US fintech manager Quona Capital intends to implement a “programmatic approach” to collecting qualitative impact data from its portfolio’s customers, according to its latest impact report, released last week.
“A lot of us in impact investing measure output,” managing partner Monica Brand Engel told New Private Markets, referring to quantitative data used to determine impact, such as number of customers served. “But outcome-level data [qualitative data on how a product is impacting a customer] is much harder to get. You have to talk to customers.”
To accomplish this, the firm is working with with impact measurement company 60 Decibels to gather “qualitative, customer-level insights from many of our portfolio companies”, by surveying a randomised sample of end users on the way the product in question has impacted them and their families.
Launched in Washington, DC, in 2015, Quona identifies as a manager with strong impact credentials, and prioritises investing in fintech companies targeting underserved consumers and businesses in emerging markets. The firm’s third flagship fund beat its $250 million target to close on $332 million in September 2022. The firm is also raising an opportunities fund with a target of $70 million to $75 million to double down on promising assets.
One of the portfolio companies included in the scheme was Khazna, an Egyptian company that provides credit offerings and early wage access to underbanked users. Surveying the customers revealed the enhanced impact of the early wage access product when used in conjunction with a local digital card scheme. Engel said: “It doesn’t mean that everyone with early wage access will have a digital card, but it is an insight into how combinations of financial services can yield different outcomes.”
The strategy was first piloted with a select few portfolio companies in 2021 and is currently being rolled out more widely. Engel acknowledged that while the hope is to include more portfolio companies in due course, the cost of collecting the data is an issue. So far, the participating portfolio companies have helped shoulder the expense.
“We’d love to do this level of customer study on each of our portfolio companies, though how to finance something like that remains a challenge,” she added.