Written by Koen The on 12 February 2018
“I would rather be partly great than entirely useless.” ~ Neal Shusterman
At Lendahand, we view ourselves primarily as a social enterprise. As such, we compete with commercial entities for customers, employees, investments (money) and media attention. We do this because we want to impact the lives of people in developing countries by affording enterprising individuals (entrepreneurs) access to otherwise unavailable financial support. We believe that this initiative will lead to the creation of jobs as well as equal access to basic needs. Thus far our efforts have met with success and we often receive positive reactions and support for our initiatives. Still, like every fast growing company our ambitions have met with their own share of challenges. For the sake of transparency, we would like to share these challenges with you and likewise our thoughts on how we intend to address them.
Assessing the impact of our initiatives
Through our platform, businesses in developing countries receive capital to stimulate job creation that we hope will lead to further growth and development. Our success in this regard is generally very difficult to gauge. We’re interested in knowing the following. Are our initiatives having any secondary effects that are impacting people and their environment in ways we hadn’t anticipated? Have there been any unintended consequences that might deter our efforts and/or any positive impact we’re making? Lendahand’s efforts are socio-economic in nature, so not being able to properly assess the issues mentioned is a concern for us. To address these concerns, we brought on a PhD student who will help us conduct the research necessary to evaluate our impact. We are also initiating partnerships with third parties to gain even more insight into the projects we support with you.
The entrepreneur’s interest rate
Lendahand runs a very cost efficient operation. Our online platform requires a very small staff and we aren’t encumbered by the costs associated with legacy IT systems. In contrast to this, those to whom we extend our services are paying an interest rate that we feel doesn’t correlate to our mission standards. In spite of the fact that we are a small company with a projected high economic scale, the amounts of credit we extend through our platform are simply too small to have an actual impact on ‘the price of money’. As a Fintech company, we find this issue troubling. However, we hope to find a solution through the use of developing technologies such as blockchain and psychometric credit analysis amongst others. We want capital to flow as seamlessly as possible from the investor to the entrepreneur, but until we appropriately address the issue we have with interest rates, it remains a thorn in our side.
Integrating the Lendahand Foundation into our business model
Running concomitant with the Lendahand online platform is the Lendahand Foundation. This foundation was created for the sake of empowering the entrepreneurs through sound financial arrangements and training. Unfortunately, we aren’t able to consistently provide the foundation with the support and nurturing it requires to function as effectively as we envisioned. This has to change, as we feel the foundation empowers our proposition: ‘To improve the socio-economic status of our entrepreneurs.’ The good news is that our investors can also contribute directly towards providing training for entrepreneurs via the Foundation's website.
We’re not always able to distinguish important things from unimportant
The legendary Johan Cruyff once said: “Of all the unimportant things in life, football is the most important.” In a business such as ours, effective prioritization is not easily achieved. Volatility and risk assessment sometimes lend themselves to misdirected focus. This is why at Lendahand we challenge ourselves to better understand when and where to focus our attention and efforts. We are a young company, so growing pains are inevitable, but because of our talented and diverse staff, we believe we have the skills necessary to meet this challenge.
One thing we all agree on: of all important things in life, money is the least important.
We need more feminine power on our ship
We are proud of our staff, but of the eight full-time employees we have; only one is female. While we assert that her talents count for two, we would like to further diversify our staff in this regard. Fortunately things are better on our platform. On average, a third of our investors are women and over half of the companies represented on our project website are led by women. We are equally proud of this fact as well.
Lack of (talented) ping pong players.
No further comments needed.
update 2019: Read here an update about our shortcomings