Anguish, Shame & We All Do It
Well, well, well we're back again with another episode of The Chirp. Two weeks ago, we got a chance to sit down with Ally Muller, a one woman wrecking crew in the startup world. If you didn't get a chance to check out this episode, unpacking all things, business and relationships, you should certainly check it out: Story 11: Friends, Family, and Fools.
For this episode, we welcomed a face and name you might have heard of once or twice in the Pigeon social sphere. This week on the mic, we had none other than Kaben Clauson, co-founder and COO of Pigeon Loans join us to speak! A man with a plan, and the voice of a politician (is that a good thing or bad thing 🤔) we talked to Kaben about all things loans, relationships, and community.
This Episode In A Nutshell
Loans, we all know what they are. We've all had to borrow money from someone before or have had to lend a helping hand once or twice in our lives. When times get tough, people depend on each other, and it's during those times that communities and relationships are of the utmost importance. In this episode, you'll hear from Kaben Clauson, co-founder of Pigeon Loans, and one of the many people in this world that have struggled deeply with the pains of lending and borrowing money with others. He tells his story, along with the stories of others, about how he's found ways to turn this often negative experience into a positive one. Listen as we dive deep into tales of shame, burden, anguish, but ultimately triumph as Kaben has had to rely on friends, family, and believers to reach the levels of success in his life.
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Audio Transcript of Story 12: Sometimes You Just Need Someone To Believe In You
Hello to all you wonderful folks. Welcome back to The Chirp: A Podcast By Pigeon Loans, where we hear people's stories of relationships between loved ones being affected and sometimes tested by the lending of money. We love to bring these stories to the forefront of our minds, tell them to the world and make what is usually an awkward subject more digestible and light-hearted and less taboo.
Today is a very very very special episode for Story number 12. I had the pleasure of sitting down and interviewing Kaben Clauson. He is the co-founder of Pigeon Loans, he is a captivating character and, as part of the Pigeon Loans team, no one has a deeper insight into money and relationships than Kaben.
Pigeon Loans is a platform for friends and family to lend each other money in an easy-to-use structured way and The Chirp was created to educate people on the value of sharing these stories about lending in relationships and what is best practice when getting involved in these loans, so a little history lesson into how and why The Chirp was created, so here we are!
So I was delighted to chat to Kaben about him and his co-founder, Brian, creating Pigeon Loans as a platform, how his own personal experiences over the years led up to this moment and him leading the charge in making lending common-place, making it easier for people to lend each other money and how important this movement is for society in general.
So hope you all enjoy this one. I learned a lot, I hope you will too. Let’s dive in to the conversation with Kaben.
Thank you so much for joining me today. Obviously you're the co-founder of Pigeon Loans, this is a podcast by Pigeon Loans and you are the first member of the Pigeon Loans team to come on and chat to me. So I really appreciate it. How are you doing today?
I'm doing wonderful. Great to meet with you!
Fantastic. Well, obviously very keen to hear about your story up until this point. Obviously I've done a lot of digging myself, but very eager to ask you a few questions about how you got started. Not only as a successful entrepreneur, but as a very talented public speaker as well, which is what struck me most about you.
So, these passions and these talents and how they've accumulated… where did you get started? And how did you come to be at this point?
Well funny, like many things in life, your family has a profound effect on you. And I grew up in a household where my parents were travelers and adventurers, and ultimately they became public speakers themselves.
So I think a lot of this was those motor neurons in your brain, observing my parents as a kid. Some of these public speaking events they did across the country, particularly in the marriage counseling space. So I was able to see them do that.
And frankly, public speaking is terrifying to me. Just like, it's terrifying to everyone. And I think at some point in my life, I saw that as a challenge, Cameron, and I was like, “Man, that scares me so much. I'd love to figure out if I could maybe have it scare me a little less!” And I started to do some Toastmasters, which is a very famous course in America.
A lot of people love that course. I started diving in and doing that and kind of approaching that fear and I'm realizing more and more that it's kind of becoming a dying skill across the world in many ways. We have become more digital. We're having less people that are willing to stand in front of a crowd.
And I am passionate not only about doing it and improving it as a skill myself, but I'm really passionate about helping other people do the skill, because this is a skill that I think a lot of people have brilliant things to do. Not necessarily from a stage, they might have something to say to their boss. They might have something to say to a family member, just the courage to speak candidly to other people. I think public speaking can give you a lot of confidence. To just speak more confidently and in general in your life. So I'm a huge advocate for it.
I started a club in Miami called Nova Miami. We're a place where people who are in the tech industry or otherwise anyone here can come to a safe place. We can all fail together. We do improv. We use speech review. We give people a chance to give a speech at the end, and it's been really cool to watch good speakers become better speakers, but I think what is even more profound, I've seen some friends of mine that literally struggled with social anxiety to such a degree that they have a hard time going to a networking event. To see them get up in front of a group of people and do a little improv shoot, even for 10 seconds. And you see that deep breath and afterwards they're like, “Wow, that wasn't so bad. Like, no one's going to get me. No, one's going to mock me.” So that's certainly a personal passion.
That's fantastic. And I think just communication in general as well. I'm a big advocate for myself and to see someone I'd say blossom and be able to come out of their shell and realize all this shit isn't that bad. I'm sure it's wonderful to watch.
As I said, great to have you on specifically because you are the co-founder of Pigeon Loans and I'm just keen to know when the idea of the platform was first put to you or when you first discovered the power of what it can do, was there any kind of Eureka moment or like a light bulb moment where you're like, “Dang, that would have been handy then!” Or what kind of instant stories came into your head where you were like, “I believe in this.”
I'm very blessed and I say blessed and you might say,” That's funny. Why are you saying you're blessed?” I grew up in a family with some high financial hardship throughout my life. It's not the worst story you're going to hear of someone in America. In some ways we're all blessed, but certainly, I saw my family go through financial stress around that, around the '08 financial crash, which was frankly really hard on my family that was doing some real estate investments.
At the time I watched my father, a man I deeply respect, be very downtrodden and sad and, and in a way, probably feeling like less of a man, because he had to go borrow some money at a time from his parents. And that moment always stuck with me because I remember thinking about how important it is that we have people like that willing to back us and help us, where would we be without those people, but then also the emotional toll it takes to even have that conversation, how awkward it can be even with parents and then how we can create awkwardness as the years go by.
And then, for me personally, I had this journey after college where I was one of those people that was really lost from a career standpoint. I wasn't the really planned-out kid who was doing the internships and getting the job and going up. And there were times where I was really struggling. And the biggest time was when I started my first company, my first tech startup called TruePublic back in 2015.
I quit my job. I took all my savings and put it into this prototype of this app. Just some crazy idea to get the public opinion of people all across America. And very quickly I was out of money and I was trying to fundraise and I was able to get loans from some people that not only kept me in business as it were but also kept me believing in myself in a way, sometimes you just need someone to believe in you.
And what was kind of profound was these loans. And these loans meant these people believed in some way, I was going to be able to pay them back. That this was going to be a success. That I was eventually going to raise money from real investors and build a company.
And we ultimately ended up doing that. And that meant a lot to me. And I think the third story though which is kind of interesting is. Lately I've been able to lend money to a few friends and that has been an, and that even happened before the idea of Pigeon even came to me. I thought with those relationships, “Boy, will this be awkward? Lending this money? Do I need to text them once a month? Do I need to remind him? Should I pretend like this money's just gone?”
I wasn't in a place where I can just give someone money. And I think a lot of Americans and people around the world are in a place where they want to be generous, but not everyone can just say, “Here's $500 or a thousand dollars or any amount and I never need it back.” A lot of people want to help, but they do need it back.
And actually I had a friend who works in Hollywood, he's an up and coming person. I think he's going to have an incredible career in Hollywood as a producer and a director, but he's kind of in that weird place in life where certain things aren't cashing out for him quite yet.
And he met a wonderful young lady recently and he's like, “Man, I want to go on a great date with her. I've gotten to know her pretty well. I want to go on like a nicer date”! And it was such a blessing for me to be able to loan the money for that specific purpose. And for them to just pay me back over the next six months.
And I think those three stories encapsulate my journey around Pigeon Loans. The one of seeing the anguish of hardship in my family and having to go to family to personally borrow money to even get a business going and relying on people's help. And then more recently feeling that giving to people, it's not worthless. Sometimes there's a selfish aspect to it, which feels really good to help people. And I think if Pigeon Loans can enable more people to help each other in the form of loans, as opposed to gifts, I think that's going to be a massive, massive boost to society in general. And I think that's something that we really want to drive here with this product.
Yeah, make loans commonplace. And I love what you said there about people wanting to give. People want to lend, but maybe they can't. And to have Pigeon Loans there to structure everything is fantastic.
And I was watching your interview alongside your co-founder, Brian, with Chris Daniels Of The Shrimp Society, a video on YouTube, and listening to the story of how the platform came about. Brian and his mother during the pandemic looking to help each other out. And you mentioned shame as a concept that you both had come across quite frequently.
And going back to that story to your Dad. Obviously, you have a huge amount of love and respect for your Dad. Was seeing your Dad struggling during 2008 and all of that horror and seeing him come out of it and someone you love and respect being kind of downtrodden with debt.
Has that kind of made you look at debt differently in general and that shame doesn't have to be a part of lending? And in that way, has it taught you to realize that people aren't defined debt and by their financial hardship?
It's funny you say that. Cause I think one of the huge secret hidden pains that's facing millions of people all over the world is they're walking around with a giant weight on their shoulders. I'm imagining a backpack that’s got rocks in it and that's their debt. And I've been in some credit card debt before, not a lot, but enough to where it was weighing on my subconscious because deep down inside you kind of feel like, just to be real, it almost feels like a net negative on society when you're a negative. When your capital's literally negative, it can feel like, “Am I valuable?”
And that to me is one of the truly heartbreaking things that a lot of people are facing because so many young Americans were really not taught in our upbringing in a lot of practical financial matters. When I went down and took out my student loans, Cameron, I had no freaking idea what these interest rates meant. Payment periods. What would this mean for my life? I was thinking, I need to go to college. College is a cool place to go. I'll meet fun people. It sounds great. And I think people are doing that again and again. So I think debt is this weight that's weighing a lot of Americans, certainly.
And then you brought up shame and I think shame is such an important word because I think in some ways this is unique… maybe not uniquely American, but certainly an American problem. And the problem is America was built on this immigrant mindset of picking yourself up by your bootstraps. You can go from rags to riches, you can become anybody. You can, you can be Barack Obama and then become president of the United States.
The American dream.
The American dream. You can grow up poor and become rich. And I think whether it's my father and myself, certainly stereotypically, these are common in men and women, probably there's this self-sufficiency we all want to have. Going to someone to ask them for money, I think in America, is often shameful. I think one thing we need to reverse is we need to rehearse that a lot of I've even talked to customers at Pigeon in the last couple of weeks, who've told me, “I've taken high-interest rate loans. We were in a bad financial decision because I literally didn't have the courage to let a friend know that I was doing badly.”
So they took out a loan, which is a way worse financial decision, right? In the payday lending world, it can be a 400% interest rate, which is insane. So reversing that Cameron, I think one of the biggest goals of Pigeon is going to people who love you, who care for you. To be the first place you go to look for help as opposed to the bank or payday lender, who they're just trying to make a profit. And there's no actual incentive for them to get you out of debt even necessarily.
Yeah, absolutely. I love that. I love that the ethos and the mission is to be the first port of call. The first stop that you do instead of going to an institution or something like that, because I know from financial services that I use, I use Revolut here in Europe, but there's the same as Venmo or CashApp or whatever you'd be using. I don't use my Irish bank anymore. And I don't really plan on using it as I move forward. And to know that the only other reason why I would kind of go to a bank is to get a loan or to get a mortgage or something like that.
And to know that there are these platforms…well, there's only one really: Pigeon Loans! Where that could be your first port of call. So banks are becoming less relevant, which some people might say is a wonderful thing! But doing market research yourself and talking to customers all the time. What are some of the behavioral things that you're learning about lenders and lendees - borrowers and lenders.
What are kind of some of the behaviors and the psychology around loans that you've noticed? Like for example, do family members typically give lower interest rates than friends do of something like that? Have you noticed any weird bits of information?
Yeah. We've noticed a lot of interesting things. First of all, one of the cool things about Pigeon Loans is, because the lenders on Pigeon aren't coming to Pigeon with a profit mindset, they're typically coming with a more charitable mindset because of that mindset. They're not coming in and giving these astronomical interest rates.
We're suddenly seeing interest rates between one and 3%. Some are even 5%. Funny tidbit for you though. In some cases I've had borrowers tell me, “I liked paying a 5% interest rate or a 7% interest rate.” Why? Well, the quote one guy gave me was, “It allowed me to save face.”
I think that goes back to what we just talked about with shame. He actually wanted to pay more interest. So he felt like his friend that was helping him, wasn't just doing a charitable thing. It was actually returned to him. That's been fascinating. The other thing that's been fascinating, lenders and borrowers are very different. Our lenders are typically people that have some more means, have more capital.
Our borrowers are typically people that are younger - under 30. Potentially struggling getting their career going, trying to get a business going, dealing with debt. But what's really unique about our lenders. And I think it is potentially profound. Many of our lenders were once borrowers. Many of our lenders, our lender profile, is more likely someone who maybe started off with a bit of a struggle.
Maybe they grew up lower middle class. Maybe they had low income in their family. Maybe they've experienced this before. Those types of individuals, when they eventually make it as a small business owner or as an engineer or as a marketing executive, they're now much more likely to turn around and lend a helping hand. It's that pay-it-forward mentality. That's so cool.
It’s like with your third story, after you getting a loan and then you were able to give back to your friends and let her go out on a date!
Exactly. And then hopefully he's going to sell a couple of big scripts and make some big moves in Hollywood, and then he's going to turn around and help someone else out.
And I think that's kind of like a virtuous cycle, but yeah, it's been really fun getting to know the borrowers and lenders and hearing all their stories and the stories really bring it to life, whether it's someone who's a friend or someone who has a wedding photography business that camera falls out of their car.
It breaks - it's a $6,000 camera wedding. They have to shoot the following weekend. They're literally about to lose that income from that wedding, which is the rent money, which is the money to pay for their baby. And someone was able to get them that money within 48 hours and get them on a loan and completely change their life.
And without Pigeon Loans, that would have been a lot harder conversation for them to have. And there's a real scenario where they might not have gotten that money.
Learning so much about these borrowers and lenders and, obviously, I know that you have your plans for the future and things like that. Obviously, you got a huge investment recently, so I'd love it if you could talk to us a bit about that. Can you give us a little bit of an idea of where you see Pigeon Loans in 5, even in 10 years as well?
I've talked to another guest in the past about the future of loans in general. And he was saying speed, speed is a huge thing. And I think Pigeon Loans is really tapping into that. Being able to do everything one-to-one. You're not waiting for institutional approval or things like that, but you know, you coming into Pigeon Loans, and we're very excited to see what you do - what plans do you want to see come to fruition in the future.
There's 13 million Americans in our estimates right now. It's just America, it's not worldwide, who currently have a loan out. They've lent money to a friend or family member and it hasn't been paid back. So 13 million Americans are dealing with this from the lending side alone and, in five years, it might be a big goal.
We want to capture at least one fourth of all of those, right? That right there alone would be a massive business for Pigeon Loans. And I think it'd be doing a lot of good in the world. Now, some of those loans are in the $100/ $200 variety. But for any of those loans that are over $500,000 makes total sense, we want it to be a no brainer.
So one of our jobs is to get this out into the zeitgeists of America, and then eventually around the world where people think about this type of a transaction, Pigeon just comes into their mind almost instantaneously. Beyond that, I think I can maybe tease the future of… We also see that there's this future where a lot of people are going into these payday lenders. They typically are $375 as the average payday lender loan. The average term is a week - It's just a week turnaround. And the interest rate on those is often 400%. And then there are all these horrible terms where if you don't pay it back, Cameron, within like one week, it doubles the interest rate, the average person in this country of the United States that does payday loans is going to pay more in interest than the principal. They actually borrowed, we are hearing stories of people that have been on a payday lending cycle. It's eating up upwards of 30 to 35% of all their discretionary money, all of it, because they're just trapped in a cycle of debt. I think that if you want to talk about the thing that gets me crazy excited it's can we go attack that?
We have ideas around building crypto based products where people can pool money together and lend it to individuals on favorable interest rates and put out this kind of predatory lending. That's even becoming illegal frankly, in many places in the world. And I think that's kind of like, “Wow, that's the kind of things that takes my breath away.”
If we could own all these large loans in America, wow. That's a big business in and of itself. But what if we can go and correct the payday lending travesties that are happening and how would that happen, practically? The problem today is you gotta walk in with a paycheck. You get to walk in with a credit score. Interest rates are super high. What about a new concept of this idea, and people have played this before, social credit. If you're willing to back me, Cameron and I then go to a pool and I've got a friend backing me for some of the money and I go to get the rest of the money from a pool of money built on Pigeon.
That could be something that's incredibly exciting, but we're putting the cart before the horse here a little bit. I mean, we first have a great product now we're executing on growing that. And we're partnering with different organizations. Where we're getting the word out, we're getting the message out.
And yeah, that's kind of the big goal over the next. I'd say five years is to own a big percentage of that market. And then also see if we can go downstream to smaller loans.
Fantastic. I've kind of touched on this before. When I first heard of Pigeon Loans. It resonated with me personally, because I don't know if you were the same but growing up, the more I earned, the more broke I was! What's stopping companies like Salesforce or a KPMG or any big organization using Pigeon Loans as a service for their employees? Should they wait to take a portion of their salaries out, maybe a small interest rate, that's at the discretion of whoever, but is that a possibility?
It’s an interesting idea. You actually bring up something that really shocked me. We thought, I think initially with Pigeon, that all the borrowers would be people that were really low income and it's not always the case.
I can't share the person's name, but there was a woman I was talking to recently. She makes an incredibly large salary of about a quarter million dollars a year. She had to borrow a lot of money. Why? Because she went through a divorce and they, because of the divorce, there was some confusion around their mortgage payment.
They miss two mortgage payments and there's things people don't understand about our system. The system, the financial systems of the world are very cold. They're cold-blooded. You can miss two mortgage payments and suddenly your credit score is completely ruined from being able to get a mortgage standpoint.
And she had to go borrow $60,000 from someone on very short notice. And even for someone as successful as she is the fact that she had to go have that conversation. And frankly, the fact that she was so embarrassed to ask for the money, I think screams to the original problem. It's not just people that are struggling here in some ways there's people that do make good salaries.
Maybe they're Salesforce employees. It's a good point that is just kind of a weird place temporarily. Another, another quick example for you. If someone that I found interesting was there's this guy moving to America from Latin America, and he's happy to take a lot of loans out. He's going to be able to pay them back.
Because he already has a job in America, that's a very high pain product manager job, but he's got this little gap in his life where he needs to have it filled in. If you can't find friends to fill in those gaps in your life, you're going to have to pay an exorbitant interest rate in order to get that done.
So I think we can actually, by normalizing this behavior, we're going to be able to help people all up and down the scope, whether they're early level executives, or people that are dealing with poverty. I think the thing can be pretty universal as a useful tool.
Fantastic. Listen, the future is nothing but exciting. We like to say that The Chirp is a separate entity to Pigeon Loans, but I'm gonna allow myself to be a little bit biased and say that I'm very excited to see what happens. Pleasure talking to you as well! Where can people find you if they want to learn more about yourself or for Pigeon Loans or even Nova Club? Where can we get you?
Yeah, I have a personal website, KabenClauson.com where I've got links to Nova, more details on Pigeon. One of my passions is I love to help people who are trying to start businesses, particularly tech startups for the first time. I know how hard that can be. I had to take out loans to do it.
I had to go through a lot of pain to do it. I love to help people avoid some of the pain and mistakes I've made. So that's another reason people could reach out to me, or I'm also @KBClauson on Twitter. That's another great place for us to interact.
Fantastic. Well, listen Kaben it’s been an absolute pleasure having a face-to-face here for the first time. Best luck with your future at Pigeon. Thank you so much for joining me today!
An interesting example of past experiences instilling generosity and the nature of financial assistance into a person and that was great to see in Kaben. He knows the pressure of debt on a human being after seeing his Dad have to go through hard times in 2008 and knows how helping someone with a loan is one of the greatest gifts you can give.
A lot of interesting emotional aspects to Kaben’s stories, especially about his Dad. What I latched onto was the aspect of shame and how his Dad’s experiences taught Kaben early on that debt is not a choice, it’s a situation that sometimes cannot be controlled. It has no bearing on a person’s character. It should have no stigma.
Lending is such a huge part of Kaben’s life, as it usually is for entrepreneurs and it was no surprise to see how Pigeon Loans got started. I loved hearing about his mission for Pigeon Loans. They want to be a household name. They want to normalize lending, make it a comfortable part of how we interact with one another, and I found that very interesting.
Speaking from my own experience, getting a loan from a bank has always been incredibly difficult for me. Is my credit rating shot from the college days? I mean probably. There’s no lenience or striking off damage in that regard. If you have a bad credit score, it can be irreparable and to see a platform like Pigeon Loans now existing means that a financial institution doesn’t have to be your only option. You can turn to a loved one, you can turn to a friend who wants to help you out. And instead of having to feel shame or be worried that your relationship might have a little rain cloud over it, Pigeon Loans can ensure the admin side of it is taken care of, the repayments are structured and in writing and it can turn what might be an awkward scenario into a powerful, caring gift which I think is great.
I feel pretty positive after that interview with Kaben. Kudos to him for creating a platform that is close to his heart, that is going to help the world. It’s nice to be a part of something that isn’t just a money-maker. It stems from his Dad’s struggles. It stems from his generosity as a friend and it also stems from being a young entrepreneur who understands the importance and the power of a loan. And whatever can make a loan between two parties easier is alway a step in the right direction for us all!
Thanks again folks for all your love and support. Be sure to get in touch if you got some stories of your own that you would like to share. We will be back mid-March with another episode. Until then, stay generous, stay caring and we will see you soon - Take care!