What's Up Wednesday

The Wanaka Bag

sept-14

By 2050, there will be more plastic in our oceans than fish. Every year, we are each (on average) responsible for 350 plastic bags, which are each used for a total of about 12 minutes before being thrown away to end up in a landfill. The group at Plastic Bag Free Wanaka were sick of seeing plastic pollution clogging up their town – so they decided to do something about it.

And so, they created The Wanaka Bag, a limited edition, eco-friendly and super-trendy handmade bag. Each one is unique, and hand-crafted by dedicated locals, who want to see Wanaka free of single-use plastic bags by 2019. With the funds raised from this first run of limited-edition bags, they can fund 1000 more Wanaka Bags to be produced commercially, and sold to stop the people of Wanaka creating more plastic pollution.

They’ve already shot past their $5,500 dollar target, but you’ve still got 19 days to get on board and support a future free of plastic pollution.

We loved not only the innovation of this team, but also their enthusiasm – and so we got in touch with Anna from the team to hear more about it:

How are you finding the campaign so far?

We knew our town would be supportive but we’re totally blown away by the support so far. We’ve even had folks from far and wide who share our love of Lake Wanaka and who have pledged. It’s very cool to think of them sporting one of our bags/bottles/karma cups on the other side of the world.

What do you have planned for the rest of your campaign? Anything for us to look forward to?

Creating 200 really high-quality bags has been a huge project in itself and keeping the town spirits up, the incentives high and the ball rolling has been a project in itself. Admittedly however, we didn’t expect the bags to get snaffled up quite so quickly so we’re currently conspiring amongst our committee to see what else we can offer to our amazing community so those that missed out on a bag don’t feel left out. We want everyone who wants to support to have a way to wave the banner.

Anything you’d like to shout out to your crowd?

As cheeseballs as it sounds, we just want to do a shout out to our town and community. We’re in a really unique environment and position, with a town so full of community-minded, pro-active and positive people. We get that not every town is like this, and we’re incredibly grateful for the wonderful locals who have jumped right in behind us to sew, support, sneak in and clean our sewing spaces, offer fabrics and food to share. You name it! No one has missed a beat! It’s one of those happy-glow moments where you can only revel in the warmth of the moment. Thank you Wanaka! The joy of bringing this opportunity is hugely amplified by having so much encouragement and support!

To provide even more encouragement and support, head over to Plastic Bag Free Wanaka’s campaign and get pledging while you still can!

What's Up Wednesday

The Misprint Co.

Sept 7

Back in design school, Kareena and Jenny were just two students creating good-looking notebooks for a university project. But then they began to notice how much paper their creations were using up. After some research, they discovered that it takes 10 litres of water to create just on A4 piece of paper – and they wanted to do something about that.

So they founded The Misprint Co, a Wellington company that offers paper repurposing services to local schools and businesses. These organisations provide the paper, and the Misprint moguls turn it into beautiful custom-made notebooks, which they then sell back to the organisations. To date, they have repurposed 61,169 sheets of paper – which amounts to 611,690 litres of water saved.

The Misprint Co. is growing already. They’ve been through both Lightning Lab Manufacturing and the Low Carbon Challenge, and now they want to take their business to the next level. They’re expanding their office, their reach, and their team (they need more than 2 people to get it all done!) And so, they’re turning to you to make it happen.

Kareena and Jenny are looking to raise $20k with their campaign, $15k of which will be matched dollar-for-dollar by the Wellington City Council, thanks to their success in the Low Carbon Challenge. They’re already over half of the way there, but they need their crowd to get behind them – so we had a chat to Jenny about why you should be getting involved in this campaign.

How are you finding the campaign so far?

The campaign is going really well so far! We’ve been overwhelmed by the amount of support and generosity we have received from our crowd. We are super stoked to have made it over half way in just under two weeks. What really helped us was our launch party, which really kicked things off.

We’ve found we have had a lot of engagement through our social media. All our big supports such as Wellington City Council, Flick Electric, Creative HQ and The Low Carbon Challenge (the list goes on) and even Justin Lester who’s running for mayor have tweeted about us and shared our campaign! With 11 days left in the campaign there is still time for us to reach our target. But at the same time it’s quite nerve racking.

What do you have planned for the rest of your campaign – anything for us to look forward to?

We have a few things up our sleeves. We will be launching a new reward in our last week, I won’t say what it is but it will definitely be interactive. We are also planning some new marketing, potentially in a guerrilla form. Keep your eyes peeled for fun things happening.

Anything you want to shout out to your crowd?

We would love to say a massive THANK YOU! Everyone has been super supportive and are really backing us for our crowdfund to be successful. A big shout out to our current clients too who are ordering their next round of notebooks through our campaign. We are forever grateful to those who have pledged and shared our campaign so far. Our crowd is amazing!

To find out more about The Misprint Co. and help these paper people reach their goal, check out their rad campaign right here.

Confessions of a Crowdfunding Enthusiast

Our latest guest post comes from crowdfunding enthusiast, Adam Millen. Engineer by day, children’s author by night, he went from backing campaigns to running one of his own. He’s hooked and planning another campaign. You can find out more about it at jackfeelsbig.nz/sophie. He tweets about crowdfunding @crazyideasnz and blogs at crazyideas.nz.

What would you do if your friends and family offered you a couple thousand dollars? They say they want to support that thing that you’re really passionate about, and the money is for you to produce something cool to share. What would you do with it?

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At the start of last year I had the idea of creating a book to teach kids the names for their feelings. And I crowdfunded it. I’ll tell that story, but first – why? Why do I care about crowdfunding ideas? Why should you care?

I care because I’m excited about the way that crowdfunding forms a bridge between people’s ideas and reality. A bridge for ideas that otherwise would never have come to be.

You should care because you could be one of those people! And it’s really rewarding to do! Both the creating and the backing.

So let me tell you my story. It actually starts even before I had the idea. I had backed crowdfunding campaigns and I already knew that I wanted to create something, but I didn’t know what.

Then, at the start of last year I stumbled across inspiration. I read an article laying out how important it is to teach young children to name their feelings and I saw a gap – it would be easier to teach these words if there were books with stories that specifically used these words. It seemed like something that I could put together. I couldn’t draw well enough for a kids book, and I don’t have the equipment for printing and binding. But I could find people to do those. I could use my engineering brain to analyse a complex concept and break it down to simpler parts. And I could come up with a suitable scenario to illustrate each feeling. I got pretty excited about this useful thing that I could create!

Coming back  to my first question – what would you create? Have you had ideas like this? Have you seen something missing from the world? Maybe you thought “someone should definitely make that”. Maybe you could be the one to do it!

I shut myself in my room over the Easter long weekend last year and wrote up a dozen stories and laid the groundwork for some more. I came up with a defined project. I would get illustrations done for 15 stories and publish them in three volumes.

Next I did some research on how much that would cost and got quotes from printers and illustrators.

If I set my crowdfunding goal at $20,000 that would mean I would need to pre-sell eight hundred copies of the book at $25 each. That balanced the fixed cost of fifteen stories worth of illustrations with the variable costs of printing, postage and crowdfunding fees.

I hadn’t done books before. I didn’t have an existing customer base or relevant community to go to. I had friends and family, but the $20,000 goal was not realistic. No worries. I just had to re-package.

I redefined and resized the project – to get illustrations done for just five stories, and with those in hand, publish “Volume 1”. For me, crowdfunding would be a stepping stone. Maybe the thing you’re passionate about is too big for a couple thousand dollars. Can you make part of it become a reality on this budget? It could be the first step to something awesome.

For my campaign, the main reward would be a copy of the book for pledging $25. For $5 and up, backers would be kept updated and would get to choose which five feelings went into the book. For $50 they would get a signed copy. There were options all the way up to a thousand dollars. The $25 reward point tends to be the most popular, but it’s important to cover the whole range to leave all of your crowd satisfied.

So what about your passion? If you packaged up a project with a budget of a couple thousand dollars, what would you share? Something tangible – like a print of a painting of yours? Or an experience like tickets to your big show? A virtual reward maybe – like an mp3 of your song? Public appreciation – like a place in the credits at the end of your documentary? Or involvement – like being part of the crew, getting inside access or VIP (Very Important Pledger!) treatment? If all else fails, how about some merchandise – like a tshirt with the name of the community group? There’s so many options if you think freely about it.

Ok. So I had my plan laid out. Next, I spent a weekend putting together a video. I had the technical know-how, and I had my idea pretty well condensed, both of which helped. My delivery wasn’t the greatest though, and it took hours of recording to get just a few minutes of not messing up my lines. And then a whole lot of editing!

If you’ve got an idea that you want to crowdfund, you’ll need to make a video. And you need to be in it. Why is this so important? People need to see your passion for this thing. If you don’t believe in it, why would anyone else? But I’m sure you can get excited about your big idea! You also need to keep it short and to the point, and it helps if your camera is stable and your shot is well lit.

The next thing I needed was a crowd. I made sure that I started talking to people even before I launched, trying to make sure I had a list of core backers that I could depend on to pledge immediately. My closest friends, immediate family and other friends who also happened to be in my target audience. When the campaign opened, it was people from this list that gave it a running start.

The sooner you start building you crowd, the better. Even before you have all the rest planned out, it helps if you make a habit of talking about what you’re passionate about. Post on social media, join relevant community groups. It all helps.

After that I reached out wider, direct messaging every single Facebook friend I had. The second push was enough that the first few days got me to about 30% of my goal. This is a typical start for a campaign that’s going to make it. It’s is a very exciting time. And then things leveled off. In general, a typical successful campaign will spend the next ten or twenty days steadily plodding toward the 60% mark. This part tested my perseverance. Someone who really liked the idea pledged $500! Then several days passed with nobody at all pledging. Then  I got an article on Stuff! But it didn’t bring in any new backers. There were definitely times when I wondered if I would even make it!

I made sure to send updates out during the campaign. I engaged with my backers and encouraged them to help spread the word. It was hard work keeping at it, even when the early optimism flagged.

Most campaigns that reach 60% by the 5-days-to-go milestone will get to the mark. As the countdown approaches, if you’ve got enough funding that it’s looking credible, the fence-sitters jump on board. The despair of the middle of the campaign is suddenly replaced with joy! All your hard work has paid off!

I reached my goal, and actually managed a little bit more. In the end about three-quarters of my backers were friends and family.

Even after the crowdfunding campaign was a success, I still had a lot of hard work to do! Producing and shipping a quality children’s book took plenty of time and effort. I spent most of my Easter long weekend this year personally delivering books to backers (a great experience in itself). Now I’m all done and I’m selling the book on my website. A book that might never have existed.

I’ve made my crazy idea a reality. How about yours? If you don’t have a project of your own, get on board with someone else’s. Help them make the video, share their page. Or back it!

Crowdfunding is going to be the bridge to reality for a whole stack of ideas that otherwise never would have gotten there. And that’s exciting.

 

Keep your eyes peeled for Adam’s upcoming campaign, Sophie Feels Big.

 

What's Up Wednesday

Cult Wine

Aug 17

Looking for a wine that will rock your world? We have the campaign for you.

Back in early 2015, Jules van Costello and Asher Boote had just founded Hillside Kitchen & Cellar in the heart of Wellington. Thanks to its creative European-style cuisine and its enticing wine list, this restaurant quickly became a favourite among Wellingtonians, and earned accolades from the likes of the Dominion Post and Cuisine Magazine. But Jules and Asher noticed something else, too: as their restaurant grew in popularity, so too did the demand for the kinds of wines they championed: wines with “character, personality and integrity”. So often, those wines were only available to buy from their little outlet in Thorndon – but they were determined to change this.

So they came up with the idea for Cult Wine, a subscription-based service offering some of the best wines available in NZ. Each month, subscribers will receive 6 bottles of wine to try, chosen not only to reflect the season but also, with three tiers of membership available, chosen to reflect their budget.

Clearly, this is something kiwis are keen to get behind. Don’t believe us? Check out Cult Wine’s campaign page, where they’ve already more than quintupled their campaign goal! We had to hear more about this roaring success, so we got in touch with Jules himself:

How are you finding the campaign so far?

Amazing, we are thrilled by the support. It’s always tough to gauge a new market when launching a new business but the support we’ve had already is telling us there is a real desire for the kinds of wines we are going to be offering.

What do you have planned for the rest of your campaign? Anything for us to look forward to?

Wellington on Plate is underway, so I’m going to be at Hillside pouring wine quite a lot over the next few weeks. Likewise we were also at the NZ Chocolate Festival pouring some amazing wines to match with Chocolate on Friday and Saturday last week.

Anything you want to shout out to your crowd?

Thank you! Thanks for all your support and thanks for sharing the message. Remember, you’re not just supporting us but you are supporting all of the small producers we buy from!

To share the message more and get a subscription while you still have the chance, check out Cult Wine’s campaign page here.

What's Up Wednesday

Wise Boys Burgers

Aug 10

9 months ago, the team at Wise Boys Burgers had a dream: to create the nation’s first fully plant-based food joint. Armed with nothing but that dream, some meagre savings and a whole lot of gumption, they worked tirelessly to build a trailer, and took their burgers to the people.

And the people loved them! Customers went mad for these meatless burgers, and their food truck was praised loudly by everyone from Heart of the City to Urban List. But as they’ve grown more popular, they’re struggling to keep up with demand – and so they want to expand, so that more people can enjoy their wonderful burgers.

This is why they’re turning to PledgeMe. In order to do things properly, they need to refit their entire trailer. They’re putting up half that cost, but they need the help of their crowd to get them the rest of the way. They’re offering some phenomenal rewards, including a date with the Wise Boys team, a jar of their amazing aioli, or even a chance to name their new truck!

We wanted to hear more about their planned revolution, so we got in touch with the brilliant Beka, the girl behind Wise Boys!

How are you finding the campaign so far?

It’s been rad! We’ve had a tonne of verbal support and it’s cool to see that translate into a tangible thing. On the first day someone bought one of our higher value rewards to win the rights to naming our trailer, which got us pretty hyped about the whole thing! It’s also quite nerve-wracking though, because you’re putting yourself out there and just hoping that you’ve communicated well and that people get it, and are up for supporting you.

What do you have planned for the rest of your campaign – anything for us to look forward to?

We have a few more rewards that we’re going to launch! And then of course you can look forward to coming and getting a burger from our pimped out trailer once we’re done!

Anything you want to shout out to your crowd?

On our last night hundreds of you guys stood in the rain waiting for our burgers, which just reinforced why we’re doing this whole thing. Thanks for being part of the food revolution, thanks for your kind words, thanks for eating our burgers, thanks for telling your friends. Let’s keep making this thing a whole lot bigger than just us!

To find out more about Wise Boys and make burgers not war, head over to their campaign page (or check them out on Instagram!)

 

What's Up Wednesday

The Spinoff’s War for Auckland

Aug 3

The Spinoff has been delighting us with smart news stories since it was launched in 2014. Offering an alternative take on traditional media coverage, they’ve discussed everything from Radio Hauraki’s mispronunciation to women’s position in Gloriavale. And now, they’re once again turning their focus to something that should concern us all: the future of Auckland.

The team at the Spinoff believe the upcoming elections and Unitary Plan are “the most important political events in Auckland in decades.” And they’re concerned traditional media will become bogged down in the worries of NIMBYs and fail to do these stories justice. They want to step up and frame the election as the crucial event it is – but to do so, they need your help.

And so many of you have provided help already! Less than two days after their campaign launch, the Spinoff had already doubled their target. With over 300 pledgers, they’ve now passed $23,000 – but they’re hoping to get even further. If they raise $25,000 they can create more noise, and add more fulltime staff to cover the stories. With awards ranging from bespoke tweets to exclusive advertising rights, there’s no reason not to get on board – but we got in touch with editor Duncan Greive to hear even more reasons why you should.

How are you finding the campaign so far?

Overwhelming. We were initially debating whether to go for $5000 or $10,000, and only put in the stretch goal at the last minute, almost as an afterthought. Not because we didn’t have a thousand great ideas on which to spend the money – but because we’d never asked before, and had no idea how our audience would respond. So to have so many people join the War so quickly, and be so passionate about it – it’s humbling and almost intimidating. We’ve talked a big game, and are determined to deliver.

What have you got planned for the rest of your campaign – anything for us to look forward to?

We’ve already hired economist Shamubeel Eaqub part-time through the election to do analysis and fact-checking – his ‘Shamubeel calls Bullshit’ series is going to be a good time. We’ve commissioned a piece of web development which we’re really excited about. And there’s a collaboration between an incredible illustrator and feature writer which we think will frame the issue in a quite stark way. And a tonne more. But I really don’t want to spoil the surprise.

Anything you’d like to shout out to your crowd?

Just that we love them, and have felt both the excitement and the sadness coming off them since we launched. This was really about trying to cover this incredibly important moment in a way which reflected the voices which have too often been shut out of this debate. We’ve heard a lot from people who might have a terraced house go up next to their property while also having the land further escalate in value. I’m not nearly so concerned for them as for those we haven;t heard from – the generations of young and less well-off who have been locked out due to the excessive amount of concern for the first group. We’ve been delivered a very good Unitary Plan. Now we want to watch to make sure it passes relatively unravaged.

If you’re passionate about the future of Auckland and want to see the Unitary Plan go unravaged, head over to The Spinoff’s campaign page and support them here.

What's Up Wednesday

Sonny Southon’s Third Album

Jul 27

 

This singer/songwriter grew up in Upper Hutt – but her quest to sing has taken her much further. In her ventures overseas, Sonny sang for everyone from Sir Bob Geldof to Duran Duran, before signing a contract to take her talent solo. Now she’s striking out on her own once again – and this time, she’s inviting you along for the ride!

After two critically acclaimed solo albums and two self-funded singles to raise money for charity, Sonny is looking to fund her third album. In order to raise the funds she needs to get there, she’s offering her crowd awesome rewards like singing lessons, lunch dates, and even a full concert via skype. We caught up with Sonny to find out a bit more about her campaign.

How are you finding the campaign so far?

Great. Very happy with how PledgeMe is helping me promote and get it out there.  It’s an awesome opportunity to get help to record this album.

What do you have planned for the rest of the campaign – anything for us to look forward to?

I had a gig last Sunday @ Days Bay Pavilion in Eastbourne.  A nice acoustic set with a log fire and great pizza. Other gigs and events are updated on my website.

Anything you want to shout out to your crowd?

Just a massive thank you to every who has donated.  Having fans who want to hear my music inspires me to keep going.

What's Up Wednesday

Kink: A Portrait Exhibition

Jun 29

Antony Kitchener is no stranger to unique photography subjects. He has documented everything from the struggle of the homeless and marginalised at Wellington’s Compassion Centre Soup Kitchen, to the Clown Doctors at the Wellington Children’s Hospital – a project that won him a spot in the finals of the 2014 New Zealand Geographic Photographer of the Year competition. We even discovered he’s photographed our very own Chief People Wrangler Tash in the past! (pictured below).

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But now, Antony’s taking on a different project altogether. For the past three years, he has been working on a series of subtle, stylised portraits of Wellington’s BDSM community. While initially uncertain of how he would find this project, he describes himself as “blown away” by the openness and trust of the people he photographed. Antony discovered that BDSM was about much more than just kinky sex – it was about identity, acceptance, and above all, community.

Portraits of Kink

And yet the broader Wellington community was far less accepting. After no luck finding a place to exhibit his pictures in his hometown, Antony began looking further afield. He was delighted to receive an offer from Melbourne’s Brunswick Street Gallery to exhibit the works – but he needs funds to rent the space and set up the exhibition. That’s where you come in.

Antony is trying to raise $2,500 to cover the cost of the exhibition – and with his rewards offering everything from darkroom prints to a full photoshoot with an old-school camera, it’s no wonder he’s already well on his way. We wanted to hear more about the man behind the camera, so we got in touch to find out why you should be pledging to Antony’s campaign.

How are you finding the campaign so far?

The campaign has been going great so far. Better than I expected. This is really a first test for me to see if I can get photography projects funded, so it’s proving rather useful. I think the key thing for me is learning how to pitch a project idea, and finding what the best medium is for spreading word of the campaign. So far I’ve been using my personal networks, and sending email updates about the campaign. I’m not a particularly big user of social media but I can really see how engaging with social media on a regular basis would be beneficial for these types of projects.

What have you got planned for the rest of the campaign – anything for us to look forward to?

I’m hoping to have a small article in the Gay Express, which is New Zealand’s magazine dedicated to the LGBT community. I’ll be continuing to hustle my networks via email and Facebook, especially in the last week of the campaign and until the very end.

Anything you want to shout out to your crowd?

I’d like to thank everyone who has supported this project so far. Obviously its a tricky subject to engage with, but the exhibition would certainly not go ahead with the generosity and support of my crowd. Its great that crowd funding platforms like PledgeMe exist to enable creatives and entrepreneurs alike to see their projects come to fruition.

To find out more about Antony’s work, take a look at his website or check out his awesome campaign page here.

What's Up Wednesday

The Lucy Foundation

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Over one billion people worldwide live with disabilities, making them the largest minority in the world. And yet many people with disabilities face huge inequality: they are less likely to be employed, have less access to healthcare, and often gain lower levels of education than those without disabilities.

But The Lucy Foundation wants to do something about that. They know that empowering people with disabilities benefits the social and economic life of their entire community, so they’re working to create a culture of inclusiveness and diversity – with a little help from everyone’s favourite brew.

Through their Coffee Project, The Lucy Foundation will work with five families affected by disability, who live in the small mountainous village of Pluma Hidalgo, Oaxaca. They will collaborate with them to produce specialty coffee in a way that is disability-inclusive, and with the help of local organisation Piña Palmera, will export that coffee to be sold in New Zealand.

But they need your help to make it happen. In exchange for helping them fund the necessary equipment, The Lucy Foundation are offering everything from a traditional Oaxacan tortilla press, to the chance to have your name tattooed on campaigner Robbie’s leg! We thought this was some pretty impressive dedication, so we got in touch with The Lucy Foundation to hear more about this inspiring project.

How are you finding the campaign so far?

It’s gotten off to a good start, we’re leaning on our personal networks to help get the word out along with some of the bits mentioned below.

What do you have planned for the rest of your campaign – anything for us to look forward to?

We’ve been featured on Bfm, you can catch Jess explaining the project in a bit more detail here. Attitude TV (New Zealand producer showcasing possibilities for people with disabilities) are also featuring us in an upcoming blog post (date TBC).

We’re posting a feature on each of the families we’ll be working with over the coming weeks, so that pledgers and supporters can get to know the people who will benefit from their generous contributions. We’re also holding a fundraiser auction in Hamilton on July 2nd. The theme is economically, environmentally and socially sustainable items.

Anything you want to shout out to your crowd?

A big thanks for the support so far! As important as the fundraising is, so too is the message of inclusion, equality and human rights. So if you’re a supporter of the cause but can’t contribute financially, the further we can spread the message the better, you can help by liking, sharing, tweeting, or telling people about what we’re doing.

To find out more about The Lucy Foundation and pledge to their amazing coffee project, check out their campaign right here.

Ethical Lending

Our friend, Raf Manji, Christchurch City Councillor and progressive banker, shares his thoughts on how the financial system is broken and how crowdlending can help to create a more supportive and sustainable marketplace between borrowers and lenders.

Raf Manji, progressive banker

 

One of the great opportunities for crowdlending or peer to peer (P2P) lending is that it can create a form of agency that does not currently exist in the lending marketplace. P2P is generally an unsecured form of lending, between individuals, where the amounts lent are usually small scale and distributed over a number of borrowers, in order to spread risk. As it becomes more sophisticated, lenders are starting to focus more on credit ratings and scores and use data to discern whom best to lend to. This is starting to drive a shift in interest rates and how those are calculated, with lower rates for better risks.

But what if lower rates actually lessened the risk of non-payment and default? I have just finished reading a very familiar story, where a borrower took on a short-term loan for an unexpected family need, and ends up being bankrupted. What kind of financial system promotes that? Well, sadly ours does. The need for short-term loans, outside a traditional borrowing format, such as a mortgage, can often be the straw that breaks the back of highly indebted borrowers. However, this straw is not the loan itself but the outrageously high interest rate that is attached. I would argue it is the unreasonably high interest rates (by that I mean anything over 20%) that cause default, not the actual loan itself. In other words, the default outcome is baked into the deal from the beginning.

We hear stories all the time of how a small loan balloons into an unpayable debt, and bankruptcy arrives soon after. Why would any rational lender promote this approach? Well, the interest rates are so high that they actually do get the principal back and a reasonable rate of interest, prior to the loan going bad. One might ask, why don’t they just charge a manageable and reasonable rate of interest in the first place, and not cause such personal misery to those least able to afford the loan?For me this comes down to the ethics of finance. Those who have easy access to capital, benefit both from lower rates and higher returns. The current financial system is heavily weighted against those who are not engaged in the tax-free housing Ponzi scheme and who rely purely on basic wages to survive. The low-grade “instant finance” lending system that services this end of the market is parasitic and unconcerned as to the outcomes they create. They argue they are providing capital to those who are unable to access traditional bank lending. That’s true and raises issues about our mainstream banking system. They would also argue that they price interest rates according to the poor credit of the borrowers. Of course their credit is poor! They live on wages and are often already in debt. The strain of that debt simply compounds away, with stagnant wages no match for the power of compound interest.

So far so bad, but what does P2P have to offer in this space? I would venture that it can offer a new form of ethical lending. This ethical lending is about the broader concept of helping people out, as you might do for a friend, not simply profiting from someone’s short-term cash squeeze. I would argue a lower interest rate would not only probably increase the likelihood of the loan being repaid but would be a fairer cost for the money provided. How interest rates of 20% plus (standard even for credit cards) can be charged, in an environment where, to all extents and purposes, the cost of money is negligible, is simply wrong. I propose that we look at creating an interest rate system where the rate falls each time a repayment is made. So where the initial rate may start off at a high level (I think 20% should be an absolute maximum), it reduces by a certain amount, for example, a half to one percent, after each payment, until it comes towards a reasonable level. How these numbers are crunched remains open.

The beauty of open, peer-focused and distributed systems like PledgeMe, is that they can experiment and iterate new ideas and findings, in order to reach an optimal outcome. For me, that outcome is where lenders make reasonable returns and borrowers pay reasonable and manageable costs for borrowing money. The current lending system is completely inequitable and broken and one of the jobs of PledgeMe has is to fix that and redraw the relationship between lender and borrower. No pressure!

Like a little piece of coal, we shine under pressure!