Lesley Li, founder & CEO of U Impact, spoke on Tech for Sheroes for Good podcast about her move to Berlin from China, how it led to founding her FinTech startup U Impact; and the challenges she faced as a woman entrepreneur. Lesley was one of the speakers at the AsiaBerlin Summit 2021 and participated in the panel “ Startup Stories: success and fuck-ups done right!” Here are some edited excerpts of the podcast conversation.
Could you tell us something about yourself?
I’m originally from China. Twenty-one years ago, I moved to England as a teenager. My parents took a leap of faith by giving me all of their life savings, sending me to the UK, hoping I could get the best education they could ever dream of.
When I arrived in the UK in 2000, my parents weren’t so well off. At that time, the exchange rate between RMB(RenMinBi, Chinese currency) and GBP(British Pound), was 15 to1. As a teenager, I took any job I could find to earn some money. So my first job was at McDonald’s. I still remember the wage I got was £4.30/hour. I was working two jobs at the same time. My second job was with Legal & General, the insurance company. After school, I would spend about 1-1.5 hours there to clean the office and every time I walked into that office, I said to myself “At some point, I’ll work in an office like this”.
When I finished high school, I managed to get into Imperial College in London. After my undergrad, I went to the University of Cambridge for my master’s degree in industrial engineering. I remember when I got my offer from Cambridge, my parents were over the moon. But the tuition was too expensive. However, they told me, they would do anything to pay for that. So they borrowed money to pay for my tuition.
In 2008, when I finished my master’s degree from Cambridge, I started looking for a job. It was in the middle of the 2008 financial crisis. While looking for a job, I had only one consideration for choosing my job, “I will go for the highest-earning job I could have”. I was informed that investment banking pays the most for a graduate. I was very lucky to land a job at JP Morgan as an analyst. So I started my banking career with JP Morgan in London on 15.09.2008, the day Lehman Brothers went bankrupt.
I joined the credit trading department as a grant in the middle of the credit crisis. It was a great learning experience for me. I realized how banks capitalize on the information of the asymmetry between financial institutions and individual people. There are many examples out there that highlight that profound inequality problem.
After three years at JPMorgan, I received a scholarship and went back to Cambridge. I did my Master in Finance and after that, I went back to banking. So all in all, I spend more than 10 years in banking.
What made you move to Berlin and start your entrepreneurial journey?
Back in 2014, I moved to Germany, because of my maternity leave. That was when my daughter was born. As my husband is German & his whole family is in Germany. When she was 11 months old, I went back to work in London. Every Monday, I flew to London and every Thursday I flew back for 3.5 years.
But as a finance professional, London was always the place to be. I had the choice between London and Frankfurt. But as my in-laws were in Berlin, I decided we will stay in London and do the commuting.
After 3.5 years, I realized I was missing the purpose. I asked myself every time at 5 AM every Monday morning in a taxi on my way to the airport. “What am I doing? What is the purpose that I’m chasing here?” I was working really hard, earning more money for the richest of the richest. Ignoring the other part of the society as there are a lot of underserved people. The purpose should be to serve the people who have no financial literacy, who have no chance of getting their education, who have no chance to work in that 1% of the economy.
From 2014 until 2019, I kept contemplating that “it is really time to make a difference”. Then it also struck me, I need to work towards the future of my kid instead of some of the richest. Therefore, at the end of 2019, I handed in my resignation.
I didn’t know what I’m going to do as an entrepreneur. But I knew what I want to do is to bring equality into the financial society. To give people a chance to strike that equality with empowerment through knowledge and transparency. I learned how the finance industry earns abnormal profits. So that is how I first started as an entrepreneur.
Help us understand what sustainable finance is? And why is it important?
For us, we have a very simple understanding when it comes to that. Sustainable Investment for us means – doing good, making an impact, but at the same time doing well. This is our belief! When people invest they are looking for a return. But at the same time, we believe there is a way to do good at the same time.
Our business started right at the beginning of the pandemic in January 2020. That was when where we got it accepted into the Porsche digital incubator programme. After that, in March, I did my first ever demo pitch in factory Berlin, and then the pandemic hit. We thought everyone was locked in their homes, what is the most important thing, the most important thing is sustainability. We thought enabling investment is good but why can’t we also do good at the same time? This is when the sustainable investment was 100% of our focus.
Why is it so difficult for most fund managers to just invest in unsustainable organizations or businesses?
Well! There are two things: the data quality & the transparency is not yet there. If you look at the trend, since the beginning of the pandemic, the sustainable investment market has skyrocketed. That also has problems like ‘greenwashing’. When too many people think it is a fashionable thing to do, it becomes greenwashing.
But having said that, the whole sustainable investment market is only 5% of the whole investment market. It’s not a new market, it started 20-30 years ago. It is because of the pandemic that all of a sudden, people think it’s important. I wouldn’t think that people like fund managers don’t want to do it. It has a lot of issues to solve. For example, the government is rolling out many regulations like the EU taxonomy, the SFDR (Sustainable Finance Disclosure Regulation) requirements to really push for that transparency and push for everything to be in place. But it’s easier said than done. There’s a lot of obstacles to rolling that out in the market. I do understand there are a lot of issues that the asset managers & fund managers have to sort out before they can ramp up that pace.
On the other hand, a lot of people are really jumping into that, causing a lot of chaos. People have no oversight – what is good, what is grey, what is dark green? How do you distinguish between the ugly and the good? So a lot of those issues are there to be solved.
That’s why at U impact, we addressed the two most important points – the knowledge side, when it comes to what is in the funds, and the transparency side, how do you bridge that knowledge gap for the people who have no idea about sustainable finance.
How do you ensure and look at the business matrix and compare it with the ESG concerns? How do you track that data?
If you look at the data, in terms of who is using the data, there are a lot of concerns right now. If you read the news, they’re debating among the professionals, the asset managers, the banks, etc. However, if you look at the policy like the EU taxonomy and SFDR, their main concern or the main objective is to bring the private money into the sustainable areas. The retail investors, the individual investors are the missing part of the puzzle. They are highly ignored. However, all these disclosure policies, they’re not really serving the retail investors. That is the missing piece, we will like to address.
We have a lot of private investors but they aren’t institutional or professional investors. There is no transparency and no one has done anything about it. That is the blind spot which we are targeting. Although we’re B2B, we’re presenting this information, transparency, and knowledge to the people who don’t have much money. The private investors have their hard-earned savings left in the banks, and they have no idea how to actually engage that money in a sustainable area. This is the part we think should absolutely accelerate!
You have won numerous awards. What is the secret sauce of your success?
When we started back in January 2020, I had no idea what I was doing. I was a first-time founder, learning a lot every single day. But I knew, why I started – to address the inequality.
When it comes to the small people, the people have no power with no financial literacy. So then when you have that purpose in mind, that’s the secret sauce. You keep on trying and don’t give up.
In the beginning, one of the colleagues that we used to work together in Barclays, who managed the Brexit project for one of the UK’s biggest banks. He came to join me for the purpose that we want to do something that matters or something that brings impact. I also have a friend who started when we were studying together in 2006. He was like a rocket scientist or engineer. But he quit the job thinking of something with a purpose.
In the beginning, as an entrepreneur, it was very lonely and hard. Everywhere you get no, no one gives you anything. So that’s how I started. However, without a purpose, anyone would have given up in the first half a year. We didn’t get paid a penny for a whole year actually. But it was the purpose that kept us going, we were moving inch by inch. We felt that we’re getting a little bit better every day. It is not about comparing another startup that just raised 5 million, or when another startup just won this award. We thought as long as we can be better than how we were yesterday, we will keep going with a purpose. I call it an infinite mindset. It’s not about winning. It’s not about losing. It’s about doing a bit better every day.
After nine months, we did that! We won our first competition. I remember it was September 2020, it was the FinTech4Impact Challenge, organized by Visa. The jury comprised 13 German banks. We competed with 10 other FinTech startups which were a lot more mature than us. But I was up there on stage with a lot of passion presented the solution that we really believe will bring value to people. We came out as the champions.
So that taught me two things – You need a purpose, that you’re passionate about, and that is the thing that will keep you going in the darkest hour. The other is one is persistence. Don’t give up and you’re will on the path to winning! That is the secret sauce!
How isolating is it to be a women entrepreneur in the FinTech space, which is highly dominated by male counterparts?
I come from a finance & investment banking background hence I am very much used to the fact that I’m one of the only women in the room. Through my parents and with my experience in banking, I learned to be resilient and keep my hands up. Being a woman, it took 10 years of practice for me to have this kind of resilience and assertiveness to be thriving in the FinTech space.
So luckily, I had the opportunity to thrive in a male-dominated space. That’s something I would actually like to share with my fellow women entrepreneurs, most of the ladies didn’t have the opportunity to really grow in a male-dominated space until they get into FinTech.
This article is a part of the ‘Tech Sheroes 4 Good’ Podcast which partnered with AsiaBerlin Summit 2021 to interview women leaders in the impact sector. Through this podcast, host Saurabh Singh interviews amazing women leaders from all across the globe and shares their incredible journey, passion, and motivation. The podcast talks focus on the intersection of Technology and Sustainability.