Lenddo, the world’s first online platform that helps the emerging middle class use their social connections to build their creditworthiness and access local financial services, recently closed a $6 million investment round from existing and new investors. These include Golden Gate Ventures, Kickstart Ventures and Skype co-founder Toivo Annus. The additional funding will be used to accelerate the company’s global roll-out, and to develop new features that will improve the user experience on such platforms as Facebook, LinkedIn and Android. Lenddo co-founder Jeff Stewart tells AlleyWatch about the funding process, and considering that Stewart is a successful serial entrepreneur and himself an angel investor, take heed…
What was the funding process like?
Lenddo sits at the intersection of social networks, finance and emerging markets, so there was a big universe of potential investors, and we felt it was important to bring diverse expertise into the syndicate.
We learned a lot by presenting with a diverse group, and often found our investor presentation led to other important introductions or partnerships.
Overall it was a positive process, and we have a stronger business as a result.
What are the biggest challenges that you faced while raising capital?
When done right, fundraising takes time…and that time is not being invested in running the day-to-day of a global business that is growing 10-15% a month. It is important to focus on both, but the balancing act can prove difficult.
- We will have a positive impact on the lives of millions of people.
- We have assembled an incredible team with an impressive track record.
- The financial services sector is a huge space (bigger than media and advertising).
- The emerging market middle class is huge, growing and currently underserved/underbanked.
You were recently selected by the World Economic Forum as a Tech Pioneer. Can you tell us a bit about that?
The World Economic Forum is very respected, and their acknowledgement has opened several opportunities. It was an honor to be selected as one of the world’s most innovative technology start-ups, especially for the hundreds of thousands of members that make up the Lenddo community. It is also great to be in the company of former Tech Pioneers such as Google and Twitter.
You have a very diverse (and international) group of investors. How has this helped in building out the company’s global efforts?
It simply would not have been possible to be so far along in so many countries without the support and introductions from our international investors.
What advice can you offer companies in New York that do not have a fresh injection of capital in the bank?
The best way to grow a business is by having happy customers pay you. I would only recommend including investors if you felt it would substantially accelerate your plans, and if you were supremely confident you could generate 10x to 100x the return for your investors.
Where do you see the company going now over the near term?
The Lenddo community has proven very popular in Mexico. I would expect Mexico, with their growing economy, to be the destination for many of the loans generated on the Lenddo platform over the next few months. Longer term, we are seeing rapid adoption of Android technology in Latin America and Asia. We expect mobile devices, as opposed to bank branches, to be the primary method for access to financial services. If Lenddo is fulfilling our mission of financially empowering the emerging market middle class, that future will happen even sooner!