“If you want to study but you don’t have enough money, you have a means to reach out and let people help you while offering them something in return. This also helps you build your network and find mentors”- Juan Guerra
Not everyone can change how university education is funded and re-establish meritocracy in the international education market at the same time. StudentFunder is an early stage fintech company, using crowdfunding to enhance the quality of student loans and leverage additional sources of funding, improving access to education, employment and enterprise. StudentFunder helps students raise donations and in the near future, also soft loans. This flexibility can support a broad range of students and appeal to a wider audience of funders: the more obvious ones are friends and family and university alumni, but StudentFunder can involve pretty much anyone and thereby allow for small contributions from multiple parties to stack up to a big difference. In the UK, the Student Loans Company provides loans to undergrad students. Students without the cash can take a loan to fund their degree. However, many professions require postgraduate education, for which there are very limited funding options available. This puts less privileged students at a disadvantage and skews the UK’s talent pipeline, inhibiting competitiveness, innovation and social mobility. For example, even though only 7% of UK population is privately schooled, 70% of UK high court judges are privately educated.
Juan once trekked across the Alps dressed as an elephant to raise awareness of StudentFunder!Every year hundreds of thousands of would be students fail to enrol and others drop out due to lack of funds. In May 2012, the Higher Education Funding Council for England (HEFCE) showed a total spending cut of £1,296m. In 2013, the budget is forecast to drop by another 20%: As a result fewer loans and scholarships will be available to students in England.
StudentFunder’s CEO, Juan Guerra, A Cranfield Business School MBA, decided to take the plunge and do something about it. Growing up in Mexico, He was accepted in a German university but did not have the funds to take the offer. As a last resort, he sent out an email to everyone he knew selling insurance and dogs and asking for help. Even though no one bought insurance or dogs, the response was overwhelming. People helped him in all sorts of ways. Back in 2004, he crowdfunded his into a German university before the term “crowdfunding” even existed, using emails and cash. He considers himself fortunate. Now, he seeks to help others do crowdfund their way into education through StudentFunder. IntelligentHQ spoke with the enterprising CEO to learn more.
IntelligentHQ: Can you tell us about you and your background?
Juan Guerra: I crowdfunded my way into university in Germany at age 19 and started out my career doing SME banking at Citi and later microfinance. I then did an MBA in Cranfield. Funding it was an uphill battle, but I pulled it off.
IntelligentHQ : Can you tell us about your Start-up?
Juan Guerra : StudentFunder has been running for six months and helped a few students already. We are running a pilot with our first partner university and are seeking to partner with a lending institution.
IntelligentHQ : Why did you choose innotribe?
Juan Guerra : StudentFunder believes that partnerships with large retail lending institutions will enable it to scale up and have systemic impact quickly. Innotribe is a perfect platform to establish links with potential partners.
IntelligentHQ : How is your product offering going to disrupt the industry?
Juan Guerra : There has been little innovation in productive retail loans. The relative attractiveness of productive retail loans (SME or student loans for instance) has declined over time, reducing people’s access to credit and ability to invest in their future. New companies are building credit scoring algorithms using social media. We believe crowdfunding can be used to greatly enhance the quality of retail productive loans and leverage funds. This makes it possible for banks to offer more loans as match-funding, reaching more people who, by the way, are more likely to repay and become higher value customer over the longer term.
IntelligentHQ: How do you see the Finance and Tech industry landscape?
Juan Guerra: I see the landscape ripe for disruption. Many interesting things are happening. Yet, I feel more innovation is required in retail, especially, productive loans. I saw a few mindblowingprojects at Innotribe.I believe this is the dawn of an age of disintermediation, meritocratisation, transparency and disaggregation in the whole sector… which is very exciting!
Follow on Twitter: @studentfunder Linkedin: uk.linkedin.com/in/juanmiguelguerra/
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