NOVEMBER 2006

New Ventures

Loans on the Web for Charity or Profit

Two online loan companies recently created by Business School folks target individual investors who want to finance people up close and personal. But matching borrowers and lenders is about all Prosper Marketplace and Kiva have in common.

Prosper, begun by eLoan creator Chris Larsen, MBA ’91, is an online auction site where potential borrowers state the amount they need and the highest interest rate they can manage. Lenders choose a borrower, determine the amount they’re ready to lend, and bid the lowest interest rate they’re willing to accept. At the end of the auction, the lowest bidders win. Their contributions are pooled, and their interest rates averaged and applied to a single, three-year loan.

Borrowers at prosper.com are as varied as their credit ratings, which are checked by Prosper and posted online, along with debt-to-income ratio and home ownership status. A random search might turn up a banker/ lawyer couple with an AA credit rating looking for an 8.5 percent, $25,000 loan to start a title company. Or it might find an unemployed student with a rating too low to grade who needs a loan of $1,500 at no more than 21.75 percent to consolidate his credit-card debt. Risky, yes, but Prosper offers lenders the chance of making a higher return on investment than is currently available.

Kiva, a nonprofit founded by former Public Management Program staffer Jessica Jackley Flannery, currently a second-year MBA student, and her husband, Matt, attracts a different sort of lender—one whose motives are charitable and who doesn’t mind earning low or no interest. Kiva facilitates would-be micro-venturers who want to help fund a small business in one of almost 20 countries, from the South Pacific to the Middle East. A visit to kiva.org finds borrowers as worthy as a women’s tontine in Senegal that needs $1,000 to buy pigs to raise for market, a tailor in Bulgaria using her $500 for a new sewing machine and renovations to her shop, and a traditional-medicine practitioner in Cambodia who spent his $400 loan on a motorbike for house calls.

The idea for Kiva sprang from a 2004 trip the Flannerys took to rural Africa, where Jessica was working for the Village Enterprise Fund (VEF), an organization that had funded many small businesses. Back in the United States, they looked for a way to help individual lenders participate in the microfinance process and enlisted a VEF coordinator to help administer their first loans. By the end of Kiva’s first year, in early summer 2006, it had partnerships with 13 microfinance organizations on four continents.

Eos airlines fills a luxury trans-Atlantic niche with more than caviar and champagne—large amounts of personal space. Photo courtesy of Eos Airlines

Cocoon for Jet Set

Anyone who’s flown the red-eye from New York to London well remembers the agony of dawn’s rosy fingernails scratching the morning sky. Enter Eos Airlines—namesake of the goddess of dawn—a pricey, premium flight service founded by David Spurlock, MBA ’94, to soothe trans-Atlantic travelers with sleep, solicitude, and space.

Spurlock, a veteran of British Airways, designed and outfitted Eos’ Boeing 757s, originally intended for 220 people, with specially designed seats (or “suites”) for 48. Each passenger is allotted 21 square feet, which includes a seat that folds flat into a bed, an ottoman for guest seating, and room for a small conference table between the two. The airline’s innovative seat design won a 2006 “Red Dot” award from the Design Zentrum Nordrhein Westfalen in Essen, Germany. Learn more at eosairlines.com.

C’mon, Get a Grip

If there is anything more frustrating than climbing to the top of an extension ladder to hang a picture and then hearing the clink of the metal hook as it hits the floor, don’t tell the person teetering on the ladder. But help is on the way. Andre Woolery, MBA ’06, has come to the rescue with the Magnogrip magnetic wristband, an adjustable strap loaded with magnets that holds nails, screws, drill bits, and other small metal objects that tend to get dropped or misplaced during the course of a do-it-yourself project. Made of heavy-duty canvas with velcro closures, the Magnogrip is strong enough to hold a hammer. It is available at selected hardware stores and through Woolery’s company, MDG Tools, at mdgtools.com.

Sporting Vacations

Somewhere along the typical path from college to biz school, Alain Chuard, a second-year MBA student, stepped off long enough to become a pro snowboarder and cofound adventure travel company Access Trips. While he finishes school, Chuard has taken a low-profile role as a director of the company, which arranges small-group instruction in surfing, kayaking, mountain biking, skiing, snowboarding, and rock climbing in exotic locales. Among the company’s offerings: bicycling the “world’s longest downhill” from Tibet to Nepal and catching a wave near the Sahara in Morocco. See AccessTrips.com.

No Hassle, Good Eats

Three Business School alums are tapping into the trend for meal assembly services for time-starved families, according to the San Francisco Chronicle and East Bay Business Times. Lisa Alumkal, a former brand manager at Safeway, and classmate Sam Lee, MBA ’91, set up Full Plate in Walnut Creek, Calif., where customers can reserve meals in advance to pick up whole or partially assemble themselves. Jeff Stevens, MBA ’90, and his wife, Jami, started a similar business, Deeelish, in Menlo Park. Both Alumkal and Stevens say they must meet the Bay Area’s high food standards. Says Alumkal, “Listening to customers is key.”