Ulnooweg Development Group

Empowering the spirit of Indigenous entrepreneurship

Ulnooweg is a Mi’kmaq word which broadly translated means: “to make Indigenous or adapt beliefs, customs, and culture of the Mi’kmaq”. The Ulnooweg Development Group operates as an extension of the communities it serves, uniquely stewarding to their needs and supporting their business leaders and entrepreneurs. The aim is to work together as a team with the goal of developing healthy, self-sustaining communities.

The origins of the Ulnooweg Development Group can be traced back to 1982 when concerns had been expressed by Helen Martin, one of the co-founders of the Nova Scotia Native Women’s Association, which was based out of Halifax at the time. Going back and forth to the Native Friendship Centre she ran into some youth that were talking about being adopted out of the communities and why it had happened.

Many children in the early 1980s were expressing concerns and questions about their identity. Helen Martin took her concerns to her organization and went to the Union of Nova Scotia Indians and met with the Chiefs. A resolution was signed to look into the concerns, which led to a gathering of about 70 people at Liscombe Lodge Resort and Conference Centre in 1983. It was one of the first times that the Mi’kmaq community discussed the hardships in a public forum. It led to three recommendations, and essentially to put a stop to adopting out First Nations children from their communities, some of whom were forcibly removed.

The hardships and dysfunction that had been brought to light led to the development of the Bachelor of Social Work program at Dalhousie University and the Affirmative Action program for Mi’kmaq people, which also led to the development of the Mi’kmaq Family & Children’s Services.

Due to the immense social requirements it was determined that for the communities to get out of poverty they also needed to assertively stress the need for economic and business development, which then gave birth to Ulnooweg as an organization. There were several national initiatives at the same time which led to the initial capitalization of Ulnooweg back in 1985 when the organization was incorporated.

With representatives in New Brunswick, Newfoundland, and Nova Scotia, Ulnooweg has been providing loans and business services to Aboriginal entrepreneurs throughout Atlantic Canada since 1986 that may not be eligible for loans through other traditional lending institutions.

The Canadian Business Journal recently spoke with Christopher Googoo, Chief Operating Officer at Ulnooweg Development Group, and proud member of the We’koqma’q First Nation. Googoo’s primary location is an office in Truro, Nova Scotia and there are three other Ulnooweg locations.

Since joining Ulnooweg in 2000, Googoo has assisted hundreds of Aboriginal entrepreneurs secure loans and access business services. He was appointed as general manager in 2006 and in 2017 became chief operating officer. He is also the Executive Director of The Ulnooweg Indigenous Communities Foundation—strengthening the relationship between Canada’s philanthropic sector and Indigenous communities of Atlantic Canada.

Ulnooweg understands the significant challenges that Chiefs, Councils and financial leaders face within the respective communities where financial governance spans rights and claims, health, justice, education, social, welfare, housing, municipal, and community-owned business matters.

Googoo says the organization was given three initial mandates: the first was to focus on economic and social welfare for the communities; the second was training and financial literacy training; and the third was to support charitable organizations and benevolent societies.

“For the first 20 years were primarily focused on the first mandate – economic and business development,” begins Googoo. “We had an initial capitalization of about $5 million to $7 million from the federal government and about $2 million of additional funding since then but we have lent out to communities and that has been the core of our operations.”

Since its inception, Ulnooweg has lent out more than $65 million, which has led to the creation of thousands of jobs. In the past 15 years the organization has continued to improve with loss rates dropping from historic highs of 17 cents on the dollar to between 1% and 2% now.

“There have also been policy improvements that have helped to strengthen our organization and broaden our services going back to the original mandates of Ulnooweg, that being supporting the communities in strategic planning and even getting into other commercial activities,” remarks Googoo.

In September 1999, the Supreme Court of Canada confirmed that Donald Marshall Jr. had a treaty right to catch and sell fish. The Court stated that Mi’kmaq and Maliseet treaty rights were not unlimited and the fishery could be regulated, including Aboriginal fishing activities.

The Marshall Decision opened up the fisheries industry for the Indigenous communities. Initially the government put in about $600 million to the communities in Mi’kmaq communities in Atlantic Canada. That funding then allowed the communities to acquire fisheries assets including boats and processing plants and harvesting equipment.

“There were some issues of mismanagement in the first five years, because it was uncharted territory for many people and a lack of proper business support. What developed from that was a partnership between the Atlantic Policy Congress of Chiefs and Ulnooweg to develop a fisheries development team, comprised of six fisheries experts,” explains Googoo. “We support communities from concept to financing their first commercial fisheries enterprise and have been doing it for about a decade now.”

To emphasize the impact of the Marshall Decision, revenues at the start were about $4 million for the entire Mi’kmaq community and now it’s more than $100 million and probably close to $120 million and created thousands of good-paying jobs within the communities.

Ulnooweg has continued to expand on that initiative, which has seen so much tremendous growth over the past 20 years. Googoo says it was about four years ago when the organization started looking at access to capital needs for the communities because they are now venturing into much larger commercial enterprises, requiring more capital and the mainstream financial institutions still haven’t been rushing to lend their support.

“We started a national campaign on how to access capital, which included looking at banks, developmental institutional such as BDC and social impact investments and we ended up pursuing philanthropy,” notes Googoo.

Throughout the same time period Ulnooweg also worked with the First Nations Finance Authority, based out of British Columbia.

“I think their first tranche was about a $100 million bond,” he says. “They wanted to expand to the east and their model is based on access to capital based on taxation revenue. We don’t have that in Atlantic Canada. We don’t have the real estate, like in B.C., that provides taxation revenues to the communities there.”

Ulnooweg worked closely with the FNFA to examine advanced audited statements and see what other types of revenues could be used to access larger financing capital and the decision was to primarily focus on gaming and fisheries revenues.

“During that process we developed a product, which we call the Community Financial Review, and from that what we do is look at audited statements of Bands. With some communities we have about 17 years of history with and we provide services to about 28 communities in Atlantic Canada,” says Googoo.

“We take the audited statements over 10 years and we present them to the communities – the Chiefs and Councils – in pictographs,” he continues. “Some statements are more than 100 pages. We show them their trends in revenues and expenses either from government sources or their own enterprise sources. We also shop jobs links through government and jobs links to enterprises.”

Googoo and the Ulnooweg team focus on debt capacity, which is important in the decision-making process. In the past the focus has been on short-term but that has now transitioned into 10- to 15-year plans, and sometimes even 20 years.

Pursuing philanthropic dollars has been an excellent route to follow, although Googoo points out there have been obstacles.

“One of the issues that we have found is the legislation under CRA,” he says. “Normally, if you have a municipality for example, that wants to get philanthropic dollars, it can receive those funds and receive a receipt – all municipalities have that under what is called Qualified Domain Status. First Nations’ governments were forgotten under that legislation so there was no mechanism to allow the flow of philanthropic dollars.”

With the support of a lawyer named Richard Bridge, who did the work pro bono, the communities were provided with legal support to get them designated as qualified recipients with the CRA. Bridge’s practice is dedicated to charities and non-profit organizations. Normally such an endeavour would cost communities about $15,000 in legal fees. To date, 27 of the 35 communities have been set up.

Googoo says there has definitely been an increase in the level of successful entrepreneurial ventures over the years and there has also been a notable upswing in the sophistication of the businesses with strong entrepreneurs.

“Indigenous people are now realizing they don’t have to limit themselves within the fiscal boundaries of the reserves,” he says. “In the last 10 years – compared to the 10 years prior – we’ve seen our growth rate increase by about 15% annually. We’ve averaged about $3.5 million in lending whereas previously we would have averaged about $1.6 million.”

Communities are now far more engaged with the private sector and taking advantage of the signed agreements with the province in the two main sources of revenue – gaming and fishers – and thus providing a great deal of equity. Now there are movements afoot to branch off into such areas as commercial real estate and agriculture while fisheries operations are successfully vertically integrating their enterprises.

“There’s one community in New Brunswick that owns more than 80 fishing vessels, as an example, so these aren’t small enterprises,” notes Googoo.

As businesses become more sophisticated through technological innovation, advanced equipment and concise education, the level of demand and size of the loans has increased for Ulnooweg. Unfortunately, the federal government has not recapitalized the network of Aboriginal Financial Institutions (AFIs) across Canada since the initial capitalization more than 30 years ago.

“Now we’re at a point where AFIs need capital and our association has discussed it with the government,” reveals Googoo. “We’ve solved our issues for the short-term with a loan from a non-profit organization from B.C and they receive their funding through philanthropy. It’s the first time an AFI has borrowed money from social impact investors.”

Ulnooweg’s performance with the banks has steadily improved over the years to the point there is now a strong working relationship. However, banks now treat First Nations communities like corporations rather than communities, which results in higher interest rates and shorter bank terms. That reality makes it harder to develop commercial infrastructure projects to develop the communities, which cumulatively total nearly 100,000 people.

“We are still having difficulties with the banks even looking at us developing our own fund and then borrowing it to lend to our commercial clients. It’s the same barriers we’ve been running into for the past 35 years,” laments Googoo.

“In terms of larger loans we’re dealing with some that are anywhere from $500,000 to $1.5 million. Individuals and communities are going into deals that are worth much more than they were 10 years ago,” he continues.

In the near-term future, Googoo has his sights set on finishing several initiatives, including wanting to have their Anniversary Fund firmly established, which is being set up in support of major Indigenous community development projects across Canada.

“We’re close now and should have it ready by the fall with expectations of growth over the next few years,” he says.

“We also want to work more with the private sector to ensure our students are equipped with the education and skills they need to succeed,” he continues. “We want to create entrepreneurs who hopefully will be the ones coming to borrow from us in 10 to 15 years to develop exciting, new business opportunities and being able to transition from life on the reserves to an urban setting while going to school or working.”

Googoo is quick to point out that the success achieved by Ulnooweg is a credit to the great people working with the organization.

“Our great staff is one of Ulnooweg’s strengths,” he proudly says. “Not only are we an Indigenous organization with an Indigenous board but more than 50% of our staff is Indigenous. Many of our staff members have many years of experience in banking and some have CPA designations.”

Day in and day out the emphasis at Ulnooweg is always placed on the need to be innovative in order to be successful in today’s exceedingly competitive business world.

“I consider myself a disruptor in the areas of philanthropy and innovation. One of the projects I have is called Digital Mi’kmaq and it’s pushing us into the area of innovation. About 85% of the jobs require digital skills,” says Googoo. “It’s not just an Indigenous issue; it’s also a provincial and Atlantic problem. We’re not properly educating our children with new digital skills. With intention, we’ve also pushed ourselves into boards and associations. I think we’ve made great strides as an Indigenous organization, representing our communities.”