By Ryan Weeks on Thursday 15 November 2018
The company uses mobile phone payment data to help people build a credit profile.
It’s always fun to guess the genesis of quirky fintech brand names. Some are easier than others.
Juvo – to help, assist, aid, support, etc. in Latin – is on a mission to create credit infrastructure for the developing world.
It’s a purpose that big-name venture investors have bought into. The San Francisco-based start-up has raised $54m to date, most recently clinching $40m in a Series B round last year. That fundraise was led by New Enterprise Associates and Wing Venture Capital.
Telecommunications firms (telcos) are at the heart of Juvo’s strategy for empowering the world’s unbanked.
Jason Robinson, VP of Product at the company, described the model in an interview with AltFi. Juvo seeks to partner with mobile operators to gather and structure information on people who are regularly topping up their balance on a mobile account and using that balance to make calls, send texts and so on. In other words, pre-paid customers.
The alternative method of phone usage (a contract agreement, essentially a loan) presents problems for customers in emerging markets – as telcos often struggle to verify their creditworthiness.
According to Robinson, telcos collectively account for around 5 billion unique customers worldwide, of which a staggering 78 per cent are pre-paid.
Juvo takes pre-payment data and makes it portable, both within and outside of the teclo, in an effort to open up access to a range of financial services. Juvo’s efforts can help telcos to extend device finance or to migrate customers from a normal handset to a smartphone. Outside of the telco, its partners offer such products as micro-insurance, digital/micro credit and digital wallets, and many of those partners are fintech firms. The firm’s intent is not only open up access to these services, but to drive down the cost of accessing them.
Robinson himself admits that telcos fully understand the ‘treasure trove of transactional data’ they’re sitting on. So why aren’t they trying to monetise that trove themselves?
“They absolutely can and they certainly are trying to around the world,” he said. But it's difficult, he argued, to structure the data in such a way that it can be factored into risk-based decisions. When pitching to telcos, Juvo talks about ‘productising’ their data – helping them to monetise it. “It’s really taking a lot of friction out of the system.”
To that end, Juvo operates a platform for connecting its financial services partners to telco data in a ‘privacy-secured way’.
Robinson also argued that telcos have now more or less saturated the planet, leaving no more room for growth for their core services beyond stealing customers off one another, which inevitably drives down revenues-per-user. Naturally, then, they are looking for new revenue streams – and this is where Juvo can help.
At present, its target customers are concentrated in Latin America, and to a lesser extent in Eastern Europe and Southeast Asia.
The start-up currently employs eighty people globally, with most based at its San Francisco headquarters.