Jessica Jackley is a co-founder of Kiva, and the spirit behind the organization. Jessica first saw the power and beauty of microfinance while working in rural Kenya, Tanzania, and Uganda with Village Enterprise Fund and Project Baobab on impact evaluation and program development. Jessica has worked in the Stanford Center for Social Innovation to launch the inaugural Global Philanthropy Forum, and at Amazon.com, Potentia Media, the International Foundation and World Vision. Jessica has spoken widely on microfinance and social entrepreneurship, and has seen microfinance at work in a variety of communities in more than 30 countries. Jessica serves on a number of non-profit boards, including Opportunity International. Jessica holds an MBA from the Stanford Graduate School of Business with Certificates in Global Management and Public Management, and a BA in Philosophy and Political Science from Bucknell University.

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Moderator: Good morning, everyone! Welcome to our Web chat with Jessica Jackley. We will begin promptly at 9am. Feel free to start sending questions at any time.

Jessica Jackley: Hi everyone - this is Jessica. Looking forward to chatting with you this morning!

Jessica Jackley: For those of you who aren't familiar with Kiva, definitely open up a new browser and check out www.kiva.org as we chat. Kiva's mission is to connect people through lending for the sake of alleviating poverty. We're is the world's first person-to-person micro-lending website, empowering individuals to lend directly to unique entrepreneurs around the globe.

Moderator: First question...

Evelyn, Boston, MA: Why does Kiva use a lending model rather than a giving/donation model?

Jessica Jackley: From the standpoint of the entrepreneur, receiving a small loan is often the ideal resource for them to boost their entrepreneurial activities and earn more revenue, grow their business, and eventually have a higher standard of living.

Jessica Jackley: From the lender standpoint, actually being able to participate in this process - through lending, not just providing a donation that is then loaned to someone down the line - allows for a deeper, more transparent, more sustainable ongoing connection.

Deborah, San Francisco: Does Kiva allow borrowers to use the money to acquire housing in fastly urbanizing and developing countries (in other words, get ahead in other ways) or is the model solely focused on business? Would you consider expanding the scope of what gets funded? What about requiring your partner institutions to provide additional services, such as training, health care, and literacy programs?

Jessica Jackley: Kiva does allow partners to post entrepreneurs on the Kiva site who are in need of what are called consumption loans, and this might include housing or a number of other things.

Jessica Jackley: Here's an example of an entrepreneur who needs a lot RIGHT NOW on the Kiva site for that purpose - http://www.kiva.org/app.php?page=businesses&action=about&id=111857&_tpos...

Justin Watt, Washington, D.C.: As Kiva’s growing pool of lenders seeks more microloans to fund, do you worry about creating demand for “debt” where there is none? To put it differently, for Kiva specifically and microfinance generally, how much capital is necessary to meet all of your needs?

Jessica Jackley: No. Only 20% of worldwide need is met at this pt - in other words, 80% of potential microfinance clients (those who need microfinance services but have not been able to access them yet) are still waiting for the type of small loans Kiva allows lenders to provide.

Jacquie, Menlo Park, CA: One common reason for microloan defaults is disaster: tsunamis, political unrest, war. Does Kiva have any systems in place to support lenders caught up in sudden catastrophe?

Jessica Jackley: Kiva itself doesn't have special systems beyond our team's efforts to support our microfinance institution partners - those organizations on the ground that are actually doing the hard work everyday of finding entrepreneurs, administering loans, collecting repayments, and supporting entrepreneurs in whatever circumstances arise (including disasters).

Laila Frankel, Baltimore, MD: I know that Kiva doesn’t charge interest for transactions, but do the microfinance institutions you work with charge a percentage or interest? Do you limit the interest they can charge?

Jessica Jackley: Yes, our microfinance institution (MFI) partners do charge interest. We don't limit what they can charge, because in each country and each community the situation is different, but we don't partner with MFIs that we believe are charging unnecessarily, unfairly high interest rates in the first place.

Nikole, Santa Fe: What are some of the challenges you faced while starting Kiva?

Jessica Jackley: I'd say one of the biggest challenges was simply to communicate a new idea to people. No one had heard of this thing we wanted to do, this idea of person-to-person (vs. institutional) lending (vs. investing or donating). The biggest battle was defining this new thing, and then communicating it to people in a way that they could appreciate.

Francie Small, U.K.: A common issue for start-ups is that to get investors, you often have to relinquish control to more 'senior' personnel who may not understand such an innovative idea. Did you face this and if so, how did you overcome it?

Jessica Jackley: We were very strict about not accepting funds - in the past, and in the present, and I hope into the future - that would have gotten us off-mission. At first saying no to funding was really difficult, but it's gotten so much easier over time to say yes OR no to the people or ideas or potential partners that would cause us not to be focused or to stray from our mission. In my opinion, it's just crucial to wait for the right funding to come along vs. changing your plans every time someone with money comes along and wants to redesign what you're doing.

Miranda, Berkeley, CA: I enjoyed your talk last night and I applaud your desire to break down barriers between the poor and the rich and to allow people to interact as individuals, but the reality is that huge barriers exist. Does it ever bother you that there’s such a power imbalance between lenders and borrowers? Do you feel obliged to educate your lenders about the underlying causes for poverty?

Jessica Jackley: Great question (and thanks for the kind words). Absolutely, I feel frustrated that those barriers still exist. However, I do believe Kiva can perpetuate relationships based on equal partnerships, not ones where there's a severe imbalance of power. For example, as Kiva expands to more and more countries, you'll see not just Americans (for instance) lending to Ugandans, but Ugandans lending to each other, and maybe soon Ugandans lending to Americans too. This will happen!! And this is what gets me most excited about Kiva's potential.

Lawrence Chickering, Palo Alto: I founded an organization called Educate Girls Globally (EGG), which promotes girls’ education by reforming government schools. Does Kiva allow investors to support non-profit institutions such as schools? Does it create “spaces” for groups or investors to finance entrepreneurs (together), either profit or non-profit?

Jessica Jackley: Hi Lawrence! It was nice to meet you at the event last night. Kiva allows MFIs to post profiles of entrepreneurs who are then supported (funded) by individual lenders. Indirectly, the MFIs that post these profiles are supported too since they receive the funding that they can then pass along to entrepreneurs, and don't have to look elsewhere for those funds, but the point is allowing people to support other people. We don't work with schools directly to post entrepreneurs - just lending institutions. HOWEVER, we do have nearly 7,000 lending teams, and these teams allow groups of lenders to work together to support entrepreneurs. There are lending teams through schools, churches, you name it. Check them out here: http://www.kiva.org/community

Leigh Wasson, San Francisco: What is the average time for return of capital? How can Kiva be effective in the U.S.?

Jessica Jackley: Hi Leigh! :) Average loan term is 9-12 months.

Jessica Jackley: Re: the US, I'm sorry to say I can't speak more specifically about that at all right now... But there's more coming soon, I promise!

Brandon Hayes, Chicago, IL: How has the global economic crisis affected Kiva?

Jessica Jackley: We've actually been incredibly fortunate during the econ crisis, as lenders have continued to come to the site in record numbers, and lend record amounts. If anything, I think people realize in these times that the need for capital is great, and universal, and Kiva's an easy way to stimulate economies (even the tiny economies of a family or village) very directly and immediately.

Elizabeth Colton, San Francisco: Last night after your presentation I became a new lender -- it was easy to do and very rewarding. What kind of updates should I expect to receive about the people I selected?

Jessica Jackley: Hi Elizabeth!! THANKS for becoming a lender! ;) Now that you've loaned, you can expect a few kinds of updates. First, repayment info will be sent to you when the entrepreneur you supported makes regular payments. You may also receive qualitative updates, written by either MFI staff, or Kiva Fellows, on the more colorful stuff - how the entrepreneur's standard of living might be changing, or photos of the new equipment/resources (like a sewing machine or a bicycle or even a goat or cow!..) they've been able to purchase, etc. Check out some updates on entrepreneurs who are currently repaying their loans here: http://www.kiva.org/app.php?page=businesses&action=listJournals ENJOY!

Jane, Sacramento, CA: Where do you see Kiva growing and becoming in 5 or 10 years?

Jessica Jackley: Kiva's grown very quickly, and it feels pretty surreal to say but we're still JUST STARTING...so, we will continue to focus on the core activities centered around our mission, Connecting people through lending to alleviate poverty - this will mean deepening and enriching that CONNECTION, finding more and more incredible institutions who can facilitate LENDING services and products with excellence and a real focus on a social mission, and finding better ways to make sure that translates into ALLEVIATING POVERTY - and showing that (measuring and communicating this impact) to lenders. Kiva's becoming such a huge fund though that we will also absolutely need to pay attn to this and be responsible about our other roles that emerge, as, for example, a huge network of MFIs. For instance, we need to be mindful of the opportunities and responsibilities that come just with that. (This is a BIG question, there's a LOT that will happen in 5-10 yrs!!)

Jane, Sacramento, CA - follow up question: Are there any problems with Kiva now that you would like to see changed in the future?

Jessica Jackley: Uh-oh...just wrote long response and it didn't send.....testing??

Jessica Jackley: Oh boy. Just a sec...going to re-type! thanks for your patience

Jessica Jackley: OK. Re: the question of whether or not there are problems...

Jessica Jackley: Basically, I don't think there are problems, but TONS of ways we can take advantage of this incredible momentum that's been created, and things we can continue to improve and iterate upon... For example, we should and we will provide more and more info about how these loans truly do change entrepreneur's standard of living for the better, and give them an opportunity to lift themselves out of poverty. this isn't easy to do... (more in a sec...)

Jessica Jackley: ...and I know I personally often struggle with HOW this should best be done. I studied a lot of poetry in college and one of my teachers reminded us a lot about how poets SHOW, they don't TELL... I think about this with Kiva sometimes. Is it better to have a long list of things that we/lenders/someone else prescribes as important changes in someone else's life (TELL)? Or do we just build a relationship with an entrepreneur and allow them to tell their story however they want it to be told (SHOW)? I personally like the latter, but obvs appreciate that both are necessary. Maybe one entrepreneur is most excited about the fact that they can now send their daughters to school; maybe another is excited about how they replaced their grass thatch roof with iron sheets; maybe another is proud that now they can afford to put sugar in their tea. I personally don't want to miss these details.

David, Canada: What is the success rate of Kiva loans? Isn't it all pretty risky?

Jessica Jackley: It's actually not - our current repayment rate (as of midnight last night) is 98.35% (so, default rate of 1.65%). There are a lot of reasons for this, and most of it is due to the hard work and expertise of our MFI partners.

Rose Sims, Portland, OR: Are there trends or particular types of businesses that seem most appealing to lenders? A seamstress or a dairy farm as opposed to a bricklayer or a bar?

Jessica Jackley: Well, there are trends, but sadly I don't have recent data in front of me... I'm sorry! I can tell you offhand that agriculture usually does really well and is very quickly funded..and that an African woman will get her loan funded (on average) 10x more quickly than, say, a Bulgarian man. So there are definitely trends.

Clare Winterton, San Francisco: Jessica, what really impressed me at your talk last night was how steadfast you were about protecting your vision of personal connection between lender and borrower, and resisting other models that might have been more compelling from a strict business or legal perspective but less inspirational and tranformational for the users. Hanging on to your vision is what has given Kiva such differentiation and strength. What advice would you give people about protecting a powerful personal vision even in the face of adverse comment, or resistance to innovation?

Jessica Jackley: Thanks Clare - and thank you again for having me at IMOW! I so admire this organization and am happy to be here. OK... I guess my advice is pretty broad, and is about life in general as well as business or anything else: BE YOURSELF. Just be who you are and pursue the things and the people that you love. This inevitably means having priorities, and focusing, and NOT doing every opportunity that comes along.. It's easy to do this some days and difficult to do this some days, but in the end it's the only way to be, I think.

Jessica Jackley: Re: a specific business vision like Kiva, I guess the lesson for me there was figuring out what truly made us unique, and clinging to that. It would have been fine and at least incrementally valuable to create another org that copied an existing model; most businesses do this and it's honorable and important to do. But we really wanted to do what no one else was doing. So that's what we stuck to. Oddly, at times this has actually been an easier thing to do than what, at the beginning, seemed like a more straightforward path.

Shabnaz: What is the process for becoming a Kiva fellow? What time and financial commitment is involved? How can I get more information?

Jessica Jackley: Hi Shabnaz! the Fellows program, as you know, offers individuals a rare opportunity to travel abroad and witness firsthand the impact and realities of microfinance, by working directly with a host microfinance institution (MFI). The Kiva Fellow is an unpaid, volunteer based position designed to increase Kiva's impact and to offer participants a unique insider experience. Past participants have found the fellowship to be a great first step in a career in microfinance or international development. ALL info on this program is here: http://www.kiva.org/about/fellows-program/

Shawn Henning, Los Angeles, CA: Could you elaborate on how you vet microfinancers?

Jessica Jackley: This could be a ridiculously long answer, so what I'm going to do is point you to the info on our site that walks through this... Most of it is here, http://www.kiva.org/about/pic and some other info about how we think through risk is here http://www.kiva.org/about/risk/overview In short, though, we look at basic financial data, we make sure the organization has a successful history of lending, we make sure they are focused on a social mission, we go and visit them and interview their leadership and team, etc. It's a long process of due diligence, and we're proud of the system we've created. You can see a list of all of our partners and how they are rated in our system here - http://www.kiva.org/about/partners/

Emily Geary, Middlebury, VT: Do you think private lending models such as microfinance institutions let governments off the hook?

Jessica Jackley: Hmm. I hear what you're saying..but I actually believe that what MFIs around the world are doing can set a great example and lead the way for governments (and any other organizations or institutions, actually) to see what works. And truthfully I don't think governments are the best providers of some of these services and products anyway. I think there are things that flexible, nimble, independent organizations can do - and problems that they can actually solve - more quickly and effectively than sometimes a government can.

Anuschka, Germany: Can you please share with us the story of an entrepreneur and or lender that you have seen or heard from that you have found most inspirational?

Jessica Jackley: Aah....this is the TOUGHEST question I ever get because it's so hard to choose just one story...! OK. One I do love so much is the story of Elizabeth Omalla, who is a fish mongerer in Uganda. She was one of the very first entrepreneurs (one of the first 7!!!!) on the site, and I've visited Elizabeth in her home many times. Anyway, her entire story is here http://www.kiva.org/app.php?page=businesses&action=about&id=91&_tpos=1&_... - but in short, just $500 allowed her to completely change her business model and begin to cut out a middleman from whom she'd traditionally purchased fish, then resold them...with the loan, she was able to get transportation to go directly to the lake and buy from the fishermen literally as they would come back to shore from their fishing everyday. I think she tripled her profits within a few weeks, and it kept getting better. Pretty amazing stuff.

Carrie, San Antonio, TX: As someone who packed up, left her job and moved to East Africa, what practical advice would you have for someone wanting to do the same? What about your own future plans?

Jessica Jackley: First of all, GOOD FOR YOU! :) I'm definitely a fan of trying new things, going on adventures, etc.. You mention the word practical though, so in terms of actually making it happen, I'd say three main things. First, make sure you find an organization, or at least a person or project, that you BELIEVE IN and can get behind and are willing to join at any level (even the gruntwork). And make sure they appreciate what you can offer, whatever that is. Second, and this is related, but don't worry too much - especially if you're starting out your career - about having the job you actually do be a perfect fit with what you envision for your ideal job right now. Focus on being challenged, being somewhere where you can learn a LOT, being around people you admire and trust and respect, and just having new experiences. third...(will send in a sec)..

Jessica Jackley: ..it's hard to articulate but as you do this, as you embark on your adventure, HONOR it and celebrate and let it be a catalyst for you in whatever way it turns out to be. Let it guide you and lead you to new places, maybe unexpected places. Be open to seeing new things, and be respectful enough of yourself to appreciate those things as real and special. We saw new possibilities 5 years ago in Uganda that led to Kiva, and I had no idea that's where my adventure would lead.

Jessica Jackley: Lastly, re: my future plans, I feel totally convinced that, whether it's through microfinance and Kiva or some other endeavors, I am going to spend my life working to connect people and help us open up to each other in ways that promote understanding and peace. I think this is what life is about. Some of my friends joke with me and say gosh jess you should just go work for match.com or something then :) but obvs what I mean is, I care about connecting people from seemingly different worlds, very different experiences, and bring those types of people together - I am convinced that when we believe more for each other and ourselves, believe that more is possible for our lives, a lot of the problems in the world will solve themselves.. So. More soon. THANK YOU everyone for your questions! it's been a pleasure chatting with you this morning.

Moderator: That's all we have time for today! Thanks, everyone, for your questions and thanks to Jessica for taking this time, giving us such thoughtful answers and sharing your passion with all of us. You're truly inspirational. All - Please check out www.kiva.org to find out more about how you can participate!