kiva applying ‘web 2.0’ to philanthropy
DESCRIPTION
+400,000 social investors have lent +$55 million in 39 months on Kiva.orgTRANSCRIPT
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Applying ‘Web 2.0’ principles tophilanthropy
The San Francisco FoundationAnnual Board of TrusteesMeeting
Premal ShahPresidentKivawww.kiva.org
"Revolutionising how donors and lenders in the US are connecting with small entrepreneurs in developing countries”
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InternetLender
Online marketplace
Local Partner(MFI)
Entrepreneur
Money
Information
Kiva 101
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+400,000 social investors have lent +$55 million in 39 months
Other Key Stats• Growth: $1M loans every 10 days.• Risk: 3.5% delinquency rate / < 0.5% default rate• MFI Portfolio: 111 MFIs in 45 countries. Growing 3 a month.• Traffic: 800,000 site visitors last month• Organization: 35 employees / +400 volunteers • Leverage: Platform raises $8 in loans for every $1 donated.
5 yr goal = $1 Billion
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Kiva utilizes 4 “Web 2.0” principles
1. Create an “Addictive” User Experience
2. Be “Radically Transparent”
3. “Crowdsource” against constraints
4. Build in “increasing returns on data”
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Create an “Addictive” User Experience
“Addictive” = Easy + Fun
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How Kiva tries to make it “Easy” Transparent and simple
human story / impact
Affordable
Quick
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How Kiva tries to make it “Fun” Rich user generated content, changing fast...
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Loans are fully funded in hours (MFI staff love
this)…
Transactions happen every 37
seconds…
Real time un-edited
progress updates from
around the world…
‘Popular’ entrepreneurs rapidly rise to
the top…
Randomized “1 minute of
fame “ for Lenders…
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How Kiva tries to make it “Fun” My Page, My Portfolio…
“My Page” encourages self
expression, evangelism and
loyalty…
“My Portfolio” concept encourages further lending, risk diversification and inter-
lender competition…
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For some, Kiva is becoming very addictive!
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KivaFriends.org – unofficial Kiva community forum
(built by our users)
Several results when searching
for the word: “Addicted”
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Be ‘Radically Transparent’
Transparency Authenticity Trust
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Kiva and Radical Transparency
Paying for Kiva’s overhead is an explicit choice
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Kiva and Radical Transparency
Data inaccuracy and defaults are made explicit
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“Crowdsource” against constraints
Big constraint? + No resources? =
Crowdsource
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Kiva and “Crowdsourcing”
Kiva Fellows Program How do we train MFIs, gather progress updates and verify data accuracy hyper-fast?
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Kiva and “Crowdsourcing”
Kiva Translator Program How do we immediately translate entrepreneur profiles from native language to English?
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Kiva and “Crowdsourcing”
We have little money, but great partners!
Free payment processing and employee support
120 Million free banner impressions
Free Google Adwords – 25% of
traffic
Free Yahoo Search Marketing and
employee support
Free promotion (Community Impact
Award)
Funding for Field Research and Development
Free phones for cell based data upload
pilot
Free promotion of Kiva widget to
bloggers
Free computers and early funder
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Build in “Increasing Returns on Data”
Leading public platform + Data integrity
“Increasing Returns on Data”
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“The Long Tail’
“The Long Tail”
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Result: 30,245,763 loans found
Kiva and “Increasing Returns on Data”
World’s largest DB of microfinance investments
Long Term: Entrepreneurs could use Kiva as a public credit bureau…
Short Term: MFIs could use Kiva to build credit worthiness to other funders…
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Thank you and questions
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APPENDIX
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Kiva’s Risk Model helps manage risk on Kiva’s platform and creates an incentive for MFIs to improve transparency and performance.
Inputs
1) Self-reported MFI Data• Organizational age• Gross Loan Portfolio (GLP)• Overall Portfolio At Risk (PAR)• Organizational Self Sufficiency (OSS)
2) 3rd Party MFI Data• Financial Audit Results• Credit Rating Score• Kiva Audit Results• Outside funder Quality• Network Affiliation Quality
3) MFI Performance on Kiva• Total Outstanding Kiva Loans• PAR on Kiva Loans• Kiva Fellows’ Journaling Coverage
Outputs
1. MFI Reputation on Kiva’s site
2. Monthly Fundraising Limit
3. Kiva Audit Prioritization
Kiva Risk Model