Flexibility Is Everything: ANCs rely on diversification to drive growth, shareholder profitability.

• Author: Simonelli, Isaac Stone
• Position: ALASKA NATIVE

Alaska Native Corporations (ANCs) count on diversification among their holdings to provide meaningful dividends and services to their unique shareholders while also growing the corporation to serve future generations.

"Afognak, like other ANCSA village Corporations, is responsible for meeting economic, social, and cultural obligations to its shareholder owners--whose families live in or originate from the village of Port Lions or our ancestral village of Afognak," says Alisha Drabek, vice president of Afognak Native Corporation.

"Like many other Alaska Native communities, the village of Port Lions is physically remote and economically distressed. Standard publicly-traded American corporations are not owned in the same manner or responsible to a tribal community in the same way as ANCSA corporations."

Afognak's advocacy plan focuses on social responsibilities, including natural resource stewardship, cultural protections, economic development, and community development efforts for the Afognak Alutiiq people, Drabek says.

To accomplish these goals, ANCs look for ways to grow and stabilize their business interests. For some, this means pivoting from traditional sectors--often resource extraction--to other, sometimes unexpected, opportunities.

Branching Out

"Cape Fox was originally focused on the timber industry in Southeast Alaska," Cape Fox Corporation CEO Chris Luchtefeld says. "As the company progressed and the timber industry was slowing, the corporation made the decision to enter into government contracting as a way to diversify the corporation."

With its holdings of 23,000 acres of Native lands, Cape Fox pivoted from the slowing timber industry in Southeast to government contracts and tourism. Originally, the tourism business was focused on the Saxman Totem Park. However, the corporation added the Cape Fox Lodge to its portfolio by the late '80s, Luchtefeld says.

While making significant headway with its federal government contracting subsidiary. Cape Fox continued to invest in local tourism ventures. Its holdings include the Cape Fox Village Store, Cape Fox Tours, the Heen Kahidi Dining Room inside its Cape Fox Lodge, Sweet Mermaids cafe, and George Inlet Cannery which offers "Taste of Alaska" tours.

The corporation saw year-over-year 2019 revenue growth of about 14 percent and is on target to see an additional 20 percent this year, Luchtefeld says, noting that it has been government contracting that has remained a strong source of...