We recently made a small loan to Lisney, a dressmaker in Colombia, so she could buy a sewing machine and expand her business. But this was no ordinary loan.
In the early days of the Barefoot MBA, we frequently explained our vision with a hypothetical story about a sewing machine. Imagine, we would say, that you are a skilled sewer. Your family’s financial future depends on your small sewing business. You sew a few pairs of pants per day, earning barely enough to cover your costs and taking home very little. You borrow money for a sewing machine, thinking that will allow you to sew more pants. It does. But the sales don’t come. It soon becomes clear that the market is not large enough to support another pants business. Now, you have to repay your debt in addition to supporting your family.
What if this situation could be avoided? What if the entrepreneur in this case understood the relationship between price and supply? What if she used the same machine to instead make shirts if that’s what the market was missing? Understanding basic concepts could empower even the world’s smallest entrepreneurs to make better business decisions and provide better lives for themselves, their families and their communities.
Nine years ago, we conceptualized the Barefoot MBA to do just that. A few months later, we created the sewing machine example to illustrate our idea to a community of leading social entrepreneurs. Recently, we stumbled upon Lisney. And couldn’t wait to help.
We are proud to give with purpose to help Lisney fund her loan. We are pleased to count Kiva, Lisney’s lender, among our early supporters. We are heartened to see that Kiva has a partner in Lisney’s case that provides business training.
Thank you, Lisney, for making our hypothetical story a reality heading toward a happier ending. Happy new year.