The impending Age Of Abundance was prophecied in the scriptures thousands of years ago.
“You have got to be willing to be poor [as an entrepreneur]. There was a time when I was living out of a single suitcase. I had a rule that I wouldn’t stay on one person’s couch for more than two weeks because I didn’t want to become a bother.” - Sean Parker
Image via WikipediaI just sent an email to my top microfinance contact in India asking her to look into the "license to transact debt capital cross border" thing that Matt Flannery, one of the founders of Kiva, has raised in a Quora thread. 
Image via WikipediaWhen you are gelling the DNA of a young company, when you are laying down the rudiments of its culture, when you are slowly building a team, there are decisions you have to make. 
Image via WikipediaDoing a tech startup is a lot like walking and running. You put one foot after another. And you can't do that unless you have a very good idea of where you are at a given point in time and where it is you want to go. Both those angles are important. 
Image by liewcf via FlickrOne big reason I want to go super high tech with my microfinance startup is because I want me and my small core corporate team in New York City to be able to see all aspects of all our operations in near real time. I want my lenders - people who might put in that $100, that $200, at no interest - to be able to see much of the action in the field. I want them to experience that last mile as much as possible. 
Image by uncultured via FlickrMicrofinance is no magic bullet. Microfinance alone can't cure poverty. 
Image by Austin Yoder via FlickrAt this blog I want to switch to talking primarily about microfinance and the technologies and business practices primarily related to microfinance. The idea is to keep a steep learning curve. The idea is to communicate. The idea is to enter into conversations. 
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Image via CrunchBaseMatt Flannery: 2007: Kiva And The Birth Of Person-To-Person Microfinance: started Kiva in 2005 ..... a growing network of microfinance institutions (MFIs) in more than thirty countries ..... MFI partners post the profiles of their loan applicants to the website ..... small loans via PayPal ..... e businesses pay the lenders back over a period of about a year ..... the human connections we build between lenders and borrowers have brought new lenders ..... One night, she invited me to come hear a guest speaker on the topic of microfinance, Dr. Mohammed Yunus. ...... my first exposure to the topic ..... the page in our workbook that asked: “What are your Career Goals? Matt ‘s Answer: “I want to live in the Bay Area and be an entrepreneur.” Jessica’s Answer: “I want to go to Africa and do microfinance. ...... “Spend as much time together as you can during the first year of marriage.” ....... Her task was to locate as many VEF businesses as possible and measure impact. She asked questions like “Do you take sugar with your tea?” and “Do you sleep on a mattress?” ...... Instead of poverty, we could focus on progress ..... I followed Jessica with my camera through Kenya and Tanzania ...... Using a set of culturally specific questions, Jessica worked to ascertain the quality of life of those she interviewed ...... the painful decisions familiar to anyone who has lived in poverty—whether to pay school fees, put food on the table, or buy medicine for a child suffering from a curable sickness ...... The $500 needed to buy an initial inventory and start a store was too great a barrier. So everyone walked. ...... a self-regulating lending marketplace where microfinance institutions could raise loan capital online to fund projects ...... business plan software ..... forced us to think about costs, revenue,
Image via Wikipedia and, most importantly, our plan for growth. ...... Jessica is an extrovert and very good at developing a web
Image via WikipediaI am not rich yet, and it really, really bothers me. 
Image via WikipediaDemocracy is basic. I am a firm believer in democracy. The year a country becomes a modern democracy is year one in that country's life. Lack of democracy, bad governance, massive corruption, and civil war are situations that are not within the domain of the microfinance industry. Basic good governance is critical for the microfinance industry to have a playing field where it can start performing, it can start to lift people out of poverty in large numbers. 
Image via WikipediaOne of the major lessons the microfinance industry has learned over the decades is that the poor need more than microcredit. They need a broad swath of financial services. 
Image via WikipediaThere are natural lakes, and there are man made lakes. Well, all poverty is man made. Poverty does not have to exist. 
Image via WikipediaThe basic premise behind microfinance is simple: access to credit is basic, it is a human right. You give people three tools - education, health, credit - and they fly. Traditional credit has depended on your ability to put down some collateral. And that has cut off a large swath of humanity. There are over a billion people who live on less than a dollar a day. There are over two billion people who live on less than two dollars a day. 
Image via WikipediaThere are five broad categories on the cutting edge: web tech, clean tech, bio tech, nano tech, fin tech. 
Image via WikipediaThe Stink From The New York Times Telegraph: Bangladeshi leaders decide Nobel financier Mohammad Yunus must go: Professor Yunus is Bangladesh's most respected international figure ..... Prof Yunus was now too old and that the government wants to redefine the bank’s role and bring it under closer regulation. ..... the government of Sheikh Hasina, which, according to Western diplomats, regards his international profile as a political threat. ..... The government’s stance also sets it on a collision course with Western governments, aid and finance organisations ..... Hillary Clinton has voiced her fears that Grameen Bank’s independence is under threat ..... former Ireland president Mary Robinson and former World Bank president James Wolfensohn, launched Friends of Grameen to save the bank from a government takeover. ..... Yunus said the government wanted to take control of the bank from its 8m borrowers and savers ..... The bank’s borrowers and savers own 75pc of the company, while the government has a 25pc stake. According to the bank, it lends $1bn every year while lifting 5pc of its borrowers out of poverty. ...... Sheikh Hasina, who said the bank was “sucking money” from the poor and using them as “pawns to get more aid”. ..... Yunus said government control would lead to the bank being used to help “win elections” and fuel corruption and that he would not step down until the government promised to maintain the bank’s independence and mission to help the poorThis is like Putin going after that businessman dude in Russia. This is a severe abuse of state power. While they are at it, the Bengalis should go ahead and disrespect Rabindranath Tagore as well. This is insane.
Image via WikipediaThere has been a stupid debate going on for a few years now that has taken new life the past few months. There is a school of thought that says microfinance can be non profit and non profit alone. 
Image via CrunchBaseNetflix has a market value of $10 billion. The New York Times has a market value of barely one billion dollars. Articles like this one are the reason why. This feels like a hachet job done by a Vinod Khosla enemy. 
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Image via WikipediaNew York Times: November 2010: India Microcredit Faces Collapse From Defaults: India’s rapidly growing private microcredit industry faces imminent collapse as almost all borrowers in one of India’s largest states have stopped repaying their loans, egged on by politicians who accuse the industry of earning outsize profits on the backs of the poor. ........ Indian banks, which put up about 80 percent of the money that the companies lent to poor consumers, are increasingly worried that after surviving the global financial crisis mostly unscathed, they could now face serious losses. Indian banks have about $4 billion tied up in the industry ........ for-profit “social enterprises” that seek to make money while filling a social need ...... microfinance in pursuit of profits has led some microcredit companies around the world to extend loans to poor villagers at exorbitant interest rates and without enough regard for their ability to repay ...... microfinance could become India’s version of the United States’ subprime mortgage debacle, in which the seemingly noble idea of extending home ownership to low-income households threatened to collapse the global banking system because of a reckless, grow-at-any-cost strategy. ...... legislators in the state of Andhra Pradesh last month passed a stringent new law restricting how the companies can lend and collect money. ..... local leaders urged people to renege on their loans, and repayments on nearly $2 billion in loans in the state have virtually ceased. Lenders say that less than 10 percent of borrowers have made payments in the past couple of weeks. ..... the industry faces collapse in a state where more than a third of its borrowers live. Lenders are also having trouble making new loans in other states, because banks have slowed lending to them as fears about defaults have grown. ..... “They aren’t looking at sustainability or ensuring the money is going to income-generating activities. They are just making money.” ...... the industry had become no better than the widely despised village loan sharks it was intended to replace. ...... SKS and its shareholders raised more than $350 million on the stock market in August. Its revenue and profits have grown around 100 percent annually in recent years. This year, Vikram Akula, chairman of SKS Microfinance, privately sold shares worth about $13 million. ...... a few rogue operators may have given improper loans, but that the industry was too important to fail. “Microfinance has made a tremendous contribution to inclusive growth,” he said. Destroying microfinance, he said, would result in “nothing less than financial apartheid.” ...... Indian microfinance companies have some of the world’s lowest interest rates for small loans. Mr. Akula said that his company had reduced its interest rate by six percentage points, to 24 percent, in the past several years as volume had brought down expenses. ..... many lenders grew too fast and lent too aggressively. Investments by private equity firms and the prospect of a stock market listing drove firms to increase lending as fast as they could ..... the number of borrowers who are struggling to pay off their debts is much smaller than officials have asserted. He estimates that 20 percent have borrowed more than they can afford and that just 1 percent are in serious trouble ...... microfinance firms had lost sight of the fact that the poor needed more than loans to be successful entrepreneurs. They need business and financial advice as well ..... the industry was now planning to create a fund to help restructure the loans of the 20 percent of borrowers in Andhra Pradesh who were struggling. ..... The television, the mobile phone and the two buffaloes she bought with one loan were sold long ago.Home ownership by the poor is not what caused the global financial meltdown. It was bad behavior on the part of bankers. This crisis in India can also be attributed to bad behavior on the part of bankers. But this crisis is overblown. Before I ever came to America I thought New York City was all about crimes and crimes alone.
