Tatyana Deryugina is an Economics Ph.D and an angel lender on WeFinance. She explains what she looks for in campaigns.
Lender Corner with WeFinance is a regular series that looks at some of our angel lenders, why they lend, and what they look for when looking for opportunities.
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What’s been your experience lending on WeFinance?
Initially, my biggest concern was that it would be overly time consuming, but WeFinance makes the process easy. I particularly like that repayments are automatic; I lend the money and receive repayments back in my bank account.
What do you typically look for when you lend to someone?
Firstly, I look for someone that has a clear goal in mind and has the potential to achieve their objective. There has to be a clear path to a well paying job. I’m also looking to make sure that they’re not borrowing too much money — it’s a red flag that they might be unable to repay in the future.
What tips would you give to someone creating a listing today?
I would suggest that they have friends and family pledge on their campaign and write endorsements. To me, as an outsider, it’s a negative signal if your friends are not willing to vouch for you.
I would also suggest that they put a lot of effort writing their description. They should emphasize what they’ll do with the money and find ways to show that they’re financially responsible.
Finally, their story has to be coherent. It’s great that you’re pursuing your dreams, but I need to be confident that I’ll get a return on loan — that you’ll have a way to pay it.
**Do you have tips for potential lenders? **
I would diversify across multiple borrowers to minimize risk. As good as a campaign may sound, there’s still a risk that you’re wrong.
A key benefit of WeFinance is that it easily allows you to diversify and split up your lending across multiple borrowers.
As a Berkeley and MIT graduate, are you more likely to lend to alum from these schools?
I think a big benefit is that I can derive more information from alum of these schools. I can look at their Facebook and see if we have any mutual connections in common. For better or worse, this is additional information which is beneficial.
Going to a school like Berkeley or MIT also reassures me that they’ll be able to repay since they’re highly employable.
I wouldn’t say that I have an irrational favorability towards these students, but I would definitely be able to derive more information to make a lending decision.
As an Economics Ph.D, what’s your view on peer-to-peer lending?
I think it’s a great concept. The challenge is finding the people who don’t have access to credit, but who are creditworthy. I went to graduate school with many international students who faced this exact problem. They either get predatory loans with high interest rates or can’t get loans at all.
Yes, there’s a risk involved with lending to internationals, but it’s not as risky as the bank’s financial models predict given their backgrounds.
I love that WeFinance is identifying creditworthy people who don’t have fair access to credit.