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This Fintech Founder Is Shrinking The £22 Billion Funding Gap Through SME Support w/ Sanjeev Jeyakumar | Lenkie

Sanjeev Jeyakumar

Lenkie

This Fintech Founder Is Shrinking The £22 Billion Funding Gap Through SME Support w/ Sanjeev Jeyakumar | Lenkie

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About Sanjeev Jeyakumar

Amardeep Parmar from Bae HQ welcomes Sanjeev Jeyakumar, Co-Founder and CEO at Lenkie.

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Sanjeev Jeyakumar Full Transcript


00:00

Sanjeev Jeyakumar:
The funding gap in the UK is 22 billion. We want to drastically shrink that.And so the reality is the employment growth is going to come for smallbusinesses and they're chronically underfunded. Reading all these articlesabout how to start a startup from Sam Altman and everything else, and I vividlyremember having read that and thought, you know what, this is all prettystraightforward, I've got it. And that was really the catalyst to me then goinginto the fintech space because I could use a lot of the skills and knowledgeI'd built up during my seven years at finance and understand how to overlaythat technology and build something kind of genuinely quite exciting.


00:36

Amardeep Parmar:
Today's guest is Sanjeev Jeyakumar who's a co founderof Lenkie. They're a platform which enables many companies, which traditionallywouldn't be able to get finances from banks, to get the finance they need forthe cash flow that they need to survive and continue to thrive and grow. Sandeep'sgot a great story. So having worked in trading for many years, he knew that hewanted to find something more fulfilling for him. And he also knew from hiswork how much credit could be such a big problem for so many people. He tookhis time in deciding what he did to work. He met his co founder fromEntrepreneur First and originally they were going to work on problems in Africabefore realizing that in this home market they could do so much good and somuch impact.


01:21

Amardeep Parmar:
It's a really interesting journey and you can just see how much Sanjeev haslearned over time too. I hope you enjoy this episode. I'm Amar from the BAE HQ.So great to have you here today and it's amazing what you're doing today withLenkie. But if you go right back to the beginning when you're growing up as akid, what did you want to be? What was your ambitions?


01:38

Sanjeev Jeyakumar:
Well, firstly, thanks for having me, Amar. It's great to be here. If I thinkback to my first, I suppose, real ambition, if I'm honest, it was to be afootballer. And, and that was like most, I suppose, young boys growing up. Butit didn't take me long, probably until I was 6 or 7, to realize that I didn'thave any of the talent required for that. But if I think about theme of maybegrowing up, some of the things that really interested me were playing games andproblem solving. So I was really into chess when I was younger. I played videogames that then became poker as I got older. So I think the common theme isI've always been interested in solving problems and playing kind of games, andthat was really theme throughout my younger years.


02:17

Sanjeev Jeyakumar:
And I think both my parents were actually teachers, so education was a bigfocus in the family. And so growing up, I don't suppose there was a particularcareer that really called out to me, but I know I enjoyed solving problems, Ienjoyed learning, and so I knew I wanted to do something that was focusedaround that.


02:35

Amardeep Parmar:
And then when you're starting at university and what you're going to study andthose kind of decisions, how did you make those?


02:41

Sanjeev Jeyakumar:
Yeah, I think it was really just figuring out a bit about myself, what Ienjoyed and also what I was good at. And I think I was really interested inkind of maths and sciences, but I didn't want to do just math. So I think Iultimately stumbled across economics, which I did A levels and enjoyed. So thatwas the reason.


02:59

Amardeep Parmar:
So funny you mentioned that about economics, because I did economics A level aswell. And A level, you do a lot more essays, then you get to university andit's all just math, so it's totally different to what you expect it to be. Andobviously you went to Oxford, right, but you grew up more in Walthamstoworiginally. How is that transition of, like, going from that background to thengoing to another school and trying to fit in these places?


03:19

Sanjeev Jeyakumar:
Yeah, it was really interesting. So I went to a primary school in Walthamstowand that primary school was actually, I think, failing Ofsted at the time,which is the regulator for school standards. But really, fortunately for me, asI mentioned, both my parents were teachers. And so growing up, I was lucky toget a scholarship to a local secondary school, which was much better. And thatwas really a different world from my perspective, in terms of what Iexperienced at Walthamstow and exposed me to different environment, whichreally allowed me to do much better. So that was that transition. I was veryfortunate to get that scholarship and it definitely, I suppose, put me on a bitof a different trajectory. And once I was there, I had a lot of friends who hadsimilar ambitions to do well academically.


04:01

Sanjeev Jeyakumar:
And that was really the springboard to me applying and getting into Oxford.


04:05

Amardeep Parmar:
So you're at Oxford now and obviously, as you said, at Oxford, the grades, thepressure, I guess, from the grades is very tight all the time. And at whatpoint did you start thinking about, what am I going to do after this? What do Iwant to be for however many years after?


04:19

Sanjeev Jeyakumar:
Yeah, it's a great question. So I think at the time, as I mentioned earlier, Ireally involved doing something that was quite fast paced. I felt like I alwaysdid well under pressure and I want to do something really surrounded by smartpeople where I can learn as much as possible. And so I managed to get aninternship in my first year at UBS to do a one week program at the investmentbank. And that's when I understood what trading was. And that kind of reallystuck out to me because it seemed really fast paced. A lot of my friends werealso applying to do it as well. So I applied to do trading out of universityand I got a position as an internship at Citigroup. So I did that, rotatedacross and I actually got put on the emerging markets credit desk.


05:00

Sanjeev Jeyakumar:
And that was really the path to me becoming a trader. I, you know, had donesome research, I'd met some traders and it thought like a really exciting placeto start my career. I did that for seven years and it was a super interestingexperience. I learned a lot, worked with a lot of smart people. And the coolthing about it is what were doing, you know, were allocating money and lendingmoney in places like Kazakhstan, in Africa, in Eastern Europe. So exposed me toa lot of those places and a lot of the challenges and issues that happen inthose areas.


05:28

Sanjeev Jeyakumar:
And I really suppose through that experience understood the other side of theproblem because most people think of how hard it is to borrow money, but alsoyou can understand as a lender, as someone that is responsible for the capital,how to think about how to de risk lending as well. So it really helped meunderstand that. And you know, I enjoyed the first four or five years but Isuppose seven years in I realized I wanted to do something that had much moreof an impact on the kind of people I knew. So small business owners, peoplelooking to grow their business and that was really the catalyst to me then kindof leaving Citi and exploring much more entrepreneurial ventures.


06:02

Amardeep Parmar:
There's interesting you said there as about, I think it happens a lot where ifyou're a founder then you think all investors are stupid and they don'tunderstand anything. And it's same thing if you're trying to borrow money thenyou think all lenders are stupid, they don't understand your vision. And Ithink it's always good, like you said, when you've been on the other side ofthe table because then you get to what it's like. So I think that's the mainreason I started angel investing myself because all you hear all the time fromfounders about how no haka Investors this, investors that.


06:26

Sanjeev Jeyakumar:
Of course, when you've got to look.


06:27

Amardeep Parmar:
At the deck yourself from a potential investment perspective, then you start tosay, oh, okay, it's different, things like this. And I think it's quite animportant thing to be able to sit on the other side of the table so you canunderstand how it really works. Because like I said, majority of the timeyou're just going to hear people complaining about the people who may be, Iguess, in the position of power of the lender or the investor, 100%.


06:46

Sanjeev Jeyakumar:
And I think there's always two sides to it. Right. And having experienced it,I've also done some angel investing and been on this, on the lending side asthe lender. And I think you have to look at it from both sides. And one of thethings that it comes down to is ultimately trust and how you build that trust.And that can be either through things you've done in the past, it can bethrough data, it can be through a relationship. But ultimately as a lender oras an investor, it's about understanding the person you're, or the companyyou're allocating capital to and you know, the likelihood of getting that moneyback.


07:17

Sanjeev Jeyakumar:
So yeah, it does help to understand it from both sides because it's easy tohave the narrative of, you know, no one's given me money as a startup or noone's lending me as a company. But I think the important point is to understandwhat they're also looking for as well and how you can fulfill that.


07:30

Amardeep Parmar:
So once you left to find a more impact driven role, where did you first go? Howdid you find that first role out of?..


07:36

Sanjeev Jeyakumar:
Yeah, so it's always a tough transition going from a professional career todoing something more entrepreneurial. And I think it did take me the best partof two years. So it started off after work, going to some talks andpresentations at Google Campus, figuring out what this new world was about andunderstanding it. Meeting people, meeting founders, meeting people interestedin startups. And I did this course called Escape the City. I think this wasmaybe 10 years ago where I met a lot of people like me who are in professionalcareers but actually wanted to do something that gave them more freedom, moreautonomy. And that was kind of the journey for me to understand actually whatthis process involved because I think it's easy to look at something and justsee it as the grass is always greener.


08:16

Sanjeev Jeyakumar:
But actually meeting people who are in that journey help me understand thesteps taken to make that shift. So I did that and Then kind of through thatexploration process, I met Charlie Paul, who was co founding a business whichwas a marketplace for small businesses. And that was really interesting becausemy experience as a trader is really bringing together buyers and sellers. So Ifelt like a lot of my skills I'd built up would be useful. So that was my kindof first experience. Joined as the founding team of a company called Stoga and.And the idea was to build a marketplace for industrial property, forbusinesses, and helping businesses monetize underutilized space and on the flipside, helping businesses access space on demand. Super interesting. Learned alot.


09:01

Sanjeev Jeyakumar:
We raised VC capital, we raised 2 million pounds of VC capital, scale thebusiness. And that was when a lot of theory that I'd previously learned got putinto practice. And I think the main learning from that experience is that thereis no substitute for the doing. I vividly remember reading all these articlesabout, you know, how to start a startup from Sam Altman and everything else.And I vividly remember having read that and thought, you know what, this is allpretty straightforward, I've got it. And then you go and try and do it yourselfand you look back in retrospect and every single mistake you were warned not tomake, you have made. So it was an amazing experience for me.


09:38

Sanjeev Jeyakumar:
Learned a lot about hiring, how to grow a team, and I think the thing that Ididn't really appreciate whilst at Citi is that having a brand is superimportant in terms of hiring, in terms of meeting customers. Whereas whenyou're starting from a startup, you have no brand and you have no presence. Andbuilding that from the ground up, going from 0 to 1 is completely differentfrom going from 1 to 100. And learning that skill set at Stowga was reallyinvaluable and I found super interesting.


10:05

Amardeep Parmar:
So you mentioned a few interesting points there, so I'm going to see if I canremember them all. One thing I really love that you said about how it was abouttwo years from you deciding I want to explore other careers to actuallyleaving. I think some people think there's a pressure of, like, you've got todo it straight away and you don't. Right. You can take your time, you can testout different options, you can go to events like I said, and really learn thatescape the city. So there's a few people who've been on this podcast who'vebeen on there, and one of the things I've always wondered about that program isdo you do it a bit in secret? Because I guess your bosses, if they knew you'regoing to something called Escape the City, of course, wouldn't be particularlyhappy.


10:36

Amardeep Parmar:
How does that work on that program?


10:37

Sanjeev Jeyakumar:
Yes, a good point. So, yeah, the clue is in the name of the program. So it'snot something I advertised at work, for sure, but it was an evenings program.So the idea was you had your work and you came in the evenings. And the ideawas just to learn about the alternatives. Right. I think a lot of people, theygo through the standard school, university, career, they feel like they're in acareer and then there's no concept an alternative. And often they might spend10, 20, 30 years doing something that necessarily doesn't fulfill them. And sofor me, it was just an exploratory thing. I wanted to meet other people who hadan interest in doing other things and just understanding it better. And as yousaid, a lot of people say, you know, you've got to do it now.


11:16

Sanjeev Jeyakumar:
And I agree to an extent, if you put something off for a long time, it usuallybecomes never at the same time. It's a big decision. So making an informed oneas possible is super important. And what I've found is it's always reallyhelpful to speak to someone that's made that step you're looking to make. Andso community is so important as why is what you're doing so important? Andmeeting people who have walked the path you're looking to walk. And that wasreally the focus of escapestream. Speak to people who are looking to make thattransition and understand the process.


11:44

Amardeep Parmar:
I think the other thing you said interesting there as well, was about how thebrand element of it, because it's one of the interesting things that I foundwhen you talk to people at different corporates, they. It's the kind ofhierarchy of the conversation, right, where somebody will act in a certain waybecause they've got common sex or whatever it is. And what they've got toremember is that once you get into the startup world, none of that stuffmatters. Nobody cares that you worked at Goldman Sachs, nobody cares that youworked at Deloitte or anything like that. It's about who are you and what makesyou good at what you're doing. And that transition, I think, is really hard formany people.


12:17

Amardeep Parmar:
We've seen it a lot with people who are leaving those companies then becomeadvisors and they think, oh, but I've got 10 years at this company, likeeverybody should want to hire me. When reality, 10 years at a company, is itrelevant to the startup in that early stage? And how did you find thattransition of obviously being trader, having all of that prestige and all ofthat status, you get alongside that to them being a startup and having toalmost start from scratch and say I'm claiming my spot and I'm here on meritand what we're doing is amazing.


12:48

Sanjeev Jeyakumar:
It's a great question and I think it is a very humbling experience. You workyour way up in a corporate, you've got all the prestige and everything else andas soon as you leave that, like you said, it's not relevant. So I think it'sgreat. But at the same time, as you said, because you've got to stand on yourown two feet, you develop much wider range of skills and you figure out how toget your point across without relying on a brand as well. And I think it's areally important, I suppose, professional growth area as well because it's veryeasy to be part of a large company and have the brand and everything behindyou.


13:22

Sanjeev Jeyakumar:
But when you go out, and I'm sure you've seen this yourself, building the bayHQ and you've got to stand on your own two feet and build something fromscratch, it's a completely different skill set. So, yeah, I found it initiallyit was a surprise if I'm honest. But then like everything, you kind of get usedto it and you figure out what you need to do. But it was humbling initially,but at the same time I really enjoyed it because it allowed me to developskills that I would never have developed if I stayed in the corporateenvironment.


13:47

Amardeep Parmar:
Hello. Hello. Quick introduction to let you know about BAE HQ. We're thecommunity for high growth British Asian entrepreneurs, operators and investorsand you can join completely free at thebaehq.com/ join.  There, you getour CEO pillars, sets, content, events and opportunities direct to your inboxevery week. So you can get involved and it can help you to further yourbusiness and your career. We also have a free startup course called BAE StartupFoundations where if you think about starting a business someday or at theearly stages, it gives you all that information to help you hit the groundrunning and to thrive in this new world. Back to the show. And as you said, youlearned so much from that initial period you had at that initial company there.


14:32

Amardeep Parmar:
What made you decide, okay, this is now the right time for me to move on andexplore other options?


14:35

Sanjeev Jeyakumar:
Yeah, it's a great question. So we raised about 2 million pounds of EC capital.We grew the company where we, at some point we had I believe kind of two and ahalf thousand Warehouses signed up across the UK and it got to the stage wherebecause were VC backed, our investors expected a venture style return. And werealized kind of pretty early on, although we could generate revenue, we couldmake money, it wasn't going to be the unicorn investors decided. And at thatpoint there was a bid from another company to buy the technology. So we endedup selling the technology to another company and that was kind of the end ofthat journey. So we saw the technology, we realized it wasn't quite the VC playwe understood.


15:12

Sanjeev Jeyakumar:
But from my perspective the learnings from that have really been foundationalto everything else I've done in my career. So that was that. And then at thatpoint I thought, you know what this is great, I've learned a lot. But now Iunderstand I've got to do something in an area where I have much more domainknowledge. And that was really the catalyst to me then going into the fintechspace because I could use a lot of the skills and knowledge I'd built up duringmy seven years at finance and understand how to overlay that technology andbuild something kind of generally quite exciting.


15:41

Amardeep Parmar:
It's not that you've just seen points about this so far, but I like that pointas well because it's a big question for many people about are you actually a VTbackable company or not? And in many cases companies can be great companies butnot VC backable. And that's not a problem. It's just you've got to understandwhat you are to do the right tactics in the right way and VC backle if you'renot really going to get to 100 million revenue the next, say five to sevenyears. Of course it's not really what VCs want and you've got to be able tounderstand that and then know that, okay, maybe you go for other types offinance and it's not that's any less successful, it's just that it's adifferent type of business.


16:18

Amardeep Parmar:
And I think that's really hard for people to understand, especially when theygo into VCs and VCs turning them down. But it could actually be really good foryou like you said, because once you've got VCs backing you who expect a certainreturn, if your company is on that kind of trajectory, you just put loads ofpressure on yourself for no reason. For the prestige of having a vc.


16:36

Sanjeev Jeyakumar:
Yeah, definitely. I think VC backed companies in general occupy far too much ofthe headlines. Think about everything on TechCrunch, everything you see online,it's all focused on the 0.01% of VC backed companies. But the reality is mostof the heroes in my opinion are the business owners who've actually builtbusinesses from the ground up, who bootstrapped it and everything else. And Ithink people wrongly assume the VC is the only path and you have to raise VC tostart a business. But like everything in life, there are pros and cons and youhave to be really aware of the path you're going down with vc. Early on in myStowga journey, again, I was thinking VC was the only path. But through Stowga,I spoke to thousands of small businesses. I met entrepreneurs across roofingand logistics and people doing food and beverage.


17:25

Sanjeev Jeyakumar:
And you understand that actually the business landscape is not VC backedcompanies. It's actually small business owners who are solving problems andbuilding great businesses. They may not necessarily become unicorns, butthey're having an impact and they're doing fantastically well.


17:40

Amardeep Parmar:
So now we're going on to Lenkie. Right, so tell us more about the. Youmentioned about who you want to support there. What was that initial idea ofhow you're going to stand out and be different to what was already in the.Already in the market?


17:51

Sanjeev Jeyakumar:
Sure. So during my first startup, Stoga, actually I spoke to loads ofbusinesses across different sectors and the job was to help them with theirlogistics. But through those conversations, what kept coming up is that almostnine times out of 10, all their biggest problems were on access to capital. Andwhat I thought was ironic were the businesses that I could see were doingphenomenally well. They were growing week on week, month on month, always soldout of inventory. These were the same businesses that couldn't borrow a poundor a dollar from any bank. And I found it really surprising coming from acredit world. Previously I would have thought a good business, goodfundamentals, so much demand, why don't these businesses borrow money? And as Ispoke to these businesses, I understand, understood that fundamentally it was auser experience problem.


18:38

Sanjeev Jeyakumar:
These business owners were busy, they were hiring staff, they were buyinginventory, they were juggling a million things at once. And the process ofgoing to a bank and applying for a loan just had so much friction and was sopainful. And it meant that by the time they needed the money, the timeframe toaccess the capital just wasn't congruent with that. And ultimately it was that.And also it was an information asymmetry problem. A lot of the banks that wouldlook to lend to them, rather than asking the questions around how muchinventory you've sold how much demand you have. They would ask for five yearPowerPoint presentations, they would ask for backward looking accounts that are24 months out of date.


19:17

Sanjeev Jeyakumar:
So really the information being used to understand these businesses was not fitfor purpose and the user experience for these businesses was also not fit forpurpose and the whole system was broken and it was a huge problem. It came upon a weekly basis and we actually got our heads together whilst at Stoga tothink about why don't we build Stoga capital to really solve this problem, usethe data we have on these businesses to lend to them. That conversation lastedabout 24 hours once we realized that was a whole different company. But thatwas really when the initial idea behind Lenki came about. That was a seed thatwas planted. Why don't we build something for these small businessentrepreneurs?


19:55

Sanjeev Jeyakumar:
Why don't we build something that understands their problems and buildsomething that uses the right data to lend the money as quickly as possible.And the core theme that kept coming up was friction. There's so much frictionin applying for a loan, there's so much friction in accessing the capital. Andwhat we realized is if you could remove that friction you could unlock hugeopportunity in really kind of reinventing the user experience of borrowingmoney for businesses. And that was the genesis of the idea that then becamewhat I'm doing now at Lengi.


20:24

Amardeep Parmar:
Once you've left Stowga, right, you now got to think about how am I going tostart this new company and obviously having that experience, you said youlearned so much from that. What were the first steps you took that you thinkbecause of that experience you were able to do in a much smarter way and buildthis company in a much better way?


20:38

Sanjeev Jeyakumar:
Yeah. So my first step was really to get more into the fintech space. So I'dunderstood traditional finance and credit given my background and I understoodthe problem faced by small businesses. But there have been such huge advancesin terms of what was available in the fintech space, in terms of banking as aservice infrastructure and everything else. So I spent a year working for afintech and that helped me really understand more about the solution. I duginto the problem whilst the Stowga and during that I've been thinking about howto best solve this problem. How do we crucially use technology that is newlybeen built to help solve this problem in a more efficient way. So I did thatfor a year and then at that time there's an accelerator called EntrepreneurFirst. I didn't have a co founder.


21:22

Sanjeev Jeyakumar:
I knew this was a Tech based solution. I needed a technical co founder, didn'thave many in my network so I joined Entrepreneur first, met my co founderthere, Nameka, who's fantastic. He also had experienced this problem. He grewup in Africa and experienced the problem of lack of access to funding as well.And that was really the catalyst to us launching Lenkie. Entrepreneur firstprovided the first hundred thousand dollars get us off the ground and we gotstarted in December 2020 which is about four years ago now.


21:51

Amardeep Parmar:
Nice. And then so obviously that process of co founding a co founder, I think Iknow at least a dozen people now who are looking for technical co founders andthey're doing interviews and going for dinners with people to try to find that.What do you think about you and your co founder makes it work so well?


22:05

Sanjeev Jeyakumar:
I think a lot of people focus on hard skills and obviously can they code whatlanguage they write in and obviously it's important but ultimately it's peoplerelationship. You go through ups and downs together, there are problems to besolved. It's got to be someone that you enjoy spending time with. It's got tobe someone that you can solve problems together with. And I focus much more onthe person obviously skills are really important as well. But really I wantedsomeone a lot of people don't realize building a company is a long, it's moreof a marathon than a sprint. So I wanted someone who could both bring acomplementary skill set but also someone I enjoyed spending time with, someoneI enjoyed solving problems with and someone I connected with on a personallevel.


22:47

Amardeep Parmar:
And as you said, building a fintech is particularly difficult because there'sregulation, there's all these different other aspects of it to get involvedtoo. And at the early stages, how long was it before you could really get yourfirst customers and really start getting those people on board? Was it a longprocess in that or was it somewhat straightforward?


23:04

Sanjeev Jeyakumar:
Well, funnily enough actually. So as a manager my co founder is from Nigeriaand whilst a city I also traded African bank debt and African sovereign debt aswell. So the initial version of Lenki was actually called Simba Fi and the ideawas to launch it in Africa where this problem of financial exclusion isactually far greater. And the reason that didn't get off the ground is becausethe cost of regulation would be into the millions to get started. But one ofthe benefits of at least business lending in the UK is that the regulatoryburden to get started is far lower. And so after Entrepreneur first we raisedour first 1.2 million in pre seed funding and that gave us the capital toreally get off the ground and start experimenting.


23:45

Sanjeev Jeyakumar:
And the first 18 months, if I'm honest, was a little bit of a wander in thewilderness because you have all these preconceived notions of what's going towork. And as soon as you get them out into the real world, you find out prettyquickly that they're not correct. So we first started off doing embeddedfinancing to retailers using kind of card and point of sale terminals. And thenobviously we started off initially looking at different geography. So there wasa period of experimentation. We then started lending to events companiesthrough an events vertical SaaS platform. So their first 18 months was reallybuilding the initial underwriting model using that capital to lend. And thefocus was on learning. So we did a lot of different things, we learned a lot.


24:27

Sanjeev Jeyakumar:
And through that process of experimentation, we then realized that actually thebig problem for businesses is around financing their payables. So when you'rein a construction business, you've got to pay for your raw materials, you doyour job and typically get paid 60 to 90 days later. And it was that cash flowconversion cycle that was a big problem. And also it's really important thesectors you focused on. There are some sectors in the uk, namely construction,manufacturing, logistics, where as a big bank, you simply just underweight thewhole sector because of the risk involved. And what happens is, typically youget a lot of babies thrown out with bathwater. You get a lot of fantasticcompanies that are doing well that actually are disregarded or overlookedbecause they're in what's considered risky sectors.


25:13

Sanjeev Jeyakumar:
And so the real learning for us is that if we focused on being in the companythat served the underserved, if we focused on the sectors that banks werestaying away from, but were able to approach it from a new way in a way whichmitigated risk and a way which created a better user experience, we couldactually build a much better experience for businesses. And that was really thecatalyst behind our, you know, what is now our flagship product called GrowNow, Pay Later. And it's a credit facility that allows businesses to financeany payable they have to a supplier as they scale. And so that was really themain learning. It took, you know, probably 12 to 18 months of experimentationto understand. But as soon as we launched that's when things really took ashift for us.


25:54

Sanjeev Jeyakumar:
We had a lot of demand, we had really positive customer feedback. And at thatpoint, the only obstacle was access to more capital to lend. But that processwas a period of process of really just trying different Things and learning asyou go along.


26:06

Amardeep Parmar:
And so you mentioned that as well you had a 1.2 million pre seed. So by mostpeople's standards that's quite a large precede unless you're in health tech orbiotech or something like that. How do you think you were able to get people onboard with the mission right in these early days before you knew exactly howyou're going to deliver that?


26:21

Sanjeev Jeyakumar:
I think what works in our favor is that because I'd spent seven years in creditI had whilst a city, I probably worked on $2 billion of structuring creditstructured credit deals. I also ran the market making desk for Middle east andso I had a strong background in credit. So when I spoke to investors about acredit and a lending business I was able to speak their language and I was ableto understand the kind of things they were looking for. So from thatperspective I really understood what credit investors were looking for and thecharacteristics of made a successful credit business. And so that I think was abig advantage early on which allowed us to get some great initial investors whohad faith in our ability to find the solution.


27:01

Sanjeev Jeyakumar:
So really I think it was the domain experience and the fact I'd built a startupbefore and so a lot of the maybe first time founder mistakes I had already madeand I'll probably be making different ones rather than the same ones again.


27:14

Amardeep Parmar:
And you said it took you 18 to 24 months to really nail down the ones which youcan see are really making an impact. What's happened since then? What's thejourney post?


27:23

Sanjeev Jeyakumar:
Yeah, so I think so we really found out the product that fit after 18 monthsand then at that point we needed debt. It's not easy to raise debt as an earlystage company because you're still unproven. We'd only probably done a coupleof million in loans and weren't making significant revenue. So you've got tofind someone that would take a bet on a pretty unproven company and so that wasa pretty long process. But I was able to find an investor, Highwood, net worthinvestor, that took a bet on us and gave us seven and a half million of his ownpersonal cash to lend with and that was really what unlocked us to then takethat next step.


28:00

Sanjeev Jeyakumar:
We raised seven and a half million pounds of debt and that allowed us toobviously grow our loan book to probably 10x our revenue. And there was aperiod of kind of real hypergrowth from 2020 to 2023 and that was the next stepfor us And I think as we learnt more, the good thing is we always really focuson feedback loops. So we spent a lot of time with customers and if you thinkabout lending, it's a few different things. It's the application process, it'sthe underwriting, it's origination. And as we did more loans, we made sure tobuild feedback loops into the product, into the company. So were constantlylearning and we made sure that were improving the product as we go, as wentalong.


28:37

Amardeep Parmar:
So what would you say are the biggest wins so far for Lenkie?


28:40

Sanjeev Jeyakumar:
I think for us, we recently just crossed 40 million in origination, which isfantastic in terms of kind of the metrics of our loan book. They're kind ofreally top tier, which I think is important for us and investors. But mostimportantly for me is the feedback from customers. So we've now servicedhundreds of customers. And what I suppose is most rewarding from my perspectiveis that those companies have grown, those companies have hired more people,those companies have expanded and ultimately the reason is I started Lenkie isto help other people realize their ambitions. And I think something that'soverlooked is that 60% of the country is employed by small businesses, yet thefunding gap to small businesses has grown 20% in the last decade and is now 22billion pounds.


29:22

Sanjeev Jeyakumar:
And so the reality is the employment growth is going to come from smallbusinesses and they're chronically underfunded. And so from my perspective, thefact that we've played a small part in actually getting money to people thatdeserve it, letting entrepreneurs realize their ambitions and then the knock oneffects that has on society has been for me the most rewarding. And we've veryrecently also just closed another funding round which is 39 million pounds ofequity in debt and that allows us to go from serving hundreds of customers totens of thousands of customers. And for me, that's what I'm really excitedabout. We've got something that works, we've got something that has really goodcustomer feedback and now we can really scale it and help a lot more people andhelp play a bigger part in solving that funding gap to small businesses.


30:05

Amardeep Parmar:
So the next question, you might have slightly answered it there, but I thinkit's very obvious as you're talking about this, the passion about what you'redoing coming through and you can see that as you're talking about the impactit's making, it's definitely coming from the heart. So you said about how thisnext funding round is going to enable you to service tens of Thousands ofpeople now. But let's say in five years time, we're sitting here again, whatwould you love to say is your biggest wins in 5 years time?


30:28

Sanjeev Jeyakumar:
From my perspective, the real goal is to reinvent the experience of accessingmoney. And if you think about it 10 years ago or even 20 years ago, it would beinsane to think you could access food on demand through your phone. It'd beinsane to be able to order a taxi on demand via Uber. And I think technologyhas really improved the consumer user experience dramatically over the last 10years. But actually if you think about the financial services user experience,it Even now in 2024, we recently opened a bank account with a large top fivebank. It took six months, it took three visits to the post office. And it was avery painful process. And the reality is to be able to access capital is stillan incredibly painful and friction and a process full of friction.


31:13

Sanjeev Jeyakumar:
And the goal for me is to make the process of borrowing money as seamless asmany consumer experiences are in terms of ordering food and ordering taxis. Soreally reinventing that experience and making sure that if you're a which iscredit worthy, you can get access to credit on demand. And what's excitingabout that is that capital no longer becomes a barrier to growth. If you'redoing well, you've got good opportunities, you've got customer demand, you'reno longer constrained by having to spend six months and going to find moneyfrom a bank. You can access it in your fingertips. And also I'm excited about,and as I mentioned, the funding gap in the UK is 22 billion. We want todrastically shrink that. And then we also have international ambitions.


31:54

Sanjeev Jeyakumar:
The problem we're solving of the SME funding gap is not a UK problem, it's aglobal problem. I think there's a lot of secular trends that are going to makeit worse. Bank regulatory capital and things like that. So we want to become,we want to fill that gap and we want to make sure that any ambitiousentrepreneur that's done the hard work of getting their business from 0 to 1,we want to be there from the stage from 1 to 100 to really help them realizethe full extent of their ambitions.


32:20

Amardeep Parmar:
Awesome to hear the story and what your ambitions are as well. We're going tohave to go to quick fire questions now. So first one is who are free BritishAsians you think are doing incredible work and you'd love to shout them out?


32:31

Sanjeev Jeyakumar:
So I think the first one I'd like to shout out who's actually one of ourinvestors is someone called Srin Madipalli. Very inspiring guy. He founded acompany that made it easier for people with disabilities to access holidayrentals, which he then sold to Airbnb. And now he's working on another AIstartup. But he's been an investor from Lenkie from day one. He's been superhelpful. I find his own journey really inspiring and he's definitely played abig part in helping getting Lenkie off the ground. So shout out to Srin.Secondly, I'd like to shout out Karan Shanmugarajah. Karen Shan. He's a CEO andfounder of Wealth Kernel. I've known Karan now for 10 years and I've seen himat the very early stages, running from meeting to meeting, team of three,getting things off the ground. Now they've scaled significantly.


33:18

Sanjeev Jeyakumar:
I think they have perhaps close to 100 people and the company's gone fromstrength to strength. I think he's a really good example of resilience and areally good example of reacting well to setbacks to be able to enable theirsuccess. And then lastly, I'd probably say Theso, who's the co founder ofYonder, they offer a card, a credit card with extra rewards aimed atmillennials. Again, I've caught up with him a lot recently. I think he's done areally, really good job and a good of being very product focused and building acompany. So I'd like to shout out those three.


33:49

Amardeep Parmar:
Yeah. So we definitely need to get Shan on who's been on my list because as yousaid, his story is incredible.


33:53

Sanjeev Jeyakumar:
Really incredible.


33:54

Amardeep Parmar:
And we've had Tim on from Yonder, but we need to get on. They say it's also onmy list of like, I need to get him on there as well. But all amazing people.And if people want to find out more about you and find out more about Lenkie,where should they go to?


34:07

Sanjeev Jeyakumar:
I think the best place is probably LinkedIn or Twitter. Obviously we're onlenkie.com in terms of understanding more about the company, but they'reprobably the best places for now.


34:16

Amardeep Parmar:
Is there anything that you need help with or that Lenkie needs help with thatthe audience listening could help you with?


34:21

Sanjeev Jeyakumar:
I think two things. One, we're always on the lookout for underserved, ambitiousentrepreneurs who are building amazing small businesses. In particular, theunderserved aspect. I think there's a lot of entrepreneurs that overlooked andthat's part of our philosophy at length, how can we serve the underserved? Howcan we, given the capital to take things to the next level. And those peopleare people like you. I mean, people in, I'm sure, amongst your viewers. Andthen secondly, we're hiring a lot following this funding round. We're lookingto add a lot of people across sales, across copywriting, customer support andalso software developers. So anyone looking for a new career, I'd love to speakto you as well.


35:06

Amardeep Parmar:
Awesome. So thanks so much again for coming on and sharing your story. Anyfinal words?


35:11

Sanjeev Jeyakumar:
Firstly, I should say thank you so much. Big fan of what you're doing, so Ithink it's great. Definitely a great thing for the British Asian community. Andyeah, thank you so much.


35:22

Amardeep Parmar:
Thank you for watching. Don't forget to subscribe. See you next time.

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