With $65M, Tala Goes Global: Q&A With Shivani Siroya and Female Founders Fund
What is the story behind your inspiration in launching Tala?
After graduate school, as an analyst with the UN population fund, I worked across West and Sub-Saharan Africa and Southeast Asia to study microfinance and other economic development programs. I was spending tons of time with individual entrepreneurs and small business owners, and basically became a walking Quickbooks for their lives. When some of them needed capital for their businesses but had no way to get it, I was so frustrated by the situation that I actually started lending to them myself.
There was one woman in particular, in Chennai, India. Her name was Seema; she had two sons and she ran a tile making business and jewelry shop. I made a few small loans to her, and she always paid me back on time.
One day a friend came to visit me in Chennai. She thought I was pretty insane, lending to Seema out of my own pocket. She wanted to know why I was doing it, and how I decided who to lend to. The answer was easy in my mind, almost unconscious. I knew everyone spent time at Seema’s shop. I knew she was saving 30% of her income to pay for her son’s computer science courses. I knew she was helping plan weddings for other young women in the community.
As I started describing Seema to my friend, I had my first “ah-ha” moment. I realized that I trusted Seema because I had gotten to know her. I had used the story of her daily life to make a lending decision. And she paid me back because she trusted me, too, and knew that I would be there for her again if she needed me.
This mutual trust seemed to be the missing piece, the reason Seema and so many others like her were financially underserved. This was a financial relationship that I wanted to figure out how to replicate at scale.
You were offering a very new product to your first users based in Kenya. How were you able to convince them to trust the brand?
We were the first company to offer unsecured loans via smartphone when we launched our app in Kenya in 2014. We didn’t know exactly how this product would be received — we just had the problem we wanted to solve, and our solution.
Demand was instant, and the app took off. With demand like that, we wouldn’t have needed to do much more to grow our business. But our mission has always been central to how we work at Tala, and we wanted to offer a new, incredible financial experience for people who’d largely been overlooked and underserved. We made the app as fast and as seamless as possible, and offered ‘round-the-clock access to our customer experience team. We went above and beyond to prove that our customers could depend on us.
Our customers, in turn, continued borrowing with us, told their friends to check us out, and slowly we built a brand that Kenyans could trust.
The market for digital lending has heated up over the past few years. How has Tala been able to maintain first mover advantage?
Tala’s primary advantage today is our brand trust and our commitment to the customer. Our mission drives us to put the customer first and to constantly iterate and innovate. We have researchers in each of our markets to keep us honest and make sure we’re designing and building from the customer up. We’ve been doing this from the beginning — the idea for Tala was born out of those 3500 interviews I did — and our longevity and depth in our markets gives us an advantage over newer players.
An example of how we deliver on trust is our commitment to customer service. Instead of outsourcing a CX team, we’ve built it in house. Our CX teammates are full-fledged members of the Tala family and share a passion for our mission.
Our second advantage is our data. We’ve been using a combination of Android and proprietary data to underwrite customers since we launched our app in Kenya in 2014. As we’ve grown our customer base and moved into other markets, that data has only become richer. Today we have global models for identity and credit that are trained off of Kenya data; these models help us launch and grow faster in new markets while also mitigating risk.
The past twelve months have been incredibly exciting for Tala as a company. What are you personally most excited about as you think about scaling the company?
At the time of our Series B, we were only in Kenya. Today, as we announce our Series C, we’re in Kenya, Tanzania, the Philippines, Mexico, and India. That geographic expansion has been incredibly exciting, but what interests me the most right now is how we continue to add value and deliver on our mission of financial access, choice, and control. We have some innovative products in the pipeline that we’ll be testing and learning on this year, as well as some new features that will create a more dynamic experience for our customers. I can’t wait for our customers to have access to these products — and to understand how these products help expand financial choice and control in people’s daily lives.
As a CEO, how do you divide your time?
Right now, I’m spending almost half my time on recruiting. We have a lot of new positions open this year, and I’m excited to find mission-aligned talent to join our team. Not only am I networking and personally recruiting candidates; I’m also out on the road, evangelizing Tala and our mission.
The rest of my time is spent between big-picture visioning, ensuring that our team has the resources they need to execute on our vision, and ad hoc projects that I’m passionate about. I’m a natural doer; I have to have my hands (at least a little!) dirty to be happy.
I keep a pretty hectic work schedule, but I always try to maintain some balance. I keep Saturdays to myself whenever possible, but I like to find challenges outside of work as well, whether its a new hike, new hobby, or new workout.
$65M is a large round. What was your fundraising process like?
We’ve always been fortunate to have investors who care about our mission, see the unmet opportunity in these markets, and believe in the potential and talent of our team. F3 has partnered with us from very early on and we’ve been grateful to be part of this dynamic community of female founders. For our Series C, I feel extremely fortunate to have found a partner in Revolution, who shares a lot of the same values we do. Their Rise of the Rest initiative founded by Steve Case is a great example of finding potential in people and places that have been overlooked — something we also do at Tala.
You now have customers across five countries. Who is your typical customer and how do they vary across the countries you service?
Our typical customer is someone who is in the emerging middle class and financially underserved. They are earning an income and supporting their families, but often don’t have access to a full-suite of financial services that can help them meaningfully advance their lives or grow their businesses.
We do extensive user research to dig deeper into our customers’ lives, particularly when entering a new market but also to evolve our product. Understanding how financial behaviors and attitudes towards money differ from place to place helps us customize our services and meet our customers where they are.
Running a company with offices in five different countries is not easy. How are you able to communicate and build a team environment?
It’s tough to build a cohesive team across so many offices, but we are putting a lot of work into helping every Tala team member feel like part of the family. One way we’ve done this is by building a global set of Founding Principles that helps us develop behavioral norms and shared values, even across cultures. Someone who grew up in Manila is coming from a very different place than someone who grew up in New York City, but when we work together at Tala, we have a shared experience — and that is really special.
We also really value in-person, human connection whenever possible. Our teams in Santa Monica travel often to our markets, and we also bring teams from our markets to Santa Monica. Our engineering organization is a great example of this — more than half of our engineers are in Kenya, and they travel frequently to the U.S. to get hands-on time with our team.
Financial services as an industry offers massive opportunity. How is Tala innovating and taking advantage of technology to offer customers a great experience?
We are at a really unique moment in human history. The number of people accessing the internet from a mobile device has doubled over the past 5 years, to 3.6 billion, and is expected to rise to 4.7 billion by 2020. Mobile broadband network coverage reaches more than 83% of the world’s population. While there is still much work to be done to improve connectivity and scale mobile-enabled solutions, we are moving quickly towards a future in which mobile phones are ubiquitous and connecting individuals everywhere to life-enhancing services.
Tala is taking advantage of this moment in time. We know technology is a means, not an end. We have always just been focused on solving a problem — and if the means to solve that problem shifts, then we’ll shift with it. We’ll use whatever means necessary to prove the potential of these customers and meet them wherever they are.
What is your vision for Tala five years from now?
I believe that Tala will be the premier financial services partner for the global underserved. I believe that emerging market economies will be growing thanks to the participation of a new class of consumers that we’ve helped introduce. I believe that Tala will be a full financial services platform that empowers the customer in every aspect of his or her financial life — a platform that people want to use rather than have to use. I believe that we’ll not just be serving the underserved, but anyone who wants more financial choice and control.
I also believe that, five years from now, we’ll have proved that it’s possible to succeed by doing things differently — that mission and profit are not a zero sum game, that you can be for both of these things and still win. And that we’ll have succeeded by building the most diverse and equitable global technology company in the industry.