knew there was more we could do as a CDFI.  So, we started thinking more broadly to other types of community development financing resources we could offer.

In early 2019, we began to develop a partnership with Anchorage Community Land Trust (ACLT), which had a program called Setup Shop. It was a combination of microlending and technical assistance and really strong on the latter. ACLT wanted a partner that could become the loan fund for small business lending. They saw us as that partner. That’s really what led to the launch of our small business loan program… in January 2020, no less.

So, you launched the business program in early 2020? A somewhat prescient circumstance given the soon-to-hit pandemic!

In some sense, the timing couldn’t have been better—especially for Anchorage small businesses. In the first few months of this year, we did two small business loans. When COVID-19 hit our area, we were set up to help shops that wouldn’t receive traditional financing from credit unions or big box banks and there were no other CDFIs or financial institutions positioned with the capacity to assist.

It was glaringly obvious very quickly that small businesses were going to be averse to debt financing. So, we had to quickly think about how to pivot our program, which at that point offered a basic loan product.

We found ourselves thinking about a loan product, at the time we were calling it a preservation loan with lower than market interest rates, flexible terms, deferred payments, partially forgivable, certain criteria, and so forth.

We started to create it when the municipality of Anchorage approached us to administer a pilot program to keep small businesses alive.  They had a million dollars to inject into small businesses and asked us to administer an emergency grant relief program with this capital.

They wanted us to fund 120 businesses. So, we pivoted again and set out to give small grants—$5,000-$10,000—to help Anchorage businesses survive those first few months of COVID-19. The grants were designed to help small business owners meet their immediate fixed and operating expenses, enabling their short-term survival over several months.

This became the “survive” of CILC’s Survive-Adapt-Thrive strategy?

Exactly! In fewer than three weeks we set up the infrastructure— application criteria, staffing, and technology—to administer the grant program. We took in more than 700 small business applications. It was really oversubscribed.

In August, the City approached us again with $5 million for a second round. We used half of the $5 million to fund some of the eligible wait-listed applicants from the pilot round. And then we did another random selection, because in the second round we received 1,600 plus applications.

Then recently the City asked us to administer a new nonprofit arts and culture grant program. We just closed out the application round for that and there are more programs the City has in mind for us to help with.

As a Native CDFI, was there a stipulation that the businesses you support be from a certain demographic?

The pilot funding was specifically for small businesses within the municipality of Anchorage. After the pilot round, we wanted to prioritize businesses owned by people of color and women and target neighborhoods with historically limited access to capital and significant barriers to economic recovery. So, we set up equity prioritization that 50 percent of the grants focus on businesses in lower income census track areas.  

Survive is focused on getting through this crisis. What are the next two elements—Adapt and Thrive—and when do you see businesses moving toward them?

We eventually hope to move businesses into debt financing. Our Adapt products will be 0-1 percent interest, partially forgivable loans with terms of up to one year and a 6-month deferment period. The idea is to give businesses opportunity to adapt their business models in response to COVID-19.

Eventually, we want businesses to move out of survival and adapt modes so they can thrive and grow. To help them, we will offer longer term, patient loan capital at below-market rates. Thrive products will be designed to allow businesses to return to a growth mindset once immediate needs for relief capital have been met, and they have strategically adapted.

Right now, we see survive mode spilling into 2021. There is no clear line for moving into adaptation. It’s going to overlap, obviously.

What have you heard from businesses receiving grants?

We’ve received really positive feedback. It ranges from simple gratitude to letting us know they’ll be able to remain in business. About 400 businesses have said they’re interested in learning more about debt financing to move forward from the pandemic.

Now we have this unbelievable pipeline of businesses that we’ve made contact with—all the marketing we expected to do for our small business program has condensed. And we will be in close contact with the businesses to understand what they need and what makes sense for them now and later. 

How has your team been throughout this—as you manage the work of being financial first responders and the anxiety of living through a pandemic?   

We’ve been working from home since March and are all missing the in-person connection that our on-site office gave us. That said, overall our morale is high knowing we are providing a lifeline to our small business community. There have been other silver linings through it all, like expanding our staff from nine to 13 people to help meet the demands for small business support.

And, this was a big surprise to us, but our homeownership staff executed the most first mortgages in CILC’s history this year. So that’s a true silver lining.

What has receiving the Native CDFI Catalyst Award meant for your team?

This award means everything to us. The funding is extremely important for the lending center, not only for this year but moving into early next year and helping us continue with our response. It’s hard to put into words how important it is. It will mean so much to our team’s ability to help our communities today and tomorrow.


Launched in 2019, the Native CDFI Awards are a joint initiative of Wells Fargo, Oweesta Corporation, the oldest Native CDFI intermediary, and OFN, a national network of CDFIs, to honor and support Native CDFIs that are creating opportunity and promoting self-sovereignty in Indian Country nationwide. Learn more about the Native CDFI Awards and read stories from Awardees here.