The beginning of a new year is a time for looking back on accomplishments and forward to the work ahead. At the start of 2005, we at VPP pay homage to the old adage, “Be careful what you wish for.” We have great investment partners who face formidable challenges yet have the potential to tackle them. We built our team with seasoned executives having extensive regional knowledge to deliver on the promise of “strategic assistance” for our investment partners. We’ve developed a comprehensive suite of tools and systems to support the VPP investment approach, and we’ve learned how to apply and improve on these tools.

Each and every day we continue to learn just how difficult our chosen course is. The investment road we have undertaken is one of high risk for high reward, yet, we remain convinced that our efforts will yield significant results, despite the risks.

For our investment partners, 2004 was a year of important strides in expanding their coverage, serving more children and youth, improving their services and thus the outcomes achieved, and building their organizations. We entered into the first stage of investment relationships with three new investment partners: The Boys & Girls Clubs of Greater Washington, Mary’s Center for Maternal and Child Care, and, most recently, College Summit. And, we began multi-year investment partnerships with CentroNía (formerly Calvary Bilingual Multicultural Learning Center) and the Latin American Youth Center (LAYC) following the completion of their business planning initiatives. We also committed to the continuation of our co-investment with the Edna McConnell Clark Foundation to support Asian American LEAD’s (AALEAD) business planning initiative, after AALEAD completed the first stage of organization building that the Edna McConnell Clark Foundation and we supported.

Other portfolio organizations moved full steam ahead implementing expansion strategies. Heads Up began serving children at two new sites in 2004, expanding to a total of 10 locations. The See Forever Foundation opened its second campus—Maya Angelou Public Charter School-Evans—in partnership with the DC Public School system (DCPS) and supported by the Gates and Walton Foundations. The Child and Family Network Centers (CFNC) opened a new center in the West End of Alexandria to serve more children with new support from the Freddie Mac Foundation. The Center for Multicultural Human Services (CMHS) began serving children and families in two new locations—Arlandia and Herndon. LAYC entered into a partnership with the Archdiocese of Washington to become the anchor youth program in a new, multi-service facility in Langley Park, MD, guided by growth aspirations developed in their business planning initiative. And, CentroNía opened a new charter school that serves children from preschool through fifth grade.

More important than simply the numbers of children and youth served, there were across the board improvements in the quality and scalability of investment partner programs and services. The increased focus on understanding their respective “theories of change” resulted in improved programs and services to better achieve sought-after outcomes. Material improvements were realized in curriculum, faculty, staff, program delivery, and client care. And, for several organizations, including Heads Up, AALEAD, and CMHS, outcome assessment systems were implemented. For example, Heads Up was able to report that individual reading assessments for the 2003-2004 program year showed that 856 students averaged a 1.1 grade level jump in reading skills over the year.

Each of the investment partners took important steps to fortify and strengthen their organizations so that they may become even more effective in building their organizations and further scaling their efforts to improve the lives of children and youth. A number strengthened management teams and further developed their boards. Heads Up, See Forever, LAYC, and CentroNía hired senior executives for their management teams. Introducing this kind of change in an organization is vital but tough, requiring Executive Directors to let go of certain tasks to embrace a newfound freedom that allows them to focus on larger issues to deliver on their mission. CMHS, See Forever, Mary’s Center, AALEAD, and Heads Up also made important additions to their boards.

Working with McKinsey & Company, the Monitor Group, and the VPP team, eight investment partners have now conducted extensive business-planning efforts, with the last three underway in 2004, allowing us to refine our approach and improve the effectiveness of the planning. In addition, VPP placed greater emphasis on outcomes planning as a core element of business planning, enlisting Policy Studies Associates and Mathematica Policy Research to help investment partners design outcomes frameworks to better assess and manage their organizations. These processes offer a way to engage management and the board to better challenge basic premises and to understand the purpose and goals of the transformation we all seek to achieve. We and our investment partners have learned much from these experiences. We’ve adapted our efforts, to evolve from a process originally designed to challenge an organization on its goals, to that of an “intervention” intended to trigger the organizational transformation necessary to help investment partners meet the difficult challenges often inherent in fulfilling bold aspirations.

Fiscal sustainability remains the biggest need and challenge for our investment partners. Although all of our investment partners are faring well in financing their operations, VPP is committed to supporting our investment partners’ efforts to better identify and secure sustainable financing streams—whether public, philanthropic, or fee-based—for the long term. Some of the more notable financial achievements included:

• See Forever forged a partnership with DCPS to gain access to public school facilities, defraying a major capital cost.


• Mary’s Center was designated as only the second “Federally Qualified Health Center” in the District of Columbia, which entitles them to $650,000 in additional federal funding for each of the next three years, federal coverage of their liability insurance premiums, and substantial increases in Medicaid reimbursements.
  
• CharityWorks selected two VPP investment partners as beneficiaries, See Forever in 2004 and Heads Up in 2005, resulting in significant financial support and, in addition, a broader awareness to open new connections to donors and resources in the region.


• Public funding appropriations for CFNC, CMHS, LAYC, CentroNía, Mary’s Center, and See Forever were secured, and CMHS was also awarded a Virginia state grant of $300,000 for the delivery of gang-prevention services.


• CentroNía was the recipient of the DC Revenue Bond Program’s 100th deal. The bond, funded through the sale of tax-exempt municipal bonds, will finance $3.5 million in upgrades and additions.


• VPP and the Edna McConnell Clark Foundation joined together, not only providing dollars but also bringing complementary expertise to two investment partnerships, and, by doing so, demonstrated a model where funders can work closely, complementing each other’s strengths, as co-investors.
  

We have refined our own investment process, developing special tools and guidelines to keep on track and maximize our effectiveness. We have partnered with the Nonprofit Finance Fund (NFF) to blend our respective methods to create a better way of assessing an organization’s financial health and now utilize the services of NFF as a standard part of the extensive analysis we do on potential investment partners.

Moving forward, our challenge is to build on our work and continue the momentum. We’ve learned that VPP is about transformation—within ourselves, among our investment partners, and within the philanthropic and nonprofit sectors. Our investment partners and the VPP team have been tested throughout the year, and we are stronger as a result. But looking back, I can honestly say that all of us have learned important lessons as our understanding of our work, goals, and each other evolves. Our investment partners and VPP as organizations are all well-positioned to continue.

In 2005, we have a full agenda. In addition to the work already underway,

• We expect to make three new investments.


• We are examining VPP’s own effectiveness and have engaged Fred Miller, President of The Chatham Group, to conduct a confidential assessment of the VPP portfolio of investment partnerships and expect the results to be presented to the board, team, and our investment partners by early spring.


• We will continue exploration of ways to increase the awareness of and find solutions for the acute shortage of leadership and management talent that continues to seriously constrain the nonprofit sector in the National Capital Region, particularly in social and human services organizations. We are focusing our initial work and attention to work with community leaders on ways to change the flow of talent to attract, retain, and develop African American leaders, benefiting not only our investment partners but broader nonprofit needs.


• We are working closely with the Nonprofit Finance Fund, one of the premier organizations in the nonprofit field, to research existing and new financing options and capital sources for nonprofits along the different stages of organizational growth.


• We are doing more to engage, serve, and learn about our founding investors to be able to advance their philanthropic interests and endeavors and leverage their collective work.


• And, finally, we are exploring VPP’s future which will build on VPP’s investment experience and evolve into a regional intermediary, capable of providing large financing and addressing structural change in organizations and the sector at large. We are assembling a core team for planning VPP’s future, have formed Planning Working Groups comprised of VPP board members and key advisors, and are working with McKinsey & Company to augment this effort.

My best wishes for a productive and fruitful 2005.

-Mario

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College Summit Latest Addition to VPP Portfolio

VPP has entered into an investment partnership with College Summit, a dynamic organization whose mission is to increase the college enrollment rate of low-income students by ensuring that every student who can make it in college makes it to college, and by putting college access "know-how" and support within the reach of every student.

During the first phase of this investment partnership, VPP will provide up to $450,000 in funding and strategic assistance to help College Summit address the college access needs of high school students from low-income families throughout the Washington, DC metropolitan area. While College Summit is a national organization, VPP's support will be focused on the College Summit DC Metro organization, enabling them to build out their leadership and fully develop their organizational capacity. Later investment phases will help College Summit prepare and implement an outcomes-driven, regionally-based business plan, develop the operating capacity to manage rapid scaling throughout the region to increase annual student enrollment 12-fold over four years (from 250 to 3,000), facilitate the building of partnerships with local school systems (including charter schools) and college and universities, and leverage other college access assets in support of College Summit's aspirations.

College Summit was founded in 1993 by J.B. Schramm, a graduate of Yale University and Harvard Divinity School who was directing a teen center in the basement of a low-income housing project in Washington, DC. J.B. was alarmed by the large number of talented, motivated, and college-capable teens not enrolling in college. As he worked to solve this problem he was reminded of his own inner-city high school in Denver where many talented students from low-income families did not go to college because they lacked parental or school-based support to manage the many pieces of the college transition process. Having worked as a freshman advisor while in graduate school, J.B. knew that college admissions officers throughout the country were aggressively searching and competing for talented low-income and diverse students to enter their freshman classes. Mobilizing the support of a Harvard University writing instructor and a community youth worker, J.B designed a college transition system to help all capable talent in a low-income school make the transition to college, the first step toward a brighter future for students who are often the first in their families to do so. This led to the creation of College Summit, a national organization headquartered in Washington, DC, with significant operations in the District, California, Illinois, Colorado, and West Virginia. As it refines and grows its programmatic reach in these existing regions, serving thousands more students, College Summit is also in the midst of a new round of site expansion into prospective communities across the country.

College Summit is helping close the college enrollment gap, making access to post-secondary education a reality in communities nationwide. Since 1993, College Summit has trained more than 700 teachers from more than 100 public high schools, held more than 120 summer workshops on college campuses serving over 5,000 students from ten states and DC, and its participants have earned in excess of $40 million in college scholarships. College Summit was identified by the US Department of Education (Office of Civil Rights), as one of only a small number of innovative approaches nationwide to effectively address diversity issues in post-secondary education. Historically, College Summit participants are 50% African American, 35% Latino, 10% Native American and 2% Caucasian with an average high school GPA of 2.8.

College Summit provides a combination of tools and approaches aimed at changing the culture of high schools and creating new norms among students so that they value a college degree, and truly believe it is within their reach. These resources include the College Summit proprietary on-line application management tool, CSNet; teacher training to fill the role that college-experienced parents play for their children in middle-class communities; the "Navigator" curriculum for high school seniors; an "Educator's Navigator" manual for teachers; intensive four-day college application and transition workshops; a peer leader and alumni development program; youth facilitators; and an ever expanding network of school district and college/university partners.

Excited about working with VPP, J.B. said, "Partnering with VPP will allow College Summit to achieve its long-held aspiration of helping the many capable students in Washington metropolitan area high schools realize their dream of attending college. We are thrilled to have the opportunity to benefit from the experience and support of the VPP team, and to expand our efforts to reach 3,000 students each year in DC, Maryland, and Virginia."

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Executive Directors from VPP’s investment portfolio share some of their organizational aspirations for the new year.

Asian American LEAD (AALEAD)
2005 will be an exciting and transformational year for Asian American LEAD. One of our biggest hopes is to develop a strategic plan that will give us clarity and clever strategies to effectively and efficiently serve more low-income Asian American children in the Washington metropolitan area. With this strategic plan, AALEAD will have well-developed short-term and long-term goals that address both organizational programmatic expansion and resource development. In 2005, Asian American LEAD hopes to find creative ways to build strategic partnerships to increase our visibility both locally and nationally, to expand our fundraising capacity, and to build an advocacy voice for Asian American children and families. Finally, Asian American LEAD will become more effective in our ability to affect positive changes in our children’s and families’ lives.

- Sandy Dang, Executive Director

Boys & Girls Clubs of Greater Washington (BGCGW)
BGCGW's hope for the new year is to strengthen its voice. BGCGW is blessed with individual acts of kindness as well as the concerted efforts of many determined to make the experiences of at-risk children in the region more positive. These inspiring youth emphasize that their futures are determined in great part, not only by the positive opportunities afforded in the Clubs' programs, but also by the mentoring influence of a professional staff member. Acquired self-esteem, combined with directed education and reinforced by character and determination, enable these young boys and girls to overcome hardships and realize their ambitions.

Going forward into 2005, BGCGW aspires to be a catalyst for at-risk youth, serving as the paramount point of entry into an established development path, through structured activity with positive role models.

- Pat Shannon, President

Child and Family Network Centers (CFNC)
Calendar year 2005 brings CFNC to the final year of its three-year strategic plan, developed in collaboration with VPP. To that end, CFNC senior staff begin the New Year with high hopes of achieving their outcomes-based plans for reaching 208 Alexandria and 45-80 South Arlington families living in poverty. CFNC's efforts will remain focused on providing free high-quality early childhood education and critical health and social services so that the young children in these families will have greatly improved odds for educational achievement in kindergarten and beyond.

In Arlington, a comprehensive multi-agency planning process, initiated by CFNC, will culminate in the 2005 September opening of multiple classrooms for preschool-aged children living in Arlington's toughest neighborhoods. CFNC has established partnerships with Arlington government, school system, nonprofit, and corporate representatives for this effort. During the winter and spring, CFNC will work with these partners on the formation of a detailed implementation plan for the classroom openings, to coincide with the 2005-2006 school year.

In Alexandria, CFNC's hope for the New Year focuses on the establishment of an enrollment mechanism that maximizes the use of every early childhood program in the city and significantly reduces the number of young children stranded on a preschool waiting list. Without such a mechanism, Alexandria parents and caregivers living in poverty (as well as parents/caregivers in similar circumstances around the country) will continue to face numerous obstacles to their efforts to enroll their children in a preschool program. The parents must search out programs, request information in their native language, determine if their children meet complex eligibility criteria, and figure out how to complete the registration forms.

With CFNC leadership, Alexandria's early childhood education leaders are collaborating to eliminate this daunting process by offering a twice-yearly clearinghouse, a community fair of sorts, where multi-lingual preschool information is available, a common application form is used, and representatives from all programs in the city are present. At the event, parents will have assistance in filling out the application form and will be guided to a representative of the program that best matches their circumstances. It is CFNC's hope, that as a result of this format, families will be less intimidated by the registration process, individual city preschool programs will fill all of their available subsidy slots, and more at-risk children will benefit from services—with a 50% reduction in the number of three- and four-year-old students on waitlists.

- Barbara Fox Mason, Executive Director

Center for Multicultural Human Services (CMHS)
Over the coming year, CMHS hopes to continue to expand mental health and a wide range of social and educational services to the growing immigrant communities in the DC area. With the opening of offices in Herndon and Alexandria, we laid the groundwork for expansion in two needy and underserved communities. By mid-2005, CMHS expects to be serving vulnerable children and families in the District of Columbia. In the coming year, we also hope to develop the capacity of CMHS to train professionals both in the US and in war-torn countries to understand and respond to the psychological needs of children and families who have experienced severe trauma and face cultural obstacles that limit access to services.

- Dennis Hunt, Executive Director

CentroNía
Our program has grown in many exciting ways over the last two years, since our strategic planning process, so it gives us much to be thankful for as a new year begins. The expansion of the Learning Center, the new DC Bilingual Public Charter School, the consolidation of the Family Community Development Institute, and the growth of the Professional Development Academy would not have been possible without the dedication, hard work, and investment of many people who care deeply about children. But one thing that always stands out, when I take time to reflect on this enormous change process, is the importance of art and creative expression in children's lives here at CentroNía. So it pleases me to walk the halls as the new year begins and see children tumbling, drumming, singing, painting, and listening to age-old folk tales. Many of these arts activities have grown over the years out of connections and partnerships with other community arts organizations—the drummer comes from the Latin American Folk Life Institute; the movement and music specialists from the Levine School of Music. And new artists continue to join us to provide additional arts activities in the Learning Center program and in the Charter School. These partnerships with artists and arts organizations are very important: they feed our souls with light, color, rhythm, and sound and affirm the creative spirit that resides in every child.

- BB Otero, Executive Director

College Summit
Alignment. We have done a lot of work over the last nine months identifying a set of metric targets for the next four years. Those targets measure our success at doing two core things: increasing college enrollment throughout communities, while achieving that in a way that generates enough fee-for-service revenue to cover variable costs, making large scale impact possible.

My goal for 2005 is to align College Summit's team members, investors, organization structure, resource allocation, and incentives around those targets, to maximize our chances of creating a Washington, DC, and a United States of America, where every student who can make it in college makes it to college, ending the cycle of poverty in his family and strengthening his community.

- J.B. Schramm, Chief Executive Officer

My hope is that we continue to provide the best and most comprehensive services possible youth by youth, family by family. Here’s to a bright New Year, filled with promise and dedication to carrying out our LAYC mission of supporting youth and families in their determination to live, work, and study with dignity, hope, and joy.

- Lori Kaplan, Executive Director

Mary’s Center for Maternal and Child Care
In 2005, Mary's Center will add additional client services, open a new site in the District's underserved Ward 4, and continue our development in partnership with VPP. Throughout these changes, it is my greatest wish that we are able to grow in a managed and effective way, and that our clients will continue to consider Mary's Center a center of excellence that meets their varied needs.

- Maria Gomez, Executive Director

See Forever Foundation
As we look toward 2005, we remain incredibly hopeful and resolute in the conviction that we are filling a valuable need in the District: to provide a high quality education for teens who have not succeeded in the large, traditional schools in Washington, DC. In the coming year, we will offer our programming to even more students; we will work to improve what we do and how we do it; and we will continue to advocate for positive change in both the education and juvenile justice system. We are excited about the enthusiasm in the District around education reform more broadly and hope that the range of stakeholders will stick together on behalf of our City's children. We hope to do our part through our partnership with DCPS and our ongoing work with community groups, business leaders, and foundations—all in support of our students and families.

- David Domenici, Executive Director

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Articles from the Winter 2004 issue of the Stanford Social Innovation Review are available online. Seth Berkeley, President and CEO of International AIDS Vaccine Initiative, talks about tackling enormous social problems. Berkeley participated in one of the dialogues in High-Engagement Philanthropy: A Bridge to a More Effective Social Sector, jointly published by VPP and Community Wealth Ventures in 2004.

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