Travis Holoway and Rodney Williams hit upon a brilliant strategy to disrupt the payday lending business with a tool that would be much more borrower-friendly. That tool is the SoLo Funds app, available from both the App Store and Google Play.
The app lets borrowers set the terms. Remarkably, lenders are generous. That may have something to do with the fact that in the company’s short operating history they’ve seen the same people become both borrowers and lenders. The community they are building can completely change the short-term lending business.
One key to their success is a new credit scoring model the company developed to measure a borrower’s ability to repay a short-term loan according to the terms they propose.
Interview with Travis Holoway & Rodney Williams; Travis CEO & Co-Founder, Rodney Co-Founder of Solo Funds Inc.
The following is the pre-interview with Travis Holoway & Rodney Williams. Be sure to watch the recorded interview above.
What is the problem you solve and how do you solve it?
Today 78% of American workers are living paycheck to paycheck and 47% of Americans cannot solve a $400 emergency cash need without borrowing from someone else or selling a personal asset. Access to loans under $1k are extremely scarce. Borrowing from friends and family puts strain on personal relationships and are embarrassing to ask for. Since banks do not lend in small-dollar increments people are forced to take high-interest loans or go without basic necessities due to financial hardship. Payday and title lending institutions are creating debt-traps daily by charging 400% average interest rates for small-dollar loans. These predatory lenders report loan history to credit bureaus to negatively impact a borrower’s credit, but never to positively impact their credit. In the U.S. wage stagnation and fluctuation has created the need for lower income workers to use payday loans more frequently. Annually, 12 million people turn to payday lenders with average borrowers taking 8 loans per year at $375 each. As a result, $9B dollars in fees alone are generated annually. It’s well documented that payday loans are predatory and many have advocated for a complete ban, but no viable alternative solution has been presented. SoLo is here to change that.
SoLo is a completely mobile lending exchange which is the first of its kind. We’re peer-to-peer lending in the purest form ever. We’ve eliminated the institution barrier between people and allow individuals to create their own terms. Ultimately, what we have created is a one-time per transaction credit score. The FICO score has been used to determine an individual’s ability to make multiple payments over a long duration of the time. We’ve created a credit rating system that determines an individual’s ability to make one-payment on one specific date. We analyze data such as cash-flow, alternative credit history, social data, and behavioral data to create a score which lenders use to determine how credit- worthy a borrower is. We believe people’s financial stories are more robust than the narrative presented by the traditional FICO score. Our technology provides mobile convenience, affordable access, and through our free financial literacy curriculum, we provide a direct path to a more financially stable life for those who have been forgotten and exploited.
More about Solo Funds Inc.:
SoLo was created to disrupt the predatory payday lending industry. SoLo’s mobile marketplace directly connects individual lenders and borrowers with pre-set terms created by the borrower. Lenders determine a borrower’s creditworthiness using SoLo’s proprietary social credit score. Loans are interest-free, range between $50-$1000, and have a 30- day maximum duration. Lenders can earn returns on lent dollar amounts. Borrowers solve their short-term cash needs conveniently and more affordable than ever. SoLo prevents the strain on personal relationships that borrowing from friends and family creates and eliminates the debt-traps that payday and title loans create. SoLo is poised to solve the needs of the 78% of American workers that live paycheck to paycheck and the 47% of Americans that cannot solve a $400 emergency cash need without borrowing or selling a personal asset.
Revenue model: SoLo makes money from donations paid by users on the platform.
Scale: Raised $1.2M dollars (Seed Round), 9 Full-Time Employees, Since April 2018 Total users – 3.5k
Travis Holoway’s bio:
Travis Holoway is the CEO and co-founder of SoLo Funds Inc. a mobile-based lending exchange created to provide more affordable access to small-dollar loans under $1,000. Travis is passionate about providing resources and improving the overall financial wellness of the world’s unbanked and underbanked populations. Originally from the greater Cleveland, OH area Travis is a graduate of the University of Cincinnati. Prior to founding SoLo, Travis built his career in the financial services industry first as a financial advisor and later as Director of Training and Development at Northwestern Mutual.
Rodney Williams’ bio:
Rodney Williams, Co-Founder of SoLo Funds Inc. and Founder/CEO of LISNR, leads one of the most disruptive companies in the IoT space and the world of mobile connectivity with a new communication protocol that is the most efficient way to connect any device with a speaker or microphone. Fresh off of their $10M Series B raise lead by Intel Capital, LISNR took the stage in 2015 racking some the world’s most coveted awards such as a Gold Lion @ Cannes for Most Innovative Mobile Technology and a three-time member of CNBC’s Disruptor 50 list to just name a few. Prior to LISNR, Williams spent over 4 years at Procter & Gamble as a brand manager and is most noted for being the first marketer there to co-write digital patents. Williams, originally from Baltimore, MD holds 4 degrees but most notably two masters, one of which is an M.B.A. from Howard University.
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Devin is a journalist, author and corporate social responsibility speaker who calls himself a champion of social good. With a goal to help solve some of the world’s biggest problems by 2045, he focuses on telling the stories of those who are leading the way! Learn more at DevinThorpe.com!