Kountable on Wefunder 2022
Many well-meaning projects aim to enact social or environmental change. For example, a company or organization may aim to get millions of COVID-19 vaccines overseas to a country in need. This would then lead to transactions that involve three parties: a buyer, a supplier, and a small-to-medium enterprise (SME) trader that can act as a middleman and handle shipping. However, such transactions can get messy and sometimes bring projects to a halt.
Kountable is a business-to-business marketplace designed to smooth out this trading process. The platform allows multiple parties to collaborate and conduct payments with ease. We reached out to co-founder and President Catherine Nomura to hear more about why the company started with Rwanda and how it makes a difference in people’s lives.
Note: This interview was conducted over phone and email. It has been lightly edited for clarity and length.
What inspired you to take the leap and start this company?
We discovered a huge and impactful unmet need in the marketplace that we began to realize no other organization could address – a not-very-well-understood market failure that we could solve through a unique, purpose-built combination of technology, know-how, and network. It came from listening to small local suppliers and distributors of products critical to healthcare, education, sustainable infrastructure, and digital connectivity and learning about their challenges in procuring the products needed to complete major projects. Even with solid global suppliers and firm purchase contracts in place from large buyers like government ministries, corporations, large non-governmental organizations and global agencies, these very resourceful and capable business owners were struggling for reasons that are systemic byproducts of the way global commerce and financial systems and their supporting technologies have evolved.
The tools (ideas, technologies, and solutions) that eventually became the building blocks of Kountable’s marketplace had been used and tested in other ways before but had never been put together in this way to solve a problem with such massive potential impact on global quality of life. SME trade failure is measured in the trillions of dollars every year (estimated to hit $5 trillion post-COVID). For me, unlocking the growth and change-making potential of entrepreneurs has always been a mission, and this was an opportunity to do that on a scale far beyond anything I’d seen or even imagined in a 25-year career of working with many of the world’s best entrepreneurial support organizations.
What is the impact of Kountable?
Impact is measured in many different ways, and we do track the impact of every trade on our platform against the UN Sustainable Development Goals, but in the broadest sense, Kountable’s impact is the difference that getting life-changing goods to people who need them at scale makes. Those goods, and the projects they enable, save lives and improve quality of life for millions, but they also help businesses, big and small, to grow and economies to thrive. The persistent inability of many countries and communities around the world to access critical supplies and inputs for health, education, digital connectivity, sustainable infrastructure development, clean water, and food security due to trade failure costs all of us. Not only do these people and communities suffer… entrepreneurial ecosystems can’t get traction, manufacturers miss out on valuable market opportunities for their products and donors, and governments and other agencies get less results for the precious resources they allocate to solving problems. Conversely, when the right goods are delivered so projects can succeed, the positive impact immediately spawns a virtuous cycle.
Kountable’s real impact, beyond the effects of the nearly $70 million in life-changing goods we’ve delivered, is that we have a proven, sustainable solution that allows many players to easily engage in a marketplace that builds wealth for all its participants, regardless of size, and we have institutional processes capable of efficiently engaging the amounts of institutional capital required to accelerate global sustainable development. It’s about giving all the kinds of participants in global trade who want to do better a place and a way to do that and see real results and giving those whose participation is needed, but who haven’t yet seen a way to engage a safe and attractive enough proposition, to draw them in. That changes what’s possible and unlocks all the other impact potential that comes when we normalize trade success versus trade failure. It’s about meaningful inclusion – what we call “being kounted.”
(You can probably see at this point why a community round makes so much sense to us.)
Wall Street has Morningstar, S&P, and Bloomberg
The equity crowdfunding market has KingsCrowd.
Who is on your team and how did you come together?
Our team has extensive experience on six continents in asset management, trade, software-as-a-service technology, infrastructure investment, entrepreneurship, financial operations, banking, and risk. In addition to the members’ respective skill sets, all share a passionate belief in the value of what we’re building and the need and potential for it in the worlds which they know so well. Several of our team members have been referrals from investors, advisors, and other supporters who know us well.
In the case of our chief risk officer, one of our venture investors insisted that we recruit him for his deep domain expertise and years of experience at Standard Chartered Bank. Fortunately, he found the role and the challenge intriguing enough to say yes! My co-founder, Chris Hale, our CEO, is, by contrast, a pure entrepreneur with over a decade of success building businesses, including one of the fastest-growing registered investment advisors in the country, and advising tech startups in the financial services sector. His vision for what became Kountable and his relentless commitment to seeing how far he (and later, we) could take it, with an invitation to come along and help, first “recruited” me, followed by many others, from employees to investors, advisors, and partners.
What is the role of your personal network in Kountable?
One of the most obvious ones that always comes up is that it’s the reason we started in Rwanda. But it goes back farther than that, in that Chris Hale, our CEO, was in my professional network and also my neighbor, and that was how we met and became co-founders. Our combined networks have had a profound role in shaping the company. My network through the entrepreneurial coaching and support world gave us the entrepreneurial focus group in Rwanda, whose honesty about their challenges and missed opportunities informed the solution and business model that has become the center of our unique approach.
Chris’s network, especially through his alma mater, Williams College, has contributed vast amounts of resources and talent to our development. Our early lead investor, TAMCAP, is a family office with close ties to the college, and Chris met the principal of that family, who was his business partner prior to Kountable, through an introduction from another Williams graduate. In addition, Kountable is fortunate to have a close relationship with the Williams Center for Career Exploration and its alumni-sponsored internship program and benefits from a catalytic infusion of interns each summer and winter that have made major contributions to the platform.
In terms of purely personal network, I’ve tapped into the special talents of many dear friends to help with things as diverse as professional photography and videography to pulling off a full-scale, Silicon-Valley-style launch in Kigali, Rwanda, and they each put their heart and soul into making those things successful. Kountable is infectious. People see the passion and the impact and want to get involved. In the early days, we even had personal friends directly fund some trades on the platform, and we still have some in our cap table.
Your company relies heavily on networks. Can you tell us more about how you can leverage the advantages of network effects and how you face the challenges that it brings?
Network effects have been core to our growth since the beginning and are inherent in our model because every trade we support on the platform has multiple parties – at least a buyer, a local distributor who is selling to them, and a supplier to that distributor, who is usually global. Each of these parties becomes a node in our network, and each has networks of their own that have become important vectors for our growth and for growth in the value of the whole network. Network effects have also led to the emergence of some new possibilities for collaboration and deepening insight into key product categories and problem areas. This is proving especially valuable in healthcare, where we can go from digitizing and underwriting a single trade to supporting an entire value chain for a disease like diabetes. Digitizing trade transactions involving local distributors allows us to, for the first time, stitch together a dataset and a bigger picture of ground truth that has significant value for different players across the network, from suppliers to logistics providers, insurers, buyers, and even the donors who often provide the funds for the purchases. The network together is much smarter than the sum of its parts.
One of the challenges is the speed of exponential growth that can happen when each new participant in the marketplace comes with an extensive network. We have to pace ourselves and make strategic decisions about which parts of those networks to serve first and how. Network effects are among the most powerful drivers we have for growth and expansion, but they need to be managed, as do expectations with them. This is a good challenge to have. It’s encouraged us to create new capabilities and develop relationships with partners that increase our ability to scale faster and more efficiently into more areas while staying focused on our core objectives.
Wall Street has Morningstar, S&P, and Bloomberg
The equity crowdfunding market has KingsCrowd.
How do you intend to use the money you raise this round to scale the business?
Kountable has had demand far exceed our supply since we launched in 2015. In order to work with the institutional players that will allow us to meet this demand, we need to maintain a strong balance sheet and sound financial governance processes. Kountable is currently engaged with some of the largest trade banks in the world as well as another platform focused on distribution of trade assets. We will use some of the capital to strengthen the balance sheet, maintain our financial governance processes, and hire relationship managers to work with our bank and enterprise partners.
As you think about the business 5-10 years down the road, what do you see exit opportunities looking like? Have you set any future goals for the company?
Kountable is operating against a detailed financial forecast and operating plan. We have aggressive growth goals driven by the consistent demand we’ve experienced in the market. There are three categories of acquirers that make sense for Kountable. The first is business spend management or enterprise resource planning platforms. These could be companies like SAP, Coupa, Microsoft, or others. The second are other fintechs. Companies like C2FO or neobanks like Revolut are potential suitors looking at horizontal expansion. As traditional banks become more digital and expand their platform capabilities, suitors like HSBC, Standard Chartered, or Citi are also possibilities. If Kountable can truly crack the SME trade gap and activite the trillions in opportunities flowing through this population, we become the key to a massive, underserved, and lucrative market segment.
We look forward to seeing where Catherine and her team take the company. Kountable is currently raising on Wefunder.
About: Léa Bouhelier-Gautreau
Léa is passionate about impact investing and sustainability. Prior to KingsCrowd, she worked for Stanford’s accelerator, StartX, helping to select the most promising entrepreneurs. She also led the first award-winning study on the Malawian startup ecosystem. In her free-time, she volunteers to help entrepreneurs in Cameroon, Brazil and Colombia. Léa holds a degree in Anthropology from France and is currently enrolled in the UC Davis MBA program.