Green Energy Economy

I have been working in the energy industry for over twenty years. This doesn’t make me knowledgeable; on the contrary, prior knowledge and my likely inability to identify my areas of incompetence, blind spots, and possible overconfidence, certainly heighten the risk of the Dunning Kruger effect being applicable to the forecasts and analysis included in this post. Thus, to attempt to counter my preconceptions, biases, and errors, I will rely on studies and the opinion of experts in the industry.

Electricity market in 2030/2050: demand and supply

According to IEA, the electric market size in 2030 could be 28,141 TWh vs 23,398 terawatt-hours in 2018. Demand for electricity is set to increase further as a result of rising household incomes, with the electrification of transport and heat, and growing demand for digital connected devices and air conditioning. Electricity demand is projected to grow at an annual rate of 2% per year on average until 2030. Most of the projected growth in electricity demand occurs outside the OECD. Demand in non-OECD countries is expected to at an average annual rate of 3.8%.

By 2030, hydro, wind, solar PV, bioenergy, geothermal, concentrating solar, and marine power in aggregate could provide nearly 40% of the electricity supply (or at least 30% according to IRENA). China is expected to lead the way, expanding electricity from renewables by almost 1 500 TWh to 2030, which is equivalent to all the electricity generated in France, Germany, and Italy in 2019.

IRENA projects that by 2050, the share of renewables in the electricity supply would grow to 90% from 25% in 2018. The remaining 10% of total power generation in 2050 would be supplied by natural gas (around 6%) and nuclear (around 4%). Notably, variable renewable sources like wind and solar would grow to 63% of all generation in 2050, compared to 7% in 2018. IRENA’s projections for the share of renewables in the electricity supply is one of the highest, neverthless there is a clear consensus among those that have created scenarios (IPCC, BP, Equinor, Greenpeace, DNV, Teske) on the important role that electrification powered by renewable energy sources has in the decarbonisation of the energy system.

For projects with low-cost financing that can tap high-quality resources, solar PV is now the cheapest source of electricity in history. Technology costs have fallen significantly and will continue to decline through technology innovation, competition and growing markets, and regulatory streamlining.

It has been noticed that the level of renewable energy ambition and potential investment, tends to correlate with the energy price level. It has been estimated that renewables could meet 80% of global electricity demand growth during the next decade and overtake coal by 2025 as the primary means of producing electricity. Solar PV could grow by an average of 13% per year, meeting almost one-third of electricity demand growth over the next decade.

I am a strong believer in market efficiency. Markets provide affordable solutions, but a sustainable future requires policy guidance. There is a need to focus on overall system design rather than the cheapest source of renewable energy. Furthermore, to avoid ‘Texas-type’ situations, grids too will have to be modernized, expanded, and digitalized.

Energy GHG emissions

Energy is the dominant contributor to climate change, accounting for around 60 per cent of total global greenhouse gas emissions.

The following is IRENA’s formula for decarbonation:

  • Stabilised energy demand through increased energy efficiency and circular economy measures while maintaining economic growth;
  • Decarbonised power systems with supply dominated by renewables to meet growing needs;
  • Electrification of end-use sectors, with the increased use of electricity in buildings, industry and transport;
  • Expanded production and use of green hydrogen, synthetic fuels and feedstocks to pursue indirect electrification;
  • Targeted use of sustainably sourced biomass, particularly in place of high-energy-density fuels such as those used in aviation and other transport modes, or in greening gas grids.
CO2 emissions abatement options IRENA
CO2 emissions abatement options – IRENA World Energy Transitions Outlook

Some reflections

Energy investments need to shift to low-carbon energy transition solutions if the Paris Agreement goals are to be achieved. I believe that point forward, all investments in the energy industry could be allocated 100% to renewables and batteries, although 100% renewable energy global supply may not be achievable even by 2050.

Decarbonised electricity could provide a platform for reducing CO2 emissions in sectors other than power, through electricity-based fuels such as hydrogen or synthetic liquid fuels.

As far as I understand the main drivers for the cost competitiveness of hydrogen are a reduction in the price of electricity by at least 50%, and a reduction in the cost of electrolyzers. Economies of scale, are expected to significantly bring down the costs in the hydrogen value chain.

As an investment opportunity, analysts are completely bullish on renewables and an electrified economy. Wunderkind Tesla’s share price is expected to increase by 500% by 2025. Even if renewables capture most of the future demand, possibly most of the optimism around renewables as an investment opportunity is unwarranted given that electricity consumption will only grow between 2-4% per year.

“I’d put my money on the sun and solar energy. What a source of power! I hope we don’t have to wait until oil and coal run out before we tackle that”

Thomas Edison (1931)

Anti Purpose-Washing

Achieving social impact

An a priori to achieve social impact is to be able to articulate your business’s purpose clearly. Defining your Theory of Change is one of the variables that distinguish social-focused enterprises from others that are only engaged in purpose washing.

Your “theory of change” is composed of two elements: “change” wish is the vision of the social impact that your organization wishes to create, and a “theory” which should describe your core business inputs, outputs, processes, and outcomes, i.e., your idea for how you believe that you will make such change possible.

There are five steps in a continuous improvement model for implementing your theory of change:

  • Set your objectives
  • Test and validate your hypotheses with your stakeholders (lean startup methodology)
  • Measure results
  • Correct (if necessary) based on verified impact
  • Share

Scaling impact

Your social impact should scale at least proportionally (and, if possible, exponentially) to your growth. Achieving and scaling positive social outcomes will not happen by itself. Less so if it is not your company’s core business objective. In a nutshell, scaling impact is the process of increasing positive social impact to better correspond to the identified social need’s magnitude.

Companies that do not prioritize achieving their purpose as their primary goal, creating impact as their core business objective, may be successful (when measured by other parameters) but should not consider themselves social enterprises.

One of the shortcuts to achieving social impact is to work in networks and via alliances with other stakeholders that share your impact goals.

Finally, although an elusive concept, if you honestly try to scale your impact, you should measure your social impact. Your impact goals should be tracked and measured by relevant KPIs. Reporting such KPI and providing regular Investor Updates will allow you to refine your objectives and processes and ultimately achieving a more significant social impact.

“Human creativity is unlimited. It is the capacity of humans to make things happen which didn’t happen before. Creativity provides the key to solving our social and economic problems.”  

Muhammad Yunus, Founder of Grameen Bank 

Growth Areas in the Green Economy

Below are some potential investment opportunities in the “green economy” according to Jigar Shah, who has been recently appointed by President Joe Bidden as head of the US Department of Energy’s Loan Programs Office.

These sections of the green economy have not yet reached Wall Street size (e.g., Next Era Energy) and there are no mature business models that have already proven to be as scalable as solar, i.e. they are not yet the ”rinse and repeat’ type of projects. Consequently, these types of opportunities may be attractive for early investors.

For each category mentioned below, I have added some examples of startups that have caught my eye either because they are representative of the category or simply promising.

Buildings / Weatherization

Buildings and their construction together account for 36 percent of global energy use and 39 percent of energy-related carbon dioxide emissions annually, according to the United Nations Environment Program. Globally, building operations (powering lighting, heating, and cooling) account for about 28 percent of emissions annually.

Retrofiting buildings for energy efficiency: Blocpower – has retrofitted more than 1,000 buildings in disadvantaged communities in New York City, with projects underway in 24 cities. BlocPower uses proprietary software for analysis, leasing, project management, and monitoring of clean energy projects that save customers between 20-70 percent on annual energy costs.

Designable (*) retrofits buildings and offers its clients the opportunity to buy (after personalization), apartments in sustainable buildings.

NEIF provides financing for energy & resiliency home improvements. You can invest in their climate action investment notes via the green crowdlending platform Raise Green

LED lighting accounts for approx. 15% of the lightning sales. It is expected that the transition to energy-efficient lighting would reduce the global electricity demand for lighting by 30-40% in 2030. Amsterdam Edge building is an example of digital technologies at the service of energy efficiency.

HVAC (heating ventilation air conditioner) retrofits.

Green Procurement

Regenerative Farming

Regenerative agriculture enhances and sustains the health of the soil by restoring its carbon content, which in turn improves productivity—just the opposite of conventional agriculture.

Regenerative agricultural practices include:

  • no tillage,
  • diverse cover crops,
  • in-farm fertility (no external nutrients),
  • no pesticides or synthetic fertilizers, and
  • multiple crop rotations.

Stemple Creek Ranch

Food waste prevention

Avoidance – An estimated 1.3 billion tonnes of food, or roughly 30 percent of global production, is lost or wasted annually, according to the UN Food and Agricultural Organization (FAO).

Imperfect Foods, Too Good to Go, Happy Hours Market (*)

Biodigesters process farm waste (animal manure & green waste) into free biogas for clean cooking and organic fertiliser for better crops and healthier soil.

Atec Biodigesters

Not mentioned by Jigar Shah, these two categories deserve to be added since they have an immense potential to contribute to climate change mitigation and wealth creation, in emerging markets:

Cooling as a Service

Freshbox (*)


Solar Pumps

Future Pump (*)

If you are interested in learning more about technologies related to combating climate change, please visit the Project Drawdown or the accelerators mentioned here.

“I am always optimistic.  I am not sure how one could not be.  We have the technology today to solve major problems around the world on food production, clean water, electricity access, waste, sewage, and other basic dilemmas.  I am excited that my generation will be the one that sees the successful deployment of this technology to truly make the world a more sustainable place”

Jigar Shah

(*) I am an investor

The Taobao Village next to you

Innovation sits at the crossroads of different trends. Just think about the possibilities of combining nascent ‘small cities’ in emerging countries with community group buying.

The migration from rural communities to urban locations seems to be a global and irreversible phenomenon. If there is one country in which this is evident, it is China. Today China has 13 cities with over a 10 million population. There are literally scores of over 5 million. Every emerging market is following a similar pattern. Go check it for yourself here.

Community group buying is nothing new. I remember circa 2000 group buying a pram at for my daughter, who is now in university. For different reasons linked to competitors, consumers and suppliers, most of the group buying startups, did not survive the dot. com boom and bust cycle. The revival is probably linked to the exponential growth of social media (particularly group chat) and to the pervasiveness of smart phones.

Most of us are well familiar with the large Chinese e-marketplaces. Taobao,, Pinduoduo are successfully bringing the best of community group buying, ecommerce and marketplaces to large and smaller cities in China and will eventually will expand their business model to the rest of the world.

What we are normally not so familiar with, are the startups that are focusing on serving small cities. Some time ago, I was listening to a podcast about the challenges faced by Chen Ying, the founder and CEO of Shihuituan, a community group buy site that operates mainly in third tier cities and below in China, and I realized that most of the emerging markets could have their own Shihuituan even if Amazon, Jumia, Mercadolibre and the likes seem to monopolize all e-commerce.

This prompted my curiosity to search for startups in emerging markets that could support the following investment thesis, that I labeled as “The future of rural e-commerce“.

The criteria that I considered for selection were the following:

  • Not an NGO but a #socent
  • Not Alibaba, Shopify, Amazon, Flipkart, FB Marketplace, Mercadolibre, JIO, Jumia.
  • Not basing its revenues on ads (OLX, Gumtree).
  • Not Etsy, or handcraft sales equivalent. Sorry Gaatha and Someone Somewhere
  • Targeting small towns and/or rural communities
  • Focused on local clusters or just different business products and services being sold online.
  • Secret sauce: aggregator (economies of scale, logistics) + localization (community leaders)
  • Low risk of commoditization and competition on price only.
  • Managed to overcome challenges such as illiteracy, lack of infrastructure (internet access).
  • Operating in countries without hindrance from government. Government could help, but at minimum should not block (e.g. avoid possibility of being taxed to death).

After some research I came across Apperto (*). Apperto is a Latam app that I could characterize as a mix of Yelp and Groupon for relatively small cities. They are currently operating in small cities in Argentina and Mexico and have been inspired by Shihuituan.

Are you aware about any other startup creating “The future of rural e-commerce“? (please leave a comment).

(*) I am an investor in Apperto.

Charm Impact – Driving positive change

Solar Mini Grid in Nigeria

Interview with Gavriel Landau, CEO of Charm Impact (*)

What prompted you to launch Charm Impact?

Back in university, when I was in business school, I took an operations strategy course, in which, Michael Porter’s essay on the creation of shared values was presented. I strongly agreed with his view about different levels of corporate social responsibility (CSR) ranging from generic (not aligned with the business), to CSR focused on the value chain (e.g. UPS improving its methods for the delivery of parcels), to strategic CSR (e.g. Toms Shoes one for one business model: buy one, give one). I felt inspired by that lecture that taught me that you can create businesses that are sustainable, and are fully focused on doing good. It is possible to create a business model in which the bottom line is 100% aligned with the mission of doing good.

After graduating I went as an English teacher to Cambodia for 3 months. Upon my return, I joined Accenture where I worked for their financial and energy clients for 5 years. I left to work in two areas for which I am passionate> renewables, and high tech. I joined, as a project manager, a UK startup focused on solar peer to peer power for the UK market. Around that time, I met the founders of Solshare, which rekindled my interest in emerging markets and access to energy.

I then decided to devote myself to promoting a meaningful step-change to the efforts to bring energy to those without access to it in emerging markets. The key question that concerned me was – why doesn’t everyone have access to electricity? I soon corroborated that access to finance was one of the critical missing pieces. It was then that I decided to focus on helping the entrepreneurs and SMEs, that are promoting access to energy, who are building companies that are commercially viable but not yet of a scale large enough to be bankable.  In addition, our preference is for helping those SMEs that are locally owned and operated and even better if they empower women either as part of the founding team or within their business operations.

What problem are you solving?

I could summarize the problem statement as “access to finance for early-stage clean energy entrepreneurs in developing economies”. This echoes well with the flavor of the decade, which is climate change. We have corroborated that people want to help fight climate change, but most of them do not know how to help. Furthermore, they do not acknowledge that their contribution (no matter how big or small), always makes a difference. We are at the frontline of this change. We have an invaluable opportunity to show people the power of their money. This can be done in two ways. First by showing them how they are financing and indirectly contributing to projects. Secondly, by helping channel people’s money into transparent companies focused on doing good, i.e., sustainable and conscious companies.

Offgrid community in Nigeria
Offgrid community in Nigeria – Charm Impact

What is next for Charm Impact?

After our successful recent crowdfunding campaign, we are ready to scale. We will devote the next months to curating a community. We will continue to work on finding the right investors that want to contribute to a meaningful and impact-focused business. Once we have a large group of impact investors, the size and reputation of our investor community will attract similarly minded investors. Our current challenge is to keep the momentum, continuing to scale, and to grow and deepen the investor community. We will be hiring early next year. Our immediate need is to recruit investment associates (to help us with building pipeline, managing borrowers, credit scoring). Then we will have to redouble our efforts on marketing and branding. This may require bringing inhouse some of the tasks that we have currently outsourced. For the next year, our goal is to focus on better serving our investors, creating a vibrant community, fostering communication and engagement.

Which are your products?

Our core service is enabling crowdlending. One side of this service is looking for clean energy entrepreneurs in developing economies. We conduct due diligence and retain the most promising projects. The other side is selling this as an investment opportunity (i.e., for impact investment) for investors mainly located in developed markets.

We act as facilitators ensuring full transparency and traceability, diversification, and giving investors an opportunity to choose who they back with their money. We focus on business loans that help companies in emerging markets grow. The method is quite simple: we find interesting opportunities, then make a first loan to those SMEs. After they have repaid the loan, provided that their business and financials continue to improve, we offer additional fundings. We help these SMEs scale until they have reached a size when they can attract more capital than what we can currently provide. Besides loans, we are helping such SMEs create a credit history and a credit score that eventually make them bankable. In the future, we envision being able to connect them with business opportunities and to offer technical assistance beyond finance.

What is your business model?

We provide small scale loans to clean energy startups in emerging markets. The loans are high-risk due to a lack of credit scores, financial history, and the fact that the SME’s that we support are testing new business models in new markets. Addressing these challenges requires new business models and new ways of thinking. Most people think about the customers near the base of the pyramid as inherently risky. Some people think entire countries are too risky to invest in. We are challenging core paradigms of how we measure the success of our investments by facilitating a discussion on balancing risk, return and impact. 

Our crowdlending model is based on a blended finance approach: we combine for-profit impact investments with grants and/or philanthropic capital. By embedding a blended finance model into our loans, we create a buffer for the investment capital, it becomes the senior tranche, and thus less risky for the impact investor. We also derisk by hedging the exchange risk for borrowers. In parallel, we help grow the available philanthropic capital. Once repaid, this capital is reused in future projects. By becoming reusable capital, its impact is leveraged, i.e. instead of being consumed, it is redeployed. Furthermore, this virtuous circle is fostered by the fact that the borrower is pushed to become profitable rather than depend on grants. In sum, our flywheel is based on the multiplier effect on capital. 

Basically, it catalyzes private investment and at the same time, it creates an incentive for the recipient companies to be more financially sustainable. We contribute to making the connections among the stakeholders. At the core, we are in the business of creating a community willing to support energy entrepreneurs in emerging markets. This requires us to focus on encouraging and nourishing impact investors and finding grants and philanthropic to derisk the loans. We are fully concentrated on making this business model easy, repeatable, and overall scalable.

Gavriel Landau
Gavriel Landau – Founder and CEO Charm Impact

What is Charm Impact’s current greatest challenge?

Our thesis and prima facie findings are that people do not think about themselves as investors. Our minimum investment is 250 pounds to make the opportunity more available to people who may not usually invest in startups. In exchange, we create a lot of value for your money both economic and in terms of impact. We have embarked on a customer journey whose goal is to help them perceive themselves as investors. 

There is also a gap between the perception of risk vs. actual risk on the ground. There are a lot of reputational factors that influence this perception. For example, people fail to distinguish between the risk of real borrowers vs. country risk. This holds back some investors from backing companies and these companies from being able to grow. 

Are you satisfied with your rate of progress?

If we measure ourselves, based on the frame of the 17 global sustainable development goals, we are still quite far from where I would like the industry to be in terms of achieving universal energy access by 2030. Nevertheless, we have a role to play. Covid-19 increased global inequality and created a significant number of new poor people. We need to contribute to lowering uncertainty. We can solve energy poverty and help entrepreneurs. COVID has only made these problems more evident and acute. There is less money flowing from traditional financiers to the emerging market entrepreneurs that could help us meet the goal of bringing energy to everyone. COVID has just made evident that now there is even more need for alternative finance. We will strive to continue to be at the frontline of “building back better“.

“Real people, real business, that is what we focus on”

Gavriel Landau – CEO Charm Impact

(*) I am a shareholder of Charm Impact

Circular Economy and Data Partnerships in smart cities

I have been reading some of the classic literature on the circular economy, starting with Cradle to Cradle by Michael Braungart and William McDonough and Donut Economics by Kate Raworth. Also, I am taking “From Linear to Circular,” a course by the Ellen McArthur Foundation, which is excellent, and thus I encourage you to check.

I have learned that some cities, such as Amsterdam are already implementing a circular economy strategy with the ambitious goal of halving ‘the use of new raw materials by 2030 and to achieve a fully circular city by 2050’. As part of their strategy, Amsterdam has identified the need to create ‘circular data platforms‘, i.e. targeting the development of a (geographically explicit) digital raw material platform. Such a platform will provide an insight into how various design strategies can help improve the flows as a whole and which policy strategies can create more efficient production and consumption chains.

One of the startups I have recently invested in, Carmachain, is deploying a technology that contributes to fully enabling data partnering among the different stakeholders in a circular supply chain. One of the main concerns of putting your materials’ flow information in the public domain is that competitors may profit from the availability of such data to reverse engineer your products or gain knowledge about commercial secrets. Consequently, some material flow information remains as restricted data, diminishing access possibilities that could have otherwise met certain stakeholders’ needs, i.e. resulting in data gaps. Carmachain has developed a technological platform that allows the exchange, peer to peer (p2p), of data in a secure and encrypted manner. With Carmachain’s platform, the owner of the data can control the type and extent of the information that it is willing to share and with whom, which will encourage the sharing of material flow information.

Eurostat methodology for material flow analysis is a subset of urban metabolism and is still a young discipline that hasn’t been fully exploited for urban planning and design. Part of the reason for this is that urban metabolism analyses have failed to provide detailed spatial and temporally explicit data on the scale at which planners and designers work. Increasing reliance on smart grids will only exacerbate the need for highly detailed data. Particularly data will be needed about when and where energy will be generated and when and where it will be required. This data is currently not openly shared due to its commercial value in a competitive open energy market. As identified in the paper ‘Space-time information analysis for resource-conscious urban planning and design: A stakeholder-based identification of urban metabolism data gaps,’ technological advances in the fields of sensors technology (such as smart meters) and modeling may contribute to overcoming such data gaps; nevertheless, privacy-friendly data processing techniques will still be required.

Cradle to Cradle is like good gardening; it is not about “saving” the planet but about learning to thrive on it

 Michael Braungart, Willian McDonoughCradle to Cradle: Remaking the Way We Make Things

Data will improve the lives of the unbanked

Interview with Ted Martynov – CEO and Founder of Carmachain (*)

Why did you create Carmachain?

CARMA is a natural extension of my background which is consumer lending. I spent many years building different lending companies in Ukraine before moving to Myanmar in 2016 to start SolarHome. SolarHome is a pay-as-you-go solar company that is essentially a mix of lending and distribution. Running lending facilities in an unbanked country was very new for me. The biggest pain point was the lack of credit data for proper credit assessment what is a horrible situation for every lender. Solving this issue become my passion and I left the company in 2019 leaving its status the biggest PAYGO solar in SE Asia to start CARMA the world’s first credit data marketplace.

Who is in your team?

Lina who also worked for SolarHome joined CARMA as CTO six months later. She is extremely talented software engineer with enormous experience in data intelligence. I parachuted myself in Kenya in the midst of 2019 for a ground survey and we were lucky to deliver MVP closer to Jan 2020. We are still in search of CSMO and I hope this highly valuable team member will join us in the next weeks to start building distribution channels.

Which are your products? Clients/Target Clients? BAHG?

CARMA aims to fill in the gap for credit reference services in underserved markets. There are 85 countries across the globe experience this problem mostly from Africa and SE Asia. The demand is coming from lending organizations that would like to have better manageability of default rates through overindebtedness control and fraud prevention. Over Indebtedness became a huge issue even in the western countries after the pandemic outbreak as it affected income sustainability nearly everybody what caused withhold granting new loans. 

CARMA is fundamentally different from traditional credit and designed to be a really quick fix of the problem. We withdrew from aggregating data into a centralized silo. Centralized data silos are vulnerable to hacking and what is more important it requires organizations to give away their entire databases. Our ground survey revealed many cases when even a good working credit bureaus environment able to collect only negative credit histories because positive information is not contributed by organizations. This approach is simply lack of transparency. We organized data sharing in a fully distributed and decentralized way. Data contributors transfer only query-related data leaving the whole database behind company’s firewall. This also created an advantage of access to real-time data that is critically important for fraud prevention among digital lenders who are the new trend of unbanked economies after mobile money introduced itself a few years ago.

Dealing with unbanked economies also brought us to an interesting takeaway. A lot of data sits with non-financial industries. Unbanked customers actually made a lot of digital footprint up to date. CARMA‘s credit data marketplace is totally inclusive for data of any b2c industry. Data contributors receive a reward every time lenders hit their information what made a quite unique revenue stream that was never introduced before.

Access to credit data is only the tip of an iceberg. At the end of the day, we see CARMA Protocol could make a secure connection between enterprises across the globe. Companies could securely leverage personalized or personalized data for the benefits of HR, R&D, marketing from each other. This might be another internet. Internet for corporate data.

Ted Martynov – CEO and Founder – Carmachain

Faster, less riskier and cheaper credit?

We were fortunate to sign an umbrella agreement with a huge association in Zambia where the situation with credit data is quite average with 9% (vs 11% average across Africa) rate of collected credit histories. The members of the accusation presume to share credit data within their group and acquire information from other local organizations as telecoms, PAYGO solar etc. CARMA facilitates transferring raw data what is a perfect feed for any scorecards. Accessible credit data helps lenders to reduce the time for credit decisions and improve the predictability of default rates which improves the quality of loan books hence lenders can give more money to creditworthy customers and mitigate losses of fraud and low-quality transactions.

The future for Carma?

CARMA‘s beauty is in its global context. The data goes directly peer-to-peer and CARMA works as a post office. We deliver “parcels” with data with no idea what is within the “parcels”. This liberates us from obtaining local licenses or putting IT infrastructure what means we can available everywhere where it is necessary right today. We made our baby steps in Zambia and making a close look at Nigeria. Some talks are coming from Bangladesh and Vietnam. We are going to be flexible in building the presence following signals of early adopters. We are happy to be in Benin, Senegal, or Uganda tomorrow after signing up for three or four customers.

We are strongly convinced that pay-as-you-go model works the best for our customers. It reflects with zero sign-up or subscription fees. Lenders pay only in case of hitting data, it entails processing reward to a contributing side. CARMA might be a smart alternative to credit bureaus. The credit bureaus usually charge per request.

Challenges, competitors and growth opportunities?

Starting up any marketplace is challenging and doing it for enterprise data even harder. Companies like the technology advantage of CARMA addresses the vast majority of their concerns in terms of data security but nevertheless the sales cycle is quite long what requires from the team and me to have enough durability. Global lockdown did not make it faster but exposed overindebtedness issue what made credit reference services critical.

We see a lot of startups trying to help lenders with credit assessment built around alternative credit data or fetching data from borrowers. We are fundamentally different, we give visibility to recorded data that sits deeply in enterprises. This makes us optimistic to improve credit risk for 530 million loan deals made annually in underserved markets.

What could CARMA do with a $1m investment?

This is going to help a lot. We are at the very beginning of building distribution channels. The technology requires more capacities to keep data security, applicability, compatibility elements on the highest level. Such investment injection would bring us to serving over 5 mln data requests bundled with access to 19 mln of credit histories. This is roughly $1 mln ARR for CARMA.

The interesting thing is unbanked left massive digital footprint since smartphones became available. This data is a real driver for many industries to find and deliver critical products and solutions for this financially underserved layer. I strongly believe CARMA is one of the missing puzzles in the equation of financial inclusion and building data-driven economics for Africa and SE Asia

Ted Martynov – CEO Carmachain

(*) I am an investor in Carmachain – check my portfolio

Superfluid Labs – Intelligent Pan-African Consumer Scoring Enterprise AI Platform

Interview with Timothy Kotin (CEO) Superfluid Labs (*)

Why did you create Superfluid Labs?

Prior to founding Superfluid Labs, I was a Research Scientist at IBM in Kenya where my team supported enterprise clients to develop new products and innovations to drive access to financial services and inclusion building on the foundation of existing innovations like M-Pesa and IBM’s technology innovations. I was fortunate to both support and witness first-hand how a regional bank at the time with only about 50,000 retail customers launched and rapidly scaled a digital banking offering for the underbanked which has now reached over 25+ million customers with credit and saving products on basic mobile phones. That product is called M-Shwari, and this innovation was possible by leveraging the power of data analytics to reach, score, and service the previously underserved. The motivation for founding Superfluid was thus the desire to develop affordable platforms which democratize access to similar advanced analytics and artificial intelligence capabilities for many more businesses, large or small, in order to expand economic opportunities by better serving the essential needs of hundreds of millions of underserved consumers, starting in Africa. 

Could you please describe your products?

Superfluid has developed an enterprise analytics and intelligence platform called SuperML ( as well as a consumer insights and credit scoring platform called SuperScore ( Together these platforms enable businesses in any mass retail (or B2C) vertical to i) to understand consumer transactional behaviour, ii) score customers to establish an accurate risk exposure, iii) offer personalised and relevant products, iv) increase customer lifetime value and v) reduce revenue churn in a scalable and accessible manner.

Behind the scenes, our platforms harness advanced analytics and artificial intelligence technologies to process both traditional and alternative data, structured and unstructured data sources, in order to predict valuable business events or outcomes and reveal relevant strategic insights for stakeholders. The company serves clients in Financial Services, PAYG Solar, Agriculture, Technology, and Retail industries across several African countries. 

What is the business driver for your clients?

Historically, high credit risk is one of the factors cited by lenders for either not serving millions of potential consumers or charging high-interest rates and fees to their current customers. With Superfluid’s credit risk scoring models which more accurately predict risk at the individual customer level, lenders can i) save working capital (sometimes up to 20%) that would have otherwise been lent to the wrong customers, yet still, generate more profits from a higher quality of good customers (sometimes up to 50-75% higher total profits). With these significant gains, lenders can therefore confidently lend to more customers previously declined or not considered or further can also reduce the interest rates charged to their current customers with lower risk profiles.

What is your marketing strategy?

Having validated our offering and proven the return on investments for our customers, we are now looking to expand our offerings to empower more businesses providing solutions for consumer lifestyle needs. The strategies we are looking to leverage for growth are two-fold: 1) establishing partnerships with aggregators which serve other specialized industries/verticals, like Solar PayGO, retail/commerce, fintech, and 2) providing white-label versions of products which can be branded by our business customers or embedded in their own systems. 

What is your ‘magic formula’?

Based on our proprietary automated machine learning platforms and other deliberate process improvements over the years, we are now able to provide our value offering at a significantly reduced initial setup cost and time to support our clients as their businesses scale efficiently. We have successfully served the clients at varying growth stages –  from those serving just a few hundred customers to multinational companies serving almost millions of customers. 

Our objective is to have both low barriers to adoption through a pay-as-you-go or volume-based pricing model based on the scale of a business as well as clearly demonstrate the ROI link between investment in our solutions and specific business outcomes. 

Challenges, competitors and growth opportunities

Data analytics and artificial intelligence are still an emerging industry in many markets so our major challenges usually come from getting clients to understand the transformative power analytics can provide for growth for them. To help mitigate this, we occasionally provide training and capacity building to enable key stakeholders to understand and adopt the requisite analytics capabilities needed to scale strategic growth and optimize current business opportunities.

Our immediate competition really comes from some businesses who will rather employ internal data scientists to deliver their needs. However, our comparative advantage lies in the broader diversity of our team’s combined depth of expertise, experiences across multiple use cases, and focus which provides much more valuable returns when we engage with clients. Even where some customization is necessary for complex use-cases, the maturity of our platforms and in-built automation means that we can deliver value in weeks rather than several months or years. 

As digitization explodes globally and especially in emerging markets, we see more business understanding and desiring the power advanced analytics and machine learning provides for scale, efficiency, and growth. We are already preparing in multiple ways to provide the needed offerings for serving these anticipated needs profitably and at scale.

What would you do today if you knew exactly what will happen in the future?

Superfluid Labs

(*) I am a shareholder – check my portfolio

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