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Datacultr

AI-driven behavioural models, to derisk loans to unbanked

UAE
Market: Financial services
Stage of the project: Operating business

Date of last change: 16.03.2021
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Idea

New To credit is a $200Bn annual opportunity for financial institutions in emerging markets, but there are inherent challenges:

1. HIGH-PERCEIVED RISK
•Lack-Credit Scores, Credible Documentation & Collaterals
2. TOUGH & EXPENSIVE DEBT COLLECTIONS
SOLUTION
Prioritizing Repayments via Data Driven Interventions, built on 3 pillars
1.EFFECTIVE RISK MITIGATION-Collateralizing Smartphones, which are livelihood & access enablers for the ‘New to Credit’
2.ML DRIVEN ENGAGEMENT MODELS-Segmented communication plans that are continuously optimising for results
3.AUTOMATED OUTREACH

Current Status

Datacultr is currently securing 2000+ new loans every day through its clients.
Datacultr’s customers are lending institutions, that provide micro-loans and other products to middle & low income groups. These include- Banks, Non-Banking Financial Corporations, Micro-Financing Institutions , Mobile Operators & FinTechs.

Market

New To credit is a $200Bn annual opportunity for financial institutions in emerging markets, but there are inherent challenges. There are over 1.7bn Unbanked adults and another 2.3Bn under-banked adults globally. They have an inherent need for formal credit for working capital and personal reasons. This tantamount to US$20bn market for Datacultr

Problem or Opportunity

$20Bn annual opportunity for Datacultr, with the following use cases
1.Smartphone financing- Live with NBFIs & Telecom Operators
2.Personal loans- Pilots with Fintechs & Banks
3.Buy Now Pay Later- Under discussions with e-commerce companies
4.Concierge, Cab, Food Delivery, Co-working, etc- Under discussions with Wework, Uber, etc
5.Asset Loans- Future, with banks, NBFIs

Solution (product or service)

KEY METRICS IMPACTED
1.NPAs: Brought down to under 3% from market average NPAs of 9% (in India)
2.Monthly Bounce: Brought down by over 25%
3.Overall Cost of Collections: Brought down by over 70%
4. Loan approval rates to 'New to credit' doubled

Competitors

Direct Competitors include:
1.Payjoy- active in Mexico & Colombia
2.Trustonic- active in more mature markets
Datacultr will have a bigger market share than these direct competitors

Advantages or differentiators

Differentiators:
1.Superior technology, that provides instant coverage across all Android devices, while competitors need to pre-integrate their software with every device that they want to secure, making scalability a big challenge
2.Focus on building a positive consumer behaviour through ML driven behavioural models, while competitors like to use a binary approach of locking a borrowers device, in case a default happens
3. Focus on consumer literacy, while competitors try to use coercive ways to recover money

Finance

SaaS Fees charged to the client for every loan that is secured on the platform.

LTV of an end user is estimated to be $7.2

Basis current client signups, sales pipeline & vision, we estimate our revenues to top US$150Mn in 5 years

Business model

Business Model: B2B SaaS
Channel:
1.Direct Sales Team, with account managers for Asia
2.Resellers for new markets- for Africa
3.Strategic Partnerships- Comviva, Qualcomm, etc
4.Co-Marketing – Microsoft, Samsung, Vivo, etc

Money will be spent on

USAGE OF FUNDS-
1.Technology- Product extension to other devices and OSs, Data sciences for behavioural interventions and blockchain for fraud detection & debt transparency
2.Market Growth- South Asia, South East Asia, Middle East & Africa

Offer for investor

Raising US$1mn at a pre-money valuation of US$8mn

Team or Management

Risks

1. Regulations, preventing financial institutions to use certain datacultr features
2. Datacultr's ML Models fail to build strong positive customer behaviour

Incubation/Acceleration programs accomplishment

Incubated by:
1.Startupbootcamp
2.Seedstars
3.Jio Gennext
4.IAMAI-Mobile10X
5.Village Capital
6.Microsoft for startups

Won the competition and other awards

AWARDS & RECOGNITION
1.Economic Times, BFSI Innovation Awards, 2020
2.Red Herring Top100 Asia, 2019
3.NASSCOM Emerge50 India, 2018
4.Certificate of Excellence from Department of IT & Communication, Government of Haryana
5.Won a Grant of $20k from Paypal, Metlife Foundation & Village Capital run Finance Forward Program, 2020
6.Won an award of $20k from Philip Morris International, for innovation in financial inclusion
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Idea
Current Status
Market
Problem or Opportunity
Solution (product or service)
Competitors
Advantages or differentiators
Finance
Invested in previous rounds, $
Business model
Money will be spent on
Offer for investor
Team or Management
Mentors & Advisors
Lead investor
Risks
Incubation/Acceleration programs accomplishment
Won the competition and other awards
Invention/Patent
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Product Video