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» Can Stellar disrupt the stokvel? Mbewu meets the CEO to find out

October 15, 2018

Can Stellar disrupt the stokvel? Mbewu meets the CEO to find out

For many of us outside of the tech “start-up” world, there is an indescribable allure about the idea of coming up with an innovative idea that fundamentally changes the lives of millions of people around the world. We’ve seen companies like Twitter, Alibaba, Uber and even… Tinder, transform the way millions of us respectively receive the latest news and information, source vendors to do business with, get from A to B and choose who we want date. The world has become an increasingly convenient place to live, especially for those who embrace these technological and digital advances. Now, in highly unequal societies, such as South Africa, the level at which one has the opportunity to embrace (or consciously reject) the conveniences of technology is largely determined by class and geography. But this is not necessarily the first time developing countries have faced an issue of economic exclusion and subsequently made strides to offer non-conventional solutions. For example, Muhammed Yunus and Grameen Bank, were jointly awarded a Nobel Peace Prize for pioneering the idea of microfinance and essentially provided rural entrepreneurs (who could not qualify for traditional bank loans) access to loans and credit for their businesses, without requiring collateral. Furthermore, we have started to see a shift in traditional Financial Institutions in South Africa who are attempting to “bank the unbanked” market by providing alternative services and transaction channels (click here to read more). With this drive towards more inclusive financial services, brings new opportunities from a technology perspective. And so, when Mbewu Movement founding members had dinner with the founders of Stellar, Joyce Kim (Stellar Executive Director) and Jed McCaleb (Stellar Board Member and Developer), on their first trip to South Africa we were delighted to hear, firstly, an international perspective on the changes in the technology world and how they think these could impact South African society, and secondly, advice on startup entrepreneurship and particularly what they think is important to know about building a start-up organisation (especially, as we know many you in the Mbewu community are already thinking this big).

Joyce Kim (image:

So what is Stellar? Stellar is an NPO based in California which “aims to expand financial access and literacy worldwide by building a common financial platform” (click here for Stellar website). According to Stellar, “around 2.5 billion people across the world cannot afford a bank account. Stellar gives everyone a chance to be banked, save money, build credit, start a business, or otherwise participate in the global economy – free of fees and other charges”. As Joyce herself explains, “the internet allowed anyone to send an e-mail, Stellar’s common financial platform allows you to conveniently send, save, and receive money, without large fees or hassle”. She also believes that “when individuals have access to financial services and the confidence that those services are working in their best interest, those individuals can independently improve their lives” (see video: Re-imagining the World’s Financial Systems with Digital Currency).

Jed McCaleb (image:

With this said, although Joyce and Jed’s visit to South Africa was to explore the extent to which Stellar could add value in the local Financial Services context, the major opportunity that Stellar is keen to explore locally is remittances (click here to read more). Which makes sense considering the number of foreign nationals in the country who would benefit a great deal by being able to easily and quickly transact with family, friends and businesses back home and/or across borders (click here to read more). Furthermore, although Joyce and Jed seemed to show immense fascination about the stokvel club culture, Stellar does not necessarily plan on disrupting stokvels. In fact, Joyce’s prediction is that that the stokvel club will be turned into chat someday since it is not only about financial exchange and contributions, it also has a very strong a social element.

Following this discussion, we then went on to talk about whether Stellar plans to have an impact on women in Africa? Joyce acknowledged that “women are financially excluded at much higher rates than men- depending on the culture women might not have the right to have their own bank account, not have the right to have their own sim card, their finances are watched, their money is taken from them. Women are also more often giving others (including Service Agents) their pins and passwords because they do not own their own devices. So anything that gives women access to save their money is important.” Stellar does plan on focusing on women through partnering with other organisations, such as the Girl Effect, which, amongst many other initiatives, encourages girls to invest in savings accounts and be responsible for their finances through gamification. In addition, gender equality is deliberately entrenched in the culture and ethos of Stellar- the office comprises of half women and everyone in the company believes in equal opportunity for men and women.

In summary, who better to receive entrepreneurial advice from, other than two brilliantly innovative and passionate founders of Stellar. Some key considerations that Joyce and Jed shared with us included the following:

  1. In Silicon Valley, the average person needs to really hustle to get funding and grow their ideas, which means that you need to spend a lot of time investing in networking and become a highly networked individual. Joyce said “the most powerful people I know in Silicon Valley are highly networked and have very strong domain expertise. So it is important to evaluate the networks you have now in the work environments that you are in and whether they are strong enough so that if you leave your company, you don’t lose those valuable connections you had built while you were there”
  2. In addition, you need to think about how you will make yourself useful to people in positions of power, for example, “Women Who Code” and “#Yes We Code” organisations have brands that appeal to people in positions of power in top tech firms because these companies want to promote and be seen promoting diversity in their companies and in the tech industry
  3. Before deciding to take the plunge to independently pursue your passion project, leverage the domain expertise of your personal friends, for example, if you are looking to get funding for a passion project, ask your Marketing friends for their opinion on your pitch or for advice on what companies are look for in sponsoring projects such as the one you will be pursuing
  4. Try to think about how some of the day-to-day operations would run in your organization and determine whether it will be viable venture, for example, create a budget for your organisation before you decide to pursue it full time, decide how much you want to get paid, think about whether you will need extra people on your team and how much you would pay them, get marketing advice
  5. Experiment with different interests on the side (at night / over weekends) in order to gain traction on your ideas and gather data more data on your target market. Publishing a website and monitoring the stats over a period of time, is a relatively easy and inexpensive way to learn about who is clicking / interested in your idea
  6. Find your passion. And by this Joyce means take the time to “discover the things that you do that make you proud as hell”. She strongly believes that being truly passionate about your work is possible and she didn’t find her passion until Stellar. Also, Joyce advises that if you know your passion but can’t get to it, it doesn’t mean that it’s gone, it just means that you need to plan more strategically about how you will get to it. Lastly, Joyce also realized that “when you follow your passion you will find that you actually end up working much harder then you used to, and your next challenge is defining work-life balance on your own terms”

Talking to the founders of Stellar provided a refreshing perspective on innovation, technology, entrepreneurship and cross cultural experiences. It was also thoroughly exciting to have the opportunity to engage personally on their ideas around making economic participation more democratic in South Africa by allowing the traditionally “unbanked” access to banking services and facilities. Lastly, we hope that the our community of budding social and private sector entrepreneurs ponder on the preparation and soul searching required to transform your passion project to a successful and sustainable start-up.

Article by: Magcino Radebe | Mbewu Movement Founding Member

Magcino Radebe holds a Master of Philosophy in Politics, Philosophy and Economics (University of Cape Town). She is a former Strategy Consulting Manager and is currently on sabbatical until she embarks on a career in Insurance Financial Services.