Tahira Dosani is Managing Director of the Accion Venture Lab, a seed-stage impact investing initiative focused on financial inclusion. Venture Lab provides capital and support to early-stage startups that leverage innovation to increase access to and quality of financial services for underserved consumers globally. Tahira works with the fund’s portfolio companies to provide strategic and operational expertise that accelerates their growth trajectories and enables stronger performance. Additionally, she supports investment decisions, manages portfolio relationships, and drives the strategy and growth of Venture Lab. Tahira previously led strategic projects at LeapFrog Investments, a specialist emerging market profit-with-purpose private equity fund focused on financial services. She also served as Director of Strategy at the Aga Khan Fund for Economic Development in Dubai and Head of Corporate Strategy at Roshan – Afghanistan’s leading telecommunications operator – where she launched the country’s first mobile money platform. Tahira began her career as a management consultant with Bain & Company in Boston. She has also worked at the Bridgespan Group and on various education and health initiatives in Pakistan, Tanzania, Kenya, and Egypt. Tahira holds an MBA from INSEAD and BAs in International Relations, Computer Science, and Education from Brown University.
How did you first become interested in impact investing and economic development?
Tahira Dosani: My Mom is from India and my Dad from Kenya, and I spent the first several years of my life in Pakistan. From an early age, I had exposure to economic inequity and the implications of not being part of the formal economy. I’ve always been interested in development and in particular, development efforts driven by the private sector. There’s a level of sustainability that can only be achieved when you align impact and financial returns, which is what drew me to the impact investing world, and specifically the financial inclusion sector.
Can you tell us about your journey to Accion Venture Lab and your key insights along the way?
Tahira Dosani: I started my career in management consulting with Bain & Company. In my time there, I built a strong strategic and analytic toolkit that I have since been able to apply across a broad range of contexts and business problems. After a few years in consulting I realized that I wanted to be closer to the implementation of the strategic recommendations we produced. I also wanted the opportunity to see whether the alignment of incentives that can create double bottom line impact was possible. So I moved to Afghanistan and went to work at Roshan, the first mobile telecommunications operator in the country. In a market that had lacked communications infrastructure, building a telecoms network had significant social and economic development impact. It was in Afghanistan that I really got interested in the link between technology and financial services. I helped to launch mobile money in Afghanistan; at that time, more than 97% of Afghans didn’t have a bank account, so the ability to conduct financial transactions over a mobile phone had huge potential. After business school, I moved from operations to the investment side, wanting to capitalize and support companies like Roshan and others to leverage innovation to reach underserved consumers profitably. Before joining Venture Lab I worked with larger funds like the Aga Khan Fund for Economic Development and LeapFrog Investments. Both are leaders in the impact investing space, working to show the capital markets that profit and purpose are aligned and complementary. I joined Accion Venture Lab four years ago because I was particularly interested in how investors could provide more than just capital to their investees. At Venture Lab, we have built a platform that allows us to provide hands-on strategic and operational support to the companies we back; we believe this accelerates their growth and scale in addition to providing us with critical learnings that make us better investors.
You are currently the Managing Director of the Accion Venture Lab. Can you tell us more about the Accion Venture Lab and several initiatives you’ve led?
Tahira Dosani: Over 3 billion people in the world are underserved by formal financial services. A lack of access to relevant and affordable financial tools is a real barrier as someone is trying to emerge from poverty. However, traditional financial institutions find it difficult to serve low-income consumers profitably; low transaction sizes and ability to pay coupled with a high cost to acquire and serve these customers mean that they generally remain underserved. Rather than viewing these customers as unprofitable, there are a set of businesses who see a massive market opportunity if they can leverage technology and data to reduce their costs to reach, assess, and engage low-income customers. Doing so requires innovation and a willingness to fundamentally rethink product, pricing, and distribution. Accion Venture Lab focuses on startups that are doing exactly this. We invest in these companies, bringing them capital along with strategic and operational support to help them scale. Traditional institutional investors typically aren’t willing in invest in these businesses at their earliest stages; they want to see traction and scale before they are willing to commit capital. By being the first institutional investors in high-potential seed-stage startups focused on financial inclusion, we hope to provide the businesses with the runway to innovate, enabling them to reach scale, delivering financial returns and significant social impact.
In your opinion, what is the current landscape for financial inclusion like?
Tahira Dosani: Financial inclusion is truly about increasing access to, improving the quality of, or reducing the cost of relevant financial services for everyone. There is an incredible amount of innovation taking place is the space today. Internet connectivity and mobile phone penetration mean that you don’t need to go to a physical bank branch or agent location to complete a transaction. This has made it possible for people outside urban centers to access financial services in an unprecedented way. Moreover, the use of mobile phones and other technology has created streams of digitized data that can be used to segment, underwrite, and engage with customers in a much more meaningful way. For example, if you own a small, informal business in Mexico City and you want to grow sales, you need access to financing to purchase more inventory or to open a second location. A traditional bank wouldn’t be able to offer you a loan because you don’t have a credit score, and without that, they are unable to determine your creditworthiness. But innovative startups can tap into new forms of digital data through your mobile phone history, electronic invoices, your sales records on e-commerce platforms, and more and can offer you credit at a reasonable price. In addition to the innovation enabled by increased connectivity, the advent of machine learning and artificial intelligence, and a strong push away from cash by regulators and the growth of cashless ecosystems all are driving new models in financial services with tremendous potential to reach the underserved.
What are the qualities of the most effective startups that seek to address financial inclusion?
Tahira Dosani: The most effective startups in this space are willing to experiment and are also able to focus. This is not an easy balance to find – innovation requires experimentation and startups at the early stage have to be opportunistic as they find paths to growth. Yet they also need to be able to focus and remain targeted on specific markets, products, and customer segments; it is impossible to be everything to everyone everywhere.
You’ve lived and worked in many different regions – Washington DC, Sydney, New York, Tanzania, Egypt, Singapore, France, the UAE, and Afghanistan. What did you enjoy the most about living in so many different regions?
Tahira Dosani: I’ve been fortunate to get to live and work in a lot of places. I spent most of my 20s outside the US. Even today, while Washington DC is my permanent address, I (along with most of my team), spend the majority of my time traveling to the markets where we have invested, working with our companies. Getting to truly know multiple markets and environments while living there has given me a strong appreciation for the stark differences that exist across countries and regions as well as the numerous factors that hold constant. I also got to learn firsthand what it takes to launch a new product in an emerging market context, enabling me to understand what our entrepreneurs face on a daily basis. I also learned how incredibly adaptable humans can be and how quickly a new environment can become home. It amazes me how quickly the foreign can become the familiar. Even an active war zone transforms into an amalgam of people, places, and memories. That doesn’t mean that it’s easy to arrive in a new place where you know no one and establish yourself, building new personal and professional networks from scratch. You have to figure out how to create ties and connections in a place where the cultural cues are unknown to you. And to do it effectively, you have to immerse yourself in that place. You cannot truly connect with people and you definitely cannot lead them if you aren’t relatable to them. Gianpiero Petriglieri, an INSEAD professor of mine, wrote in this piece, “No one wants to follow a stranger. Without some sense of home, nomadic professionals don’t become global leaders. They only turn into professional nomads. Leaders need homes to keep their vision, passion and courage alive — and to remain connected both to the people they are meant to serve, and to themselves. . . Without a local home we lose our roots, without a global home we lose our reach.” That statement has long resonated with me as I attempt to move and travel without becoming just an itinerant wanderer.
What is your advice for individuals interested in impact investing careers?
Tahira Dosani: It’s a rapidly growing space, which means there are an increasing number of opportunities in the sector. To thrive in this space, you have to bring not only a strong technical skill set and understanding of investing and operations, you also need an equally strong commitment to impact and passion for supporting businesses to create that impact. Neither one alone sets you up to succeed in impact investing; it requires both.
The other thing I will say is that impact investing is not a singular model. There are many organizations playing at many levels with varied approaches. People looking to enter the space should think about what it is that they want to focus on – what geography, what sector(s), what stage and size of investment, whether they want to work at the GP level in operations or on transactions or whether they want to be at the LP/fund-of-funds level, and more.