An Ultimate Good
March 10, 2009
The people at Kiva are phenomenal. Hanging out with them was one of the best things about being there. It was inspiring to get to know the founders – Matt Flannery, Fionia Ramsey, and Jeremy Frazao – and hear about why they started Kiva and their passion for their work. They’re a dynamic, unique group of people.
What most people don’t know is that Kiva is very small, with only 30 to 35 full-time employees. Last year, I’d say they had about 10 volunteers at any one time, half being from Oliver Wyman. So we definitely have had an impact on the team dynamics, in a good way.
The Kiva staff – I'm in the back row, second from left.
There were six Oliver Wyman NPFs while I was there. The group included Jessica McLaughlin from San Francisco, Emily Dixon from London, Nick Baer and Lyndsey Erickson from Boston, and Qin Ma from Beijing. I sat upstairs to be with the Kiva Fellows and Translation teams, but there’s a whole Oliver Wyman table downstairs, right next to Matt, the CEO.
They actually refer to us as the O-Dubs and we have become an integral part of the organization. (Manas Babbili from the Dallas office originally used the term to refer to Oliver Wyman when he was at Kiva in 2007.) Kiva sees Oliver Wyman almost as their internal business strategy group and put us on their most critical issues.
Oliver Wyman NPFs have been doing a lot at Kiva; we were involved in a few work streams last year. One was risk management. Kiva is essentially an online crowd-funding website; lenders look through the site to find a borrower in the developing world that they like, and they can give that person a loan. But all that money goes through microfinance institutions (MFIs) around the world, and so Kiva has to pick its MFI partners carefully and have processes to minimize its financial risk. Several Oliver Wyman people have worked with Kiva on these and other finance issues.
Another main work stream was launching the Kiva Lending Team Program. To make lenders feel more connected to each other, Kiva wanted to build a web community by adding functionality similar to Facebook. Lyndsey, Emily, and Nick contacted organizations around the world, which they thought might be interested in Kiva, about starting their own lending teams. Members of these groups, who share a focus or interest, can send messages to each other, post their profiles and pictures, start blogs, and lend together, all through the Kiva site.
The lending teams have created a new sense of community and brought in new lenders who might not 
have joined Kiva on their own. I joined several lending teams myself, including our Oliver Wyman team. (It’s easy to join or start a lending team. Just visit Kiva.org and click on the Community tab at the top.)
The O-Dubs have also done a lot of analytics, turning the data collected by Kiva’s databases into meaningful metrics. Premal Shah (Kiva’s president and a one-time Oliver Wyman consultant), came up to me before I left and said “Please bring more Oliver Wyman people.”
I chose Kiva because the opportunity combined a lot of the things I wanted to do with my NPF. I wanted to see what it’s like to work at a social entrepreneurship. It was interesting to see how business, technology, and entrepreneurship can be combined to have a social impact.
I had originally thought about going into the field, but felt I could have more impact and a broader reach working in the Kiva office doing public relations, marketing, and recruiting for the Kiva Fellows and Translation Programs.
Kiva Fellows are unpaid volunteers who work one-on-one with the MFIs around the
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| Kiva Fellows 7th Class were deployed in early February 2009 (read about their adventures in the Kiva Fellows Blog), including Oliver Wyman's own Bernice Wong, who is based in Thanh Hóa, Vietnam! |
I actually had a blank slate to work with. Kiva had never done formal recruiting for either program, it had all been done through word of mouth.
Kiva has been successful at using a viral approach to public relations, so I used similar approaches to get people talking about the volunteer programs. We used creative strategies – Kiva wants to be very nimble and quick and aggressive but they also want to control costs.
We took advantage of Web 2.0 technology. Kiva was already on the online volunteering websites, so we also made sure to post on different groups on Facebook and Friendster. I created keywords so that ads about the Fellows and Translation Programs would pop up with certain searches on Google, which gives Kiva $40,000 a month in free ad words. In addition, we e-mailed high-impact student leaders at all the major universities, saying, here’s a great opportunity to be a translator or a Kiva Fellow, please forward this information to your groups.
We also used the connections of alumni of the Kiva Fellows Program. Since Kiva can’t afford to fly people across the country, I organized speaking engagements and asked former Kiva Fellows living nearby to speak at colleges, conferences, and career fairs, and hooked them up with the college papers at their alma maters to get articles written about being a Kiva volunteer.
Finally, I looked for beneficial partnerships. For example, Kiva Fellows need to pay for their own living expenses while they are in the field, and some people can’t afford to do that. I tried to connect potential Fellows with universities that provide grants for development work.
The common strategy behind these approaches is to take advantage of networks – to turn group leaders into Kiva advocates who then excite more people to talk about or volunteer at Kiva. Over four months, the number of people applying for both the Fellows and Translation Programs shot up. Kiva had nearly 350 volunteer translators and editors processing about 5,000 loans every month. But by February 2009, they had over 800 people on Viva, the Kiva site launched last October that allows people to register and do translations online, and they’ve been working hard to review all of the applications.
Kiva will need more translators in order to achieve their lending goals, and to help them scale the Translation Program, I did a couple of things.
First, I created SQL reports (I learned SQL at Kiva, thanks to Emily Dixon, the “queen” of SQL) and metrics to measure how Kiva’s Translation Program is doing and project the number of translators that will be needed to handle the loan demand anticipated in the next six months. The metrics can be pulled weekly and are used in the monthly company-wide all-hands meeting. Kiva had never tracked these things before.
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| As of March 16, 2009 463,021 Kiva lenders have made 91,423 loans totalling US$63,890,710. Visit Kiva.org for the latest statistcs, updated nightly. |
I did a lot of research on what similar organizations are doing, suggested ways to expand the program, and created a predictive model of when they would need to take the next step. I was able to show that they can grow their translation team by tiering it. Kiva’s translation managers would oversee a number of super volunteers – very loyal volunteers who have worked with Kiva for years and have translated tons of loans. These super volunteers would then manage more volunteers.
This would enable Kiva to increase engagement among its volunteers. That’s a key factor. For example, the super volunteers would not only communicate regularly with their volunteer teams and monitor their work, they would also build a sense of community by meeting for social events, or just coffee, holding translation-a-thons, and so on.
To ease the translation burden, Kiva could also minimize the testing of translators (because of the added supervision of the super volunteers), standardize loan descriptions, and maybe eventually use video instead of written loans.
Scaling is a huge issue at Kiva. Matt tells a story about when he went to venture capitalists to get funding to start Kiva: They said it would never scale above what he and Jessica (his wife and Kiva co-founder) were doing at the time – connecting an online network of their friends and family with people he had met in Uganda.
Now Kiva is bringing on more microfinance partners and spreading into different geographies to increase the number of entrepreneurs while increasing the lender base by giving partial loan repayments and launching the Lending Team Program.
Kiva is a constant balancing act between the ratio of borrowers and lenders, supply and demand. Sometimes you’ll go online and find that all the loans have been funded. And then it can be the exact opposite, when there are more borrowers on the site and not enough new lenders.
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Kiva entrepreneur Chiv Sokheng, borrowed US$600 to buy piglets for her farm in Pursat, Cambodia. She received her loan from Hattha Kaksekar Limited (HKL), a partner of Save the Children. |
The banks need to pay their operational expenses, and the interest they charge, around 20-30%, is much lower than the 300% charged by loan sharks. Because they’re getting 0% capital from Kiva, the banks are able to reduce what they charge borrowers. Eventually, when the banks become more efficient, the rates should go down. It also gives the MFIs an incentive to work with lower-profit customers (i.e., the ones that live far away, no collateral, small loan size, etc.).
Before microfinance, very low-income people in the developing world had no access to financial tools like savings accounts, credit cards, or loans. By giving people small loans through Kiva, they are able to start their own businesses.
I love to go on the Kiva website and read the stories of entrepreneurs from around the world – you know how many kids they have, who they’re married to, where they live, what kind of business they started. Some are requesting their fifth loan, and you’ll read about how they’ve been able to use the profits from their business to hire more people, pay for their children’s education, or build a house for their family. All they needed was to have somebody take a chance and lend them some money.
Kiva has this huge impact on people’s lives. They have a great repayment rate – only 1.5% of loans default. It’s a sustainable way to support economic development, because it’s not a one-time gift, it’s a loan. Each month I get a credit back into my Kiva account, and then I can relend to another person.
At the end of the day, you know that what you’re doing is an intrinsic or ultimate good, that it’s going to effect the lives of people in a very positive way.
Click to read more about Tamara's experiences at Kiva >
At the 2008 Awards Dinner of the World Affairs Council of Northern California (from left): Fiona Ramsey, Jen Hamilton, Jeremy Frazao, and Sam Mankiewicz (Kiva); Nobel Peace Price recipient Muhammad Yunus; Bill Draper (Draper Richards Foundation); Casey Albert Santiago (Kiva); and Lyndsey Erickson and Tamara Sanderson (Oliver Wyman).
Jessica Flannery received an award for Kiva that evening, and it was cool to see Kiva founders Jessica, Jeremy, and Fiona get a big hug from Muhammed Yunus, whose work in microfinance was the inspiration for the creation of Kiva. We all had tears in our eyes.
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