Steve Polsky: Juvo’s investors are a bunch of
entrepreneurs, but the company has kept quiet while it
builds relationships with operators and customers
It’s Friday night on the couch. Millions of your
prepay customers have run out of credit on their phones, which
means they cannot text their friends to arrange to meet in the
local bar. Which bar? What time? Who’s
A social crisis for many mobile users, but it is lost revenue
for operators (and bar owners, no doubt). The users may not be
short of cash – just short of the means to top up
their phone account. Back to the couch for a boring evening at
Or there may be a family emergency. No credit on the phone
means no way to contact friends and relatives to pass on news
or to summon help.
How about a loan? Better still, an electronic, over-the-air
loan to enable customers to top up their phones – and
then pay back the sum the next time they are passing a top-up
After all, it’s not a lot, says Steve Polsky, CEO
of Californian start-up Juvo. "Most top ups are small, $1.30 or
so, sometimes only 40¢," he says.
The trouble is, mobile operators do not have the means to
decide who’s creditworthy and who is not. Worse,
in many countries they do not know the identity of many of
their customers. All they need to do is get a SIM, top it up,
and they are connected.
Who knows whether they are someone that can pay back $1.30 or
even 40¢ come Monday morning?
And yet across the world, mobile operators are feverishly
looking for ways to expand the range of services that they can
sell to their customers. Financial services have been
successful for Kenya’s Safaricom and other
companies in Africa. In Europe, Orange has teamed up with a
bank in Poland and has bought another bank in France.
Mobile payments in Africa are simple person-to-person
transactions via SMS, though the range has been extended so
people can pay bills. These work very well for prepay SIMs,
which account for most of the market in Latin America and the
Asia Pacific. But the person making the payment must have the
money in their phone account. No cash, no payment.
Credit scoring system
Polsky has just gone public with the names of the first two
operators that have signed up with Juvo for a credit scoring
system for mobile financial services. Cable & Wireless Communications
(C&W) and Millicom are both based in Latin America
and the Caribbean, though Polsky hints that he is also talking
to companies in other parts of the world.
"It is two and a half years since we set up Juvo," he says. "We
have kept very quiet so far – we’ve been
focusing on mobile operators and subscribers."
Behind the Juvo investment there is a stellar team of veteran
wireless professionals: people such as Bill Esrey, former
chairman and CEO of Sprint, Arun Sarin, former CEO of Vodafone,
António Viana-Baptista, former chairman and CEO of
Telefónica, and former AT&T Wireless president and
CEO Mohan Gyani. "A bunch of great entrepreneurs," says Polsky
about the investors behind Juvo.
Millicom has launched Juvo’s mobile identity
scoring in six markets in South America, where the company
operates under the Tigo brand: Bolivia, Colombia, El Salvador,
Guatemala, Honduras and Paraguay.
The Swedish owned group, which also has mobile businesses in Africa, has put Juvo
technology into its Tigo Shop app, which prepay customers can
use to buy service packages and to manage their balance to
activate additional voice, messaging and data, without paying
more. Miguel Angel Garay, vice president of mobile for
Millicom, notes that "prepaid subscriber behaviour is changing,
driven by increased connectivity, digital services and
This needs "an innovative digital strategy across multiple
markets in Latin America", he adds.
"Juvo was uniquely positioned to help us transform our
relationship with consumers at scale in a cost-efficient way.
The company’s solutions to establish financial
identities have helped us lay the foundation for a successful
digital subscriber experience with a positive business
Financial identities are at the heart of it. In cash-based
economies, people do not have a financial identity: their
mobile top up is often the biggest financial transaction they
"The idea is that we can do hundreds of millions of financial
inclusions, starting with everyday interactions," says
"We partner with mobile operators to re-imagine the way they
work with consumers. And we can make individually targeted
decisions. We get a holistic view of subscribers."
The Millicom partnership is "right at the very beginning of a
true digital transformation journey", he says. "By
demonstrating the scope and scale of our services through
increasingly deep engagement, we have become a trusted partner.
The next stage is to look at other areas where we can support
Millicom in highly competitive markets, to open up even further
access to advanced mobile services."
He clearly has a long-term view of how Juvo can develop the
services it offers. Start by making an advance for the phone
top up for voice, move on to data, "then you can provide mobile
financial services" and other services. The first loans are
intended for phone services, and Juvo aims to grow from
On his to-do list are items such as small business loans and
insurance. "We bring a whole swath of people into basic
financial services," says Polsky. "Everyone who has our service
spends more money." Average revenue can go up 10-15%, he
Flow Lend in 15 Caribbean markets
The second deal Juvo announced was with C&W, now part of
the huge international cable group Liberty Global.
C&W has branded the Juvo-powered service as Flow Lend and
has launched it in 15 Caribbean markets. It allows prepaid
users to request credit extensions for immediate usage,
dramatically improving customer experience and satisfaction,
says C&W, which is offering credit extensions to 10% of the
smartphone market in the Caribbean.
Flow Lend customers are, on average, consuming 10% more of the
company’s products and services and are 50% more
loyal, says C&W. It offers the service in Antigua and
Barbuda, Barbados, Saint Lucia, Dominica, Anguilla, Cayman
Islands, Grenada, Jamaica, Montserrat, Saint Kitts and Nevis,
Saint Vincent and the Grenadines, Turks and Caicos Islands, and
the British Virgin Islands. It will soon be launched in Panama
and the Bahamas, says C&W.
James McElvanna, vice president of products at C&W, says:
"From user-acceptance testing, to in-market customisation and
advanced data science methodologies, the overall experience has
been very positive."
The company had concerns at first about some of the risks
involved, including potential bad debt, but, says McElvanna,
"identity scoring has helped to mitigate these risks and our
12-month goal of $1,000,000 in credit extensions was reached in
less than four months, surpassing expectations."
According to Polsky, running out of credit means that many
customers "don’t use their phones for four to six
days a month". With the Juvo system, there is "zero interest,
zero fees" and customers "pay back the exact amount they have
borrowed". The benefit to the operators is that customers make
calls that they wouldn’t otherwise have made. "The
average loan is typically $1 to $20," he says. "It may be about
avoiding Friday night on the couch, but it is much more about
convenience. The average person who uses us does so five times
a month." Juvo-funded calls can be 50% of consumption, he
Are Juvo loans secure, though – and how can they be,
if operators do not know the identity of their prepay
customers? "At first, we would not need to know your name,"
says Polsky. "But at the point of the cash loan, we will need
to know that." Sometimes that will be done in association with
a bank, he suggests.
Overcoming the high barrier to entry
Another challenge is that "a lot of financial services
offerings are too esoteric." Getting people to sign up "is a
high barrier to entry", he adds. "It is about meeting people
where they are today. We want to make it immediate. We are
focusing on high prepay, cash-based economies."
The two first contracts have both been in the Caribbean and
Latin American region, where Juvo has needed to operate in just
English and Spanish, but the company has also looked at
south-east Asia. Moreover, there have been "positive calls" in
eastern Europe and the US, he says. It’s probably
no coincidence that eastern Europe has a high prepay rate and
the US has millions of unbanked people who find it hard to get
The company’s website lists Miami and Chicago as
the sites of US offices, in addition to San Francisco; and
there is also Buenos Aires, London, Manila, Jakarta and Hanoi.
Those cities may be a clue as to the locations of future deals.
"Mobile operators are in an amazing position. No one reaches
more people than we do. We have a very solid revenue
And, since you are asking, what does "juvo" mean? It is Latin,
the first person singular of "iuvare", which means "to
help", or "to assist". So, helping people to get off their
couches on a Friday night.