Our OpenFi Partnership Strategy

Want to know how we choose our partners to help grow the OpenFi ecosystem? Find out inside.

At Gluwa, our mission is clear: make the world a better place. That’s why we’re committed to building a new financial ecosystem based on the principles of OpenFi. An ecosystem that puts transparency, democratization and, most importantly, social impact, at its very heart.

But, we can’t do it alone.

Rather, our role is to connect people, capital, information and businesses around the world to each other, and then let markets do the rest. For you, that means opening up opportunities to invest in companies like Untapped, Aella and Jenfi.

But, how exactly do we go about finding partners and growing the OpenFi ecosystem?

We want to be completely transparent about our long-term ecosystem growth strategy, and that’s why we’ve written this blog post to walk you through our thought process.

Who are we looking for?

It’s important that all our partners bring something valuable to the table. That could mean boosting financial inclusion, improving our technology, and in the very best case scenario, integrating with Creditcoin and raising capital from Gluwa Invest. But, not every OpenFi partner can do everything. That’s why we take into account a number of potential factors to assess our ecosystem growth opportunities.

1) Mission-Alignment

The most important factor by far is mission-alignment. In other words, does a potential partner have the same values, mission and goals as us? This usually means looking for financial service providers in emerging markets whose express aim is to drive financial inclusion. If they’ve got a focus on credit, then even better, but that’s by no means a deal breaker.

A good example is Aella. They work to deliver credit, as well as wider mobile banking services, to millions of Nigerians — all with the aim of increasing financial inclusion. Like us, they are committed to transparency. That’s why they now record all of their loans openly on Creditcoin.

2) Creditcoin Compatibility

Another important factor we look at relates to Creditcoin itself. Specifically, does a potential partner’s business model lend itself to possible Creditcoin integration? We’re always looking to expand the adoption of Creditcoin and the principles of OpenFi. That means working with companies that issue loans and debt-financing as a core component of their business model, either now or in future is ideal.

Companies like Jenfi, which operate a typical debt-financing business and can easily integrate with Creditcoin, are therefore priority targets.

However, not every company that can contribute to OpenFi fits the technological structure of Creditcoin. For example, Untapped don’t issue your typical bullet-loans, they do asset-financing. So, although they still make a valuable contribution to OpenFi, their form of debt financing isn’t easily ported over onto Creditcoin. You can read mroe about Untapped here.

3) Debt-Investment Opportunities

The primary purpose of OpenFi investment is to provide debt financing to emerging market businesses. This means we look for partners that want to raise debt, either now or down the line. If a partner isn’t looking to raise debt-capital, then you won’t be able to invest in them.

That isn’t always a problem like we’ve said, but, our mission to expand debt-investment opportunities to everyday investors like you means we necessarily prioritize partners looking for debt-investment themselves. Again, not a deal-breaker, but an important consideration nonetheless.

4) Technological Synergy

Sometimes, a potential partner doesn’t even need to do debt financing, issue credit, or work directly in emerging markets. Simply bringing valuable technology to the table is often enough for us to work with them. And, if possible, embed our technologies with theirs, too.

That could mean expanding the interoperability of Creditcoin to new blockchains with partners such as Stacks or Flow, or leveraging opportunities for on-chain credit scoring and analytics with SaaS providers such as Goodloans. Just because a company can’t lend on Creditcoin or isn’t looking to raise debt-financing, doesn’t mean it can’t make valuable contributions to the OpenFi ecosystem.

5) Network Building

Even when a company doesn’t meet most of these criteria directly, many partnerships offer ample opportunity to build on these things indirectly. Having built strong relationships with one company, the opportunity to leverage each other’s networks increases.

Much like our debt-financing partners use Gluwa Invest to reach you, our OpenFi investors, we can use our partners as a platform to network with possible new OpenFi partners. By working with Goodloans, it’s more likely that we’ll also work directly with their clients in emerging market finance. Thereby we can leverage a software-only partnership to build new OpenFi investment relationships for Creditcoin and Gluwa Invest.

What are the challenges?

Sadly, it’s not as simple as just walking up to a company and saying “join OpenFi”, “raise capital with Gluwa’’ or “integrate with Creditcoin”. The reality is, not all companies are ready to integrate with Creditcoin or join the world of OpenFi debt investment — even when they’re mission is closely aligned with our own.

Generally speaking, larger, more established companies, which are typically in the best position to raise capital via debt-financing, also have more deeply embedded infrastructure, making it harder to transition them onto Creditcoin. This means that nimbler, early-stage companies are often more amenable to building their infrastructure on top of OpenFi and Creditcoin.

Early-stage companies have their own set of limitations, however. Many simply aren’t looking for debt-financing, nor would it be smart for us to lend to them. For example, they may be loss-making (like most startups), too high-risk, or simply uninterested in debt financing. In this case, the high risk/reward nature of early-stage investment usually means that equity investment or a simple partnership makes more sense than debt investment.

What is our growth strategy?

Given these challenges, we take a two-pronged approach, but always with the same end goal: more debt-financing opportunities with Creditcoin integration as well.

Debt-investment is our go-to tool for fully fledged OpenFi investment partners. When partners aren’t ready for, or don’t fit, this model, then we use small equity investments or simple partnerships as a tool to build relationships, develop our technology and get in early with some of the most promising companies around.

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About Gluwa

Gluwa is an Open Finance platform, connecting capital from developed markets to emerging market lending opportunities using blockchain technology. Investors can use the Gluwa Invest platform to partake in debt-financing deals with emerging market fintech lenders, earning up to 15% APY.

About OpenFi

Open Finance integrates blockchain technology with financial institutions, service-providers, fintechs, platforms and more. By capturing DeFi’s enormous potential and injecting it directly into the real world, OpenFi is recalibrating the financial system towards democratization, transparency and impact. Read the OpenFi manifesto here.