With Trump in the White House and a hard Brexit on the horizon, protectionism is back on the menu.
Many entrepreneurs are concerned about the implications for the free movement of goods, capital and people. But at a recent Leap 100 breakfast, chief executive and co-founder of Prodigy Finance, Cameron Stevens, sounded a note of cautious optimism.
Prior to founding Prodigy Finance, Stevens was at Insead, where he and his co-founders witnessed students domiciled outside the US unable to access funding. They found it paradoxical that a graduate could be accepted into the best universities in the world but not be trusted to pay back a student loan. “It seemed like a problem worth fixing,” says Stevens.
Prodigy Finance took international graduates who had been cast aside by banks and lent to them – initially just through alumni networks, but now also through a pool of impact investment funds. Like so many entrepreneurs, he wanted to find the “intersection of doing something meaningful for the world, but also build a profitable, high-growth business.”
Prodigy Finance was founded in 2007. “Fintech wasn’t sexy and it wasn’t called fintech and everyone just thought of us as crazy.” His advice from a credit lawyer was straightforward: “Please don’t do this. This is the only advice we’re going to give you. You’re going to regret it.” So far, Stevens has nothing to regret: Prodigy Finance has provided over $250m of funding to graduates from 118 different countries, with a 99 per cent repayment rate.
Banks remain restricted by local considerations when offering their services. Stevens thinks it’s “ridiculous that they’re so nationally orientated. Most internet services are going global, but most financial services are still local. We think that’s going to change.” He says there’s been a fundamental shift in how the world works. Just because someone has moved country, it shouldn’t make it harder to collect their debt. LinkedIn and other platforms allow banks to keep track of debtors; taking the slow boat to China is no longer a worry.
Prodigy Finance has been global from day one, with Stevens praising platforms such as Upwork and Clarity for making it easier to scale. Technology now allows entrepreneurs to “zero in on that skill you need really quickly, and effectively have the infrastructure of a large multinational without having it internally.”
But with offices in London, Cape Town and New York, as well as a satellite office in Bangalore, sometimes things get lost in translation. Stevens recommends employees read Erin Meyer’s Culture Map to address “the problems that arise with hiring people from different backgrounds and the mindsets they bring.” His South African team don’t always understand why the American team on Skype video don’t take a couple of minutes out for personal interaction before getting down to business – “maintaining culture over multiple locations can be very difficult.” To address this, Stevens advocates “bringing the entire team together, physically in one place.”
Stevens is optimistic for tech. He thinks that the creativity of entrepreneurs will circumvent the protectionist forces of Trump and Brexit. “Ultimately, we’re seeing a physically closing world but a digitally opening world so position yourself to take advantage of that, rather than be challenged by it.”