Amee Parbhoo runs Accion Venture Lab, the venture arm of Accion, the global financial inclusion nonprofit. Parbhoo manages Accion’s global seed-stage impact investment activities hinged on backing fintechs and embedded financial companies focused on underserved populations.
What was the most important decision in your career?
My biggest decision was leaving consulting in the US and going to work in India and seeing what it means to build and operate a business on the ground. Early in my career, I worked for SKS Microfinance, which was, at the time, the largest microfinance institution in India. I moved to India to help build new home products and to develop technology within a microfinance company. That was a very decisive point in my career to see what it actually means to build a business from the ground up.
What’s one fintech opportunity you see across Africa and Asia that’s often overlooked?
Thinking about the “assets” that consumers and small businesses have. Too often we don’t see what that looks like for an underserved customer. It might be their salary, their land, it might be a motorcycle they own, it might be their shop or inventory that the shop owner has. All of these different things can unlock the potential to reach that consumer. While they might look cash-poor and not valuable for a lender or a financial institution to reach and serve, in reality, there’s a lot of power there for that consumer. A lot of what we find interesting is unlocking those assets, helping customers better leverage them—whether that’s through data on their shops, traction from the business they’re doing, or their salaries—and using that as an asset to provide financial services.
What’s a common misconception in developing and emerging markets?
That it’s sort of “copy and paste” in the way these businesses are built from the West. Fintech in the US, which is also a market we invest in, has been hugely successful and I would argue that emerging markets have and are going to be just as successful. But it isn’t copy-paste in how you operate and build those businesses. There’s a different path to which those businesses, depending on the market, will scale and become profitable.
What investment trends in emerging markets are you most excited about?
I think the buzzword for fintech over the last year has been embedded finance. It’s so much broader than just a trend. The way we think about embedded finance is it really touches the ways financial services are provided to customers. And it cuts across trends in lending, insurance, savings, and investments. It creates opportunities for companies that are not financial institutions to provide financial offerings. But it also provides a customer who doesn’t have access through traditional means a way to more seamlessly access financial services. So we’re excited about companies like Kenya’s Lami, an embedded insurance provider in which we recently invested and Field Intelligence, a healthcare supply chain platform we backed in Nigeria and Kenya.
What’s the key challenge with fintech startup growth in the markets you’re watching?
We think a lot about how to grow profitably. [For startups,] there’s always been this push to grow, and oftentimes that means to grow at all costs and focus on profitability. I think that’s just not as feasible over parts of emerging markets. It’s not long-term sustainable for companies, and it doesn’t always put customers first. Oftentimes, growing at all costs means you don’t have the same focus on customer lifetime value, on retention, and on increasing the value that you provide to customers. Because all you really care about is the initial acquisition, not retention. And that’s something we’ve found to be challenging. And so we spend time, even as a seed investor, focused on unit economics. How do you drive unit profitability? Because we think that’s ultimately going to be best for the company to grow as well as for their customers to continue to see lifetime value and see more value offerings that the company provides.
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