Alternative Finance Data for Emerging Markets: Explaining the Capital Finder (Part I)
One of our flagship products at AlliedCrowds is the Capital Finder, which has a lot going on under the hood. I decided to write a three part blog series to help our readers better understand what we are up to and why it is important. This is Part I.
I will take readers from a very high level view of what we are using this data to accomplish in this first part. I then explain in more detail how the data is gathered and processed in the second part. Finally, in the third part, I go into some of Machine Learning and Natural Language Processing code used to make it all happen.
What is the Capital Finder?
The Capital Finder is a proprietary database that contains over 7,000 alternative capital providers across the developing world (ex-China).
The Capital Finder contains all of the sources of capital available to projects in a given country. This includes:
- venture capital and private equity firms.
- angel investor networks,
- impact investors,
- crowdfunding platforms,
- development banks,
- international organizations,
- retail banks and more.
Essentially, it is an exhaustive list of where you can raise money in each country.
Furthermore, this data is highly searchable and customizable, and contains a lot detailed information about each capital provider. We will get into this below.
What are some common use cases?
We categorize the uses for the capital finder two broad functionalities: the Searchable Directory, and the Data Platform.
The Searchable Directory is the entrepreneur-facing side of the Capital Finder. It is meant for projects, firms, organizations, and entrepreneurs who are looking to identify the firm that is most likely to provide them with funding. We manage to do this on a global scale, finding the handful of suitable funders out of thousands that are potentially relevant.
The Capital Finder is the ideal capital sourcing tool and it will produce an effective shortlist for you to get started. But what if you don’t have your pitch down? This is why we created the Entrepreneur Hub. The Capital Finder tells you who to contact, while the Entrepreneur Hub explains how to approach them.
The Capital Finder on AlliedCrowds.com is a simple free version with the basic functionality to allow project leaders and developing world entrepreneurs to get started. We offer additional services for paid clients; these include:
- keyword/phrase searching: we comb thousands of websites and millions of web pages in order to discover which capital providers have mentioned which key phrases; this enables us to narrow down your search
- business plan matching: we use natural language processing to analyze text provided in a business plan or project write up, and use machine learning to match projects to the most suitable funders around the world
- additional data points: lots of value lies in the financial and deal data that we have acquired for a growing number of capital providers
Regardless, we think the free version is plenty for an individual. Often, we find that users do not need to search past the first or second page to find compatible funders (much like you don’t search past the first or second page of Google to answer your question). However, we recommend organizations looking to provide solutions at scale to get in touch.
You can find public examples of the Searchable directory at use in the AlliedCrowds Capital Finder, SDG Capital Finder or the WGEO Capital Finder.
The Data Platform is linked to the entrepreneur-facing product in that they share the same database. They are, however, different in how each product uses the data.
The most straightforward use case for the Data Platform is on display in the alternative finance data we feature our reports. These reports are generated almost entirely automatically via the Data Platform. Generally speaking, we use the Data Platform to facilitate research, consulting and advisory, and, of course, alternative finance data analysis.
As an example, consider an organization that would like to investigate how many Kenyan alternative finance providers fund agriculture products, and how this compares to its neighbors. The Data Platform can show how Kenya compares to other East African countries on a per % land area basis, informing decisions on which country is performing better on a relative — rather than simply an absolute — basis.
Alternative capital providers funding agriculture vs. agricultural land across Africa, focusing on East Africa
The scalability of the database allows AlliedCrowds to not only make country-level comparison (e.g., Tanzania, Uganda, Rwanda, and Kenya), but to also create entire indices (e.g., country rankings across the developing world). This gives us the ability to landscape the entire developing world based on a given sector (e.g., agriculture) and/or funding type (e.g., venture capital). Based on this analysis, we can see which countries are overachieving relative to their peers, and begin to explore why. Ultimately, this analysis can help us to come up with policy recommendations that result in more money flowing to projects and MSMEs in developing countries, leading to job growth and economic expansion on a macro level.
See the following reports for some examples of how our data has been used for clients in the past: Financial Sector Deepening Africa, UNDP Indonesia, and World Bank and feel free to contact us in order to find out more about how AlliedCrowds can provide custom reports and indices for your organization!
Kapuza’s second post in this series discusses how the alternative finance data in the Capital Finder is sourced and categorized. You can read that post here.