[Music]
in many parts of the world when you
apply for a business loan at a bank the
bank is going to take down various
pieces of information about you such as
your age your name education and address
and input that information into a risk
model to figure out if you're going to
pay that money back and together
additional information about you now
that we live in the glorious age of
artificial intelligence and machine
learning even more information can be
collected about you and analyzed to
figure out what makes you successful in
business that is unless the data being
collected about you has nothing to do
with what really makes you successful
this would seem obvious right if you're
going to use technology to determine the
creditworthiness of a business or an
individual you should make sure that the
data you're using is at least relevant
by geography culture and demographic and
that's how it works in most of the
Western world and the result of that is
the generation of wealth and prosperity
but in Africa we have a problem in
sub-saharan Africa where we operate
finding the right kind of data and
sourcing that data to make these
decisions is incredibly difficult
customers are thin file the information
is localized at a bank it's not shared
it's not federated in a general sense
like you would with a with a credit
bureau and those decisions are hard in
Africa we should be completing on a
global basis but we're not and that's
because the financial institutions in
our ecosystems don't have the technology
or the risk models to harness the wealth
potential accurately and what I mean by
that is that the traditional methods
currently use to evaluate
the creditworthiness and the risk
profiles of these businesses completely
ignore the vast differences and the
cultural realities of ethnic and
religious groups across the continent
and I really do think that in order for
them to compete on a global scale
Africans must start to generate and
transfer wealth authentically and the
only way to do that is to build our
culture in our history directly into the
financial ecosystem our business our
banking and our technology so a few
years back when we started this journey
we noticed that the banks and the
microfinance institutions who had set up
shop across Africa didn't seem to be
able to make a dent in the more than
three hundred billion u.s. dollar
business credit gap which to us means
that the companies are supposed to be
helping actually are not growing or
generating wealth at all and I've got
feeling was that this is because they
actually do not understand African
businesses or entrepreneurs so in 2013 I
co-founded a company called oh bombuh
with my business partner Marvin Cole
with the goal that we would try to
figure out how to get these businesses
to grow correctly and we started by
studying various tribes in Cameroon to
figure out what is it that makes them
successful and how do they respond to
financial obligations now Africa has
thousands of ethnic groups and more than
2,000 different languages and the
cultural diversity and traditions make
for a very complex landscape so if you
want to start talking about business and
financial products you might you really
need a deep understanding of the nuances
and the history and respect the the
elegance required to code for the
financial products and the business
environment of the vast African market
and this is why we decided to use
artificial intelligence and our own
proprietary technology to embed ethnic
and cultural data into the risk models
algorithms and
products that we have since developed so
here's an example if you take an
entrepreneur who goes into a
microfinance institution to apply for a
loan these types of businesses are often
from the informal sector they often use
their family members as employees they
don't keep a balance sheet and they're
certainly not working to a well-written
business plan and they are sometimes
functionally illiterate and by that we
mean they are able to read and write but
they may not be formally educated in
business and these applicants usually
get turned down by banks and this is the
reason why they go to microfinance
institutions but the microfinance
institutions when determining risk about
these groups can only really use what is
at hand information like you look like a
woman your gender your age your bank
account how you deposit your capital and
collateral hopefully that collateral has
the kind of land title that they can use
for these loans but with the model that
we use we added an additional maybe as
much as 400 additional data points
things like language dialect family
structure personal and professional
relationships number of wives and even
tribe and that's because we believe that
this is the kind of information plus
some other pieces that you truly need to
understand African business risk so what
about the house the man who applies for
a loan now in his neighborhood he has a
shop and Eid he sells candles and in
August and September he's selling
back-to-school items the rest of the
year
maybe small electronics and his shop is
usually always open except for about
four to six weeks when he's closed for
Ramadan now he can't go to a
microfinance institution because most
microfinance institutions actually do
not carry Islamic products that type
that are non-interest bearing and banks
are going to think he's a high risk
because of the changing nature of his
business so he would likely turning him
down
and that would be that but we know that
that would be indeed and be a mistake
because we know and understand that
traditionally speaking if he is Hauser
there is a chance he's got more than one
wife and if he does have more than one
wife it means that he's actually a very
good risk for us and he's the kind of
customer that we like to to fund and
that's because polygamy which is still
practiced in Africa actually acts as a
form of life insurance its strategic
it's a sign of wealth and stability it
is not a sign of romantic instability
and what about ethnic groups like the
befores bar ombo Ballon dough or the
Rocco's groups that have a rich
agricultural way of life now groups like
this they are driven by their social
standing and operate within a cash
economy with close ties to informal loan
and saving groups that we call in Jan
gays and banks are unable to justify
lending to groups like this because they
often don't have enough banking
information all the type of bank
accounts that they can monitor or even
the property with the right collateral
to be used now if you really want to
understand the risk you should start
evaluating their relationships with
council leaders and tribal leaders not
necessarily their banks or their balance
sheets these groups are compelled by the
family and tribal obligations and
they're super careful with their money
and they're very careful with business
they dare not lose their social standing
because it would be the equivalent of
losing a credit score now if a bank or a
microfinance institution were to try to
lend money to these groups it actually
would not be that effective at helping
them to generate more revenue or build
wealth there long agricultural tradition
is something that we would instead
leverage and we find that they will do
better getting support with warehousing
logistics and that sort of thing alone
is probably just not the best type of
product for them so these are just a few
examples and hopefully you'll see what
we saw just how huge this opportunity
can be Thanks
in Africa don't build mobile apps or the
technologies that will allow them to do
things like measured the success of a
woman's vegetable farm or to incorporate
how well a parent pays their children's
school fees into a risk model so we
thought that we should use technology
that would build a roast model to do
exactly that and build technology and
products to match and so far it's
working
we've deployed more than 25 million to
260 companies or more and helped them to
achieve seven times the amount of
revenue and in some cases as much as
four times the amount of inventory
available to sell and in sub-saharan
Africa we have barely begun to scratch
the surface of how to build the right
technologies to help African businesses
make it into the future and
understanding how to do that begins with
understanding the human beings right now
1.2 billion human beings on the African
continent will soon be 2.3 billion over
the next 30 years and by 2100 one third
of the Earth's population will live on
my continent that's a lot of potential
entrepreneurs who could be generating
wealth for themselves their families
communities and the world if the path to
wealth generation was defined for them
now let's zoom out imagine around the
world
if financial products were designed with
the cultural nuance and sensitivity
towards the businesses that they seek to
support would this mean more wealth in
America's heartland with the lifetime
service and experience of a retiree be
an advantage when applying for a
start-up loan what about women
entrepreneurs whose cultures make it
more likely that they will be
stay-at-home moms could this lead to
loans tailor-made for the woman building
an internet business out of her living
room or financial services for Native
Americans who understand how to build
wealth from the land and the natural
resources the reasons why we do this is
for the same reasons that pandora chose
to map the music genome or the reasons
why geneticists rushed to map the human
genome
it's to find truth and to find
understanding so that we can develop
tools to harness our own potential and
realize our best selves in digitizing
our future we will preserve the beauty
of our culture and unlock the code to
our best wealth traits and if we do this
Africans will become global citizens
with less reliance on charity becoming a
global citizen also means that we have a
place at the table as equals
lastly the real reason we must do this
is because we want to build a foundation
for our future that is rooted in who we
authenticate
[Applause]